dsquared’s “post”:https://crookedtimber.org/2007/01/08/trust-in-me/ below reminds me of this “post”:http://atrios.blogspot.com/2006_10_29_atrios_archive.html#116222547954644309 that Duncan Black wrote last year, which I meant to write something about, and never did.

[Mallaby] starts with the basic premise that well-functioning societies require a degree of trust, something I agree with … But then he moves from the issue of shared social capital – trusting each other – to the need for people to have faith in the ruling class … Mallaby’s arguing that society functions much better when the ruling class is unfettered by the pesky masses. Yes, yes, the ruling class shouldn’t abuse its trust – that would be wrong – but when it does the real tragedy is that then they get subjected to pesky oversight from the dirty fucking hippies which prevents them from achieving their true awesomeness as our unaccountable overlords.

A lot of my “academic work”:http://www.henryfarrell.net/distrust.pdf is on the relationship between trust and interests. Like much academic writing, a fair amount of it consists of spelling out the obvious at laborious length, but given how badly notions of trust are abused in current debate, perhaps it isn’t entirely useless. Simply put, the political argument that you should trust people who don’t have a good self-interested reason to behave trustworthily is at best naive and at worst dishonest apologetics. In particular, powerful people by and large don’t have much interest in behaving trustworthily to weaker ones in the absence of external sanctions; while in some cases they may be trustworthy nonetheless (perhaps they’re genuinely noble and disinterested types), you wouldn’t want to count on it. None of this is exactly rocket science, but given the amount of guff from pundits about social capital, loss of trust in government etc, you wouldn’t know it.

In comments on an open thread on my blog, Michael Greinecker points to a truly strange response to arguments for a zero rate of social time preference.

Crucial quote

I found myself becoming very curious whether economists who support Sir Nicholas’s social discount rate of zero, such as econ bloggers John Quiggin and Brad DeLong, identify themselves as pro-choice or pro-life, and whether they had considered the Stern Report from this angle.

My response has been anticipated by a commenter who observes

Strange as it may seem to Economist writers, there are phenomena in the world that aren’t particularly illuminated by applying economic concepts. Attitudes towards abortion have nothing at all to do with discounting rates.

Others in the comments thread spell this out.

One odd feature of the Economist blog is that contributions are anonymous. I know that Megan McArdle (aka Jane Galt) has something to do with the site, but I have no idea whether she wrote this piece. While I’m used to pseudonymous commenters, most economics bloggers are (as Matt Yglesias puts it) proudly eponymous, or at least easily identified, and I find this a more satisfactory mode for arguing about issues like the Stern Review, though can’t exactly say why.

I’m rather glad to see that Hilary Benn is the bookies’ favourite for the Labour party deputy leadership. I have no real knowledge of the state of internal Labour party politics, or of what Hilary Benn’s actual policies are. But on the other hand, neither is my support for him[1] based on pure sentimentality about his dad. Nope, I’m a Benn man for the simple reason that I think there ought to be some earthly reward for a political career that has been marked out by honesty and competence. If only for novelty value. After the disgrace that was Clare Short’s term as Secretary of State for International Development[2], Benn was a breath of fresh air. He was (and remains) utterly essential to the peace talks in Sudan. And he was the only major World Bank shareholder to stand up to Paul Wolfowitz and say what needed to be said about Wolfowitz’s utterly bogus “I Can’t Believe It’s Not An Anti-Corruption Policy”. My only reservation in voting Benn is that, to be honest, the developing world needs him a lot more than the Labour Party does, and that the SSID job is cleaner, more honest and more important than turning himself into the thinking man’s John Prescott.
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During the discussion of discounting and the Stern Review, I got an email raising a point that I had already been worrying about. In discussing costs and benefits in 2100, I and others routinely refer to future generations, and in a sense that’s right, since the people involved in the discussion won’t be around then. But, children alive now have a reasonable chance of living to 2100 – quite a good chance if life expectancy keeps rising. Economists often deal with this kind of thing by modelling a series of overlapping generations, but I haven’t seen much discussion of this in relation to benefit-cost analysis, though no doubt it’s in the literature somewhere.

I finally got around to thinking about this, and in particular the following question. Suppose we accept an ethical framework in which everyone now alive matters equally. Suppose also that as individuals we have a consistently positive rate of time preference, preferring to have higher utility now at the expense of less in the future, that is, more when we are young and less when we are old (this isn’t obvious by the way, but I’m assuming it for the sake of argument) . What is the appropriate pure rate of time preference for society as a whole?

My preliminary answer, somewhat surprisingly to me, is “Zero”. I’ll set out the outline of the formal argument over the fold, but the simple summary has two parts. First, since generations overlap, if, at all times, we treat all people now alive as equal then we must treat all people now and in the future as equal. Given this equality, positive individual rates of time preference translate not into a social preference for the present over the future but into a social policy that consistently puts more weight on the welfare of people when they are young than when they are old.

