Would You Buy a Used Poll from These Men?

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On Tuesday evening, June 5, two hours after voting closed in Wisconsin, the Los Angeles Times website was still headlining a story about how its exit polls projected an extremely close race — at a moment when the bulk of the vote was in, and Republican Governor Walker was running almost 20 points ahead of his opponent, Democratic Mayor Barrett of Milwaukee.

An hour before, CNN had somehow revised its exit-poll projections from 50–50 to a modest 52–48 for Walker. Even Fox News’ exit polls indicated a race that was “knife-edge” close. These polls were remarkably wrong. All the predictions were, including the predictions that brought 400 Democratic lawyers into Wisconsin, determined to contest a close election. (Wouldn’t you have loved to see those suits trooping off the plane in Milwaukee, cellphones and briefcases at the ready?) Walker won by a margin of about 7%, somewhat unusual in seriously contested American elections, but the same as President Obama’s national margin in 2008, sometimes hailed as a “landslide.”

Nevertheless, about an hour after CNN finally projected Walker as the winner, its hapless anchorman, John King, was still talking about the exit polls. While they were somewhat off, he said, they still indicated that Obama was way ahead of Romney in Wisconsin. Having said that, he turned to a map of the United States and changed Wisconsin from an expected Obama victory to a toss-up. Then, half an hour later, he opined, “Our exit polls clearly undercounted Walker” (yeah, do you think so?), but added that we shouldn’t project the Wisconsin results onto the national election in November. (Maybe — why not?)

Still later, with 80% of the votes in and Walker running 12 points ahead , King was prompted by his younger colleague, Erin Burnett (who, thank God for intelligence, kept harping on the disparity between polls and performance), to speculate about what had (obviously) gone wrong with the exit polls. Thereupon King babbled things about how you might overestimate something in an exit poll, or “guess” wrong, and that’s why you need to correct the exit polls when the actual votes come in. Huh? So what’s an exit poll? And what’s a poll? And why should we worship them? A commercial break; then King was asked another embarrassing question about the polls’ failure to predict what happened. He replied, “The exit polls were weighted anti-Walker, pro-Barrett.” Pardon me? What did he mean by that?




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Beer Battle

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Here in Alabama we beer drinkers are still warring with the state. We won our most recent engagement, however. On May 16, the governor signed a bill allowing our favorite elixir to be served in 25.4-ounce, rather than 16-ounce, containers.

Of course, the goal of the state had been to keep large quantities of beer out of the lower colons of our young people. This assumes a school system that doesn’t teach that 2 times 16 is 32 and 3 times 16 is 48 — both larger than 25.4.

A couple of years back, in 2009, we legalized beers with over 6% alcohol. So we’re definitely making progress.

The opposition filibustered the large-bottle bill, ranting that alcohol had “broken up many families.” Yeah, I guess. So has fried chicken.

“Dear, pass me that drumstick.”

“But you ate the first one, and I want that remaining plump piece of chicken. Here’s a nice, crispy neck for you.”

The drumstick consumer throws the bone of the first — now deceased — drumstick at his “dear” dinner partner. (Not the half-full beer bottle, which she served without a glass.) Obviously, a freshman sociology student could observe this tension brewing for weeks.

And remember, all you legislators, he threw the chicken bone — not the beer bottle. So what’s beer got to do with it? More importantly, what’s the state legislature got to do with it?




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Memo to Obama: Here’s How the Market Works

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President Obama is running a political campaign as predictable as it is despicable. It is based on attacking capitalism. “Markets never work, government always does” appears to be his meshuggeneh mantra. As it happens, two recent Wall Street Journal stories illustrate the free market (disparagingly called “capitalism” by its opponents) in action. Obama might want to reflect on them, though it is doubtful that he often reflects on anything — he seems to be the epitome of a reflexive instead of a reflective person.

The articles, appearing on the same day and the same page, report on the impact of the fracking revolution in natural gas production, a revolution that has dramatically decreased the price of natural gas — by nearly half in the last year alone.

