Thursday, September 29, 2011

Wednesday, September 28, 2011

Zuckerberg Rex?

This chart, showing the flow of talent among Silicon Valley heavyweights, is sort of breathtaking.

What you see here is Facebook suctioning up the talent of the entire tech industry. LinkedIn, Microsoft, Google, Apple, and Yahoo are all losing employees to Facebook, and the latter four at a staggering rate.

So what does this mean? Is Zuckerberg going to conquer the world? Does Silicon Valley think Zuckerberg is going to conquer the world?

Probably not. I'm not sure precisely what's causing these trends, but I have a hard time believing it's tech workers migrating to companies with brighter futures. Because look who comes in second: LinkedIn, the red-headed stepchild of the New Tech Boom. I know, I know -- their IPO was a big hit. But what does LinkedIn actually do? It's a poor man's Facebook -- or more accurately, Facebook for the white working class -- an overly sanitized, overly corporatized social network for aspiring professionals and really no one else. It's the middle-management ethos made manifest in a website. There's probably a niche for that, especially in an age where everyone and their brother needs a job, but absolutely nothing about LinkedIn suggests it has the power to entrench itself in the social fabric in the same way that Google or Facebook does, or climb to ever-greater commercial heights the way Apple already has.

Hot companies might be able to entice employees away from Google and Microsoft with some combination of higher wages and tech trendster cred -- Facebook had a movie made about them, after all, and LinkedIn, it's true, has been splashed all over the front page of the Wall Street Journal. But these are second-order indicators of success (just like the chart itself is), and I think they're deceptive. The investors who jumped so eagerly for LinkedIn, and the talent flocking to it -- did they look it up and down and decide the site has huge potential for growth, or did they just think "This company is hot right now, and all these people can't be wrong?"

I know what I think. And I'll just say that some of the bubbles in this chart don't seem big enough.

The best way to understand these companies is and always will be to look at what they produce and how people use that product. Right now, there are a lot of signs people are looking at, and reacting to, something else altogether.

(h/t Ezra Klein)

Tuesday, September 27, 2011

The backlash against the backlash against the backlash against Malcolm Gladwell

I posted a little while back about Malcolm Gladwell's first article on Grantland. Gladwell was basically contending that the public should not sympathize with the NBA owners in the ongoing lockout negotiations. His reasoning was that NBA owners shouldnt expect to make a profit because owning an NBA team is fun. 4:17am favorite Matthew Yglesias agreed with Gladwell. I argued that lots of jobs were fun and that the important issue was that the owners were incorrect in claiming that player's salaries were interfering with their profits. Today Gladwell wrote another article on the NBA lockout. His main point is that:
At the very moment the commissioner of the NBA is holding up the New Jersey Nets as a case study of basketball's impoverishment, the former owner of the team is crowing about 10 percent returns and the new owner is boasting of "explosive" profits.
I think the argument that NBA teams are currently financially sound and that future owners have expectations of "explosive profits" is far better then the "owning a team is fun" argument. So I found it strange when Yglesias positively quoted the Gladwell article and added this:
Especially given that owning an NBA team is fun if you’re a basketball fan, there’s no particular reason to think the Nets or any other team should register operating profits at all.
I get that owning an NBA franchise is probably pretty fun, but so is playing basketball for a living. And that's what the people who the owners are negotiating against do for a living.

Every season, millions of dollars of revenue are collected through TV deals, sponsorships and ticket sales. The negotiations are about who gets to keep that money. They're not about whether the players are having fun playing or the owners are having fun owning.

The owners are wrong because the player salaries are not the cause of the financial troubles the NBA teams currently find themselves in. Not because owning a team is a good time.

Monday, September 26, 2011

Bittorrent is the world's museum

As an apparent sop to Our New Economic Reality, asks its readers "for tips on accessing culture and entertainment on the cheap." For its part, it comes up with clunkers like "Don't be picky," and "Be detail-oriented."

Hey, Slate! I have a better idea than any of yours. Three steps:

1. Learn how to use Bittorrent.
2. Illegally download everything. Books, music, movies, TV shows. You name it.
3. Go buy the stuff you like the most. Spend as much as you can afford but don't sweat it if you can't justify additional purchases. You probably wouldn't have spent the money anyway.

Unlike Slate's plans, mine helps both artists and audiences alike, and doesn't require concessions of quality or convenience in the name of affordability. I mean, think about it:

You get access to, well, pretty much anything you like. The cultural bounty of twenty centuries of human civilization is yours for the taking.

The artists/creators get roughly the same amount of money they would have otherwise. Maybe a little more, if you like a lot of stuff. Plus, since you're selecting from a wider assortment than you could if you prepaid for your culture, your purchasing decisions are better-informed and more likely to help support the stuff you like the best. Meaning more of that stuff will get made.

You'll never see Slate recommending that anyone do this, because it's totally against the law. But tell me: who is worse off for it?

The recession lets employers get away with weird stuff

These days, if you apply for a job, there's a better-than-even chance that the employer is going to check out your credit history. Felix Salmon surveys the evidence against this emerging practice:
There is a lot of reason to believe that using credit reports to judge candidates will lead to unfair outcomes. Consider, for instance, a case the Department of Labor won against Bank of America which revealed that by using credit checks in its application process for entry-level jobs, Bank of America excluded 11.5% of African-American applicants, but only 6.6% of white applicants. Who else might reliance on credit reports work to exclude? Well, the major causes of bad credit are things like divorce, large medical bills, and unemployment. So, maybe divorcees, the uninsured, and the currently jobless?

Now, one might argue that while such a situation is unfortunate, it is nonetheless part of a bigger picture. By judging job candidates on debt-to-income ratio, accounts in collection, foreclosures, bankruptcies, and education and medical debt (all things firms report will make them less likely to hire a candidate), employers are helping to ensure that they wind up with good workers.

The only problem is, there isn’t any evidence that credit is an indicator of how reliable a worker will be, or the likelihood that he will embezzle or otherwise steal. As a lobbyist for TransUnion testified in front of Oregon legislators last year: “At this point we don’t have any research to show any statistical correlation between what’s in somebody’s credit report and their job performance or their likelihood to commit fraud.”
We all know that the recession is putting people out of work, but I think Felix's post gives us a little bit of a window into how the recession can also warp the process of getting a job. Ordinarily, you wouldn't expect firms to turn away qualified applicants, because doing so only shrinks the pool of potential employees and increases the price of labor. In an ordinary economic environment, companies should quickly abandon ineffectual screening mechanisms like credit history checks, because they drive up the cost of finding new employees and provide little or no benefit in return.

Currently, however, we're living in an economy with a surplus of cheap labor. It's a buyer's market, and firms can adopt discriminatory hiring policies without fear of financial consequence. This has a number of pernicious effects. It can lead to the expression of sublimated prejudices (unemployment among blacks has absolutely skyrocketed relative to unemployment among whites). And it can lead to the substitution of arbitrary credit elitism in place of rational hiring practices.

