I’m currently reading Scarcity by by Sendhil Mullainathan and Eldar Shafir. At this stage, I’m inclined to sympathise with the unnamed colleague who commented “There’s already a science of scarcity. It’s called economics”. So far, it’s mostly straightforward applications of the observation that time and attention are scarce resources, combined with some fairly familiar observations from behavioral econ on how people fail to optimise either the first-order problems of allocating a tight budget or the second order problem of allocating time and attention to the first-order problem (my terms here, not theirs). However, I’m only part way through, and the authors promise to show how their approach differs from the way in which economists would normally think about this kind of problem.

This post is about a specific and well known observation cited by Mullainathan and Shafir. Faced with paying $100 for an item that could be had elsewhere for $50, most people are willing to put in a fair bit of effort (say, driving for an hour) to get the lower price.[^1] On the other hand if the item costs $1050 and could be had for $1000, people with reasonably high incomes mostly pay up, instead of driving to the other store. This is obviously inconsistent with standard opportunity cost.
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Once upon a time, I was going to write an article with that title. Finished a draft and everything. About Zizek (duh!)

But I’ll just leave that as an exercise to the interested reader. (It’s not a hard assignment, honestly.)

Have you read The Napoleon of Notting Hill, by G. K. Chesterton? I just reread it. It’s wonderful, fabulous! It’s so utterly solipsistic, with its two half-heroes completing each other – the jester king with the fairy name, Auberon Quin; and the dead serious Adam Wayne. There is only one woman in the whole book. And it has scores of characters before we’re done. She fits, with room to spare, in a nutshell-sized morality tale:

“In a hollow of the grey-green hills of rainy Ireland, lived an old, old woman, whose uncle was always Cambridge at the Boat Race. But in her grey-green hollows, she knew nothing of this: she didn’t know that there was a Boat Race. Also she did not know that she had an uncle. She had heard of nobody at all, except of George the First, of whom she had heard (I know not why), and in whose historical memory she put her simple trust. And by and by in God’s good time, it was discovered that this uncle of hers was not really her uncle, and they came and told her so. She smiled through her tears, and said only, ‘Virtue is its own reward.'”

I call that spectacular failure of the Bechdel Test – I do. Still, it’s nice to think that about virtue.

I don’t want to give away the ending – it turns out there’s a water-tower! – but I thought about the ending during the shutdown fight. Do you think Ted Cruz is sort of like Adam Wayne? Only the ending turned out differently? Or is he like Auberon Quin? Or is half of his brain one, and half of his brain the other?

Chesterton’s characters are so wonderfully likeable, and Republicans like Ted Cruz are so loathsome, not to put too fine a point on it. It isn’t because no one gets hurt, because Chesterton is fiction; or that no one gets hurt in the fiction – they do! It’s that Chesterton makes sure that the dangerous, ‘Every Day Is Like Thursday’, signature Chesterton protagonist delusionalism is utterly innocent and childlike at the root, even if the branches whack other folks, who are almost as innocent. Imagine thinking Cruz was fundamentally good-hearted, boy howdy. Wouldn’t that be a sight to tell your grand-kids you saw?

This post is sort of a sequel.

On December 23, 2005, I went out on a date. It was one day after the transit strike that crippled New York had ended. I was in a foul mood.

The night before, you see, I had been on another date. Throughout dinner, the woman I was out with complained about the transit strike. About how much she was inconvenienced (she worked in the publishing industry and her commute into Manhattan had been screwed up), how good the workers had it, how bad public sector unions were.

So on the night of the 23rd, as I walked into the bar, I was ready for the worst. When I met the woman I was due to have a drink with, I asked her how she was doing. “Oh fine,” she said, “if you like meeting strange men at bars.” (We had met online; this was our first date.) “Well,” I said, “I can make this really easy on you. Where do you stand on the transit strike?” She replied instantly: [click to continue…]

A while ago, I listened to a fascinating talk by Erik Olin Wright about Envisioning Real Utopias, on which we held a book event a while back.[^1] He mentioned the Port Huron Statement, published by Students for a Democratic Society in 1962. I looked it up, and was struck by the fact that it envisaged, and welcomed, the political realignment later implemented by Richard Nixon as the Southern Strategy, and which still dominates US politics.

