Can it really be better to make new bulbs, and destroy these without using them? How does that save energy? Can they be serious?
Answer: YES, if you understand that environmentalism has nothing to do with saving energy, and everything to do with religious ceremonies where cost is actually a signal of devotion. As soon as you start to think of environuts as religious zealots, it makes perfect sense.
(Nod to the Blonde, again. She just can't let these Heat Balls alone!)
"Well, it’s the absurdity of expressing it, the absurdity of commerce… making records is commerce and it’s about fooling yourself as a writer and a performer and fooling the audience into not thinking about it and accepting it. It’s like when you walk down the street, and you say, “look at that girl’s ass, it’s so great.” You’re ignoring also the fact that she farts and shits out of that ass."
What, these incandescent light bulbs? The ones outlawed by the EU ubernannies? Those aren't light bulbs at all! Those are small heating units that plug into an otherwise unused light bulb. Sure, they produce a small amount of light, but that's a bonus.
"University of Pennsylvania law professor David Skeel, writing in the Weekly Standard, suggests that Congress pass a law allowing states to go bankrupt. Skeel, a bankruptcy expert, notes that a Depression-era statute allows local governments to go into bankruptcy...A state bankruptcy law would not let creditors thrust a state into bankruptcy -- that would violate state sovereignty. But it would allow a state government going into bankruptcy to force a 'cramdown,' imposing a haircut on bondholders, and to rewrite its union contracts. The threat of bankruptcy would put a powerful weapon in the hands of governors and legislatures: They can tell their unions that they have to accept cuts now or face a much more dire fate in bankruptcy court." [Michael Barone, NRO Online]
Pelsmin's reason for sending it: "This is just the thing for the semi-immobile guy who needs to chase down his oxycodone with a frosty Bud Light." Yes, yes it is.
I want to go on record as being bullish on 2011 for the US economy. I want to predict average growth for the year of 4.2%.
Yes, de-leveraging is not over. Yes, housing probably has not hit bottom. But, my view is we are poised for a semi-robust expansion.
But I'm afraid to come out and say it.
Why?
Well I'm not proud to admit this but I'm afraid of the House Republicans and the crazy sh*t they will no doubt try and pull. Yes I know, checks and balances and all that, but they worry me.
If they go after the Fed, throw a lot of heat and light on rolling back HCR and the financial oversight bill, and try to shut down the government over the debt ceiling, we could be right back into economic doldrums.
Look, I am not a big fan of the Fed or of HCR as currently constituted, but my advice to the Republicans would be to wait until after 2012 when the economy should be much sounder and maybe you also have the Senate to try and make your move.
The biggest thing Washington could do right now to help the economy would be to take a 14 month vacation.
And, since my eye hurts too much to sleep, I have been up catching up on good blog posts. Like the ones at Popehat. So now my eye hurts AND I'm outraged. DUI is really tough, because it is like the war in Iraq: the right wants to do stupid shit, and the left is too big a bunch of pussweilers to stand up for the Constitution. Because half-wits like Ezra Klein have decided that talking about the Const is just bringin' up ol' stuff. And why you wanna bring up old stuff?
Separated at birth? Mungowitz and Nick Nolte... Lagniappe: The reason *I* look that way (Not sure what Nick's excuse was) is that I had this operation. With local anesthesia. Which means I got to watch (it's a 2 hour operation, by the way). If you want to see what it looks like from outside, check out this video.
It's amazing they can do that to an eye. It's even more amazing they did that to mine, and that I had to watch the whole thing. On the plus side: they prescribed oxycodone, the oxycontin plus other stuff pain medication. I was a little upset to learn that that was what they were going to prescribe, because they try to avoid it. It has to be clear that you are going to hurtin' before you get it. It does help, though. Gosh, have you ever looked at how your fingers bend? I mean really looked at your fingers. Whooooaaaaa.....
PS. One thing I really like about Latin American Spanish is the -azo. Take a soccer goal (gol). If it's spectacular, add the azo and call it a golazo! If Serge Ibaka busts open Josh Smith's pumpkin with a vicious elbow (codo)? That, people, is a codazo!