The first article reports some good news about the rock-bottom prices for natural gas. The price is inducing companies with trucking fleets to switch from diesel to natural gas (NG) — either compressed (CNG) or liquefied (LNG).

For example, Waste Management is now buying NG trucks. It plans to make 80% of the new trucks it buys over the next 5 years NG trucks. The NG trucks cost about $30,000 more than ordinary diesel trucks, but save more than $27,000 a year in fuel expenses. Ryder Systems, a truck leasing company, is making the same move, with one of its vice presidents saying, “The economics favoring NG are overwhelming.”

Other corporations shifting their truck fleets to NG include such huge players as UPS and AT&T.

The article notes the standard problems facing fleets looking to convert to NG, such as the need for bigger tanks, and especially the lack of CNG or LNG fueling stations nationwide. But as the fracking gas revolution continues apace, it is likely that the price of natural gas will remain extremely low compared to diesel, so will tempt more and more gas stations to offer NG fueling pumps. And the article doesn’t note how much cleaner NG is than diesel, which means that as air pollution laws continue to tighten, the cost of diesel trucks will go up. Nor does the article note that as more fleets convert to NG, the price of NG trucks will start to fall as production of them cranks up.

On the bad news side, the companion piece reports that natural gas “giant” Chesapeake Energy has been beaten up by the low price of its product and is now investing heavily in unconventional drilling for shale oil. Specifically, Chesapeake is focusing on the huge Utica shale formation lying under the state of Ohio, betting billions to buy leases for drilling rights to about 5% of the state’s land.

This is either ballsy or balmy, depending on your tolerance for risk. The Utica field is estimated to contain between 1.3 and 5.5 billion barrels of oil, but the company has drilled only 59 wells, and of the nine about which it has released data, the information shows that oil is but a third of what is provided — the rest being mainly that damned cheap natural gas!

All this simply illustrates the view of pricing that Hayek and Kirzner enunciated: that pricing is an information transmission mechanism — more simply, a language. The price of a product tells both producers and consumers how to alter their behavior and plans for the future. When the price of natural gas went up not so long ago, it told producers to produce more, and they did — in spades! Now that it has plummeted while the price of oil has remained relatively high, it tells consumers to switch to it, and it tells producers of natural gas and oil to shift capital from producing the former to producing the latter.

All this would be illuminating to Obama, were he a man capable of illumination. But he isn’t, so it won’t.




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Should the Bank's Loss Be the Law's Gain?

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The great thing about laws is that they protect us when we are unwilling and unable to do so on our own. Laws are great because they make sure no harm is done. So when it came to our attention that JP Morgan Chase just lost $2 billion because of risky investments and hedging, it may have seemed that what was needed was more and better laws, not personal responsibility.

Of course this isn't true.

Laws are necessary but not sufficient. Laws will never be able to keep pace with new developments in the financial sector, or anywhere else, which is why laws will never prevent problems but only react to them. And being reactionary instruments, laws cannot prevent the next wave of risky financial instruments or clever schemes to make money off of money.

In addition to not being able to anticipate problems, laws have unintended consequences that are sometimes worse than the problems they were designed to correct. Look at the laws that led to the housing bubble. For a time, the government, through various policies but primarily through Fannie Mae and Freddie Mac, infused more money into the housing sector than the market would have on its own. By making loans easy and affordable for people who would have otherwise not been able to secure home loans the government encouraged a misallocation of resources that drove up home prices.

Making loans available to people who would not have qualified without government interference pumped more money into the housing market than the market demanded. This drove up demand, which in turn drove home prices beyond market levels. Housing prices fell because the market corrected itself. This correction is what we recognize as the bubble bursting. The bubble and the burst were unintended consequences of the government getting involved in the housing industry.

In the banking and finance industry the government also distorts risk assessment, thereby forcing a misallocation of resources. Keeping interest rates low discourages saving and encourages investing. Low interest rates make putting your money in the bank an unattractive option if you want a return on your investment. So if you want your money to make money, you put it in the stock market. The government is essentially affecting the supply and demand of money rather than letting the market set interest rates and therefore determine where capital flows. This forces money into circulation that would otherwise not be there.