Saturday, September 24, 2011

Batman v. The Man

Over at the Prospect, Jamelle Bouie turned out a pretty great post about Batman yesterday.  He argues that it's better to under the caped crusader as a idealist rather than a crime-obsessed vigilante:
Nolan’s Gotham is ruled by fear and corruption, and the only way to change the situation is deep structural change. But that change can’t come by philanthropy or the actions of well-meaning rich people – as Nolan shows in Begins, those efforts are doomed to failure. Genuine change requires ordinary people to reject their fear, and Batman is there to offer an assist. For Nolan’s Bruce Wayne, Batman is a tool to inspire Gotham’s populace to better things, not an identity. The story of The Dark Knight, in particular, revolves around Bruce Wayne’s attempt to bolster a legitimate crusader – Harvey Dent – and relinquish his role as Batman.
Obviously, with so much history behind the character, there is no “right” depiction of Batman. But for my part, I think Nolan has it best. The “crazy” view of Batman is interesting, but it misses the point. At base, Batman wants to save Gotham from its worst qualities, and that’s only possible if he has purpose beyond simple retribution – an insane or pathological Batman becomes a vigilante in the truest sense, more akin to violent figures like The Punisher or Rorschach than a traditional superhero.
It's worth noting that this is a very progressive conception of Batman, because it depicts Batman as fighting to fix a world that is structurally, rather than morally, broken.  In this view, saving Gotham requires Batman to rearrange the social and political mechanisms that underlie its crime-plagued exterior.  Batman cannot save Gotham by simply making people better, increasing personal responsibility, or putting all the bad guys in jail.  (The movies more or less say this explicitly: in The Dark Knight, the Batman-inspired vigilantes who try to take a stand against crime in Gotham just end up beaten up by Scarecrow and murdered by the Joker.)

Unfortunately, Bouie's post also highlights the great flaw with all superhero narratives.  You have heroes who want to save or redeem society.  That's a desire that resonates with all do-gooders, great and small.  At a high enough level of abstraction, the X-Men and the NAACP are the same organization.  These people are fantastical but their moral imperatives are also recognizable. 

But who, then, are the villains?  Invariably, comic books and superhero movies opt to pit their heroes against some loony criminal or megalomaniacal crackpot.  But the RGA aside, real life doesn't contain powerful individuals or fraternities dedicated to eroding American society for no discernible reason.  There's nothing recognizable about comic-book villains.

It rings false, because on some level, most people realize you can't fix the world by rooting out the bad apples.  And that remains true no matter how bad you make the apples. 

The villains hold comic-book storytelling back.  The villains make the heroes silly.  When Batman tries to inspire Gotham to fight corruption, it works, because he's the fantasy solution to a real-world problem.  When Spider-man tries to save New York from a man dressed as a goblin on a hoverboard, it's just stupid: he's the fantasy solution to a fantasy problem. And the more time movies and comic books spend delving into the minutiae of their villains' origins or abilities or motives, the worse it gets.  The story wanders into something of a narrative blind alley and loses any resonance for anyone not already invested in the characters.  Until someone really bites the bullet and makes a superhero movie without a villain, it's hard to see how they can evolve far past being simple urban fables or superpowered soap operas.

The more successful stories have been able to circumvent this problem to some extent.  Someone like the Joker is more a stand-in for the forces of nature than a bad apple in his own right.  It's still far from perfect, though: the solution is still "catch the bad guy and put him in jail."

(It's worth noting that comic books are much further ahead on this front than movies are.  One of the main themes of Watchmen, for example, is the futility of trying to save the world by beating up criminals.)

I also thought that the Iron Man movies would address this oversight.  The reason that Tony Stark becomes Iron Man in the first place is to atone for his role as a weapons manufacturer.  Not only does this raise some interesting philosophical questions (can Stark prevent wars and violence by building better weapons?  Is Pax Ferrana possble, or desirable?) it also pits Iron Man against socio-structural problems instead of individual villains.  In a sense, Iron Man is up against the economic and social forces that lead to violence, and the network of institutions that facilitate violence.  It would be interesting to see Stark try to solve these problems -- or alternatively, try to knock off a succession of villains and dictators before rejecting the Great Man theory of history and accepting that society-wide ills have roots that reach beyond any set of individuals.  But for some reason, the movies shy away from this, giving Stark plenty of robotic opponents to beat up. We'll probably never get to watch Iron Man campaign against nationalism or bridge sectarian divides.

The Batman movies are surprisingly good at integrating Batman's small-bore problems with Gotham's urban failures.  The arc of the first movie was about whether Gotham could be saved or should be destroyed; Bruce Wayne's dad was a reformer who built infrastructure and tried to revitalize the city.  A disproportionate number of Batman scenes are set in government buildings, judges' chambers, City Hall and the like.  The movies do a fantastic job of reminding the viewer that Batman is a rogue element in a long-standing system, and for much of the running time, the system itself is very much in the foreground.

On the other hand, the Batman movies are nothing if not overloaded with zany villains.  Every movie has included at least two.  And we're moving in the wrong direction: it sounds like the next movie will include even more.  As the focus increases on musclebound super-antagonists like Bane, the institutional disaster that is Gotham necessarily fades out of sight.

In other words, it might be a while before might be a while before anyone gets this right.  We're still getting the wacky cartoon heroes we want, not the heroes we need.

Tragedy of the commons, air travel edition

I'm traveling this weekend, meaning I get a chance to talk about something that has mystified/frustrated me for a long time: the bizarre economics of airplane baggage.

As anyone who has been on a plane in the last ten years has noticed, you can't check bags for free anymore.  The reasons for this change are less than obvious.  They could range from legitimate (too much baggage was driving up fuel costs) to avaricious (more fees!).  Regardless, the result has been both predictable and irritating.  Instead of checking bags, every airline passenger brings the maximum carry-on allowance (one bag and one "personal item" -- which, thanks to the magic of statutory construction, now usually means "another bag") and stows it in the overhead compartment. 

Ultimately, giving away this good (overhead space) for free creates the same problem that giving away any good for free will create (shortages of overhead space).  What's worse is that the suitcase companies have responded in kind, creating special bags that are specially designed to maximize usage of overhead space while still complying with carry-on size regulations.  Consequently, not only is the overhead space used up quickly, overhead space is used to carry the maximum amount of cargo by weight and volume.  

Overuse of the overhead compartments relative to the cargo hold might be a relatively efficient outcome if it were actually preferable to transport luggage in the passenger cabin.  But I can't see why that would be the case.  In fact, the passenger cabin seems like the worst place to transport cargo, because packing it full of bags frustrates tight timetables and poses safety and convenience problems for passengers.  Boarding is more chaotic, debarking is more chaotic, accessing personal items during the flight is more difficult, and so on. 

What's more, if the idea was to reduce fuel costs by reducing weight, the new policies aren't terribly successful in that regard either.  Although there is an incentive for passengers to check less baggage, there is no incentive to reduce carry-on use. 