A most alarming fact is that few, if any, politicians are calling for changes in these conditions. Only a handful even are calling on the President to “live up to” platform pledges; no one is demanding structural changes, such as the shuttling of Southern Democrats out of the Democratic Party…. super-patriotic groups have become a politically influential force within the Republican Party, at a national level through Senator Goldwater, and at a local level through their important social and economic roles. Their political views are defined generally as the opposite of the supposed views of communists: complete individual freedom in the economic sphere, non-participation by the government in the machinery of production. But actually “anticommunism” becomes an umbrella by which to protest liberalism, internationalism, welfarism, the active civil rights and labor movements. It is to the disgrace of the United States that such a movement should become a prominent kind of public participation in the modern world — but, ironically, it is somewhat to the interests of the United States that such a movement should be a public constituency pointed toward realignment of the political parties, demanding a conservative Republican Party in the South and an exclusion of the “leftist” elements of the national GOP.

I don’t suppose the SDS activists thought that the combination of the Goldwater right and the Southern Democrats would form a majority coalition strong enough to dominate US politics for decades. Still it’s far from obvious that they were wrong in wishing for the emergence of a clear partisan division to replace the coalition politics of the time.[^2]

Any assessment of the realignment is complicated by the shift to the right that took place throughout the developed from the 1970s onwards. The fact that this shift seems to be going into reverse in the US.[^3], while it is accelerating in Europe, may be in part the product of the great realignment. Oddly enough, precisely because partisan politics is so new in the US, the Dems seem to be more willing to engage in it than their Social Democratic counterparts in Europe (of course, they’ve been schooled in it by the Repubs for twenty years or so). And while the objective position of the Dems is still well to the right of European SocDems, they seem to be breaking with neoliberal ideas like the Grand Bargain at precisely the time the SocDems are (for the most part) capitulating to austerity.

[^1]: We seem to be missing the link on this, but here’s my opening contribution.

[^2]: BTW, it seems bizarre to me, and to other non-US people I’ve talked to that the acryonym GOP is used to describe the Repubs, even by a group as hostile as the SDS. There’s no corresponding acronym for the Democrats – it would seem that DP and RP or just D’s and R’s would serve much better. Any thoughts on this?

[^3]: As evidenced both by the renewed electoral success of the Democrats, and more tenuously, by a shift away from the idea of a market liberal “Grand Bargain” and towards a reassertion of support for the institutions of the New Deal (minus the accommodation with Southern racism).

Over the years, Eric Alterman has written many articles I’ve disagreed with. I’ve never commented on them publicly because he’s a colleague at Brooklyn College. But in the current issue of the Nation Alterman devotes a column—and then a blog post—to a critique of Max Blumenthal’s new book Goliath: Life and Loathing in Greater Israel.

Even if you haven’t read Blumenthal’s book, it’s not hard to see that Alterman is writing out of an animus he can’t get a hold of. His prose gives him away.

Alterman writes, for example, “And its [Goliath’s] larding of virtually every sentence with pointless adjectives designed to demonstrate the author’s distaste for his subject is as amateurish as it is ineffective.” A writer more in control would have seen that it’s not possible for an adjective to be both “pointless” and “designed to demonstrate the author’s distaste for his subject.” Also, that it’s not wise to lambast the use of adjectives with a sentence deploying three of them—and then to follow that up with a sentence using two more.

