Saturday, October 31, 2009
"Men go abroad to wonder at the heights of mountains, at the huge waves of the sea, at the long courses of the rivers, at the vast compass of the ocean, at the circular motions of the stars, and they pass by themselves without wondering." - Saint Augustine
Wednesday, October 28, 2009
Luigi Zingales is worried that populist anger might fall into the hands of evil Democrats rather than Republicans who would, of course, use this strong populist force for good:Pro-Market Populism Is GOP's Out, by Luigi Zingales, Commentary, investors.com: ...[T]he financial crisis has created significant discontent. In a survey taken last December, 60% of Americans declared themselves "angry" or "very angry" about the economic situation.If Republicans ignore this popular anger, as the party establishment did last autumn, they leave a powerful and potentially disruptive force in the hands of Democrats. The Democrats could channel popular anger into protectionism, 90% tax rates and onerous new market constraints.In Republican hands, populism could become a strong force for positive change.
And Republicans would do this by adopting Democratic ideas:The Republican Party has to move from a pro-business strategy that defends the interests of existing companies to a pro- market strategy that fosters open competition and freedom of entry.While the two agendas sometimes coincide, they are often at odds. Established firms are threatened by competition and frequently use their political muscle to restrict new entries into their industry, strengthening their positions but putting their customers at a disadvantage.
Reducing market power through regulation and is something Democrats have long advocated, but Republicans have argued that the market takes care of this itself, there's no need for government to intervene. So how would Republicans solve the problem in, say, the financial industry?A pro-market strategy aims to encourage the best conditions for doing business, for everyone. Large banks benefit from trading derivatives (such as credit default swaps) over the counter, rather than in an organized exchange. ... For this reason, they oppose moving such trades to organized exchanges, where transactions would be conducted with greater transparency, liquidity and collateralization — and so with greater financial stability. This is where a pro-market party needs the courage to take on the financial industry on behalf of everyone else.
Again, that sounds like what Democrats have been saying, that these markets need to be regulated.
What else is involved in this pro-market strategy that will save the Republican party?A pro-market strategy rejects subsidies because they're a waste of taxpayers' money and because they prop up inefficient firms, delaying the entry of new and more efficient competitors.And a pro-market approach holds companies financially accountable for their mistakes — an essential policy if free markets are to produce sound decisions.A pro-market party will fight tirelessly against letting firms become so big that they cannot be allowed to fail, since such firms may take risks that ordinary companies would never dream of.
I can imagine a few people on the left supporting some types of subsidies, but generally I don't think you'll get much disagreement here either (e.g. see Sachs on subsidies in the post above this one). The accountability thing sounds like a jab at government intervention to save the bank (as does the first point), but take a look at the latest proposal from Democrats that attempts to put the cost of bailouts on the companies themselves while still protecting the economy (as opposed to just letting it melt down). But go on...A pro-market party should favor a robust safety net — for people, not companies. Of course, this safety net should be run on market principles as much as possible. Unemployment insurance should retain incentives for people to look for work, and the health-insurance industry should be opened up to competition. But defenders of markets cannot ignore the importance of providing such security for citizens.
The details would differ a bit, e.g. the health insurance competition part certainly differs from a Medicare for all structure many Democrats endorse (but not all), but the general idea of a "robust safety net" for people seems consistent with Democratic ideas, less so with Republican principles.
Besides robust safety nests, what else is on the long-time concern of Republican's list?They also cannot ignore the nation's growing income inequality and the widespread loss of confidence that the future will be better than the past. The knee-jerk Democratic reaction is to give these poorer citizens entitlements disguised as rights.The Republican response should focus on providing opportunities. Parents should have access to good schools for their kids, regardless of their financial means or where they live. The best way to deliver on that promise is through a voucher system.
Entitlements disguised as rights? Such as? The general idea that some kids are disadvantaged by the education they receive has been a mainstay within the Democratic party for a long time, and quite a few Democrats endorse vouchers as part of the solution (even breaking up teacher's unions in some cases).And concern over inequality? From Republicans? Generally Republicans argue that inequality isn't really increasing or as bad as you think (the attack the data when you don't like the answer approach), or that it's necessary to fuel the engine of capitalism.
What's next on the list of Democratic ideas disguised as Republican concerns?Students should have better access to loans to finance their education because everyone gains from a better-educated work force. The unemployed should have access to retraining, which can also be designed through a voucher system.
Student loans, help with finding new employment? Yet again, strong Democratic ideas. The only thing new is to toss in a voucher system, but that's a debate about how best to reach the goal, not what the goal is (and again, vouchers aren't automatically rejected by all Democrats). I suppose you'll want to adopt health care as a Republican idea as well?Health care should be available in the marketplace. The current system, in which only employers get a tax deduction for health insurance, reduces labor mobility and increases the cost of becoming unemployed.
What is the goal here? If it's to make health care affordable and available to everyone, simple saying it ought to be "in the marketplace" is far from enough. The incompleteness of the proposal makes this hard to evaluate (but given the proposals so far, you have to think the work "vouchers" would be involved in the solution).
Finally:The U.S. has been the inspiration for all who believe in freedom, both political and economic. Its identity, however, is predicated on maintaining a political consensus that supports market values.Growing income inequality, the financial crisis and the perceived unfairness of the market system are undermining this consensus. If Republicans don't stand up for markets, who will?
If standing up for markets means -- running down the list above in order -- reducing market power, regulating financial markets, eliminating subsidies, breaking up too big to fail firms, providing a robust safety net, overcoming income inequality, fixing schools, increasing the availability of student loans, providing retraining, and providing health care, then the answer is Democrats.