The whole situation is analogous to attempts to reduce air pollution by placing a hard cap on harmful emissions.  While you might reduce pollution overall, you're also guaranteeing that every factory will lower emissions by whatever amount necessary to get under the cap, and no more.  And any factory (or passenger) who was under the cap to begin with will happily increase their emissions (or luggage volume) until they hit the cap. 

The solution to the luggage problem isn't to create unwieldy regulations, then, but to actually price in the externalities of additional luggage weight.  In other words, airlines should charge a basic fee for a seat, and then extra for each marginal pound a passenger brings aboard.  And when they're boarding, passengers should get to choose whether or not to carry on an item or just to check it through to their destination.  More bags would get checked and overhead space would be reserved for items that passengers actually want with them on the plane. 

Okay, passengers might resist at first.  They'd have to get their luggage weighed at check-in!  It would be annoying.  But in the end, everyone wins -- including the passengers, who could reduce ticket costs by packing light, and whose airfare would no longer include a subsidy for the carry-on bags of the man in seat 21E.

Of course, this raises a second question: what about the other marginal pounds a passenger brings aboard?  In other words, should fat people pay more for air travel?

Friday, September 23, 2011

The administration gets Solyndr0wned. Or not.

I haven't been paying much (any) attention to the Solyndra "scandal," because, well, it's completely stupid.  But Republicans care about silly things, and so it's on the front page of the New York Times.  Still, there are a few passages in the article that really tell you all need to know: 
“[W]e did not just take what this company was telling us,” Mr. LaVera said. “We did the analysis on our own and decided it was a good bet.” 
Turns out, it was a bad bet instead.  Strike one.  
“There was just too much misplaced zeal at the Department of Energy for this company,” Mr. Mehta said. 
Misplaced zeal!  Strike two!

And then there's the smoking gun: 
If there was a single bet made by the Obama administration that would determine the success or failure of its investment in Solyndra, it centered on the global price its competitors pay for one of earth’s most common elements: silicon.  
Wait -- Obama overestimated the rising global cost of silicon?!  Strike three!  Impeach!  Impeach!

Okay, so this isn't exactly Watergate.

Actually, the Solyndra stupidity is just another variant of the exact same tactic Republicans have been using against the stimulus for years -- and against government spending more generally for decades.  The way it works is quite simple.  The government spends a lot of money on a lot of things.  Basic probability dictates that some government money will therefore spent on projects that either (a) don't pan out, (b) are tenuously connected to some sort of indiscretion, or (c) have a silly-sounding name.  When Republicans find item (a), (b), or (c), they then trumpet their discovery to the high heavens, forcing the Times and other respectable outlets to report incessantly on this non-story.  Cue torches and pitchforks.

Better yet, because the government is huge and spends so much money, even a small slice of that spending is going to sound like an awful lot of money to an ordinary person.  So while Solyndra's half-billion loan guarantee is chump change relative to the size of the stimulus more broadly (and while a lot of money given to Solyndra was likely invested in research and personnel and material, serving its purpose regardless of the company's long-term fate), it doesn't matter, because the Solyndra story is aimed for the cheap seats.  And most laymen have absolutely no conception of proportionality or the relative size of numbers or the scope of government activity nationwide, so the idea of a half-billion being somewhat wasted enrages them -- even while we fight trillion-dollar wars and private firms churn tens of billions of dollars into purchasing patents and just an incredible amount of waste goes on all around us. 

The key here would be to have reporters exercise some editorial discretion -- "Hey, maybe this isn't a big deal outside of the fact that the Republican Party wants to make it a big deal, so maybe we shouldn't put it on A1" -- but of course reporters are primarily concerned with not sounding biased, so they refuse to make that call.  Besides, they're probably too innumerate to know the difference anyway.

Wednesday, September 21, 2011

Snob colleges v. slob colleges

According to the NY Times, colleges are placing an increasingly large emphasis on admitting applicants who are able to pay tuition without financial aid, a practice which will surely have no negative effects on social  mobility or the prosperity of the middle class. 

Some of this is likely in response to recession-induced funding shortages, but I'd like to think it also represents a reaction to the ever-rising tide of student loan debt swamping American college grads.  It's hard not to wonder how many lives universities have derailed by suggesting that "It's a lot of money, but with this new degree, you can pay it all back!"

Of course, that leaves colleges stuck between a rock and a hard place.  One on hand, it's irresponsible to encourage cash-strapped students to apply to expensive degree programs.  On the other, it's unconscionable to give the wealthy a shortcut into higher education, while forcing the rest of us to duke it out for limited scholarship funds. 

What's the solution?  I don't know.  (It sure isn't student loan forgiveness.)  I'm drawn to the idea of "flattening" the post-secondary education system, by which I mean changing the emphasis from the creation and promotion of unique and storied institutions to supporting the enormous network of mid-sized local and regional colleges already in place across the country.  With less money riding on national reputation and less time spent in the cultural spotlight, these schools seem better situated to do the hard work of figuring out how to best provide good educations at an acceptable cost.  And they're better candidates for public subsidy, too: the money goes further and their graduates are already somewhat less likely to pay off debt incurred in college.

The snobs and the savants can still have their Yales and Harvards, of course.  But I see no reason that society should model all its post-secondary institutions after a handful of elite universities.  Whatever social value accrues from the obsessive cultivation of somber academic fora, it's more than counteracted by the social cost of pricing the general public out of the ivory tower altogether.

Tuesday, September 20, 2011

People with a high cost of living are getting what they pay for

Matt addresses one of pet peeves today: objectively rich people who absolutely cannot accept the fact that they are rich.  As he says, if you make $200K a year, you're four times better off than the average American.  Even if you "just" make $100K a year, you're twice as well off as the average American.   Seems pretty simple.

But I'm a little disappointed he didn't also address the phenomenon of "people insisting that they’re not 'really' wealthy because alongside their objectively high incomes they also live in expensive houses located in neighborhoods full of expensive restaurants."  It's an argument that comes up all the time among lawyers -- "My 120K starting salary doesn't make me rich because I live in Manhattan/Chicago/D.C., and I can't buy as much as you'd expect because of that."  

The obvious response is that I, along with many other people, would absolutely love to live in Manhattan or Chicago or D.C.  And the thing keeping me out of these cities isn't my literal physical inability to move into them, but the cost of living associated with them.  Rich people living in expensive, desirable neighborhoods are just making the same spending decisions as everyone else -- generally speaking, they've chosen to live in expensive desirable neighborhoods at the cost of maintaining "only" a solidly middle-class level of consumer spending.

The rich might still argue (do argue, in fact) that this isn't fair, because their jobs are often permanently located in high-cost cities, so they don't have the opportunity to opt for consumer spending in lieu of better living situations.  Maybe.  Maybe they don't really want to live in big cities and nice parts of town after all, and have been forced into it by economic pragmatism.  But this claim is easy enough to test.  First, most cities, even expensive cities, do contain a number of neighborhoods, which in turn offer a range of price options.  So if these people are right, we'd expect to find large numbers of high-earners moving into more troubled areas in order to buy bigger houses and nicer cars.  Additionally, if high-earners really are much less concerned about where they live than about how they live, there wouldn't be much practical difference between earning a fortune in NYC and earning a much more modest sum in, say, Minneapolis.  So job candidates would treat high-paying jobs in expensive cities as nearly equal to lower-paying jobs in cheap cities.