The banking laws we have in place encourage risk taking in other ways as well. First, banks the size of JP Morgan Chase know they will get government bailouts when they bet wrong, which means they can take whatever chances they want, and there is no risk involved. Second, the FDIC insures traditional deposit accounts up to $250,000, which means that no matter what kind of investments a bank makes with your money, as long as your account is below the $250,000 threshold, no one loses. Banks can fail in any number of ways without anyone involved failing to make money. The unintended consequence of government interference is an increased willingness of banks and their investment arms to take greater risks, which become no risks at all.

Certainly FDIC insurance has many benefits, as did the Wall Street and automotive bailouts, but there are unintended consequences that may have counteracted the favorable effects, if not encouraged the sort of risky behavior that created the need for the laws in the first place. The only solution is for individuals to take responsibility for their own actions. In view of our attachment to laws, this is an unlikely solution, but it is the only one with any promise.

Laws allow us to relinquish personal responsibility. When we make a bad investment that we did not understand entirely, or get into too much credit card debt because we failed to control our spending habits, it is easier to blame the lack of sufficient laws than to blame ourselves. If we were not motivated to make money we would have no reason to enter the stock market or make risky investments. But if we are motivated to do these things, the least we can do is spend some time understanding what we are getting ourselves into. If we don't understand what others are doing with our money, or understand the risk involved, then we shouldn't get involved. And if we do get involved with something we don't understand, we have only ourselves to blame. Laws can't help this; only we can. More time and energy should be directed toward cultivating character than toward crafting laws.




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Social Insecurity

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I feel remiss in not reporting lately on the most recent news concerning the crown jewel of the progressive liberal welfare state: Social Security. It is the ur-program from which all the other major programs (such as Medicare) were spawned. Over the years, I have periodically reported on its looming fiscal crisis, but I haven’t said much during the past year.

So it’s time to check up on the program that has elected so many generations of Democratic politicians. Surprise, surprise — it is accelerating downwards!

Start with that cesspool of fraud, Social Security Disability Insurance (SSDI). A report in the estimable Investor’s Business Daily informs us that Obama has set another new record. Not only is he the Debt President (having added more to the federal deficit in his short time in office than any other chief executive — nearly $5 trillion, more than the big-spending Bush spent in 8 years), the Food Stamp President (having added to the rolls of food stamp recipients more than twice the number of new recipients per year — over 4 million — than even the prior record-setter, Bush, who added 1.84 million yearly), and the Emigration President (having presided over a political economy in which a record number of Americans renounce their citizenship — nearly 1,800 last year, compared to about 200 in 2008). In addition to those titles, Obama is now the Disability President.

Yes, a record number of people have gone on SSDI during Obama’s benighted reign — a whopping 5.4 million. And the number is growing at a rapid clip: from January of this year through last month, an astonishing 540,000 more have been granted disability, and more than 750,000 have applied. Of the total (10.8 million) now on SSDI, half joined under Obama. America’s seemingly endless high unemployment is clearly taking its toll. Doubtless this will hasten the projected day of SSDI’s insolvency, scheduled already for 2018.

Turning to the Social Security retirement program (i.e., the main one), the news is grim again. As recently as 2007, the Social Security program ran a surplus of $186 billion. This dropped to a mere $3 billion the next year, and became a $49 billion deficit in 2009, in the depths of the recession. However, last year — a “recovery” year — Social Security ran a deficit of $45 billion. The program’s trustees now forecast a deficit of about $66 billion on average for the next six years. After that, the trustees project triple-digit billions in deficits. In 20 years — three years earlier than projected last year, the so-called trust fund (a bogus pile of IOUs from the federal government to itself) will be gone, at which point benefits will have to drop by 25%.

Strange to say, the Obama administration is far more concerned about whether Romney engaged in a mean prank half a century ago than about Social Security’s lack of solvency. Obama’s economic record is so wretched that one can see why he refuses to discuss the entitlement crisis. But why do the mainstream media refuse even to mention the government’s own report? Surely this report should be of immediate and vital concern to all the public. . . Oh, yeah — I forgot. The mainstream media, formerly noted for “investigative journalism,” has become the Amen corner of the Church of Obama.




