Credibility problems

by Henry Farrell on August 11, 2006

Matt Yglesias announces the institution of “Krauthammer Friday”:

bq. Charles Krauthammer’s columns are published on Fridays. Thus, I hereby proclaim a new recurring feature — the second Friday of every month, we’ll revisit the man’s January 18, 2006 column, “The Iran Charade, Part II” in which he confidently proclaimed — contrary to the judgment of every relevant intelligence agency — that “Iran is probably just months away” from a nuclear bomb.

But even better, to my mind, was Krauthammer’s confident judgement on Iraq WMDs back in “April 2003”:,eventID.274/transcript.asp.

bq. Hans Blix had five months to find weapons. He found nothing. We’ve had five weeks. Come back to me in five months. If we haven’t found any, we will have a credibility problem.


Capitalism and the poor

by Matt_Bishop on August 11, 2006

The best recent books about capitalism and the circumstances in which it helps poorer people escape their poverty are Hernando de Soto’s “Mystery of Capital” and Rajan and Zingales’ “Saving Capitalism from the Capitalists”. I met with Fred Mishkin yesterday, who has convinced me that his new book – ” The Next Great Globalization: How Disadvantaged Nations Can Harness Their Financial Systems to Get Rich”
will be a worthy complement to these two.

Certainly, I suspect it will be a lot more insightful than the other globalisation book about to appear, Joseph Stiglitz’s “Making globalisation work”, the follow up to his anti-World Bank rant, “Globalisation and its Discontents”.

What I most like about de Soto’s work is its emphasis on the legal system, and the importance of it being accessible to the poor and supportive of their de facto property rights. The great strength of “Saving Capitalism from the Capitalists” – a book that deserves to be much more widely read – is its focus on the problems that flow from the existence of an entrenched elite that writes the rules of capitalism to secure its own position, rather than to allow the bulk of the population to participate fully.

Mishkin, who says he will not be allowed to give interviews about his book under impressively strict conflict of interest rules once he becomes a governor of the Federal Reserve in a few weeks, takes the story one step further, arguing that opening a country up to international capital markets in the right way is crucial to growth. As he notes, so many countries have botched the process of joining the world financial system that many are tempted to conclude it is better not to try – Argentina being a recent example. But, says Mishkin, rightly I think, doing so sentences them to remaining a poor, low growth economy.

That is, above all, because to successfully open up to international financial markets, a country has to develop the right domestic institutions, including rule of law, central banks and good governance.

Mishkin is particularly worried about Latin America, where he fears a serious reversal of the process of building sound institutions. The outcome of the current Mexican stand-off may be particularly important – not because Calderon, the declared winner of the Presidential contest, is necessarily the better candidate (his closeness to powerful business interests may limit his capacity to be a reformer) but because if the loser, Lopez Obrador, succeeds through public protests in overturning the result, that would deal a death blow to the election commission, the establishment of which was a huge step forward for institution building in Mexico, a country not hitherto known for its strong independent institutions. Here’s hoping the election commission stands firm.

Flights of fancy

by Matt_Bishop on August 11, 2006

On reflection, maybe the ban on carry on luggage won’t be so bad: without a pc, let alone a phone, there need be no guilt about watching some movies on the seat-back video instead of working. My colleague who writes inflammatory editorials arguing for segmenting families with kids from other passengers, or charging higher prices for kids, because of the externalities they impose, will no doubt be delighted at the thought that a ban on baby food will deter more families from flying.

Another friend thinks the logical conclusion is to fly naked – but then he was a fan of the now-grounded Hooters Air. The reality would be less delightful than he imagines, I suspect, given the unbuff bodies that most of us would get to expose to our fellow fliers. On the other hand, I noticed during a previous flight in “a tad above steerage” that BA provides First Class passengers with a delightful pair of blue pyjamas. Perhaps this generosity could be extended to all classes, and terminals transformed into giant changing rooms?

Ellery Eells is dead

by Harry on August 11, 2006

My colleague Ellery Eells died this week. His health had been deteriorating for some time, and last Friday he slipped into a coma from which he did not recover.

When I came to Madison I knew Ellery’s work just well enough to be entirely intimidated by it — the combination of technical complexity with real philosophical depth was unnerving. But as a person he was whatever the reverse is of intimidating: kind, gentle, and shy. A sad loss for my department and for the profession, but most of all our hearts go out to his wife, Joanne, and his children.