Tuesday, October 27, 2009
- Fundamental stipulations
His worldview began with a bedrock belief in people and their ability to make judgments for themselves, and thus an imperative to maximize individual freedom. On top of that was layered a trust in free markets as almost always the best and most magical way of coordinating every conceivable task. On top of that was layered a powerful conviction that a look at the empirical facts -- a comparison, or a "marking to market," of one's beliefs with reality -- would generate the right conclusions. And crowning that was a fear and suspicion of government as an easily captured tool for the enrichment of cynical and selfish interests. Suffusing all was a faith in the power of argument and the primacy of reason. Friedman was an optimist. He was convinced people could be taught the truths of economics, and if people were properly taught, then institutions could be built to protect society as a whole against the corruption and overreach of the government.
And he did fear the government. He was a conservative of the old, libertarian school, from the days before the scolds had captured the levers of power in the conservative movement. He hated any government intrusion into people's private business. And he interpreted "people's private business" extremely widely. He detested the war on drugs, which he saw as a cruel and destructive breeder of crime and violence. He scorned government licensing of professionals -- especially doctors, who heard over and over again about how their incomes were boosted by restrictions on the number of doctors that made Americans sicker. He abhorred deficit spending -- again, he was a conservative from another era. He feared that cynical politicians could pretend that the costs of government were less than they were by pushing the raising of taxes to pay for spending off into the future. He sought to inoculate citizens against such political games of three-card monte. "Remember," he would say, "to spend is to tax."
This did not mean that government had no role to play. He endorsed the enforcement of property rights, adjudication of contract disputes -- the standard and powerful rule-of-law underpinnings of the market -- plus a host of other government interventions when empirical circumstances made them appropriate. Sometime empirical circumstances could win Friedman some unexpected allies. Left-wing Mayor Ken Livingstone's congestion tax on cars in central London is an idea straight out of Milton Friedman. Friedman's negative income tax is one of the parents of what is now America's largest anti-poverty program: the earned-income tax credit, which was greatly expanded by Bill Clinton. And, most important, government had a very powerful and necessary role to play in keeping the monetary system working smoothly through proper control of the money stock. If there was always sufficient liquidity in the economy -- enough but not too much -- then you could trust the market system to do its job. If not, you got the Great Depression, or hyperinflation.
Monday, October 26, 2009
Yesterday, congress appropriated a $680 billion for the Department of Defense in FY 2010. Chris Preble observes that, shockingly enough, this $680 billion isn’t even the whole bill:
The defense bill represents only part of our military spending. The appropriations bill moving through Congress governing veterans affairs, military construction and other agencies totals $133 billion, while the massive Department of Homeland Security budget weighs in at $42.8 billion. This comprises the visible balance of what Americans spend on our national security, loosely defined. Then there is the approximately $16 billion tucked away in the Energy Department’s budget, money dedicated to the care and maintenance of the country’s huge nuclear arsenal.
All told, every man, woman and child in the United States will spend more than $2,700 on these programs and agencies next year. By way of comparison, the average Japanese spends less than $330; the average German about $520; China’s per capita spending is less than $100.
Preble says that this enormous expenditure “flows directly from our foreign policy.” But it’s worth also saying that our foreign policy flows from the vast scope of our defense spending. My biggest concern about the war in Afghanistan isn’t overblown feasibility concerns, but the failure to take seriously David Obey’s point that we should put this in some kind of cost-benefit framework. Arne Duncan doesn’t have a $700 billion per year budget to play with as he tries to help American kids learn. Jay Rockefeller doesn’t get to say “I could make this health plan really good by kicking the ten year cost up to $7 trillion.” People are starving in Ethiopia for want of a fraction of the DOD’s daily budget in food aid.
Thursday, October 22, 2009
China’s recovery accelerated in the third quarter as a result of the government’s massive lending programme with the economy growing at 8.9 per cent compared with the same period last year.The National Statistics Bureau on Thursday said that the increase in investment and retail sales had also accelerated in September, underlining the rapid rebound in the economy that has taken place in recent months.The expansion in the third quarter compared with year-on-year growth of 7.9 per cent in the second quarter and 6.1 per cent in the first quarter, when the country’s export sector was hit hard by the global crisis. In the first nine months, the economy expanded 7.7 per cent, much faster than any other major economy.
Li Xiaochao, spokesman for the NBS, said the economy was at a “crucial stage”. “The basis of the economic recovery still needs to be consolidated, and the insufficient external demand is still severe,” he said.
The sharp rebound in the economy has prompted calls for the government to begin withdrawing some of the stimulus it has injected, including a massive increase in bank loans. Qin Xiao, chairman of China Merchants Bank, said in an article in Thursday’s Financial Times that China needed an “urgent” tightening monetary policy to prevent bubbles in stock and property prices.
The State Council indicated a shift in strategy on Wednesday when it said that China’s policy should focus both on controlling inflationary expectations and securing stable growth, the first time it had mentioned inflation since the crisis began. The statement has prompted speculation that the government could begin to restrict credit to banks or appreciate the currency in order to limit inflationary pressures.
Wednesday, October 21, 2009
Greg Ransom has found a new book with an interview done with Hayek in 1979. In it, Hayek says the following:
“I agree with Milton Friedman that once the Crash had occurred, the Federal Reserve System pursued a silly deflationary policy. I am not only against inflation but I am also against deflation. So, once again, a badly programmed monetary policy prolonged the depression.”
Those Austrians who think deflation is always and everywhere a good phenomenon strongly overlap with those Austrians who wonder whether Hayek is really an Austrian (or a even a classical liberal) anyway, so I'm doubtful this will convince them of the claim that a concern with monetary deflation has been, and should be, a core part of Austrian monetary and macro theory. However, it does, in fact, bolster the case for a monetary equilibrium reading of Hayek.
