John Q

I don’t have anything original to say, but it seems important enough to discuss. I’m going to pre-emptively rule out Trumpism and bothsidesism: you can take that to X or tell it to Ernst Thaelmann.

In my previous post on utilitarianism, I started with two crucial observations.

First, utilitarianism is a political philosophy, dealing with the question of how the resources in a community should be distributed. It’s not a system of individual ethics

Second, (this shouldn’t be necessary to state, but it is), there is no such thing as utility. It’s a theoretical construct which can be used to compare different allocations of resources, not a number in people’s heads that can be measured and added up.

Failure to accept these points is at the heart of the kind of ‘longtermism’ advocated by William McAskill and, earlier, Parfit’s Repugnant conclusion. The claim here is that the objective of utilitarians should be to maximise total utility, including people who are brought into existence as a result of our decisions. In particular, that means that it is desirable to bring children into existence who will have a miserable life, provided that no one else is made worse off, and the life is not so bad that the children in question regret being born.

As well as being intuitively unappealing, this idea makes no sense in the two main contexts in which it is relevant: families deciding how many children to have, and polities deciding whether to promote pro-natalist policies[1]

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As regular readers will know, CT blogger Ingrid has long been making the case for limitarianism, that is, the idea that there should be an upper limit on the amount any one person can own or consume. As Ingrid has observed, limitarianism is a constraint, rather than a complete ethical principle, so it’s important to consider how it interacts with other principles. In the case of utilitarianism, the answer is surprisingly well, at least in (using Ingrid’s terminology) this and nearby worlds. But understanding this requires a little bit of background and some arithmetic.

Shorter JQ: utilitarianism implies limitarianism. The full argument is over the field (no tricks this time, I promise).

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In view of the apparent end of what passed for democracy in Israel, it’s time for me to repost my comprehensive proposal for US policy covering all aspects of relationships between the US and the Middle East. It’s over the fold.
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As is usual with trends of all kinds, some recent electoral successes for far-right parties in Europe have been extrapolated into a narrative in which the rise of the far-right is just about unstoppable.

That narrative took a blow with the recent Spanish elections in which the far-right Vox party performed poorly and its coalition with the traditional conservative Popular Party failed to secure a majority. Possibly as a result, the leader of the German CDU backed away from a suggestion that his party might go into a similar coalition with the AfD. And a similar coalition government in Finland appears to be on the verge of collapse.

From the other side of the world, it’s hard to know what to make of all this, but important to try to understand it. So, I’ll toss out some thoughts and invite readers closer to the action to set me straight.

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I was looking at this picture of people (mostly tourists, it appears) fleeing massive fires in Rhodes, feeling despair about the future of the world

when I was struck by an even more despairing thought.
Almost certainly, a lot of the people in the picture are climate denialists. And even more certainly, they will mostly remain so despite this experience.
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Over the fold, a piece I wrote for The Conversation. It’s focused on Australia, but includes a swipe at European advocates of a “nuclear renaissance”, the most notable of whom are Macron and (at least until his defenstration) Boris Johnson
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Not quite 20 years ago, I got an invitation to spend a week as a visiting blogger at an exciting new group blog called Crooked Timber. In the manner of the most catastrophic house guests, I managed to turn that into permanent residence.
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Daniel Ellsberg has died, aged 92. I don’t have anything to add to the standard account of his heroic career, except to observe that Edward Snowden (whose cause Ellsberg championed) would probably have done better to take his chances with the US legal system, as Ellsberg did.

In decision theory, the subsection of the economics profession in which I move Ellsberg is known for a contribution made a decade before the release of the Pentagon papers. In his PhD dissertation, Ellsberg offered thought experiments undermining the idea that rational people can assign probabilities to any event relevant to their decisions. This idea has given rise to a large theoretical literature on the idea of ‘ambiguity’. Although my own work has been adjacent to this literature for many decades, it’s only recently that I have actually written on this.

A long explanation is over the fold. But for those not inclined to delve into decision theory, it might be interesting to consider other people who have been prominent in radically different ways. One example is Hedy Lamarr, a film star who also patented a radio guidance system for torpedoes (the significance of which remains in dispute). A less happy example is that of Maurice Allais, a leading figure in decision theory and Economics Nobel winner, who also advocated some fringe theories in physics. I thought a bit about Ronald Reagan, but his entry into politics was really built on his prominence as an actor, rather than being a separate accomplishment.

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Since the beginning of this millennium, I’ve been writing critiques of the “generation game”, the idea that people can be divided into well-defined groups (Boomers, Millennials and so on), with specific characteristics based on their year of birth. As I said in my first go at this issue, back in 2000 (reproduced here )

Much of what passes for discussion about the merits or otherwise of particular generations is little more than a repetition of unchanging formulas about different age groups Ð the moral degeneration of the young, the rigidity and hypocrisy of the old, and so on.

Demographers have a word (or rather two words) for this. They distinguish between age effects and cohort effects. The group of people born in a given period, say a year or a decade, is called a cohort. Members of a cohort have things in common because they have shared common experiences through their lives. But, at any given point in time, when members of the cohort are at some particular age, they share things in common with the experience of earlier and later generations when they were at the same age.

