From the monthly archives:

April 2011

I’m thinking about doing another book, which would be a reply to Henry Hazlitt’s Economics in One Lesson a tract published in 1946, and available online, but still in the Amazon top 1000. It’s largely (as Hazlitt himself says) a rehash of Bastiat.

I’ll try to put up a prospectus soon, but I thought I’d start with something simpler, a response to Leonard Read’s I, Pencil.

Update I’m getting a lot out of the comments, and updating the piece in response.

This essay is a description of the incredibly complex “family tree” of a simple pencil, making the point that the production of a pencil draws on the work of millions of people, not one of whom could actually make a pencil from scratch, and most of whom don’t know or care that their work contributes to the production of pencils. So far, so good. Read goes on to say that

There is a fact still more astounding: the absence of a master mind, of anyone dictating or forcibly directing these countless actions which bring me into being. No trace of such a person can be found. Instead, we find the Invisible Hand at work.

Hold on a moment!

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The Statistical Abstract of the United States

by Kieran Healy on April 15, 2011

I saw this report go by on the Twitter saying that, in the wake of the latest budget deal, the Census Bureau is planning on eliminating the Statistical Abstract of the United States, pretty much the single most useful informational document the Government produces. The report says,

When readying the FY2011 budget, the Census Bureau tapped teams to do thorough, systematic program reviews looking for efficiencies and cost savings. Priorities for programs were set according to mission criticality, and some cuts were made to the economic statistics program. According to Tom Mesenbourg, deputy director of the Census Bureau, “difficult choices had to be made” in order to reduce expenditures on existing programs and move forward with new initiatives in FY2012. Core input data that the Bureau of Economic Analysis relies on to produce the National Income and Product Account tables, for example, would be retained. New data sets needed to be added to the Census of Government regarding state and local government pensions (e.g., cost of post-retirement employee benefits). In addition, FY2012 requires funding for the planning stages of the 2012 Economic Census; data collection begins in 2013. So what’s left to cut? It was felt that the popular Statistical Abstract of the United States—the “go to” reference for those who don’t know whether a statistic is available, let alone which agency/department is responsible for it—could be sacrificed. Staff will be moving to “Communications,” digitizing the data set. It is hoped that the private sector—commercial publishers—will see the benefit of publishing some version of the title in the future.

Bleah. When it comes to the United States, the print and online versions of the SA are a peerless source of information for all your bullshit remediation needs. What’s the median household income? What does the distribution of family debt liability look like? How many people are in prison? How many flights were late, got diverted, or crashed in the past few years? How many women hold public office? What sort of families get food stamps? Who does and doesn’t have health insurance? What percentage of households own a cat, a dog, a bird, or a horse? (The fish lobby seem to have lost out on that one.)

In his early days as a pundit, Paul Krugman got a fair amount of mileage from columns that consisted mostly of taking some claims about the U.S. trade balance or industrial structure, looking up the relevant table in the Abstract, and calling bullshit on the claim-maker. (Of course, that was in those far-off days when all this were nowt but fields, Krugman was still a Real Economist—i.e., he had yet to win the Nobel Prize in Economics, or say rude things about Republican economic and social policy—and he patrolled the boundaries of his profession against the incursions of pop internationalists.) So, properly used, the SA might even make you famous.

In the meantime, maybe this is all a feint or post-budget posturing by the Census Bureau. I have no idea. But I really do hope the abstract doesn’t go away anytime soon, or become the property of some gobdaw publisher looking to sell me tabulations of data the government has already collected using public money.

Fantasy 11-dimensional chess

by John Q on April 15, 2011

For those who’ve picked Obama (Democrat) in their fantasy 11-dimensional chess league, here’s the winning line that’s opened up, with annotation. Starting position is Budget compromise.

1. … (Reps) Announce Ryan strategy !? given the requirements to cut taxes, raise defence spending and reduce the deficit, it would have been better to temporise, but Serious Commentators approve
2. (Obama) Wait two days for Ryan plan to fall apart under scrutiny 2 … Keep looking Serious and try to erase worst bloopers from Interwebs ?? Overlooks Wayback machine, screenshots
3. Propose plausible plan, with mix of tax increases and expenditure cuts 3 … Keep looking Serious
4. Announce that debt limit vote must be Up or Down 4 … Cave in if 4 … refuse to lift debt limit, forced loss as in Clinton v Gingrich 1995)
5. Hold line on budget except for more cosmetic expenditure cuts 5 … Cave in if 5 … hold to Ryan plan, 6 make election referendum on Medicare vs tax cuts for millionaires wins easily
6. Wins

Of course, that’s the fantasy version. The likelihood that the Obama (Democrat) who spoke the other day will reappear any time soon is pretty small. In the real world, Obama (Republicrat) will almost certainly meet the Reps halfway and then some.