It is also useful to counter the claim that Hayek was a "liquidationist" in the sense often deployed by people like Brad DeLong, as well as the more general claim that Hayek thought we should do nothing during the depression. By implication, if you think deflation is bad, you believe that the Fed (given its existence) should have behaved differently between 1930 and 33. It could have done something to prevent the events that "prolonged the depression."
This also is some support for what I would call the Austrian-Monetarist-Interventionism explanation of why the Great Depression got started, got so deep so quickly, and lasted so long. Each "school" (think Rothbard, F&S, and Higgs if you want authors) lines up with each element of the explanation in the order given. Even Hayek agrees that traditional Austrian cycle theory alone can't explain the whole thing, even buttressed by Higgs or Cole & Ohanian. If you want to explain why the Great Depression was both "great" and a "depression" not a recession, you need the Friedman and Schwartz story, and you'll have Hayek on your side.
Whether the same situation as we faced in 1930 was in place last fall remains a debatable question. However, if velocity was falling in the way some folks believed, doing nothing would have invited a potential repeat of the early 30s, and now we can say with even more certainty that Hayek, at least, would have recommended that the Fed act to avoid it. (Of course, nothing in this paragraph is an endorsement of the extreme to which the Fed went, nor the other really stupid things it did last fall and since.)
James A. Nichols IV
cell: (770) 312-6736
www.JimNichols4.com"Nothing in the world can take the place of Persistence. Talent will not; nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Education will not; the world is full of educated derelicts. Persistence and determination alone are omnipotent. The slogan 'Press On' has solved and always will solve the problems of the human race." ---Calvin Coolidge (1872 - 1933) "I have come to the conclusion that politics are too serious a matter to be left to the politicians." Charles De Gaulle (1890 - 1970)
STEVEN LEVITT and Stephen Dubner have reprised their Freakonomics roles in "SuperFreakonomics", which is due out in just a few days. As it happens, some chapters from the book are already in circulation, including one on "global cooling" which has drawn quite a bit of criticism, including responses from respected climate scientists and environmental economists. Mssrs Dubner and Levitt have attempted to respond, but I find the criticism of their work to be quite compelling; it appears that the authors made a number of outright errors and generally opted to present their case in a manner aimed more at provoking controversy than informing, which is highly irresponsible given the subject matter. (You can follow links here, here, and here.)
One interesting point that a number of critics have made is that the Freakonomists' writing seems to be vastly different in quality when using research that Mr Levitt has himself produced (as was the case in the first book) than when addressing topics he has not previously discussed. This isn't all that difficult to understand; Mr Levitt no doubt chooses his research topics based on things like the quality of data available rather than the likelihood of a particular question being "hot button". And there are also very different publication standards for academic work than there are for popular publications.
But that doesn't mean that there can't be reputational blowback from a disastrous popular publication. Given that, it's a shame that Mr Levitt opted to dedicate a chapter to a subject—climate change—on which he doesn't have subject-area expertise and on which topic he doesn't use his methodological expertise. Instead, he simply deploys his reputational "expertise". This may make him some money, but it won't come without real costs.
And it's not like he didn't have plenty of real academic work to use. Matt Yglesias directs readers to an interesting paper co-written by Mr Levitt on the use of minimax strategies in professional sports. And just today, this paper popped up at NBER (co-written by Steven Levitt and Roland Fryer):
We document and analyze the emergence of a substantial gender gap in mathematics in the early years of schooling using a large, recent, and nationally representative panel of children in the United States. There are no mean differences between boys and girls upon entry to school, but girls lose more than two-tenths of a standard deviation relative to boys over the first six years of school. The ground lost by girls relative to boys is roughly half as large as the black-white test score gap that appears over these same ages. We document the presence of this gender math gap across every strata of society. We explore a wide range of possible explanations in the U.S. data, including less investment by girls in math, low parental expectations, and biased tests, but find little support for any of these theories. Moving to cross-country comparisons, we find that earlier results linking the gender gap in math to measures of gender equality are sensitive to the inclusion of Muslim countries, where in spite of women’s low status, there is little or no gender gap in math.
Very interesting stuff. With the reputation Mr Levitt built for himself through the first book and his New York Times blog, he could easily have made himself millions of dollars with a sequel focused on these kinds of questions. But instead he and Mr Dubner wrote a chapter that differs dramatically in style and method from what we've all come to understand as the Freakonomics way.
That is an thought-provoking phenomenon in and of itself. I suspect Mr Levitt could say something quite interesting about the incentives facing academics with popular brands, if he weren't quite so involved with a natural experiment of his own making just now.
Sunday, October 18, 2009
His early months in office have been "very disappointing." Obama is "a frightened man," who won't take on corporate power. Obama is "conflict averse" - and a "harmony ideology type," who's being taken advantage of by the sharks in Congress, of both parties. He's "Bush-Cheney redux" when it comes to military and foreign policy, "albeit with better speeches" to the Muslim world. Given Obama's handling of the wars in Iraq and Afghanistan, Nader wonders in amazement: "And they gave him the [Nobel] Peace Prize?"
