Green Solutions February 5, 2007

GREEN SOLUTIONS by Paul Stephens, CasCo Greens
Economics in One Lesson
Henry Hazlitt, the long-time free-market columnist for Newsweek (Milton Friedman took over his job in the late 1960's) wrote a simple book explaining one basic fallacy in the then-dominant "Keynesian" economic policy. He called it "the broken window fallacy, or what is seen and what is not seen", and it was first identified in the work of Frederick Bastiat, a 19th century French advocate of free trade and free markets. Literally millions of copies of Hazlitt's book were printed and distributed free to schools, business groups, and other venues by the Foundation for Economic Education and other business-supported educational institutions.
Basically, the argument is as follows. Someone breaks a window, thinking it will increase jobs and thus promote "economic development." Someone will have to replace the broken window with a new one. Someone else will have a job in a glass factory to produce the new window. Still others will haul the sand and other materials to the glass factory, and the landowner will be paid for these "natural resources." Still other teamsters will haul the glass from the factory to the hardware store. The store-owner will make a profit on the glass he sells. He will hire clerks and other workers. In short, this single act of vandalism will (when multiplied by thousands of similar actions -- say, from a war or tornado) will result in a boom for the whole economy. We will all get rich off of destruction!
Such is the "war is good for business" thinking when it supports going to war, or more military spending. (Or more pollution and disease, which "benefits" the healthcare industry; or more stupidity, which demands more government spending for "education."). The present Iraq invasion, occupation, and continuing carnage is a perfect example of this policy. No one doubts that this is really an "economic war". That is the real reason why we're there -- because many of our national leaders have a direct "investment" in waging war and then profiting from its hate-driven violence and destruction.
What would Henry Hazlitt, the "free market, free-trade economist" say to all this?
He would apply the simple rule of "what is seen and what is not seen." He would use the economist's basic concept of "opportunity cost." There's a Center for Economic Education at MSU Bozeman, which gives seminars to Montana high school teachers and students about basic concepts in economics, including a popular stock market game. I attended one of these a dozen or so years ago, and the MSU business professor who was leading it did not understand the concept of "opportunity cost." Let's see if I can explain it, here.
"Opportunity cost is the value of the next best alternative foregone" when, say, you make a decision to spend a given amount of resources in a certain way. That's more or less the textbook definition, as I recall. Suppose one has $10,000 to spend. Say, you need a car, a refrigerator, you have $2000 in debts to pay, and you would also like to buy a new computer for $1000. You would, as a rational decision-maker, prioritize these needs or wants, and allocate the $10,000 accordingly.
You might spend $5000 on the car, $500 on the refrigerator, pay the $2000 debt, buy the $1000 computer, and keep a $1500 reserve. Or, you might spend $10,000 on the car, keep paying interest on the debt, and forego the refrigerator and computer. Whatever you do, you are "trading off" one set of goods and services for another. The "opportunity cost" of making whatever decision you make is the value of the goods and services you didn't buy, instead. All valuation, in this theory, is "subjective." Only you know what you value, and how much, and it is only by "demonstrated preferences" - spending the money in one way rather than another, that your values are objectively expressed.
The same, incidentally, applies to government expenditures. The $100 million the prison lobby wants the legislature wants to spend on the prison system means $100 million which is not available for education, health care, public transportation, funding state pension debt, alternative energy projects, tax rebates, or whatever. Many anti-war groups have listed the "opportunity costs" of the Iraq War in terms of building houses, hiring teachers, providing universal health care, etc. But our MBA president, like his MSU counterpart, has apparently never heard of, or understood, the concept of "opportunity cost." His friends and cronies; their stockmarket portfolios, and the corporations they represent are the war profiteers. Thus, the priorities are all in favor of war and destruction, the Republicans continue to support the massive waste, fraud, and abuse documented so well in Robert Greenwald's recent film, "Iraq for Sale: the War Profiteers." http://iraqforsale.org/ .
In the case of the broken window, the "opportunity cost" of breaking and fixing the window, with all its attendant economic benefits to others, is the value of all the other goods and services which the (say, $100) spent on fixing the window might have provided. Instead of restoring a broken window to its original condition, you might have spent the hundred dollars on a new suit. This would be a net gain to the whole economy, benefitting the clothing store owner and his workers, the suit-maker, the transporters, the cloth manufacturer, and finally, the wool grower and her local agricultural community. So, all the "external benefits" from economic activity would be roughly the same. The difference is, you now have a new suit rather than the same window which was originally broken. "What is seen" from breaking the window is all the "benefits" going to those employed by repairing it. "What is not seen" is the new suit you would have, and all the benefits to the clothing (or other) industries if the window had NOT been broken, and you had spent the $100 elsewhere.
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Real Public Radio: Don't Support NPR
For some unknown reason, KUFM is having its yearly fund drive a couple of months early. Apparently, this is independent of National Public Radio's regular April "pledge week" (sounds like a fraternity, doesn't it? Skull and Bones, perhaps?) In any case, I haven't yet heard the details, but it begins Feb. 12. I hope that KUFM and other listener-supported stations will finally "get it" and "unsubscribe" from National Public Radio, which is neither "National" (federally supported, as a socialized educational service) nor Public (serving the public interest and operating under democratic processes). The content and conduct of NPR news under the Bush Administration is nothing less than disgraceful, and it will be a cold day in hell before I send them any sort of contribution.