But since I don't see any evidence that either of these things is true, I'm going to have to continue assuming that living in expensive neighborhoods doesn't make a person poor -- it makes him wealthy.

Fire this guy already

David Brooks has a unique talent for consistently topping himself.  Just when you think he's written the most awful, inconsistent, condescending, irritating, factually brain-dead, lazily composed, predictable column you've ever seen, he goes and churns out something even worse.  Still, today is special.  Today, he's managed to create something that is substantively so absurd, ideologically so putrid, that if there were any justice on Earth, he would be banished from New York to wander the wastes of Connecticut for the rest of his life.  He would remain barred from polite society forever, forced to glean scraps of news about his long-lost friends and acquaintances from nothing but Times wedding announcements and the journalistic efforts of Arianna Huffington. 

Who could possibly deserve this fate, you ask?  Well, the man who wrote this:
When the president said the unemployed couldn’t wait 14 more months for help and we had to do something right away, I believed him. When administration officials called around saying that the possibility of a double-dip recession was horrifyingly real and that it would be irresponsible not to come up with a package that could pass right away, I believed them. I liked Obama’s payroll tax cut ideas and urged Republicans to play along.
But of course I’m a sap. When the president unveiled the second half of his stimulus it became clear that this package has nothing to do with helping people right away or averting a double dip. This is a campaign marker, not a jobs bill. It recycles ideas that couldn’t get passed even when Democrats controlled Congress. In his remarks Monday the president didn’t try to win Republicans to even some parts of his measures. He repeated the populist cries that fire up liberals but are designed to enrage moderates and conservatives.
So, yeah.  Let me see if I can work through the reasoning.
  1. David Brooks thinks the administration is right that unemployment poses a serious threat to the nation. 
  2. David Brooks thinks the administration's plan to help solve the jobs crisis is good. 
  3. David Brooks also recognizes that there are a lot of people in Congress who want to see these plans fail, people who are not amenable to these plans at all. 
  4. And when Congress then blocks the administration's plans, David Brooks blames the administration.
Look at that incredible, pirouetting leap of logic you've taken, David Brooks.

Yes, that is correct: he actually blames the administration for Republican opposition, solely because the administration said things that were then opposed by the people that oppose everything the administration says.

Just so we're clear on this: if Obama makes a proposal, and you support that proposal, and then other people in Congress oppose that proposal, then blame for the proposal failing lies with the people who opposed it.

Oh, but it gets so much worse.
Yes, I’m a sap. I believed Obama when he said he wanted to move beyond the stale ideological debates that have paralyzed this country. I always believe that Obama is on the verge of breaking out of the conventional categories and embracing one of the many bipartisan reform packages that are floating around.
David Brooks, for your own edification, someone should strap you into a chair and force you to read the paper you write for. Or for that matter -- force you to read your own weekly column.  You "always believe that Obama is on the verge of embracing the bipartisan reform packages that are floating around?" What about... oh, I don't know... the bipartisan reform package he embraced not two months ago? The reform package you yourself lauded him for embracing? The reform package that was subsequently defeated by the same Republican Party you now refuse to criticize?!
I keep thinking he’s a few weeks away from proposing serious tax reform and entitlement reform. But each time he gets close, he rips the football away.
The only explanations I can conjure up for this level of short-term memory loss involve medical conditions.  An August brain aneurysm, maybe. Or early-onset Alzheimers. Do you even remember, in July, writing the following words:
The members of this movement do not accept the logic of compromise, no matter how sweet the terms. If you ask them to raise taxes by an inch in order to cut government by a foot, they will say no. If you ask them to raise taxes by an inch to cut government by a yard, they will still say no.
That's about the Republican refusal to compromise, to be clear. Just going by your own words, David Brooks, the only way Obama has "ripped the football away" is if you define "football" to mean "apparent willingness to totally acquiesce to all Republican demands."  It's incomprehensible that anyone could look at the events of the past year and decide that it's Obama who won't strike a bargain.

But hey, whaddya know, you found a way:
[Obama] talks about fundamental tax reform, but I keep forgetting that he has promised never to raise taxes on people in the bottom 98 percent of the income scale. That means when he talks about raising revenue, which he is right to do, he can’t really talk about anything substantive. He can’t tax gasoline. He can’t tax consumption. He can’t do a comprehensive tax reform. He has to restrict his tax policy changes to the top 2 percent, and to get any real revenue he’s got to hit them in every which way.
So if anybody missed it, read that last bit again.

See what he did there?

According to David Brooks, the reason Obama can't strike a bargain with Republicans is because he refuses to raise taxes high enough.

There are historians: people who examine past trends and try to extrapolate patterns.  Imagine someone who does the exact opposite of that: someone who examines past trends and extrapolates things that are completely false.  That's what David Brooks does.  He is literally an ahistorian.

Here is one small smidgen of evidence that our friend at the Times could have considered: follow this link in order to  get to a little thing called the "Taxpayer Protection Pledge."  It was created by Grover Norquist's Americans for Tax Reform.  It reads: "I will oppose any and all efforts to increase the marginal income tax rates for individuals and/or businesses."  It has been signed by two-hundred and sixteen House Republicans.

That's two votes shy of a voting majority in the House.

But of course, it's Obama's fault we can't raise taxes.  It's because he abandoned centrism, and compromise.


David Brooks, it's technically possible that you're stupid and petty enough to have written this column in good faith.  (I mean, let's be honest here: I'm going to think you're stupid and petty either way.)  But I don't believe you really think this. It's too perfect.  Obama can't strike a deal because he doesn't want to raise taxes high enough?  Obama is the Lucy to the Republicans' Charlie Brown?  It's like you've gone out of your way to say things that the are the inverse of true.  Things that are not only wrong, but remarkably, outstandingly wrong. 

No, there's got to be some other explanation.

So maybe you have an extremely well-developed sense of irony.  Maybe this is all some elaborate charade designed to show how hip and meta and self-aware you are. 

But maybe, you're just ludicrously clinging to whoever you believe is on the upswing in D.C.  You're less concerned with picking the right side than you are with picking winners -- especially if the winner will wine and dine you in the White House one day.  And right now, you don't see any upside in standing behind Obama anymore.  So you criticize him for believing what you claim to believe and leave Republicans unscathed for believing things you claim to oppose.

You're worse than a sellout.  You don't even need to be bought.  When Rick Perry and the Tea Partiers come to D.C., there you'll be, riding in their wake.   I'm sure you're just hoping that they're as willing to forget the things you've written as you've proven to be. 

Monday, September 19, 2011

And the cycle begins anew [Updated]

The Obama administration released a fresh deficit plan today.  That shouldn't be news, because it also had a deficit plan in March, and August, and we've been through this whole rigmarole before, and everyone knows that the administration's plans will necessarily include tax hikes and therefore cannot pass, and etc. etc.  But nonetheless it's emblazoned across the top of the New York Times website, so let's take a look, shall we?