Saturday, October 17, 2009
When did the Roman Republic fall? What would the demise of our Republic look(ed) like?A series of court decisions expected this fall could put the nation on track to return to turn-of-the-century campaign finance laws. This week, the U.S. Court of Appeals for the D.C. Circuit will hear arguments in a case that opponents say could pave the way for political parties to raise unlimited amounts of money from corporations, individuals, unions and anything else with a bank account. Last week, the same court announced it will review Federal Election Commission rules aimed at reining in outside independent groups, after two of its three-judge panels offered differing judgments on them. Next month, the 5th Circuit Court of Appeals in New Orleans will hear arguments in a case that would essentially wipe out the post-Watergate rules against coordination between parties and candidates. And campaign finance foes and fans are awaiting a U.S. Supreme Court decision freeing corporations to use general treasury funds to finance movies attacking candidates, as well as a D.C. District Court ruling in another case that would permit the national party committees to once again collect “soft money” checks from businesses — a practice that was banned a century ago. “There is no end in sight. There are a lot of other cases in the pipeline,” said Paul Ryan, an attorney with the Campaign Legal Center.
Expendable People?: A Human Rights Perspective on the Impact of Global Economic Migration on Georgia
The sixth annual Emory Public Interest Committee (EPIC) conference, Expendable People?: A Human Rights Perspective on the Impact of Global Economic Migration on Georgia, will be held Saturday, Oct. 17, in Tull Auditorium at Emory Law.
The conference is free and open to the public. We ask that you register in advance. To register for the conference, click here. Practicing attorneys seeking CLE credit will be required to pay a fee. Please see below for more information.
The conference aims to examine the human rights issues that accompany global economic migration. It will focus on three aspects of economic migration: (1) human trafficking, (2) the guest worker program and (3) the undocumented workforce.
We seek to engage conference participants in an open discussion of each of these topics: their causes, incidences and effects—on those directly involved and on the greater Georgia community. The conference will serve as a space where individual, government and community responses to economic migration can be examined and even challenged. Specifically, we want to discuss the relationship between human rights and citizenship.
Read more about the conference's speakers and panelists.
See the conference schedule.
Friday, October 16, 2009
La. justice of the peace cites concerns about any children couple might have
HAMMOND, La. - A Louisiana justice of the peace said he refused to issue a marriage license to an interracial couple out of concern for any children the couple might have.
Keith Bardwell, justice of the peace in Tangipahoa Parish, says it is his experience that most interracial marriages do not last long
Thursday, October 15, 2009
I’ve seen a fair amount of commentary on the part of Ryan Lizza’s profile of the Obama economic team where Christina Romer recommends a $1.2 trillion stimulus proposal and they wind up with just a bit more than half of that out of deference to the tender sensibilities of the United States Senate. I’ve seen less commentary on this other part, where basically the same thing happen on financial system policy:
Romer believed that the banks wouldn’t lend again until they were well capitalized. For banks in severe stress, she favored creating a government-backed “bad bank” to take the toxic assets off the banks’ books and then recapitalize them with government funds—essentially a version of nationalization, and what the Swedish government had done during that nation’s financial crisis of the early nineties. This argument was quickly rendered moot because of the cost. There wasn’t much money left in the TARP kitty, and any chance of getting more from Congress had ended with that morning’s news: A.I.G., which had received a hundred and seventy billion dollars in federal money, had handed out multimillion-dollar bonuses to the executives responsible for the company’s demise. Axelrod said, “The one thing that was absolutely clear was, we were not in a position to go back to Congress.”
Axelrod’s argument seems absolutely sound. And Rahm Emannuel’s argument on the stimulus that congress wouldn’t appropriate $1.2 trillion also seems absolutely sound. But of course Romer’s arguments weren’t arguments about feasible legislative strategies. Of all the senior members of the Obama administration, Romer has by far the least experience with practical legislative politics and also has the job that’s the least concerned with practical legislative politics. And I think that it was in a lot of ways a masterstroke to appoint a very policy-focused academic with no practical legislative experience to the CEA job. When people work too long in Washington, their notions of what would be good policy in principle tend to become unduly corrupted by their knowledge of what’s possible in practice.
But what Lizza is telling us is that on the two biggest pieces of macroeconomic management, the Obama administration is pursuing policies that its in-house expert on macroeconomic crisis management believed were far too timid. He’s also telling us that this was done primarily not because people disagreed with her analysis, but because they felt it wasn’t possible, legislatively speaking, to do what was objectively necessary. It’s a bit of a scary situation.
Tuesday, October 13, 2009
When you go to an academic conference you expect to see some geeks, gravitas and graying professors giving lectures. But the people who showed up at the Social and Affective Neuroscience Society’s conference in Lower Manhattan last weekend were so damned young, hip and attractive. The leading figures at this conference were in their 30s, and most of the work was done by people in their 20s. When you spoke with them, you felt yourself near the beginning of something long and important.
In 2001, an Internet search of the phrase “social cognitive neuroscience” yielded 53 hits. Now you get more than a million on Google. Young scholars have been drawn to this field from psychology, economics, political science and beyond in the hopes that by looking into the brain they can help settle some old arguments about how people interact.
These people study the way biology, in the form of genes, influences behavior. But they’re also trying to understand the complementary process of how social behavior changes biology. Matthew Lieberman of U.C.L.A. is doing research into what happens in the brain when people are persuaded by an argument.
Keely Muscatell, one of his doctoral students, and others presented a study in which they showed people from various social strata some images of menacing faces. People whose parents had low social status exhibited more activation in the amygdala (the busy little part of the brain involved in fear and emotion) than people from high-status families.
Reem Yahya and a team from the University of Haifa studied Arabs and Jews while showing them images of hands and feet in painful situations. The two cultures perceived pain differently. The Arabs perceived higher levels of pain over all while the Jews were more sensitive to pain suffered by members of a group other than their own.