Usually I half-agree with what Julian Sanchez has to say. But not in this case.

In a recent post, I suggested that claims about “desert” are generally misplaced in arguments about copyright—whether they are deployed on behalf of “deserving” small fry artists or against “undeserving” labels. As some commenters pointed out, there’s no obvious reason this argument should be restricted to the domain of copyright—and quite right. I think most areas of political philosophy and policy—theory of just punishment springs to mind as a possible exception—would be better off if we just scrapped the concept of “desert” entirely, and just spoke about what people are entitled to.

Here’s the difference, very roughly, in case this sounds like semantic hairsplitting. To say someone deserves X is to say that X is in some sense an appropriate or fair reward in light of that person’s morally virtuous qualities or conduct. To say that someone is entitled to X is just to say that the person has a just claim to X, without any implied commitment to some deeper claim about their moral merit.

Here’s his thesis, a paragraph or so further on: “I think political and policy discussions should concentrate on what people are entitled to, rather than on necessarily muddy attempts to determine (and embed in law) what people morally deserve.”

The post goes on at some length. Sanchez is at pains to confess that he is making a rather vague argument, not trying to nail anything down. But it seems to me 1) absolutely, completely hopeless; 2) a standing temptation to libertarians and conservatives; 3) worth shooting down hard. [click to continue…]

The Civil War in America’s narrative

by Henry Farrell on April 14, 2011

Matthew Yglesias “points to research”:http://yglesias.thinkprogress.org/2011/04/many-white-southerners-still-love-the-confederacy/ showing that many white Southerners still refuse to concede on the Confederacy.

bq. roughly one in four Americans said they sympathize more with the Confederacy than the Union, a figure that rises to nearly four in ten among white Southerners. […] When broken down by political party, most Democrats said southern states seceded over slavery, independents were split and most Republicans said slavery was not the main reason that Confederate states left the Union.

This is perhaps, not entirely surprising. What is more surprising to me is that this version of events is officially accepted by the United States. I became a US citizen yesterday, after spending some time over the previous few days reading the “US civics study guide”:http://www.uscis.gov/USCIS/Office%20of%20Citizenship/Citizenship%20Resource%20Center%20Site/Publications/PDFs/M-638_red.pdf to study for the citizenship exam (since I am a political scientist, it would have been _particularly_ embarrassing for me if I had failed it). For better or worse, it’s hard for me to switch off my inner social scientist. Hence, I started paying a different kind of attention when I read that ‘states rights’ is one of three acceptable answers to the civics question ‘name one problem that led to the Civil War’ (slavery and economics are the other two). My understanding, perhaps mistaken, is that ‘states’ rights’ is typically employed as an explanation by those who would prefer to forget (as Ta-Nehisi Coates notes; also “here”:http://www.theatlantic.com/national/archive/2010/04/the-ghost-of-bobby-lee/38813/) that it was one particular right – the right to own slaves – that was what was really at stake in the conflict. The study guide goes on to elaborate that:

bq. The Civil War began when 11 southern states voted to secede (separate) from the United States to form their own country, the Confederate States of America. These southern states believed that the federal government of the United States threatened their right to make their own decisions. They wanted states’ rights with each state making their own decisions about their government. If the national government
contradicted the state, they did not want to follow the national government.

after which it does get into a discussion of the relationship between slavery and economic systems in North and South, and its relationship to the Civil War.

This – of course – was only a very small part of the event in question (and in any event I got asked a completely different set of questions on the day) – but it was interesting. Tests of this kind are a very useful way of gauging what is accepted, and what is not accepted as part of the official national narrative, especially when, as in the US, there is no national history curriculum. I was surprised that this _was_ part of the accepted (or at least acceptable) narrative, alongside the expected questions on Martin Luther King, and the origins of slaves in Africa. But perhaps there is a different history of the role of states’ rights in the conflict than the limited one I know (I am obviously not an expert on US history, or on the origins of the Civil War).

Winter sports roundup

by Michael Bérubé on April 12, 2011

It’s time once again for hockey blogging, or, as we call it, “hogging”!  As CT’s only resident hockey blogger, it naturally falls to me to explain precisely what will happen in this year’s Stanley Cup playoffs.  As usual, I will provide <a href=”http://www.michaelberube.com/index.php/weblog/hastily_hogging/”>precise and preternaturally accurate predictions</a> about the first round of the Eastern Conference playoffs, and I will challenge <a href=”http://www.lawyersgunsmoneyblog.com/author/scott-lemieux”>Scott “Scotty” Lemieux</a> to do the same for the West.