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Arrival at Red Rock

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In some ways it’s all so familiar — traveling westward to cover a Libertarian National Convention where a (relatively) high-profile former Republican office-holder is expected to sweep away a field of Libertarian sidelights and gain the party’s presidential nomination.

And yet, it is also all so different. For starters, Gary Johnson is no Bob Barr. In his time as governor of New Mexico, Johnson never postured as a drug warrior or tried to “defend” marriage by legislation or other means — in fact, legalization of marijuana and support for gay marriage are probably the two positions of his most likely to attract any voters hesitating between the Romney rock and the Obama hard place.

Thus far his approach has been about as different from Barr’s as can be; where the latter marched through the convention areas with a flock of operatives keeping away the riffraff, Johnson has been approachable, and his staffers friendly and accommodating, within reason (and the ability to make that last distinction is vital for anyone attempting to navigate any large gatherings of libertarians). Johnson’s team has clearly also learned another lesson Barr failed to: recruiting a VP long before the ballots get filled out. Hence he can welcome onto his prospective ticket the highly respected Judge Jim Gray, and not risk the baggage of an intolerably chipper huckster or other, even less sane second.

All of which means precisely zero, at this point. No matter the outcome of the convention or the general election though, it’s hard to imagine Johnson ever saying that libertarians ought to vote for Newt Gingrich for anything. And if nothing else, that is already a change worth celebrating.

* * *

One thing that certainly hasn’t changed is airport security. It's far past cliché by now, and yet the TSA keeps finding ways to top themselves: this time it wasn’t just ludicrously inefficient layout or mufull-body scanners, not just the removal of belts and shoes and the ritual offering of the clear plastic bag of fluids—no, this time they added, at the end of it all, a sign that read “RECOMBOBULATION AREA.” Ostensibly this is the place where you put your clothes back on, reassemble your luggage, get everything back together, but it’s also as close we'll ever get to a direct admission that the goal of the checkpoint is not to stop terrorists, but to discombobulate everyone coming through.



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From Russia, with Oil

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While the Obama administration continues to stifle fossil fuel production in the hope — the delusional dream, actually — of replacing it by wind, solar and biofuel, other nations continue to act rationally. In particular, Russia is working assiduously to become the world’s major energy supplier. A recent WSJ article illustrates this.

The story reports that Russia’s state oil company Rosneft (rhymes with “raw theft”) has cut a huge deal with Italian energy firm Eni to exploit oil fields in the Arctic. In exchange for access to the huge Russian Arctic fields, Eni will give Rosneft stakes in Eni’s projects in Africa, the Americas, and Europe.

Eni is getting a third share of a big pie, or more exactly, pies. The Fedynsky field (northwest of Murmansk) alone contains 19 billion barrels of oil. The total estimated recoverable reserves are about 36 billion barrels.

This deal is on top of an agreement that Russia signed last week with Exxon Mobil, which gives Rosneft a 30% share in development of fields in Canada, the Gulf of Mexico, and West Texas.

So Russia is wasting no time in developing the Arctic, while we block oil and gas drilling and funnel our state resources into solar projects that go bust. Thank God we have such enlightened leadership.




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Rich, White, Mormon . . .

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In a recent piece, I suggested that Romney would likely win the Republican nomination, and since he has no history of scandals and is obviously intelligent, the Obama campaign (which cannot run on Obama’s record in office, which is risible) would attack him in the only way it can. It will try to attack him for being rich, white, and Mormon. That is, it will try to arouse envy of the rich among the poor, hatred of whites among blacks and Latinos, and anti-Mormon prejudice among the populace at large (and especially among evangelicals).

So I am not surprised that Obama is now running this sort of campaign. I am, however, surprised — and pleasantly so — at how quickly the Romney campaign and the countermedia are hitting back.

I have already described in some detail the mainstream media’s concerted attack on Romney’s faith. Two recent illustrations have just occurred. MSNBC host Martin Bashir read on air from the Book of Mormon, somehow linking it to his condemnation of Romney to hell for allegedly lying about Obama’s stellar record of job creation (a record that, by the way, should condemn Obama to hell). And Montana Gov. Brian Schweitzer couldn’t resist reminding us all that Romney descends from a polygamist great-grandfather.