Mina Cikara of Princeton and others scanned the brains of Yankee and Red Sox fans as they watched baseball highlights. Neither reacted much to an Orioles-Blue Jays game, but when they saw their own team doing well, brain regions called the ventral striatum and nucleus accumbens were activated. This is a look at how tribal dominance struggles get processed inside.
Jonathan B. Freeman of Tufts and others peered into the reward centers of the brain such as the caudate nucleus. They found that among Americans, that region was likely to be activated by dominant behavior, whereas among Japanese, it was more likely to be activated by subordinate behavior — the same region rewarding different patterns of behavior depending on culture.
All of these studies are baby steps in a long conversation, and young academics are properly circumspect about drawing broad conclusions. But eventually their work could give us a clearer picture of what we mean by fuzzy words like ‘culture.’ It could also fill a hole in our understanding of ourselves. Economists, political scientists and policy makers treat humans as ultrarational creatures because they can’t define and systematize the emotions. This work is getting us closer to that.
The work demonstrates that we are awash in social signals, and any social science that treats individuals as discrete decision-making creatures is nonsense. But it also suggests that even though most of our reactions are fast and automatic, we still have free will and control.
Many of the studies presented here concerned the way we divide people by in-group and out-group categories in as little as 170 milliseconds. The anterior cingulate cortices in American and Chinese brains activate when people see members of their own group endure pain, but they do so at much lower levels when they see members of another group enduring it. These effects may form the basis of prejudice.
But a study by Saaid A. Mendoza and David M. Amodio of New York University showed that if you give people a strategy, such as reminding them to be racially fair, it is possible to counteract those perceptions. People feel disgust toward dehumanized groups, but a study by Claire Hoogendoorn, Elizabeth Phelps and others at N.Y.U. suggests it is possible to lower disgust and the accompanying insula activity through cognitive behavioral therapy.
In other words, consciousness is too slow to see what happens inside, but it is possible to change the lenses through which we unconsciously construe the world.
Since I’m not an academic, I’m free to speculate that this work will someday give us new categories, which will replace misleading categories like ‘emotion’ and ‘reason.’ I suspect that the work will take us beyond the obsession with I.Q. and other conscious capacities and give us a firmer understanding of motivation, equilibrium, sensitivity and other unconscious capacities.
The hard sciences are interpenetrating the social sciences. This isn’t dehumanizing. It shines attention on the things poets have traditionally cared about: the power of human attachments. It may even help policy wonks someday see people as they really are.
Whether it’s Newark, Detroit, parts of Chicago, South-Central Los Angeles, Camden, N.J. — take your pick — we’ve looked the other way for decades as the residents of hard-core inner-city neighborhoods struggled with overwhelming, life-threatening problems and a chronic shortage of resources, financial and otherwise. We’re having an intense national debate over whether to move ahead with nation-building in Afghanistan and to continue protecting the population in places like Kabul and Kandahar while all but ignoring the violence that is consuming the lives of boys and girls in Chicago, America’s third-largest city. Dozens of boys and girls of school-age and younger are murdered in Chicago every year. One hundred were killed there last year, according to the police. The blood of the young is spattered daily on the stoops, sidewalks and streets of American cities from coast to coast, and we won’t even take notice unless, for example, we can engage in the ghoulish delight of watching the murder played over and over again on video. In Newark, where some of the streets do look as bad as the scenes that were part of Conan’s comedy bit, the unemployment rate is 14.7 percent. Keeping kids in high school long enough to graduate is difficult. Drug dealing is a fallback employment option for men and boys who can’t find legitimate work. Other cities have the same problems, some to a greater degree. So what are we doing? While mulling the prospect of sending up to 40,000 additional troops to Afghanistan, we’ve stood idly by, mute as a stone, as school districts across the nation have bounced 40,000 teachers out of their jobs over the past year. That should tell you all you need to know about twisted national priorities.Even as teachers by the tens of thousands are walking the plank to unemployment, we’re learning, as The Times reported last week, that one in every 10 young male dropouts is locked up in jail or juvenile detention. As if that weren’t gruesome enough, we find that the figure for blacks is one in four. What would it take to get the perpetual crisis facing these young people onto the radar screens of the rest of America? Conan was just trying to be funny, but the reality behind his late-night humor is horrifying. In Detroit, the median sale price of a house has hovered around $8,000. Seventy percent of all murders in the Motor City go unsolved. Joblessness is off the charts. The school system is a catastrophe. I remember driving around Camden, which is right outside of Philadelphia, on a rainy afternoon. Young people with nothing to do — they had dropped out of school and had little or no chance of finding a job — were gathered on porches, saying little, staring the hours away. I had on a suit and was driving a nice car. More than one person that I approached thought I was either buying or selling drugs. The inner cities have been in a recession for decades. They’re in a depression now. Myriad issues desperately need to be addressed: employment, education, the foreclosure crisis, crime, alcohol and drug abuse, health care (including mental health treatment and counseling), child care for working parents and on and on and on.
Monday, October 12, 2009
Saturday, October 10, 2009
Given the (South Park inspired?) upswing in the general pejorative use of the term “gay” over the last decade, it is perhaps not surprising that you would hear people noting that using “gay” when you mean “lame” is offensive. Question: Why isn’t it offensive to use “lame” as a generic insult or to indicate that someone is “out of touch with modern fads or trends; unsophisticated”? Are the crippled or physically disabled less deserving of consideration? That just seems retarded.