The New York Times article is less than clear, but it looks like a top-line figure of $4.5 trillion.  About $1.1 trillion of that comes from dialing back the wars in Iraq and Afghanistan.  Another $500 billion or so are from entitlement cuts -- mostly Medicare.  No changes to the eligibility age, thankfully.  The article also mentions $1.5 trillion in tax increases.  This leaves a whopping $1.5 trillion unaccounted for.  One has to assume that comes out of discretionary spending.  To that, I say this: urrrggghhhhhhhh.  Squeezing milk from a stone, and all that.  At some point, "discretionary spending cuts" translate into "Oh, you liked having national parks?  Too bad."

Anyway, my verdict: the $3 trillion in savings that's reported isn't that bad.  The missing $1.5 trillion is sort of scary, though.

On the other hand, it's possible the New York Times is just screwing up its numbers.  Because you'll note that 1.5 trillion plus 1.1 trillion plus 500 billion equals 3 trillion, and the paper's top headline reads "Obama Plan Includes 3 Trillion in Spending Cuts."  It would be odd to lead with anything but the top-line figure, so it's possible that the paper's headline writers have just bought wholly into the Republican framing of the deficit issue, and are using "deficit reduction" and "spending cuts" as synonyms.

Update: Holy cow, I was right about the second bit.  The total figure really is $3 trillion.  J-school strikes again!  Math: who needs it?

Anyway, the more important takeaway is that the Obama administration has totally given up on trying to appease Republicans, because this plan is something like 3-1 in favor of tax increases. (After you exclude the savings from ending the wars, anyway. Which is the only fair way of doing it.)

Sunday, September 18, 2011

The oil constituency

In the latest iteration of his Let's Play Make-Believe President routine, Boehner gave a jobs speech too! And it contained this gem:
"I’m not opposed to responsible spending to repair and improve infrastructure. But if we want to do it in a way that truly supports long-term economic growth and job creation, let’s link the next highway bill to an expansion of American-made energy production. Removing some of the unnecessary government barriers that prevent our country from utilizing its vast energy resources could create millions of new jobs."
Whoa, what? No, I don't think it would. Like, first of all, how long would this take? Millions of new jobs over the next three years are nice. Millions of new jobs over the next ten years -- not so much. But locating oil and coal reserves and building rigs and training workers and mining and drilling: this all takes time. Obama might have gotten a lot of guff for talking about "shovel-ready" projects back in 2009, but there's a reason it's important that stimulus projects not be long-term ventures requiring years of prep work. Besides, the amount of economic benefit that could be derived from increased exploitation of energy resources is limited by the amount of energy resources actually available in the United States. Republicans are congenitally incapable of remembering this, but that's not a very large amount. Seriously, I'm not just making this up.  The strangest part of the Republican position on oil use is that it's entirely dependent on us living in a fictional version of the United States where vast, undiscovered, untapped oil reserves lie underneath all our most beautiful wildlife preserves .  

Still, Boehner isn't saying anything that every other Republican hasn't already said by now. Which brings me to my second point: what is the deal with the bizarre GOP fetish for fossil fuel production?  It requires such a total dismissal of so many scientifically verifiable facts, about climate change and health consequences and limited oil reserves.  The more specific the proposals get, the harder it is to believe that anyone honestly supports them as a matter of national economic policy.  I can at least sort of understand why, if you're a kind of dim bulb who ignores climate science, you might inclined to cheerlead, say, the use of tar sands.  But who on earth thinks the solution to the recession is to install drilling rigs off of Cape Hatteras?  And yet so many GOP policy proposals tilt towards the latter.  Why?  What's the constituency for this? 

On my good days, I assume it's "crotchety old white guys who would cut off their nose to spite a liberal's face."  On my bad days, I assume it's just Exxon-Mobil executives. 

Wednesday, September 14, 2011

That guy

Matt Yglesias may be the patron saint of 4:17 AM, but it sounds like he's also kind of obnoxious to hang out with:
[If you want to advance progressive causes] be personally annoying about your political views when they’re relevant to your interactions in everyday life. I, being a jerk, will absolutely not allow someone to make a remark about the high prices, crowding, and mediocrity of DC bars without subjecting them to a discourse about the DC liquor licensing regime.
I think Matt's trying to be funny and self-aware when he references his own jerkiness, but no, that actually sounds seriously annoying. We've all been there: you're at the bar, it's Friday night, you want to hang out and have a beer and make funny jokes, but no, "that guy" is there, and "that guy" wants to talk about licensing laws/strict constructionism/trademark law/monetary policy. Everyone just wants him to go away or shut up or chill out or something, but he won't. He's got an opinion, by god, and you're going to hear it.

The dilemma posed by "that guy" might seem minor and personal, but it does raise a broader question for politicized individuals of all stripes: how does someone import his politics into his social life without actually destroying his social life? Nobody likes having other people's opinions rubbed in their face. So how do you make your ideas known and understood without also making friends and acquaintances feel like they're under attack?

Now, obviously, this isn't a problem for me, because all my friends read this blog (a statement necessarily true because its contrapositive is true: if you don't read this blog, you're not my friend). But most people don't write a blog. They don't have access to public forums. They don't go to class. And they'd prefer to spend their free time having pleasant social interactions and not giving lectures on licensing regimes. So how do these people balance the competing interests of "spreading their political values" and "not acting like a tool"?

Facebook gets us halfway there, because Facebook lets us have political debates in full view of our acquaintances without actually engaging our acquaintances in said debate. Everyone knows that debates in Facebook aren't actually about convincing the other side; they're about convincing the onlookers. But even on Facebook, aggressive political proselytization will eventually backfire. Carry it too far, and suddenly you're "that guy on Facebook," the one who will step in to unrelated threads to correct the slightest ideological heresy with 48 carefully written replies. You can, of course, be courteous in your disagreement, but it doesn't really help: the only thing worse than being endlessly opinionated is being endlessly opinionated and dull.

Small wonder, then, that most people prefer to remain outwardly agnostic about politics. On the individual level, the cost-benefit analysis unmistakably favors the taciturn: it isn't worth burning social bridges to promote some sort of nebulous national political agenda. But that's a problem for national political agendas, particularly the ones that have the advantage of being demonstrably correct. The faithful don't want to go out and convert the unconvinced, so everyone just bounces around discovering ideas on their own. Or more often, not.

Tuesday, September 13, 2011

This happened

Just a reminder.

Turns out even Ron Paul supports universal health care

The video above contains a pretty fascinating exchange from the debate tonight. It starts off with Wolf Blitzer posing a hypothetical to Ron Paul: Imagine a healthy young man who chooses not to buy health insurance, for reasons other than cost. Imagine that man falls into a coma. Who should pay for the life support?