As it happens, however, I have written about Max’s book on my blog, and Alterman’s portrait bears little resemblance to the book I read. [click to continue…]

The UK has a law providing that government documents become public after thirty years, which is an admirably strong provision – unless it’s ignored. [click to continue…]

Timothy Egan is at it again in the New York Times

Oscar Wilde still lounges, louche-like … a river crossed by bridges named for playwrights and patriots … the clamorous clans of Erin … a bittersweet anniversary. Fifty years ago the last king of Ireland, President John Fitzgerald Kennedy, came to the land of his great-grandfather Patrick. … delighted a lyrical people with his wit and his one-liners … charmed old ladies, nuns and schoolgirls …750 years of British occupation enforced by hangman’s noose and cannon. … poor island of farmers, shopkeepers and laborers … Hipsters from Google and Facebook flooded pubs in Dublin’s Temple Bar area and danced to traditional music as mournful as it was infectious. … crucifixes are gone from many homes … What remains, in homes and shops and pubs, are pictures of President Kennedy. … But looking back is always productive. Memory is embedded in every square foot of Irish sod.

It’s as if Thomas Friedman had himself decided to follow the leapin' leprechaun, hopping swiftly from one cliche to another. Only worse. I don’t know why it is that NYT editors’ critical faculties desert them every time they see a piece singing of the sweetness and the sorrows of the Auld Sod. But I do wish that they’d stop it.

From James Warburg’s oral history: [click to continue…]

I’m back today with part 5 of my intellectual history of fear. After my posts on Hobbes (rational fear), Montesquieu (despotic terror), Tocqueville (democratic anxiety), and Arendt (total terror), we’re ready to turn to more recent theories of fear, which arose in the 1980s and 1990s, in the wake of the conservative backlash against the 1960s and the collapse of communism.

In my book on fear, I divide these recent theories into two broad camps: the liberalism of anxiety and the liberalism of terror. The first camp tracks communitarian liberalism (or liberal communitarianism) as well as some influential arguments about identity and civil society; the second camp tracks what is often called political liberalism or negative liberalism, and it includes treatments of ethnic conflict and violence. The first camp takes it cues from Tocqueville, the second from Montesquieu.

The primary theoreticians of the first camp include Michael Walzer, Charles Taylor, Michael Sandel, Will Kymlicka, Amitai Etzioni, David Miller, and to a much lesser degree Seyla Benhabib. The primary theoretician of the second camp is Judith Shklar, but her arguments are echoed by theorists like Avishai Margalit and Richard Rorty and popular writers like Philip Gourevitch and Michael Ignatieff. The work of Samuel Huntington hovers above both camps.

Both camps, I argue, are responses to the failures of the radicalism of the 1960s and to the conservative retreat since then. To that extent, their political and intellectual context mirrors that of Tocqueville writing in the 1830s and Arendt (and other Cold War intellectuals) writing in the late 1940s and early 1950s. All were grappling with questions of fear in the wake of ruined insurgencies. [click to continue…]

Eighty years ago today, on October 16, 1933, Franklin Roosevelt decided to push up the price of wheat, to increase the income, and purchasing power, of depression-struck farmers. He thought that the way to make wheat more costly was to have the government buy some. But was it the large purchase, which limited supply, that affected the price? Or was it the announcement of a purchasing program that shifted expectations and affected prices? [click to continue…]

Notorious technophobe Luddite Ethan Zuckerman

“I don’t want a Google car,” I tell her. “I want a train.” … There’s something very odd about a world in which it’s easier to imagine a futuristic technology that doesn’t exist outside of lab tests than to envision expansion of a technology that’s in wide use around the world. How did we reach a state in America where highly speculative technologies, backed by private companies, are seen as a plausible future while routine, ordinary technologies backed by governments are seen as unrealistic and impossible?