Friday, October 9, 2009
To take up the challenges of sustainable development of human societies, it is necessary to achieve a more equitable distribution of wealth. In this regard, John Stuart Mill's concept of the stationary state outlined in his Principles of Political Economy is conceptually in line with the modern exposition of sustainable development (Lin 2006; 2007). O'Connor (1997) also investigated Mill's concepts of a private propertybased liberal society as well as a stationary-state society, and argued that the writings of Mill represent a prototype for ideals of a "sustainable development." Winch (2004, 111) points out that Mill is one of the earliest green thinkers and his "defense of a zero-growth society conveys the substance of his environmentalist concerns." Mill's virtuous stationary-state (zero-growth) society, according to Winch (2004, 122), is "a continuous state of dynamic equilibrium" in which all improvements in new technologies can be redirected toward redistribution of wealth and the promotion of life quality.Although greatly influenced by David Ricardo, Mill's stationary state was not the dismal scenario which Ricardo visualized. Mill took a different view of his desirable society and outlined his desires for a good future. In his chapter on the stationary state, in which he discussed the long-run tendencies of the economy, he said:But the best state for human nature is that in which, while no one is poor, no one desires to be richer, nor has any reason to fear being thrust back by the efforts of others to push themselves forward . . . There would be as much scope as ever for all kinds of mental culture, and moral and social progress; as much room for improving the Art of Living, and much more likelihood of its being improved, when minds ceased to be engrossed by the art of getting on. (Mill 1965, 748-51)Looking at the economic and social conditions of his time, Mill felt that the masses of society were bypassed by the materialistic development of the Industrial Revolution and wondered whether a country with a growing economy was a desirable living place. He envisioned that the stationary state would result in an improvement in the art of living:It is only in the backward countries of the world that increased production is still an important object: in those most advanced, what is economically needed is a better distribution ... On the other hand, we may suppose this better distribution of property attained, by the joint effect of the prudence and frugality of individuals, and of a system of legislation favouring equality of fortunes, so far as is consistent with the just claim of the individual to the fruits, whether great or small, of his or her own industry. (Mill 1965, 749)As this passage suggests, Mill's stationary state might be narrowly interpreted as a society with no (or limited) growth in physical output. Alternatively, it should be best understood as a society with unlimited growth in mental culture and improvements in economic equality (by means of wealth redistribution).
Latest landslides, back-to-back storms push death toll to nearly 500
Massive mudslides and flooding in central Luzon. The damage to infrastructure, lives, crops from multiple events over the past ten days will have tremendous macroeconomic impacts on philippines for quite some time. The political impacts could potentially be startling.
So yeah, once or twice a day, my power goes out for about 2 hours. Very disruptive to me, but also to those coordinating relief efforts. - Nick in Manila
Massive humanitarian relief efforts are continuing and have been for quite some time now. No let up. It's pre-occupying a lot of peoples' time.
Metro manila - the economic center of the country - has been placed under rotating blackouts - two to four hours a day each - because of the explosion and fire at a power transformer south of the City at a huge, critical power substation. That just happened last night.
Tuesday, October 6, 2009
The chairman of the Finance Committee, Senator Max Baucus, Democrat of Montana, said he was trying to “strike a balance between affordability and proper coverage.”If the government does not set minimum coverage levels, he said, insurers will continue to offer low-value policies that leave consumers exposed to exorbitant costs and the risk of bankruptcy.
Such policies amount to “pseudo coverage,” Mr. Baucus said.
Since the WSJ is, essentially, rerunning op-eds:
May as well rerun a few of the responses:
[See also Don’t know much about history. by Paul Krugman.]
Henry County will be the venue for a visit next week by a well-known gubernatorial candidate. David Poythress, a Democratic candidate for governor, will be the guest speaker for the Oct. 14 meeting of the Henry Council for Quality Growth. The meeting will be held at Eagle's Landing Country Club in Stockbridge. According to officials with the group, networking will begin at 11 a.m., with the lunch meeting scheduled to start at 11:55 a.m. Poythress said the growth-and-development-oriented group is highly focused on transportation and future land use as key issues. He expressed gratitude to the organization for its efforts in coordinating his appearance in Henry County, and said the issues it is focusing on are important well beyond the boundaries of Henry County. "That kind of strategic, broad-based planning is important in keeping Georgia competitive," he said.
while not having another depression is a good thing, all indications are that unless the government does much more than is currently planned to help the economy recover, the job market - a market in which there are currently six times as many people seeking work as there are jobs on offer - will remain terrible for years to come.
Indeed, the administration's own economic projection - a projection that takes into account the extra jobs the administration says its policies will create - is that the unemployment rate, which was below 5 percent just two years ago, will average 9.8 percent in 2010, 8.6 percent in 2011, and 7.7 percent in 2012.
This should not be considered an acceptable outlook. For one thing, it implies an enormous amount of suffering over the next few years. Moreover, unemployment that remains that high, that long, will cast long shadows over America's future.
Anyone who thinks that we're doing enough to create jobs should read a new report from John Irons of the Economic Policy Institute, which describes the "scarring" that's likely to result from sustained high unemployment. Among other things, Mr. Irons points out that sustained unemployment on the scale now being predicted would lead to a huge rise in child poverty - and that there's overwhelming evidence that children who grow up in poverty are alarmingly likely to lead blighted lives.
These human costs should be our main concern, but the dollars and cents implications are also dire. Projections by the Congressional Budget Office, for example, imply that over the period from 2010 to 2013 - that is, not counting the losses we've already suffered - the "output gap," the difference between the amount the economy could have produced and the amount it actually produces, will be more than $2 trillion. That's trillions of dollars of productive potential going to waste.
Wait. It gets worse. A new report from the International Monetary Fund shows that the kind of recession we've had, a recession caused by a financial crisis, often leads to long-term damage to a country's growth prospects. "The path of output tends to be depressed substantially and persistently following banking crises."