As you'd expect, Ron Paul doesn't think it ought to be the government. That's the problem with socialism and "welfarism," he says. "He should do whatever he wants to do. My advice to him is to have a major medical policy, but... That's what freedom is all about, taking your own risks."

Then Blitzer pushes back: "Should we just let him die?"

Some of the audience cheers, creepily enough. But Paul can't find it in himself to say yes. "No, no no," he says instead. "I practiced medicine before we had Medicaid... the churches took care of them. We never turned anybody away."

"We've given up on this whole concept that we might take care of ourselves, true responsibility for ourselves... our neighbors, our friends, our churches will do it."

Let me take that a step further for Dr. Paul. Let's imagine that, in order to make the process of taking responsibility easier and more efficient, we, our neighbors, and our friends all pay into a fund. That fund then goes towards paying for the medical care of uninsured members of the community. You know, this is starting to sound sort of familiar.

If I'm not mistaken, Ron Paul just described the ideological basis of a system of universal health care. We don't just take care of ourselves, but also our communities. We take responsibility for us and them. And there's no "freedom to choose" about it. If you never turn anyone who needs health care away -- as he claims he never did -- nobody has taken any risks. They've just made a decision about who pays for any health care they eventually need: they themselves, or their neighbors.

Philosophically, here's no real daylight between between this and the PPACA, except the latter is large enough to utilize economies of scale.

And this exchange is precisely why, over a long enough time horizon, universal health care is a virtual inevitability in developed states. When push comes to shove, even dyed-in-the-wool libertarians like Ron Paul are unwilling to let platitudes about personal responsibility lead to pointless loss of life. And once you've agreed that failure to pay insurance premiums shouldn't amount to a randomly administered death sentence, the realities of risk pooling and cost control push inexorably towards a state-run system.

Monday, September 12, 2011

Obama can't win with progressives

Obama really wants this jobs bill, doesn't he? During lunch today, I was watching him on CNN, giving what was by all appearances (the volume was off) a fiery speech which the network had captioned "No politics, no delays." I'm not usually one to pay much attention to the day-to-day grind of presidential speechmaking, but even to me there seems to be an uncommon urgency to Obama's latest policy drive.

You'd think progressives would be happy about this, and so far they mostly are. But I'm convinced that, as far as the left is concerned, this jobs push is actually a bit of a trap for Obama (when it comes to the left, most things are).

Think about it:

If Obama stops campaigning too soon, they'll blame him for not trying hard enough.

If he tries and succeeds, they'll blame him for not trying earlier.

In fact, the only way to win the left's approval would be to try and fail, vindicating himself and his earlier decisions.

I don't know what that says about Obama, but it sure says something about the left. Now, true, I too think that Obama should have pushed for a jobs bill sooner (although I'm convinced that the power of the bully pulpit is less than generally believed, and that this barnstorming session, like all attempts to create policy with applied rhetoric, will end mostly in failure). But I understand the political rationale for not wanting to pick fights that can't be won.

The left, though, has a bit of a mania for lost causes. So much of it would prefer its leaders be mostly uncompromising instead of mostly successful. It's not really, surprising, then, that once again the only way Obama can unambiguously win with the left is to lose on the substance.

Saturday, September 10, 2011

On weirdly resilient entitlement myths

My recently-completed financial management class was the source of many frustrations for me, but nothing quite as bad as the day when we talked about the US deficit. My professor started out by forcing the whole class to look at one of those awful deficit-tracking sites (see, e.g., These sites are essentially libertarian propaganda in the guise of a public service. Without some context (i.e., education on macroeconomic policy), a large red number labeled "US public debt" does very, very little to teach anybody anything, beyond eliciting the simple observation that "Gee whiz, that's a really big number." Even worse are the ones that update in real time -- "In the time it took you to read this, the US government spent four million dollars" frightens a lot more than it informs. Worse still, there's always a whiff of anti-fiat goldbuggery about them. It's the sort of thing people paint on signs and hold up at Ron Paul rallies.

Or teach in financial management, apparently.

After letting us stare at these sites for a while ("That's a really big number," one of my peers helpfully contributed), my professor made a little joke. "So, do you guys think you'll have Social Security?" And everyone laughed knowingly.

Okay, here's the thing about Social Security that you may not realize. It's not going under. It's not unsustainable. It's not out of control. It's facing one well-understood, medium-term challenge: the change in population demographics that accompanies the aging of the baby boomers. Look, Ezra Klein explains it very well:
Over the next 75 years, Social Security’s shortfall is equal to about 0.7 percent of GDP (pdf). If we increase its revenues by that amount -- which could be accomplished by lifting the cap on payroll taxes -- or reduce its benefits by that amount or do some combination of the two, Social Security is back in the black...

Why does Social Security show a shortfall? As Stephen C. Goss, the system’s chief actuary, has written, Social Security projects an imbalance “because birth rates dropped from three to two children per woman.” That means there are relatively fewer young people paying for the old people. “Importantly,” Goss continues, “this shortfall is basically stable after 2035.” In other words, we only have to fix Social Security once. After we reform it to take account of modern demographics, the system is set for the foreseeable future.
Despite the fairly incontrovertible truth of this assessment of the program's finances, Social Security remains hounded by the insidious myth that it's going broke. Its fictitious struggles have passed from political cliche into the popular consciousness. Like the incident in my financial management class demonstrates, everybody "knows" that Social Security is doomed, in spite of the simple fact that it isn't.

Some of the persistent public ignorance about Social Security's sustainability can surely be explained by the Republican Party's campaign against the entitlement. The GOP has a vested interest in conjuring up as a frightening picture of Social Security as possible. "Talk about it being a “monstrous lie” or “a Ponzi scheme” or “broken” is meant to create a crisis to clear the way for radical changes in Social Security." (Klein, again.)

But this myth has taken root in a way that most Republican talking points haven't. Almost everyone across the political spectrum thinks Social Security is in dire shape. I have no idea why this is. I'd say that it's a reflection of a general modern cynicism about the future, but Medicare -- which actually is on track to implode if it's not reformed somehow -- doesn't attract nearly the same level of popular pessimism.

Anyway, this is precisely the kind of misconception you'd expect a public policy professor to understand and correct. Instead, we're teaching it to our future bureaucrats. So I guess it's going to stick around for a while.

Bigger Countries Don't Necessarily Work Better

Will posted a few days ago about the advantages of having a bigger country. I think he makes a couple of big mistakes in his analysis.

His main point seems to be that citizens approve or disapprove of their leaders based on the current economic condition of their country (True). He says that a lot of the time the economic conditions of a country are affected by something unrelated to the actions taken by a country's leaders (Also, true). He says this is a bad thing for governance (Also, true). He says that a smaller country is more likely to be impacted economically by outside events (maybe, true). Therefore, bigger countries are better (logically true, but misses a bigger point).