The countermedia hit back, pointing out that Obama’s grandfather and even his father were polygamists. So the Schweitzer attack quickly fizzled.

Then there were the attacks on Romney’s wealth. Obama felt obliged to remind us that he was “not born with a silver spoon in his mouth,” and his campaign advisor and pet harpy Hilary Rosen opined that Ann Romney had never worked a day in her life.

The pushback was rapid. If not a silver spoon, Obama clearly had some feet in his mouth. The blogs had a field day pointing out that his white grandmother was wealthy; she paid for him to go to the toniest prep school in Hawaii, then sent him to Occidental, a high-priced private college. The sharp-tongued Ann Coulter caused a stir when she observed that Obama was a clear beneficiary of affirmative action, which is certainly a case of being privileged.

As to Rosen’s slur, the backlash was quick and strong enough to make Obama disavow Rosen’s views and make her apologize rather quickly. Ann Romney had, as the countermedia reminded us, raised five boys, which every parent will attest must have involved endless work. The countermedia also showed that Mitt and Ann Romney started out with essentially nothing, and built their fortune together.

Of course, Rosen was just pushing a line, one found in a strain of feminism that goes back to Simone de Beauvoir. It’s the idea that women who choose to be stay-at-home mothers are being turncoats to The Cause. This may play well with Women’s Studies profs, but it clearly doesn’t resonate with most women.

Finally, it became all too clear how Obama aims to fire up his base among minority voters: look for any racial incident to exploit. One appeared, providentially, in the killing of Trayvon Martin. Knowing the game plan, the mainstream media quickly hyped the story: big, armed white man shoots innocent black child, and gets away with it in the Deep South. Obama quickly pushed racial grievance exploiters like Al Sharpton and Jesse Jackson aside (not an easy thing to do!) to get in front of the issue. “If I had a son, he’d look like Trayvon,” the prez solemnly intoned.

Obama’s plan was as obnoxious as it was obvious: find and dramatize a racial incident, get minority supporters to rally behind him, then turn to the rest of the country and say, “See? You need me to keep racial tensions under control! My opponent can’t do that, because he’s white!”

However, the countermedia rapidly discovered facts that shook the Narrative. Trayvon’s shooter, George Zimmerman, was half-Hispanic; he was smaller than Martin; Martin had had trouble with the authorities; Zimmerman had wounds on the back of his head, consistent with his story of self-defense; and so on.

The president and his henchmen in the MSM will continue to assail Romney along these obvious tracks. But the countermedia seem to be pushing back, and Romney seems to be catching on to the vicious assault headed his way. He has had only a tiny appetizer — the main course awaits him.

In the meantime: entitlement programs keep heading towards collapse, war clouds appear once again in the Middle East; we remain totally dependent on volatile oil supplies (Obama having canceled the Keystone pipeline and prevented oil and gas exploitation on public lands), and the pathetically tepid “recovery” seems headed for a stall.

A country gets the government it deserves. And it gets the economy it deserves as well.




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Libertarian Aphorisms

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Running your own life is difficult. Running someone else’s is impossible.

There is no such thing as safety, but there is such a thing as courage.

The job of business is to make life livable. The job of government is to make business impossible.

If war is hell, then pacifism must be heaven.

Assuming that to want something you must also want to pay the price to get it, everyone always gets what he wants in a free market.

Taxes are the price we pay for living in a society that has not yet become truly civilized.

Wealth is what society gives to the owners to compensate them for bearing the risk of large-scale failure.

Democrats sacrifice the healthy to save the sick.

Government: ambitious thugs who proclaim themselves saviors — which is precisely what you would expect ambitious thugs to say.

The difference between libertarians and conservatives? Libertarians have more fun.