The same report, however, suggests that this isn't inevitable: "We find that a stronger short-term fiscal policy response" - by which they mean a temporary increase in government spending - "is significantly associated with smaller medium-term output losses."
So we should be doing much more than we are to promote economic recovery, not just because it would reduce our current pain, but also because it would improve our long-run prospects.
But can we afford to do more - to provide more aid to beleaguered state governments and the unemployed, to spend more on infrastructure, to provide tax credits to employers who create jobs? Yes, we can.
The conventional wisdom is that trying to help the economy now produces short-term gain at the expense of long-term pain. But as I've just pointed out, from the point of view of the nation as a whole that's not at all how it works. The slump is doing long-term damage to our economy and society, and mitigating that slump will lead to a better future.
What is true is that spending more on recovery and reconstruction would worsen the government's own fiscal position. But even there, conventional wisdom greatly overstates the case. The true fiscal costs of supporting the economy are surprisingly small.
You see, spending money now means a stronger economy, both in the short run and in the long run. And a stronger economy means more revenues, which offset a large fraction of the upfront cost. Back-of-the-envelope calculations suggest that the offset falls short of 100 percent, so that fiscal stimulus isn't a complete free lunch. But it costs far less than you'd think from listening to what passes for informed discussion.
Look, I know more stimulus is a hard sell politically. But it's urgently needed. The question shouldn't be whether we can afford to do more to promote recovery. It should be whether we can afford not to. And the answer is no.
States that host large numbers of immigrants should resist popular pressure to erect barriers to newcomers in the economic downturn and highlight the economic benefits of migration, according to United Nations development experts.In a study published on Monday, the UN Development Programme acknowledges that “the tendency to blame outsiders for society’s ills is accentuated during economic downturns”. It argues, however, that closing the door to people from abroad would be short-sighted, even from a strictly economic perspective.“Movement is inevitable,” Jeni Klugman, the lead writer of the report, said in an interview. “Restrictions on movement lead to worse outcomes than would otherwise be the case, so we aim to raise public understanding of the benefits that accrue to destination countries from migration.”
Research for the report suggests that the gains from a 5 per cent increase in the number of migrants in developed countries would be worth $190bn. The report notes that by taxing illegal immigrants, while turning a blind eye to their status, the US raises $7bn a year for the Treasury
Honduras’ de facto government on Monday is set to repeal a decree passed just over a week ago to curb civil liberties – a sign that it may be relaxing its hitherto authoritarian style.
The decree, passed in response to the surprise return of Manuel Zelaya, the country’s ousted president, and to his subsequent calls for a nationwide protest, had led to the closure of two media outlets as well as the arrest of dozens of Zelaya supporters in the past week. It had also provoked a torrent of criticism from international leaders and human rights organisations.
Speaking in an interview on national television, Roberto Micheletti, the de facto president, said: “We’ve abolished the decree”, adding that it would be revoked first thing Tuesday morning and signalling that the country was returning to calm.
Shortly after the announcement, the Organisation of American States (OAS), confirmed that it would send a mission to Tegucigalpa on Wednesday to help broker a solution to the political deadlock that has gripped Honduras since soldiers stormed the presidential palace June 28, removing Mr Zelaya by force.
Iceland’s prime minister has hit out against the International Monetary Fund and the British and Dutch governments for holding up recovery efforts a year after the country’s banking sector collapsed.
Jóhanna Sigurdardóttir, the prime minister, said that it was “not acceptable” that the IMF had delayed a review for months. This review is needed before Iceland can access more of its $5.1bn (£3.2bn) international rescue package.
She also renewed criticism of Gordon Brown, the UK prime minister, for his decision a year ago this week to use anti-terror laws to freeze Icelandic assets – a move that deepened Iceland’s crisis and damaged relations between the Nato allies.
“To stamp a friend and a long-time ally as a terrorist is an act we will hardly forget,” she told the Financial Times. “It hurts.”
Iceland remains locked in a dispute with Britain and the Netherlands over compensation for nearly €4bn (£3.67bn) of money lost by depositors in Reykjavik-based “Icesave” accounts.
Monday, October 5, 2009
Unambiguously and without doubt, it was caused by the people who taught and believed the nonsense of an actual “invisible hand” that magically ensured that “the free market coordinates the behavior of self-seeking individuals to the benefit of all” (and all variations to that affect). It most certainly was “ideology”, as John Cassidy says, but it was never anything that Adam Smith asserted, despite hose who used his name as a sort of holy authority for claiming that the “ideology” was worthy of the attention given to it since the 1950s.
By refusing to allow Guantanamo detainees to be transferred anywhere in the United States, including its supermax prisons, those representatives in Congress eagerly fighting to keep the prison in Cuba open may unintentionally be easing the lives of terror suspects.
Last Thursday, the House of Representatives voted 258-163 to refuse to allow detainees now held at the Guantanamo Bay prison to enter the United States. Even a supermax prison facility isn’t safe enough to contain them, they decided, in a nonbinding resolution.
But Peter Finn at the Washington Post noted on Sunday that conditions at the United States’ most secure federal prisons are actually far more draconian than they are at Guantanamo Bay.
“For up to four hours a day, Khalid Sheik Mohammed, the self-proclaimed mastermind of the 9/11 attacks, can sit outside in the Caribbean sun and chat through a chain-link fence with the detainee in the neighboring exercise yard at Guantanamo Bay, Cuba,” writes Finn. By contrast, terror suspects in U.S. prisons are usually kept in complete isolation, allowed only one hour a day outside, and never get to speak to anyone.