For Great Falls residents, this adds insult to injury, following the suppression of an independent Great Falls public radio station, KGPR, by some KUFM personnel and the University of Montana. Their local agents keep telling us to "get over it" and welcome the mediocre, newsless, lowest common denominator stuff posing as "local programming;" when we could have had a vital, activist, full-time local news and information source dealing with the vast corruption and ignorance which characterizes our city and county government, school board, hospital, and other local public services. This is another good example of "what is seen and what is not seen." In order to "save" NPR and the KUFM signal from Missoula (which were never in danger of being lost to us), the fascist usurpers of our local public institutions suppressed and closed down our only local public media (and in fact, the only locally-owned and controlled radio station, period.)
This leaves us somewhere between a rock and a lump of coal. KUFM still has some of the best news and commentaries on coal and energy issues (now that Mike Dennison left the Tribune's Capitol Bureau for the Lee Chain), and the turnover rate for local Tribune environmental reporters seems to average about six months -- just long enough for them to learn what not to say or write about.
Thomas Jefferson said that he preferred a society with newspapers and no government to one with government and no newspapers. Today in Great Falls, we have neither democratic government nor any sort of locally-owned and controlled news media (unless you count a few bloggers and this Bulletin). Our "newspaper of record" for legal notices and supposed "coverage" of local issues of vital importance to the people of Cascade County and the rest of central Montana is the property of the Gannett Corporation, known to be one of the worst corporate media monopolies in the world. Our several attempts to establish (at the least) an independent weekly newspaper, local public radio, or even to re-broadcast other Montana Public Television stations have all been viciously opposed and suppressed -- primarily, we believe, by the Gannett Tribune and other corporate media. It is a disgrace to the University of Montana and its proud anti-corporate tradition that they should be accomplices, through their J-School graduates, in the suppression of a free press and local public broadcasting in Great Falls. We're still waiting for an apology from Tribune staff, the (illegally constituted) KGPR Board, and others responsible for this state of affairs, along with a decision to move forward to establish KGPR as a fully independent, locally-controlled station.
But getting back to National Pentagon Radio, the propaganda organ of the Bush Administration and the radical right, the Zionists, and the corporate media monopolies, why should anyone want to support it voluntarily? The fact is, we've been subjected to a "bait and switch" strategy on the part of KUFM staff and management. They provide us with all sorts of excellent cultural programming appealing to UM Alumni and the professional class; ask for and receive our enthusiastic support and contributions; and then send up to half the money contributed to support National Public Radio, which has always been an inferior and underfunded product. Of course, the Republicans have a very good answer. They've always been opposed to "public broadcasting." When the Democrats controlled it, and used it to advance their political agenda, we didn't object (actually, we did -- our independent KGPR was established during the Clinton Administration, and partially in response to their assaults on Pacifica, as well as the poor and the American Left, in general). Now that we have Republican war-mongers in power, they have been claiming the same rights to use the state broadcasting facilities to advance their agendas.
With the recent Democratic victories in Congress, we may see some changes in the leadership of NPR, but they won't be significant. After all, the Democrats tried to suppress and take over Pacifica (mainly because of strong Green Party presence there, and in the Indymedia movement generally). Even the best of NPR reporting and coverage of national and international issues never approached the quality of real "state radio" like the BBC, the CBC, Radio Sweden, or the like, which spend 100 times more per capita on their services as our aptly-named "Corporation for Public Broadcasting", which is merely a conduit for corporate interests to provide their own content and suppress any dissident voices -- at taxpayer's expense. After eliminating the few (moderate) independent voices like Bob Edwards on NPR, even Missoula seems ready to bail. The highly-successful classical music program, Performance Today, has also left NPR for the reorganized American Public Radio.
There is certainly a place for NPR, but local residents shouldn't have to pay for it. It should be broadcast as a national service to every part of the country, and of course you can get it that way online, along with most programming being archived for a later hearing. But if we're only going to have one local public radio station, we certainly shouldn't be wasting local resources on that federal propaganda organ.
The answer, found by so many other university and community-owned public radio stations, is to opt out of NPR (we can still get grants for hardware upgrades and the like) and join Pacifica, American Public Radio (also called Public Radio International), and here in Montana, we could even get CBC news and programming, Radio Netherlands (which we have been receiving all along -- mostly music, but other programming is available as well), or whatever else is freely available by exchange. This was the model which some of us proposed for KGPR when we declared our independence from Missoula. The fact that some rabid nationalists demanded that we continue the NPR programming (even though there were two other stations willing to provide it) pretty well destroyed our support, but there was no reason not to have NPR continue here with the full KUFM signal on a different frequency, or from a translator for KEMC, Billings. Both of these alternatives were nixed by the University system, under pressure from UM alumni in Great Falls and a regent in the employ of D.A. Davidson. And that is why we still only have one public radio station controlled from Missoula, rather than the three or more we were attempting to provide as the Great Falls Public Radio Association.
Prior to Senator Burns' Telecommunications Act of 1996, it was a simple matter for Missoula, Billings, Bozeman, and a Native American station at Fort Belknap to acquire translators for their stations in Great Falls. But KUFM had already established a position of not wanting to be one of many stations serving Great Falls. They insisted on having a monopoly. And so it goes. Perhaps they will finally now give up the NPR franchise, and mind their own business, but don't count on it. -- Paul Stephens