OK, those of you who clicked the first link have now learned that my first-round picks last year were a jumbo package of epic fail.  But don’t forget, I’ve had <a href=”http://www.michaelberube.com/index.php/weblog/almost_forgot1/”>my moments</a>.  And I did say that last year’s finals would be Penguins-Hawks, and I still think that’s what should have happened in the end, so I was kind of right about that too, except for the Penguins part.  So, without further ado:
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Towards an economics of unhappiness

by John Q on April 12, 2011

For at least the last decade, there has been a boom in work on the economics of happiness. But following Tolstoy[1], I’ve always wondered why we don’t study the economics of unhappiness instead: after all, there’s so much more data.

For the last year or so, I’ve been planning a paper in which I took off from this point and made the case for unhappiness as a driver of economic activity and particularly of economic change (including ‘growth[2]’). But, as usually happens[3] with my thoughts along these lines, it looks as if someone has beaten me to it.

Chris pointed me to this piece by Stefano Bartolini, which argues that people strive to increase their wealth as a response to the negative externalities generated by positional externalities[4] and the destruction of social capital.

I’ve also been reading a translation of Sedlacek’s Economics of Good and Evil, a surprise hit in the original Czech, which discusses many of the same issues, focusing on the contrast between the economics of the ancients and that of Adam Smith.

I have a more positive take on unhappiness. It’s possible, I think, to want something better than what you have (for many different values of “better”) without being actively miserable. In a world where change, both good and bad, is inevitable, cultivating a position of stoical detachment seems to me to be something of a copout[5}

fn1. Tolstoy had his own economic ideas, which drew (not surprisingly for the time, and for a dissident landowner on Henry George)

fn2. Growth, like GDP is a tremendously unsatisfactory and misleading concept when dealing with complicated economic aggregates, some components increasing and others decreasing. But that’s another post.

fn3. Often by a fair stretch of time, as I’m very slack about reading the literature. I was very pleased with my discovery of Ramsey’s Rule of Saving until I discovered that Ramsey had got there first.

fn4. To translate from the economese, the fact that some social benefits depend more on your relative position than your absolute wealth means that if one person becomes better off, others are worse off.

fn5. Does this useful slang term have an equivalent in formal English? I can’t think of one that isn’t a paraphrase.

Transparency and Revenue at the ASA

by Kieran Healy on April 11, 2011

dues-comparison

How cost of membership compares across selected social science disciplines. Click for a PDF version.

The American Sociological Association is one of the more expensive associations one can join in the social sciences, and a proposed dues increase would make it just about the most expensive right across the income spectrum. (More data on that here.) The rationale for the increase says a lot about the importance of a progressive dues structure, which no-one disagrees with, but nothing about why additional funds beyond the (routine) cost-of-living increase—which the proposal will certainly raise—are needed in the first place. Perhaps there are good reasons, but they haven’t been forthcoming thus far.

So, there’s a petition at http://asatransparency.org requesting a better explanation from ASA for this proposal. If you’re a sociologist and feel the ASA should do more to explain and justify this increase to its members—which is of course consistent with either supporting or opposing the increase itself—please consider signing it.

The City and the City

by Henry Farrell on April 11, 2011

A piece I wrote on China Miéville’s _The City and the City._ has “come out”:http://bostonreview.net/BR36.2/henry_farrell_china_mieville.php in the _Boston Review_. The nub of my argument:

bq. Miéville brings these quotidian practices into stark perspective. He uses slips of perception and movement back and forth between cities to highlight the contingency of many of the social aspects of the real world. The City & the City draws no hard distinction between the world of fantasy and our own. Instead, Miéville seems to suggest, the real world is composed of consensual fantasies of varying degrees of power. The slippage isn’t between the real world and the fantastic, but between different, equally valid, versions of the real. As the title makes explicit, neither city has ontological priority over the other—Besźel is not a simple reflection of Ul Qoma, or vice versa.