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The Scorekeeping Society

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The aftermath of Hilary Rosen’s statement that Ann Romney “hasn’t worked a day in her life” has focused mainly on whether or not “mothering” is considered “work.” The Obama administration has fallen all over itself in an attempt to gain distance from Rosen’s statement, and Rosen herself has issued an apology. In fact, it would be hard to find anyone who would seriously assert that raising children and keeping house doesn’t require effort.

But the commentators are missing the real issue here. It isn’t how Ann Romney spent her time that bothers Rosen and others like her — it is the fact that Romney wasn’t paid by an outside source for her services. If she had operated a daycare center from her home, taking care of someone else’s five children for pay, or if she had gone into other people’s homes to clean and organize and drive carpool, no one would have suggested that she “hasn’t worked a day in her life.” It isn’t the nature of the work that angers them. The true, underlying objection to stay-at-home moms is that there is no way to measure the worth of their labor. We are a society that likes to keep score, and the way we keep score of an adult’s value is through dollars.

The truth is, most stay-at-home moms don’t stay at home. They are extremely active and productive. I was hoping Ann Romney would talk about some of the work she has done outside her home as well as how hard she worked inside her home raising her boys. She has worked as a teacher and as an administrator in many charitable organizations, particularly within the Church of Jesus Christ of Latter-day Saints. The Mormons are a lay church, meaning they have no paid ministry. As president of a congregation’s Relief Society, for example, a Mormon woman is responsible for ministering to the spiritual, social, and welfare needs of hundreds of families. She oversees weekly classes, coordinates compassionate service projects, counsels with women who are struggling with various problems, and delegates duties to an army of women who watch over the flock, all through voluntary service. In many ways, her job is similar to that of the director of a Red Cross or Salvation Army unit in a neighborhood that experiences the equivalent of a home fire every week. But because she is not paid for her services, there seems to be no acceptable way to measure the value of her work. And without a unit of measurement, the “score” is assumed to be zero.

For many years Ann Romney served as the teacher of a rigorous daily scripture-study course for high school students. The program is administered by the worldwide Church Educational System, which requires teachers to attend monthly faculty meetings and in-service training sessions. It also requires intensive daily study and preparation on the part of the teacher. True, a “real teacher” (i.e., “salaried” teacher) would spend the entire day leading perhaps five sections of the same course, instead of just one hour-long session. But the preparation required to teach a class is the same for one section or multiple sections. Ann Romney worked just as hard at just as respectable a job as any employed teacher. But she received no credit in the eyes of the world because she wasn’t financially remunerated. There was no way to keep score.

Romney is also an athlete. Despite being diagnosed with multiple sclerosis, she competes as an adult amateur in equestrian dressage at the national level. I suppose if she were a paid athlete, we would consider this a “job.” Certainly she puts in as much practice and effort to reach the national level as a professional athlete might. But since she is an unsalaried amateur, this is considered just one more example of Ann’s little hobbies as a wealthy stay-at-home mom. She has dedication and success, but it isn’t really “work,” is it?

This obsession with scorekeeping has invaded our school system as well, where it threatens to stultify the naturally creative minds of the young. Bush’s “No Child Left Behind” program has turned many of America’s children into mush-headed test-takers. “Teach to the test,” once the hallmark of the worst kind of teaching, has become the new mantra of public school education. With jobs and funding at stake, school administrators chastise teachers who introduce art, music, or even spelling (which isn’t on the standardized tests) to their students. “Get those scores up!” administrators fairly bellow, and that means focusing only on the tasks that are tested. It’s all about keeping score and bringing in the money.

In an advanced economic system, where money and exchange form the basis of measuring work, it is very easy for the capitalist to start viewing the world narrowly in terms of “making money” instead of “making useful goods and services.” But value is determined by much more than money. Interestingly, the people who characterize stay-at-home moms as “not working” because they don’t get paid are often the same ones who try to eliminate scorekeeping in Little League and other youth sports. “Children should play for the love of the game!” they proclaim.

I think they have this backwards. Games require scorekeeping. Goods and services require a medium of exchange. But caring for family, friends, and community can be done for the rich reward of merely a hug. Women who rear families and care for their homes do not need a paycheck for validation. Let’s put scorekeeping back on the soccer field, and take it out of our homes.




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