Quality arguments

by Henry Farrell on August 11, 2006

“Tyler Cowen”: at _Marginal Revolution_ today.

bq. The libertarian vice is to assume that the quality of government is fixed. … If the quality of government is fixed, the battle is then “government vs. market.” Not everyone will agree with libertarian views, but libertarians are comfortable on this terrain. … But sometimes governments do a pretty good job, even if you like me are generally skeptical of government. The Finnish government has supported superb architecture. The Swedes have made a good go at a welfare state. The Interstate Highway System in the U.S. was a high-return investment. … The libertarian approach treats government vs. market as the central question. Another approach, promoted by many liberals, tries to improve the quality of government. This endeavor does not seem more utopian than most libertarian proposals. The libertarian cannot reject it on the grounds of excess utopianism, even though much government will remain wasteful, stupid, and venal. More parts of government could in fact be much better, and to significant human benefit and yes that includes more human liberty in the libertarian sense of the word. Libertarians will admit this. But it does not play a significant role in their emotional framing of the world or in their allocation of emotional energies. They will insist, correctly, that we do not always wish to make government more efficient. Then they retreat to a mental model where the quality of government is fixed and we compare government to market.

When reading this post, it’s hard not to think of Albert Hirschman’s brilliant little book, _Exit, Voice and Loyalty_. Hirschman’s theoretical innovation is precisely to assume that quality (of organizations, of products etc) _isn’t_ fixed, and that there are different mechanisms through which we might imagine that quality would be improved. “Exit” – the threat of switching to a competing organization – is one such mechanism, and it’s one that libertarians will be very comfortable with, as it’s greatly enhanced by free markets or market-like competition under many circumstances. The other is voice – which refers to more directly political actions, of argument, protest, criticism etc, and which doesn’t seem to me nearly as congenial to libertarians, because it suggests that faulty organizations and governments can be made better without recourse to market mechanisms. Indeed, under some circumstances, increased opportunities for exit may reduce the ability of voice to bring through change. Authoritarian regimes frequently allow some critics to go into exile, for fear that they’d become rabble-rousers at home.

Which makes me curious. What do libertarians think about Hirschman’s arguments? Do they read him? Do they have a sophisticated response?

Update: Alex Tabarrok points me to an “old post”: of his, which rightly points out that under some circumstances exit and voice can be complements.

PowerPoint Corrupts the Point Absolutely

by John Holbo on August 11, 2006

Via Arms & Influence, a passage from that Thomas Ricks book [amazon] everyone has been reading (my copy isn’t here yet): [click to continue…]

Happy birthday

by Chris Bertram on August 11, 2006

The “IBM PC is 25-years-old today”: . Me, I resisted at the time, but I’m not sure I could have afforded one. I’m pretty such that the first personal computer I used was a “Commodore 64”: in the early 80s, followed by an “Apple IIc”: when I worked at Verso around 1985 (I remember seeing “the first Mac”: in a window by Liverpool Street Station at about the same time). Liking Macs but not being able to afford them meant that I invested in an “Atari 1040STFM”: in about 1987 which I used at home for about five years or so (lovely crystal clear b&w monitor). I also spent a good deal of time on “Amstrad PCWs”: When I arrived in Bristol (1989) my Department had one (1) “BBC Micro”: in the basement, and there was a great deal of resistance to my suggestion that we should all have pcs on our desks. Some time in the mid 1990s, we all got i386 based clones, and it has been all upgrades to Pentiums since. Except that I just got my “MacBook”: , and had a new “iMac”: delivered to my office.

More Side Effects of the GWOT

by Kieran Healy on August 11, 2006

By the time I got to Chicago yesterday my flight to Montreal had been cancelled and I got re-routed through Toronto. (One Canadian city is as good as another, eh?) My bag went on a mysterious and still-unfinished journey of their own. As a consequence, I did something I’m slightly ashamed to admit I rarely do these days: I read a novel. I picked up Jonathan Safran Foer’s Extremely Loud and Incredibly Close in Chicago and by the time I arrived in Montreal I had just finished it. The main protagonist is Oskar Schell, a nine-year-old boy whose father was killed in the World Trade Center, and the novel is told mostly from his point of view. When we’re not inside Oskar’s head, the voices of his grandmother and grandfather (who have complicated stories of their own) take over.