I grew up in Canada a country that has about 1/10th the population and 1/10th the GDP of the United States. Sometimes the economy goes bad in Canada. We Canadians are a simple folk, we like to play hockey and eat fiddleheads. However, we are astute enough to notice that when the economy isnt going well in Canada, it usually isn't going well for our neighbors to the south. This at first struck us as a strange coincidence, why do our economic conditions so clearly mirror those of the US? We at first thought that the US was copying us, but that idea was quickly scrapped. After a while we began to realize that because the US was so big and our economies were so interconnected, things that happened in the US would affect us in a pretty big way. As a result every time the housing bubble bursts in the US we don't take our hockey sticks and run John Diefenbaker or whoever the prime minister is out of Ottawa. Here is a list of our recent Prime Ministers and their tenure:

Steven Harper: 2006-Current (Conservative)
Paul Martin: 2003-2006 (Liberal)
Jean Chretian: 1993-2003 (Liberal)
Kim Campbell 1993-1993 (Conservative)*
Brian Mulroney 1984-1993 (Conservative)

*Kim Campbell was designated Prime Minister when Mulroney retired and then lost the election

What you see is a series of about 10 year terms that alternate. Obviously the party gains and loses seats and some of the time they don't have a majority of parliament, but you don't see the sort of Banana Republicanism that Will has predicted. This seems to be the case in most small democratic countries. I think this reflects an electorate that understands that with an economy so linked to the US, there is only so much a Prime Minister can do. I find Americans on the other hand are still having a tough time grasping the fact that Chinese policy actually affects the US. The size of their country may prevent them from seeing the impact of other countries. (Note: i'm not totally sure if this is true but seems just as plausible as Will's suggestion)

I have more thoughts on whether a bigger country is better more generally that I will save for a later post. However, Will's point about more things randomly affecting smaller countries, and they therefore will vote irrationally more often, so bigger countries are better, does not seem to be correct.

Friday, September 9, 2011

We live in uncertain times (and places)

This is a smart Yglesias post*, but it overstates its case. Short version:
  1. Republicans are right, regulatory uncertainty is a damper on economic growth.

  2. But the actions of future legislators are always uncertain.

  3. As is the future more generally.

  4. So there's not much that can be done about regulatory uncertainty, short of developing reliable methods of predicting the future.
He's mostly right, I'd say. It's awfully difficult to untangle the ill-defined "regulatory uncertainty" that inhabits Republican stump speeches from plain ol' metaphysical doubt about the future. And precisely because "uncertainty" is so nebulous and so deeply ingrained in the human experience, it's an easy target for Republicans. Since Obama can't control the very flow of time itself, he'll always be vulnerable to charges that he's not protecting the economy from uncertainty.

Still, Matt's point is also very obviously overbroad. All investment environments are not made equal. Some are more stable and predictable than others. One of the thing that impacts stability and predictability is governance and public policy. And ideally, we'd opt for public policy that minimizes economic friction.

The difference between what I'm saying and what Rick Perry is saying, I think, is scale. Republicans would have you believe that all this plays out on a microscopic level: that business is afraid of specific, potentially onerous proposals put forward by the Obama administration. That argument is easily refuted: all you have to do is point to the total paucity of concrete, realistic proposals to impose any sort of sweeping regulation on most sectors of the economy. On an individual, firm-by-firm level, there's simply no reason for business to fear Democrats.

But even in lieu of a specific, identifiable regulatory threat, businesses might also be unnerved by the prospect of unpredictable shifts in the style and direction of governance. Shifts that would necessarily redraw the administrative environment. And looking at the current state of American democracy, it's rather difficult for me to think that this variety of regulatory uncertainty isn't afflicting the private sector.

The thing is, while it can certainly be remedied, macro-level regulatory uncertainty has nothing to do with Democrats or Republicans. It's a manifestation of structural weaknesses in the American political system, which reacts chaotically to external and internal pressures. Regulatory outcomes are the product of legislative, administrative, and judicial minutiae and can be dramatically altered by seemingly insignificant events. Of course there's regulatory uncertainty when the political inputs have so little effect on the statutory outputs. The solution to this problem isn't to promise to make government do less -- futile, in the long run -- it's to rebuild the system so that it's clear what government will do and when it will do it.

* "But Will," you might say, "don't you think every Yglesias post is smart?" And to that I would have no answer.

Wednesday, September 7, 2011

Bigger countries work better

Hey, the stock market went up today! That doesn't seem to have happened in a while.

Ostensibly this strange phenomenon is because there are a handful of signs that Europe is finally getting it together. Far be it from me to give an opinion about whether Europe is actually getting it together -- I'm no expert, but I'll note that the optimists have always been wrong before -- but the markets, at least, seems mildly relieved by something that occurred somewhere in the world, which has to be a nice change of pace for the markets.

It does make you wonder how much of the US economy's dismal performance has been the result of Europe dragging everyone else down. It's not like the US economy is exactly going like gangbusters right now, but there were a couple of years of mildly encouraging signs before this summer, when everyone seems to have collectively looked down, and noticed that they were running on thin air, a la Wile E. Coyote.

What this news does do for me is help vindicate my general preference for big governmental units over small governmental units. (Think the EU vs. Greece, or the United States vs. New Hampshire, or the coming One World Government vs. your antiquated and pedestrian conceptions of nations with borders and identity.) That's because Europe finally getting it together, and the US economy improving as a result, would be great news for Barack Obama's reelection campaign, which, as a demonstration of democratic accountability, doesn't make any sense at all. After all, what can Barack Obama do about Europe? Unfortunately for Obama and elected representatives everywhere, voters aren't smart or astute enough to separate Things Their Leaders Can Change from Things Their Leaders Have No Control Over. It's the same story in every country: if the economy sucks, the guys in charge will probably get the hatchet. You have perfectly capable leaders getting booted out of office in favor of their (potentially) less capable opponents for no particular reason at all. All in all, this isn't exactly a recipe for a sustainable or sensible system of government.

Some of this is inevitable, I suppose. ("Meteor Collides with Earth, Obama's Approval Rating Falls.") But some of it can be avoided by giving elected leaders the ability to actually influence the events that determine whether or not they get to stay elected leaders. If, on the other hand, power is concentrated in smaller, weaker political units, leaders can't control their destiny (and knowing that, might have less incentive to take proactive action to fix problems). Some people think that smaller government means that elected leaders are more vulnerable to public opinion. But that's not the only thing they're more vulnerable too: they're also left more at the mercy of pure, random chance. So for democracy's sake, let's have big countries.

Sunday, September 4, 2011

NYT columnist: "If you love humanitarian intervention so much, why don't you invade Russia?"