The federal supermax prison in Florence, Colorado is home to such notorious convicted terrorists as 1993 World Trade Center bomber Ramzi Yousef; Teodore Kaczynski, the Unabomber; and Terry Nichols, convicted of the 1995 bombing of the federal building in Oklahoma City.
The conditions at Florence are supposedly so bad that terror suspects in Britain appealed to the European Court of Human Rights to prevent their extradition to the United States, arguing that the prison conditions constitute cruel, inhuman or degrading treatment. In fact, studies have found that such extreme isolation can cause or exacerbate mental illness.
At Gitmo, meanwhile, KSM gets to work out on the gym’s elliptical machines and stationery bikes, choose his own movies to watch in the media room, read newspapers and books, and play handheld electronic games, reports Finn.
The Obama administration hasn’t yet revealed how it intends to close the Guantanamo prison, and what it plans to do with the 220 or so detainees that remain there.
Two Pakistani Army generals confess a painful truth about the Bush administration’s years of giving billions to Pakistan:
Between 2002 and 2008, while al-Qaida regrouped, only $500 million of the $6.6 billion in American aid actually made it to the Pakistani military, two army generals tell The Associated Press.
Why, who could have forseen that? After all, the Bush administration only paid its ally Pervez Musharraf in untraceable cash transfers. Yes, that’s right: billions in cash. Why would anyone think that money wouldn’t reach its directed targets?
A NEW BALANCE OF POWER: Two cases this term could also completely rework American election law, handing powerful conservative interests unprecedented power to manipulate elections. The first is Citizens United v. FEC, in which the conservative bloc appears poised to overrule a century-old rule permitting laws limiting the influence of corporate money in politics. Should the Court gut this rule, as it is widely expected to do, the health insurance industry will be free to spend billions to defeat lawmakers who support meaningful health reform; the tobacco industry will have free reign to spend limitless sums to elect politicians who will immunize them from accountability under the law; and Wal-Mart will be free to unleash its massive treasury to help elect a Congress which will strangle unions and freeze or eliminate the minimum wage. Also looming is the Court's decision in Free Enterprise Fund v. Public Company Accounting Oversight Board, which concerns the power of Congress to create "independent agencies" whose members cannot be fired at the whim of the president. Should the Court gut Congress' power to create such agencies, the next Karl Rove could pressure the FCC to fine the Rachel Maddow Show while ignoring the antics of Glenn Beck, and he could strongarm the FEC into manipulating elections to benefit a future president's party.
"If Harry Reid does not have the leadership skills to get 60 votes for cloture and give a Democratic president an up-or-down vote on health care, progressives will help defeat him in 2010, even if that means Republicans take that seat," said the head of one progressive organization, who's still working out the detail of the campaign. "There is no use for Reid's vote if 60 Democratic votes means nothing on cloture, and no use for Reid's leadership if his leadership is so blatantly ineffective."
That might not be such a troubling threat if Reid, who's up for re-election in 2010, wasn't suffering at the polls.
That famous infighting of the core McCain campaign versus Sarah Palin is still continuing, with former McCain campaign manager Steve Schmidt openly saying at the Atlantic's "First Draft of History" symposium that it would be "catastrophic" if Palin were to win the Republican nomination in 2012.
Schmidt said: "I think that she has talents, but you know, my honest view is that she would not be a winning candidate for the Republican Party in 2012, and in fact, were she to be the nominee, we could have a catastrophic election result."
It's sure been a long journey for Schmidt, as far as his attitudes on Palin are concerned. The Los Angeles Times reported in October 2008 that Schmidt himself pushed McCain into picking her. After Karl Rove said the pick was a campaign decision, and not a governing decision, Schmidt fired back: "Karl's wrong. She's an exceptional governor, a reform governor in Alaska."
But with the campaign long over -- and Palin's performance regarded as disastrous by everyone except her core fan-base -- Schmidt is sure singing a different tune.
Barack Obama, the US president, has agreed to abide by a 40-year policy of allowing Israel to keep nuclear weapons without opening them to international inspection, according to a US newspaper.In a report on Saturday, The Washington Times quoted three unnamed sources as saying Obama had confirmed to Binyamin Netanyahu, Israel's prime minister, that he would maintain the "don't ask, don't tell" policy.
Breaking news from the change we can believe in front! The Obama administration is opposing Congressional legislation to protect reporters from being jailed for refusing to reveal who disclosed confidential information to them. For national security reasons, of course. As Charlie Savage put it in a story in the New York Times the other day, “The bill includes safeguards that would require prosecutors to exhaust other methods for finding the source of the information before subpoenaing a reporter, and would balance investigators’ interests with ‘the public interest in gathering news and maintaining the free flow of information.’” Obama doesn’t like this. And he’d like judges to be told to be “deferential” to the executive branch when it screams “national security” in such cases.
And, as the inaptly named Jason Ditz reported on Antiwar.com a couple of weeks ago, the administration is seeking the extension of several major provisions of the Patriot Act, including one that would allow the gov to subpoena library and bookstore records, and others that make it easier to wiretap on the executive branch’s whim.
Oh, and given Congressional Democrats’ opposition to sending more troops to Afghanistan, in the pursuit of god knows what, the admin is going to turn to the Republicans for backing. On issues of imperial war and the national security state, Obama 1 is looking more and more like Bush 3.
Thursday, October 1, 2009
Your will is always within your powerNothing truly stops you. Nothing truly holds you back. For your own will is always within your control.Sickness may challenge your body. But are you merely your body? Lameness may impede your legs. But you are not merely your legs. Your will is bigger than your legs.Your will needn't be affected by an incident unless you let it. Remember this with everything that happens to you.