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Imagine, 45 years after Britney Spears dies, some young kid mimicking her on Stars in Their Eyes. You can’t. Madonna? I’d be surprised. Jagger, Springsteen, Dylan? Ephemera. Hendrix and Presley? Perhaps they are as great as George Formby. Perhaps.

So a treat for the fans amongst our readers (and I know there are some). Scroll down toward the bottom of this page and click “Watch in real media”, and about 3 minutes in you’ll find a lovely little lad playing “My Little Stick of Blackpool Rock”. He doesn’t quite get how dirty it is (thank goodness) and he’s not yet got quite the presence of the master, but it is wonderful. And heart warming. The curious can see the master himself here, here and here (is that the marvelous Beryl there with him?).

Does the Daily Show owe our former co-blogger Ted Barlow, a writing credit?

Watch and decide …

(“Direct link to video”:http://www.youtube.com/v/BQsMJRUypuM )

I just finished reading ,The Amazing Adventures of Kavalier and Clay (UK) and want to recommend it to everyone else who is several years behind the curve. (My next review will be of a book that has today as its publication date, honest). Before Daniel rolls his eyes about “bloody Marvel comics” I should say that initially I had no intention of reading it. Chabon is compared on the sleeve with Cheever and Nabokov, neither of whom I have read; there is no indication of any murders in it, or English detectives solving them; and even I find the idea of a novel about people writing comics slightly silly. What prompted me to read it was the enthusiasm of my wife, a person who holds comics in the kind of contempt that people with a sense of humour reserve for the “humour” pages of Reader’s Digest. (My daughter and I finally made her read some Tintin and Asterix a year or so ago, at which point she relented slightly, but only with regard to French and Belgian comics). And she was right, Kavalier and Clay is a wonderful novel. The central characters (surprisingly enough called Kavalier and Clay) are both realistically drawn – Kavalier is a brilliant obsessive who lives mostly in his head, escapes pre-war Czechoslovakia in a coffin and, once in New York is drawn into the comic business by his cousin, Clay, right in the middle of the golden age. He is determined to bring his family to join him, and, like Clay (who idolizes him) determined somehow to bring America into the war. Their great creation, The Escapist, seems to be loosely modeled on the radio serial character Chandu the Magician. Its hard to say much more without giving too much away, but there are really five central characters, all of them lovingly drawn – Kavalier, Clay, the bohemian girl Rosa Saks with whom both of them become involved, a long-dead New York City, and the world of the comic book production team. Though long, its moves at a fast pace, and I think what I liked best about the novel was the good-heartedness of the author – all the central characters and most of the supporters are flawed but decent people, and none the less interesting for that. I guess I’ll have to read his novel with the word “mysteries” in the title, even though it doesn’t seem to involve any murders, unfortunately…

2007 marks the 400 year anniversary of the Flight of the Earls, the moment the political leadership of the Irish aristocracy left Ireland and scattered all over Europe. Following an unsuccessful rebellion in 1601 that marked the end of a nine year campaign against the English, the leaders, Hugh O’Neill (an antecedent of Henry’s and mine, I believe) and Rory O’Donnell, left Ireland for the continent. O’Donnell died suspiciously in Rome the following year, and O’Neill’s plans to use his Spanish allies to mount a further military campaign fizzled out. I’m pretty hazy on the details, but I think the Irish colleges in Paris and Louvain have strong connections with the Flight of the Earls.

Learning about the Flight of the Earls in primary school, I remember feeling very sad that the last stand against colonialism ended so decisively, and that its leaders were forever (self)-exiled. But chatting to some Irish ex-pats in Brussels recently, I found myself wondering aloud if the English actually did us a favour. Certainly, the Flight of the Earls opened the way for the plantation of Northern Ireland, a forced colonisation whose implications we’re all still struggling with. But perhaps Ireland also gained something from losing its native aristocracy.

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If you want to see the new flexible workforce, go to Walmart (hat-tip Tim Dunlop). As Tim’s title suggests, there’s nothing new about workers being told, from day to day, whether they’ll be wanted and for how long – look at any old movie about the waterfront for illustrations. All that’s new is that it’s being done by computer now. And flexibility, in cases like this, is a zero-sum concept: the more flexibility our bosses have to direct us, the less we have to run our own lives.

Obviously, I’m not the only one who gets annoyed by pieces pointing to purchases of consumer goods as evidence that rising inequality isn’t really a problem. As Henry says, this is a tired shtick that lots of us are sick of.

But, as an economist, it particularly annoys me when this claim is put forward by people who claim to understand markets. I’ve been going on about this for yearsand years.

The most important thing that happens in markets is that relative prices change. If prices change, but income and preferences don’t, what we expect is that people will consume more of the goods and services for which prices have fallen and less of those for which prices have risen. So, when Jeff Taylor tells us that

With price points dropping below the $1000 mark, high-end TVs are moving down-market fast with Wal-Mart leading the way.

we can all cheer this renewed verification of the Law of Demand. But, of course, this tells us precisely nothing about what’s happening to inequality.