It’s a good novel. I was unconvinced by some aspects of each of the main characters, and I thought the central plot device could have been handled better. But at the same time, the book drew me in and I found parts of it quite moving. It is exceptionally difficult to write plausibly about the inner world of a child, if only because it’s so easy to forget what being a child is like. Foer’s strategy is to make Oskar irresistibly kinetic: high-energy, endlessly talkative, exceptionally smart, and independent to an almost absurd degree. It mostly works, except of course when the plot requires that Oscar not be as smart as all that. It would have been easy to have Oskar come off as a kind of miniature Woody Allen, neurotically roaming New York in search of something or other. But Foer manages to make you like him.

It strikes me that Roddy Doyle’s Paddy Clarke Ha Ha Ha would make for a good comparison with Extremely Loud and Incredibly Close. Paddy is ten and Oskar is nine. They are both quite talkative. In different ways, bad things happen to both. Yet Paddy is ordinary and Oskar is one of a kind. Paddy lives a routine existence in late 1960s Dublin. Oskar is on the Upper West Side. Paddy’s parents fight. Oskar’s father was killed in a terrorist attack. I read Paddy Clarke when it came out (ten or more years ago I think), and remember being astonished by how well Doyle got the reader inside Paddy’s world, especially the way he showed how awful even ordinary domestic problems can seem when you are ten and don’t fully understand what is happening. I may be biased because it’s easier for me to identify with Paddy’s life and mode of speech, but I think Doyle meets the challenge of writing from a child’s point of view better than Foer. Perhaps Foer’s problem is that the weight of 9/11 is just too much for Oskar as a character to bear, just as within the novel it is too much for him as a person to manage.

Is territorial possession a form of property?

by Chris Bertram on August 11, 2006

I was reading a paper by Samuel Freeman the other day and came across a passage that I found arresting. I found it arresting because it asserted propositions that looked false to me. But Freeman is a very smart guy (and a very distinguished Rawls scholar) and I rather suspect that the points he’s alluding to are symptomatic of some very deep differences in philosophical opinion. They’re also of interest because Freeman’s denial that a state’s control of its territory is akin to property ranges him against both those who are more egalitarian than he is (Pogge and Tan in the passage quoted, but also those like Philippe Van Parijs who claim the existence of borders is sufficient to establish that there is a global basic structure) and Lockean libertarians. I reproduce the passage below together with some (possibly inept) reactions from me.

bq. The one significant practice or norm Rawls’s critics allude to which might at first appearance be regarded as a basic global institution is peoples’ recognition that nations have “ownership” or control of the land and natural resources in the territories they occupy. Pogge, K. C. Tan, and others see this example as justifying a need for a global distribution principle to regulate this practice, and decide how global resources are to be distributed. But it is a mistake to regard this norm as a basic institution, on a par with the institution of property. For control and jurisdiction over a territory by a people is sui generis: it is the condition of the possibility of the existence of a people and their exercising political jurisdiction. As such it is not a kind of property; for among other reasons, it does not have the incidences of property: it is not legally specified and enforced, nor is it alienable or exchangeable, but is held in trust in perpetuity for the benefit of a people. But more importantly, rather than being a kind of property, a people’s control of territory provides the necessary framework for the legal institution of property and other basic social institutions. Finally, peoples can and have controlled territories without norms of cooperation or even recognition by other peoples at all. Indeed this has been true of many countries for most of history; they have existed in a Hobbesian state of war. The point is not that there is anything just about this situation – on the contrary, it has been sustained by aggression and injustice for most of history – but that, unlike property and other basic social institutions, a people’s control of a territory is not cooperative or in any way institutional. It is then misleading to call a people’s control of a territory and recognition of others’ boundaries “property,” a “basic institution,” or part of a “global basic structure,” simply in hopes of showing an inconsistency in Rawls and smuggling in a global principle of distributive justice. (Samuel Freeman, “Distributive Justice and _The Law of Peoples_”, in Rex Martin and David A. Reidy (eds) “Rawls’s Law of People’s: A Realistic Utopia”: (Oxford: Blackwell, 2006).)

The following points strike me as relevant:

[click to continue…]