Monday, October 26, 2015

Rates are Higher on Unsecured Loans

Interests rates are higher on unsecured loans. That's really all there is to it.

Now, for the background: Socialist Senator and Democrat presidential candidate Bernie Sanders was quoted as saying, "It makes no sense that students and their parents pay higher interest rates for college than they pay for car loans or housing mortgages."

Robert Tracinski at the Federalist responds:
Why do car loans and mortgages have lower interest rates? They are secured by a tangible asset that can be reclaimed by the lender if the borrower stops paying. The bank can foreclose on your home or repossess your car, so they end up with an asset they can sell to recoup their losses. Rates on these loans are likely to be lower because the lender’s risk is lower. An education, by contrast, is not a tangible asset. It cannot be reclaimed and has no value other than to the person who acquired it.
He has graphs and stories and some economics to continue the story, and we could discuss how student loans drive up education costs, but secured vs. unsecured is really as far as we need to look for why the Sanders quote makes no sense.

Friday, October 09, 2015

GMOs, Migrants, and Nationalism

What do GMOs and migrants have in common? Hungary doesn't want either sneaking in.

Hungary was celebrated by the anti-GMO world in a recycled news story about how it had previously destroyed crops grown from genetically modified seeds banned in the country. A devoted ally in the organic jihad against science? Probably not.

If we recall that Hungary has a nationalist government, a little protectionism might explain the whole thing.

Then came the wave of migrants from the Middle East. Hungary is the first contiguous member of the Schengen Area on the Balkan route to Central Europe. Faced with an onslaught of migrants, Hungary began to construct a border fence ("A wall!"). For this, Hungary was condemned.

I suspect that the same parties who hailed Hungary for burning GMOs would condemn it for trying to control immigration, when these two actions are actually quite consistent.

"Hungarian Conservatives Reject GMOs" at Seed in Context, provides substantial background on Hungarian national attitudes including this:
A nationalist program which is associated with the rejection of gypsies and international biotech capitalists suggests vague similarities to the Nazi program which rejected gypsies and international Jewish bankers, but too much should not be made of the comparison. The Fidesz party is conservative, not radical or racist. The comparison does suggest the importance of GMOs and their creators as symbols of cultural identity which the Fidesz hopes to use to justify and represent their national leadership.


In important parts of Hungarian society there is both a deep-seated social distrust of biotech crops and a belief that Hungarian farmers profit from being a leading ‘GMO-free’ supplier of food and feed to European markets. Hungary is somewhat unusual in that this distrust is associated with the right side of the political spectrum.

Burning crops grown with imported seed is an easy win for the nationalist government of a small country. What GMOs and migrants have in common--they are feared foreign unknowns.