My most prominent contribution to the debate was this piece in the New York Times five years ago, prompted by the Pew Research Centre’s announcement that it would define people born between 1981 and 1996 as members of the millennial generation. After discussing the history of the “generation” idea, I made the central point

Dividing society by generation obscures the real and enduring lines of race, class and gender. When, for example, baby boomers are blamed for “ruining America,” the argument lumps together Donald Trump and a 60-year-old black woman who works for minimum wage cleaning one of his hotels.

Now, I’m pleased to say, Pew has changed its view, partly in response to a “growing chorus of criticism about generational research and generational labels in particular.”
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Kevin Drum points to an obscure, but radical proposal to change the way the US government does benefit cost analysis. The Office of Management and Budget has released draft guidance saying

One practical approach to implementing weights that account for diminishing marginal utility uses a constant-elasticity specification to determine the weights for subgroups defined by annual income. To compute an estimate of the net benefits of a regulation using this approach, you first compute the traditional net benefits for each subgroup. You can then compute a weighted sum of the subgroup-specific net benefits: the weight for each subgroup is the median income for that subgroup divided by the U.S. median income, raised to the power of the elasticity of marginal utility times negative one. OMB has determined that 1.4 is a reasonable estimate of the income elasticity of marginal utility for use in regulatory analyses.

This is pretty obscure, but what it means is that, a project that delivers a dollar of benefits to each of a group of poor people is worth more than a project that delivers a dollar of benefits to each of a group of poor rich people.

A lot more !

Kevin uses a graph to illustrate, showing that an extra dollar for the median household is worth 50 times as much as an extra dollar for a household with an income of $1 million a year. Conversely, an extra dollar for households at the bottom of the income distribution is worth 12 times as much as an extra dollar at the median.

It’s actually simpler to get the intuition of you use an elasticity of 1, which corresponds to logarithmic utility. Then you can sum up the implications by saying that a given percentage increase (or reduction) in income yields the same additional (or reduced) utility no matter who gets it. So, for example, if a policy halved Elon Musk’s income, while doubling the income of a single randomly chosen US household, it would be evaluated as neutral. If the policy doubled the income of two households, it would be beneficial. More generally, you can just add up all the percentage changes in income from the project (included the taxes needed to finance* it). If that sum is positive, the project should be approved.

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I had an odd intellectual experience recently. A US high school student wrote to me as part of an assignment, asking for my thoughts on Brave New World, and its current relevance. I replied talking about the role of “Our Ford”, and Gramsci’s contemporary concept of Fordism.

That got me thinking about post-Fordism, and then to the idea of post-post-Fordism, referring to the information economy that has emerged since the rise of the Internet. I expected that this would be a reinvention of the intellectual wheel on my part, but when I popped the phrase into DuckDuckGo, I got a single hit, which was part of a 2015 interview with UK radical economist Robin Murray. whose ideas about the concept were very similar to mine, but whose comments were very brief.

I didn’t know of Murray, but I thought I should write to him and ask him how he had developed the idea. Sadly, I was led to Wikipedia, which reported that Murray had died in 2017, apparently without writing anything further on the topic. I’ve found a handful of citations, but of the “in passing” variety.

I’m not sure where to go next with this. I’d like to revive the idea (if indeed it died with Murray), but I’m not sure how to deal with an intellectual history like this. Perhaps some of my readers knew (or knew of) Murray or have seen the idea of post-post-Fordism?

Yesterday was May Day, celebrated as the Labour Day public holiday here in Queensland. And this week, appropriately enough I’m giving two presentations on the case for a four-day working week, one to the Committee for Economic Development of Australia, a business-oriented thinktank, and one to a parliamentary inquiry.

I started writing a post about the prospect of a radical change in the relationship between workers and managers in the information economy, arising from the combination of near full-employment and the shift to remote work for large groups of workers. But I ran out of time, so for now, I will just toss up some points I want to discuss

• Will full employment be sustained, or will central banks succeed in recreating the reserve army of labor ?
• How real is the threat of employer spyware extending surveillance into home workplaces ?
• How should we conceptualise the relationship between workers, managers and owners of capital ?
• What are the implications for unions?

I’ll throw it open for comments, and think some more about all this.

There’s been a lot of recent discussion about relative economic performance of the EU and US as well as (mostly separately) discussion of differences in mortality rates.

One way to integrate the two is to think of living in the US as a (very) dangerous occupation, and think about the wage premium demanded by workers to take up such occupations, relative to comparable low-risk jobs.

The typical estimate from econometric studies is that a 0.1 per cent chance of death on the job (a really dangerous job) implies a wage premium of around $10000/year.

For Americans aged between 25 and 65, the annual death rate in 2019 (pre-Covid) ranged between 0.13 and 0.88. EU mortality rates were one-third to half of that.

Doing the math, the wage premium that would be needed to take on the extra risk of being a working-age American, compared to the EU, is somewhere between $10000/yr and $40000/yr.

Even the lower figure would push the US down to the middle of the rich-country pack based on standard comparisons of median income.

(From my Substack)