… My student Rodrigo Davies has been writing about civic crowdfunding, looking at cases where people join together online and raise money for projects we’d expect a government to otherwise provide. On the one hand, this is an exciting development, allowing neighbors to raise money and turn a vacant lot into a community garden quickly and efficiently. But we’re also starting to see cases where civic crowdfunding challenges services we expect governments to provide, like security. Three comparatively wealthy neighborhoods in Oakland have used crowdfunding to raise money for private security patrols to respond to concerns about crime in their communities. …

… On the one hand, I appreciate the innovation of crowdfunding, and think it’s done remarkable things for some artists and designers. On the other hand, looking towards crowdfunding to solve civic problems seems like a woefully unimaginative solution to an interesting set of problems. It’s the sort of solution we’d expect at a moment where we’ve given up on the ability to influence our government and demand creative, large-scale solutions to pressing problems, where we look to new technologies for solutions or pool our funds to hire someone to do the work we once expected our governments to do.

There’s a lot of good stuff in Colin Crouch’s new book, _Making Capitalism Fit for Society_ (Powells, Amazon), but one point seems particularly relevant today. As umpteen people have pointed out, the rollout of the federal enrollment system for Obamacare has been a disaster. The polymathic David Auerbach has been particularly excellent on this.

The number of players is considerably larger than just front-end architects Development Seed and back-end developers CGI Federal, although the government is saying very little about who’s responsible. The Department of Health and Human Services’ Centers for Medicare and Medicaid Services (CMS), which issued the contracts, is keeping mum, referring reporters to the labyrinthine USASpending.gov for information about contractors. … By digging through GAO reports, however, I’ve picked out a handful of key players. One is Booz Allen … Despite getting $6 million for “Exchange IT integration support,” they now claim that they “did no IT work themselves.” Then there’s CGI Federal, of course, who got the largest set of contracts, worth $88 million, for “FFE information technology and healthcare.gov,” as well as doing nine state exchanges. Their spokesperson’s statement is a model of buck-passing … Quality Software Solutions Inc …[have] been doing health care IT since 1997, and got $55 million for healthcare.gov’s data hub in contracts finalized in January 2012. But then UnitedHealth Group purchased QSSI in September 2012, raising eyebrows about conflicts of interest.

… Development Seed President Eric Gundersen oversaw the part of healthcare.gov that did survive last week: the static front-end Web pages that had nothing to do with the hub. Development Seed was only able to do the work after being hired by contractor Aquilent, who navigated the bureaucracy of government procurement. “If I were to bid on the whole project,” Gundersen told me, “I would need more lawyers and more proposal writers than actual engineers to build the project. Why would I make a company like that?” These convolutions are exactly what prevented the brilliant techies of Obama’s re-election campaign from being involved with the development of healthcare.gov. To get the opportunity to work on arguably the most pivotal website launch in American history, a smart young programmer would have to work for a company mired in bureaucracy and procurement regulations, with a website that looks like it’s from 10 years ago. So much for the efficiency of privatization.

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It’s the fiftieth anniversary of the March on Washington and the Kennedy assassination, both in their way notable events in the history of African American civil rights. But it is also the hundredth anniversary of a different, equally notable event: the racial segregation of the US government in 1913 under newly elected president Woodrow Wilson. [click to continue…]

I have always been of the view that there’s no real point in getting too outraged about the Nobel Prize for Economics. For one thing – economics is an important subject which is bound to have an important prize, and it’s a good thing that this prize isn’t wholly in the control of the American Economic Association[1], because if it was it would be a whole lot worse. For another, on an objective look at the quality of the company which the Economics Nobel is keeping, I don’t think anyone can really claim it’s bringing the average down. The Peace Prize is a notorious joke, of course, but the Literature prize is also wildly eccentric, and even the Physics and Chemistry prizes are occasionally awarded to people who believe in ESP[2]. So let’s stipulate that the Balzan Prize and the Fields Medal are both really really good prizes, and that winning one of them is probably even better than having dinner with the King of Sweden[3].

So, the Fama/Shiller/Hansen prize, or as the vast majority of comment has it, the prize for “Fama, Shiller and that other guy”. What does it say about the state of economics? I think it encapsulates everything good and bad about the subject. First, the good.

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