I mentioned Farah Mendlesohn’s “Rhetorics of Fantasy”:http://www.amazon.com/gp/product/0819568686/ref=as_li_ss_tl?ie=UTF8&tag=henryfarrell-20&linkCode=as2&camp=1789&creative=390957&creativeASIN=0819568686 in the piece, but I wasn’t able to make clear how great a debt I owe to it (since Farah is an occasional CT reader, I hope this post can serve as both thanks and public acknowledgment). _Rhetorics of Fantasy_ allowed me to figure out what I thought about the book (some have “suggested”:http://vectoreditors.wordpress.com/2009/05/22/mr-h-mr-h-discuss-the-city-the-city/ that it’s indeed one of the texts behind TCATC. Its argument – brutally simplified – is that the different modes in which fantasy authors represent the relationship between the world they have created and the real world has important rhetorical consequences. Thinking about fantasy in this way highlights just what is most interesting about TCTATC – that it is a fantasy of superimposed worlds, none of which is entirely fantastic (the genuinely fantastic elements of the book are extremely limited, and are a kind of macguffin), and each of which is just as rooted (or unrooted) in reality as the other. This allows Miéville to make the familiar strange – to treat something (or somethings) that closely resembles real life as if it was fantastical in the same way that your imagined-world-of-choice is fantastical. It is a very interesting shift in perception, and one which I do not think I would have been able to decode, at least to my own satisfaction, had I not read Farah’s book.

Well, their official publisher is called Veritas

by Henry Farrell on April 11, 2011

Ireland’s _Sunday Business Post_ informs us that the country’s bishops have come out with a startling admission.

From “LanguageLog”:http://languagelog.ldc.upenn.edu/nll/?p=3070.

Zombie Doppelganger

by John Q on April 10, 2011

I got an email the other day, trying to set up an interview about Zombie Economics: How Dead Ideas Still Walk Among Us. Shortly afterwards there was a cancellation – they actually wanted the author of Zombie Economics: A Guide to Personal Finance, due to be released in May.

I’m well aware that there’s no copyright in book titles (Zombie Econ was originally going to be called “Dead Ideas from New Economists, and back in the 90s I wrote one which the publisher insisted on calling Great Expectations), but I can’t help wondering about the implications for sales. At least for the moment they don’t look too bad. According to Amazon, 12 per cent of people who viewed the doppelganger ultimately bought my book, while the proportion going the other way is zero (although some zombie fans go for Chris Harman’s Zombie Capitalism). But I imagine that’s the result of bad search results among people looking for mine, rather than a spillover from those looking for the doppelganger. If so, I imagine the flow will reverse when the new one is released.

Are there other interesting examples of book title recycling, or interesting ideas for new takes on classic titles?

Two Pieces on Europe

by Henry Farrell on April 8, 2011

Both recommended:

First: Kevin O’Rourke’s “more general take”:http://ineteconomics.org/sites/inet.civicactions.net/files/BWpaper_OROURKE_040811.pdf (PDF) on the trilemmas facing the eurozone.

bq. What we have seen instead is a series of ineffectual moves on financial regulation, and now a complete unwillingness to confront the European banking crisis head-­‐on. Rather than promoting pan-­‐European growth strategies, the institutions of the Union have been enthusiastically promoting pro-­‐cyclical fiscal adjustments in the periphery, even as they insist that heavily indebted governments repay private creditors of private banks in full. Not only is the policy incoherent, making sovereign default more likely on the one hand, while preaching austerity on the other; the insistence that taxpayers rather than investors pay for bank losses is also setting the stage for a potentially very damaging confrontation between core and periphery taxpayers. The political consequences of this are unknowable, but in Ireland, just three months after the troika’s intervention, the political party that had been dominant since the 1930s was annihilated at the polls, with the radical and Eurosceptic Sinn Féin now sniffing at its heels: and this in one of the most conservative, and Europhile, countries in Europe. What three or four years of the current policy mix will do is anybody’s guess.

The paper is particularly interesting in its focus on the _politics_ of Eurozone governance, which does not get nearly as much attention as it deserves. John Quiggin and I have a piece forthcoming in _Foreign Affairs_ which talks to the medium-term consequences of institutionalized austerity at the European level – O’Rourke’s piece provides a good general take on the same set of issues, as well as discussing topics (class and distributional divides) that we don’t get into. The paper is being presented at INET – there is much other interesting looking material available “here”:http://ineteconomics.org/initiatives/conferences/bretton-woods/agenda.

Second, Kate McNamara’s more “topical piece”:http://www.foreignaffairs.com/articles/67710/kathleen-r-mcnamara/can-the-eurozone-be-saved arguing that the European Union needs to take the plunge and become more like a state.

bq. In the eyes of markets and skeptical observers, the European Union is more than an intergovernmental organization but not yet a state. When the European Union bickers and dithers, the markets have no idea what may happen. The euro is the only single currency in history that has not been tightly linked to broader state- and nation-building efforts (often following wars, during which military action required budgeting and taxation). Although the euro is an extraordinary peacetime achievement, it suffers from a lack of supporting political institutions that can make broader macroeconomic policy. The European Union needs to change that and move beyond the structure of its current economic and monetary union — which were seemingly designed for a world in which private and public actors never over-borrow and financial markets never question their ability to repay — to real political and economic cohesion, something international markets would recognize as parallel to a nation state.