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One of the more annoying libertarian shticks to us lefties is the “increasing poverty and inequality don’t matter because consumer spending is going Up! Up! UP! ! !” three card monte routine. I think it must surely have reached its apotheosis in this “failed November hack job on Edwards”:http://www.reason.com/news/show/116797.html by Jeff Taylor in _Reason Online_ which I didn’t see until Nick Gillespie linked to it today.

However, the slapstick of the Edwards misstep should not obscure the really big picture, the fatal flaw in his “Two Americas” spiel. Many thousands of Americans evidently have $600 to spend on a video game machine. What’s more, this Christmas is expected to usher in the year of the flat-panel. With price points dropping below the $1000 mark, high-end TVs are moving down-market fast with Wal-Mart leading the way. Contrary to the Edwards’ pitch that labor-hostile companies are leaving American workers destitute, somebody is making some money out there in America. More importantly, they are making it in many, many cases without a union card. This reality will very hard [sic] for union-funded Democrats like Edwards to ignore as the 2008 presidential campaign unfolds. Hewing to the union rules, clear evidence of prosperity, like perhaps a shortage of $600 game machines, will have to be swept out of the campaign.

It isn’t hard for me to believe that someone would make the hilariously cackleheaded argument that because “many thousands” can afford a Playstation 3, economic inequality is a non-issue; I see this kind of guff in the comment sections of blogs all the time. But it is rather surprising that it’s being published by a sometimes quite interesting website as a purportedly serious contribution to political debate.

(As an aside, Taylor also introduces us to the interesting sounding concept of ‘Pythonseque depravation one-upsmanship;’ a spelling error trifecta unless depravation is a portmanteau term indicating Taylor’s opinion of the moral qualities of those wicked enough to be poor. Someone really needs to be proofreading the contributions to Reason’s website a little better).

The Eastern Division of the American Philosophical Association had its annual meeting last week. This year it was in Washington, and for the second straight year I attended but went to exactly zero sessions – I was conducting interviews. But the real excitement was at 4:30 am on Saturday when the fire alarm went off in the hotel. I basically assumed somebody had pulled a switch in a drunken stupor, but my wife and I decided not to take the time to get our 6-year-old dressed, so we just wrapped her up in her sleeping bag and I carried her down the hall to the stairs. We definitely smelled something burning when we passed the seventh floor, and as we waited outside some people were saying that they had crawled through part of the hall on the seventh floor because the smoke was so thick. The rumor was that one woman was taken away by ambulance after breathing in smoke, but I didn’t see that.

After about an hour (I’m guessing – I didn’t have a watch), we were allowed to go into the ballroom where we waited for another hour before being allowed back into our rooms. On the ground floor, there was some water damage from the sprinklers on the seventh. On our way back to our room we peeked into the seventh floor where the smell of smoke was strong and several of the doors had been broken down. No word on how it started, but I’m sure grateful that the alarms and sprinklers worked.

Last spring I put up a post about Randy Cohen, the NY Times Magazine “ethicist”, and I quoted the following passage from his book: “real virtue lies not in heroically saving poor orphans from burning buildings but in steadfastly working for a world where orphans are not poor and buildings have decent fire codes.” Let’s hear it for decent fire codes.

This YouTube video of our calico cat and a wind-up toy bird has had just over 9,000 hits. My wife initially put it up expecting that just a few friends would take a look. At some point, it went from a few dozen hits to several thousand. For the past couple of months, it has been poised to break the 10k barrier, but lost a lot of momentum somewhere along the way.

This is where you can help.

Besides, it seems like time finally to do my first CT post of 2007, and it was either this or something about the late Seymour Martin Lipset‘s place in the history of the Shermanite faction following its departure from the Workers Party. A tough decision. But I find that the video does not actually decrease my will to go on, so here it is.

I have little interest in cricket, but — like snooker — it is enjoyable to watch because of its psychological element: you get to see grown men crushed psychologically without any violation of the Geneva Conventions. Though at the moment Australia are pushing it pretty close to a Human Rights Violation with England. Shane Warne got 71, this from the second-to-last man in the batting lineup. In the process he said to Paul Collingwood, “You got an MBE, right? For scoring seven at the Oval?” And now England are in. Over to Tom Fordyce and the BBC online commentary:

*1433: Eng 0-0* Right England – let’s see what you can do after that onslaught. …

*1439: Eng 4-0* McGrath opens the Aussie bowling for the last ever time in a Test. Writing those words has provided me with a small crumb of comfort. He beats Cook twice outside off, but the Essex tyro then cuts him tastily for four.

*1439: WICKET – Cook ct Gilchrist b Lee 4, Eng 4-1.* Oh no…

Chin up, Tom. It’ll all be over soon.