In the New York Times today, Steven Erlanger writes an awful editorial about "the lessons of Libya." It's a ponderous piece: most of the "lessons" belong in a remedial-level current affairs course, not on the front page of Times. (Among his observations: the war in Afghanistan is going badly! Many European citizens are skeptical about its feasibility! Some European nations are pretty broke! Sometimes, intranational political concerns frustrate international coalitions!) But what really stuck out for me was his completely botched assault on the rationale for Libyan intervention.
But oh what a war! More than six budget-busting months against one of the weakest militaries in the world, with shortages of planes, weapons and ammunition that were patched over by the pretense that NATO was acting simply to “protect civilians,” when it was clear to everyone that the alliance was intervening on one side of a civil war. All resemblances to the Kosovo war, of course, are a priori inadmissible. That was the war — 78 days of bombing Serbia and thousands dead before Slobodan Milosevic finally capitulated — when NATO said: “Such a success, never again!” Yet here we are — with the “responsibility to protect” the new mantra, replacing Kosovo’s “humanitarian intervention.” Both are debatable, given the failure to intervene in the separatist Russian republic of Chechnya then and Syria, Bahrain or Yemen now.
Dear Steven Erlanger: if the choice to protect Libyans from Qaddafi but not to protect Chechens from Russia seems arbitrary to you, it's not because NATO's mission is muddled. It's because you're being thick-headed.

I don't ask that all foreign policy analysts become pragmatists, but some small smidgen of pragmatism should be a prerequisite before writing an editorial like this. A worldview in which we cannot practice humanitarian intervention without also invading Russia, Syria, Bahrain, and Yemen isn't much use to anybody at all.

What's remarkable is how, just half a page later, he says this:
The question, however, is whether European members of NATO will ever decide to embark on such an adventure again.
Indeed, that would be an interesting question, if you hadn't just told us that NATO members resolved to abandon humanitarian intervention after Kosovo. If I didn't know better, I'd say that it's hard to predict whether future wars will be fought, because each potential war is the result of a cost-benefit analysis that is uniquely applicable to the situation at hand.

Libya has proven a remarkable litmus test for foreign policy thinkers. On one side, you have people like Erlanger, who seem to understand the decision to commit military resources as a manifestation of a set of abstract principles, defined in advance and applied evenly to every circumstance. To them, the Libyan war is aberration that speaks to the hollowness of our foreign policy pursuits. On the other side, there are people who looked at Libya and saw a dictator who had started a war with his own people and was days away from slaughtering hundreds of thousands of them. They knew Libya was a tiny country with a weak military and they thought, "Maybe we can do something about this."

Military intervention in Libya was desirable precisely because the objective was so eminently achievable and so few other options remained. Some would have you believe that going to war on this basis is arbitrary, unfair, or even immoral. But why? The alternatives, as Erlanger's editorial demonstrates, are either doing nothing while preventable atrocities unfold, or launching ourselves headlong into hopeless wars that will leave almost everyone worse off for the effort.

The electoral college isn't real great for democracy

This little note from Ezra Klein's blog caught my eye:
Is the electoral college biased towards the Republicans or the Democrats? Brian Gaines and Neil Thomas Bear tried to take a rigorous look at this and basically found that there have been so few elections in which the electoral college was even close to mattering that it was almost impossible to tell. Democrats, they said, clearly think the electoral college hurts them -- the National Popular Vote initiative, which would undermine the electoral college, has had very little luck in Republican states and quite a bit of luck in Democratic states -- but that might just be because the 2000 election looms so large in their minds.
It seems pretty clear that the electoral college can ultimately benefit both Republicans and Democrats, in different years. A rationally managed political party should structure its platform and candidates so that it wins the maximum number of votes in any given election. When you have two such parties pitted against one another, they should split election victories more or less evenly. That is to say, Republicans adopt positions that appeal to roughly half the electorate and Democrats should adopt positions that appeal to roughly half the electorate.

The problem with the electoral college isn't that it benefits one party more than the other. The problem is that it forces the parties to change their platforms in order to maximize their chances of winning elections. For example: in a world without the electoral college, Democrats might be sufficiently competitive running on a platform that appealed primarily or exclusively to urban dwellers. But with it, they're forced to adopt positions that allow them to compete in rural areas as well. This sort of incentive wouldn't register as a "disadvantage" for the Democrats, but it's still deplorable for anyone who would prefer to see Congress represent the interests of as many people as possible.

Friday, September 2, 2011

Another month, another lousy jobs report

Wow, what an awful job report today. No net gain in jobs. Zero. Zilch.

Two things to note:
  • I sound like a broken record at this point, but this is every bit as much a political crisis as it is an economic crisis. Look, even if you don't agree with me about what the government should do to foster job growth, you probably think there's something the government can do to foster job growth. Even if, in your case, "something" means "close its doors and strike all regulations." But no proactive action is being taken at all, in either direction. Congress is fiddling while the economy burns. It doesn't really have a choice, because both sides are perfectly capable of blocking the other and will do so until the end of time. It's total paralysis, born not out of political irresponsibility (but it helps! I'm talking to you, Eric Cantor!), but out of institutional design. We've known this was coming for a while, and now, it's here.
  • Which is not to say that neither side is getting what it wants. The endless recession is the greatest boon small-government conservatives could have asked for. It's accomplishing what twenty years of ideological warfare could not: a sustained and dramatic reduction in the size of government. The results, predictably, have been dismal. As Yglesias points out, if conservatives were to be believed, the slow erosion of government would lead to an explosion of private sector opportunity. But it turns out conservatives are dead wrong about this, like most everything else. So the Republican-led cuts in government just mean that depressed job figures get even worse. This month, the decline in government jobs actually canceled out private sector job growth altogether. But you know, arg blargh crowding out and regulatory uncertainty and all that. You really nailed it, guys.

Thursday, September 1, 2011

Michele Bachmann's oil production plan may be bogus, but that's bad news for everyone

Over at the Washington Post, Brad Plumer points out that domestic oil production has skyrocketed in the last few years, even while gas prices have risen. Then he uses this fact to score political points against Michele Bachmann, who is currently campaigning on a promise to lower prices by increasing domestic fuel production.

That's fair enough -- I would never begrudge someone the opportunity to score political points against dumb Republican presidential candidates! -- but the dynamic Plumer is highlighting has implications beyond Michele Bachmann. It also demonstrates just how little control domestic policymakers have over oil prices. Increase domestic production, decrease domestic production, it doesn't matter. The price of gas doesn't really respond to domestic policy.

Plumer says, "It’s almost as if additional U.S. oil production is too small in the global scheme of things to affect prices at the pump in any sizeable way." What he doesn't say is that, "in the global scheme of things," increases in the cost of oil are inexorable. We've used a lot of the oil we know how to reach, and rapid development in nations like China means energy demands will climb ever higher.

These are facts that should keep any politician (or aspiring politician) up at night. Voters care a lot about gas prices, and know immediately when the price rises. Many voters are convinced that politicians have some influence over gas prices. Many voters will punish politicians if prices rise too high. Politicians do not, in fact, have any real control over gas prices. And gas prices are going to go up, and up, and up, and there's nothing Michele Bachmann or Barack Obama or anyone else can do about it.

The solution, obviously, is to promote energy efficiency and alternative energy sources, ultimately reducing the correlation between gas prices and voter dissatisfaction. Instead, Republicans have, if anything, strengthened that correlation, by promising dramatic action to lower prices. It's a promise that will come back to bite them eventually, of course: they've taken it upon themselves to fix a problem over which they have no agency. But in the meantime, politicians of all stripes will face undeserved scorn.