As she recognizes (and O’Rourke argues too) there is little enthusiasm among European leaders (let alone publics) to make this jump. This obviously generates normative objections (some perhaps fundamental) as well as practical ones. But equally, it is not at all clear that the European Union can survive as it is, as a kind of ungainly half-way house between an international organization and a genuinely federal system.

Wisconsin comes to Washington?

by John Q on April 7, 2011

It was always highly likely that, given a Republican win in the US House of Representatives, the 1995 shutdown of the government would be repeated, and now it seems virtually certain[1]. Until recently, I’ve assumed that the outcome would be a capitulation by Obama and the Dems. Less likely, but still possible, was repeat 1995 where the Republicans caved, and took the political blame for the shutdown, but one in which there were still substantial budget cuts borne mostly by workers and the poor (actually, I think Clinton had done most of this pre-95).

The events in Wisconsin have shifted the odds, making it much harder for the Reps to shift or share the blame for a shutdown, and therefore more likely that an eventual compromise will be on terms than can be seen as a political win for the Democrats. More importantly, though, they’ve raised the prospect of something much bigger – a genuine popular movement against cuts that could turn the whole debate around.

I have no idea whether anything of the kind is being organized. I hope so, though it would be even better if something like this began as a spontaneous outgrowth of the movement in Wisconsin and elsewhere. That would, I expect, horrify Obama and the Dems even more than it would the Reps, but the example set by the fugitive legislators in Wisconsin suggests that there may yet be some Hope in the Democratic party.

BTW, sorry for posting so much lately. As you can probably tell, I have a lot of really urgent work to leave until the last possible minute.

Update The outcome was a last minute compromise that looks like a win for the Dems, relative to prior expectations. The cuts not much more than they had pre-emptively offered, and the various riders (Planned Parenthood etc) stripped away.

fn1. One problem with being in Australia is that I can’t always keep track of time. It’s already Thursday evening here, and I’ve been thinking of tomorrow as shutdown day, but actually it doesn’t start until midnight Friday DC time, which is still a day and a half away.

Yemen again

by John Q on April 6, 2011

The news from Yemen is grimly familiar – more protestors shot by President Saleh’s security forces and plainclothes thugs. But now the US government has shifted position, letting it be known in various ways that it’s time for Saleh to go. Their hope now is that a replacement will allow the operations against Al Qaeda in the Arabian Peninsula to continue as before. A few thoughts about this.

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The base and the superstructure

by John Q on April 6, 2011

Glenn Greenwald looks at the dilemma faced by the Democratic base, and by much of the left globally. He doesn’t offer any answers, and I don’t have many either. The Republicans are getting scarier and crazier, so much so that any repeat of a Nader-style strategy is unthinkable. On the other hand, the fact that the base has nowhere to go, and can’t even justify abstention means that Obama and the rest of the Democratic leadership can and do kick them (or, thinking more globally, us) with impunity.

In some sense, it was ever thus, and the problem is not specific to the left – the Republican base spent years complaining about RINOs in much the same terms. Given a spectrum of opinion, the outcome is likely to be close to the median (calculated with respect to the weight given to particular people’s opinions which commonly won’t be uniform). Those far from the median face a choice which inevitably presents itself, to some extent, as one between lesser and greater evils.

The frustration felt on the left at present is (at least at my case) associated with a feeling that we should be doing a lot better. The case for market liberalism is in ruins after the Global Financial Crisis and it’s obvious that the reconstruction of the system has changed nothing, leaving the bankers unscathed and putting all the burden onto ordinary people. Left positions on lots of specific issues have much more public support than is evident from their political representation. The right screwed up massively over Iraq, is delusional on climate change and so on. And Obama won office easily running hard against Bush’s abuses on civil liberties and for a decent health care plan.

Similar points could be made about the situation in Australia, where the Labor government has essentially adopted the positions of its conservative predecessor (confusingly called the Liberal Party) while the Liberals have moved into the crazier reaches of the right. Over the fold, my own reaction to a recent speech by our Prime Minister Julia Gillard, which illustrates this very well (non-Oz readers may need to Google specific names, but a lot of the themes should be familiar).

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