Sean Ehrlich, International Studies Quarterly, December 2010, Pages 1013-1033
Abstract:The embedded liberalism thesis, a major component of the trade policy literature in political science, argues that governments can build support for free trade by compensating economically those hurt by trade, usually with welfare or education policies. This strategy depends, though, onopposition to trade being driven by employment factors, such as job or income loss because of increased competition. The current fair trade movement raises many non-employment criticisms of trade such as concerns about the environment and labor standards but the literature tends to treat these concerns as traditional protectionism in disguise. This articleargues, instead, that for many, these concerns are sincere and that this presents a growing challenge to the compromise of embedded liberalism. The article demonstrates this by examining survey data in the United States and showing that those who support fair trade tend to have characteristics that are opposite those who support economic protection.
A clear problem with democracy. Idiots who are racist or homophobic get to decide employment and marriage policy. And idiots who have no idea how an economy works get to regulate the economy. Democracy is overrated.
I actually thought that Angus must be making up the thing about "old people should be ignored because they were retarded." After all, Arnold Kling is hardly a left-wing goober.
But the left-wing goobers are saying the same thing! Check this bon mot from the aggressively useless Ezra "History Begins With Me!" Klein:
He actually says that the reason no one should read the Constitution is that it is old, and no one can tell what it says.
To be fair, I'm sure he means that one has to read the "midrash" of Supreme Court decisions before you can know what the "torah" of the Constitution actually means. (At least, I hope he means that.)
But, consider the 2nd Amendment. Ten years ago I had lunch with a friend who teaches Con Law. I mentioned that the 2nd Amendment clearly creates a personal, individual right to have and bear arms. The only question is how much the state can regulate and limit the size and use of such weapons.
My "friend," with amazing condescension, suggested I should read some undergraduate books to learn what the Constitution really means. Clearly, given what the Court had said in Miller (for example) there is NO right to individual ownership. It doesn't really matter what I think the Constitution says, he told me in the patient tone of a parent lecturing a wayward and willfully ignorant child.
Well, my good friend Prof KM, given the recent decisions in Heller and in McDonald...HOW DO YOU LIKE ME NOW, SWEETIE! Maybe YOU should go read that old Constitution. It has some really cool parts.
Of course, some of it is very hard to understand, I admit. Take the first Amendment, where it says, "Congress shall make no law..." Opaque language, that, as Stephen Gutowski notes. Must mean that Congress can make pretty much any law it wants, right? As long as a majority approves, like in McCain-Feingold?
100 years ago, Ronald Coase was born. 20 years ago, I was privileged to write a book review of Ronald's book, THE FIRM, THE MARKET, AND THE LAW. Here is part of that review:
"The reason the collection works as a book is that Coase frankly recognizes that though his work (particularly "The Nature of the Firm" and "The Problem of Social Cost," Chapter Five) is often cited it is apparently little read or accepted. In fact, Coase seems frustrated at the misuse of his work, particularly regarding the apocryphal "Coase Theorem": The world of zero transaction costs has often been described as a Coasian world. Nothing could be further from the truth. It is the world of modern economic theory, one which I was hoping to persuade economists to leave . . . Economists [have] been engaged in an attempt to explain why there are divergences between private and social costs and what should be done about it, using a theory in which private and social costs were necessarily always equal. It is therefore hardly surprising that the conclusions reached were often incorrect.., their theoretical system did not take into account a factor which is essential of one wishes to analyze the effect of a change in the law on the allocation of resources. This missing factor is the existence of transactions costs. (pp. 174-175, red emphasis added.)
So Coase actually thought transactions costs could make social and private costs diverge. Does that mean Pigou was right? Well, yes, Pigou was certainly right, especially when he said:
It is not sufficient to contrast the imperfect adjustments of unfettered enterprise with the best adjustment that economists in their studies can imagine. For we cannot expect that any State authority will attain, or even wholeheartedly seek, that ideal. Such authorities are liable alike to ignorance, to sectional pressure, and to personal corruption by private interest. (1920; p. 296)
The point is that we should READ the classics, not just cite them. Especially when we cite them wrong. Both Coase and Pigou are much more subtle than the caricature they generally get in intermediate micro classes. Happy birthday, Dr. Coase.
I focus a lot of my historical reading on the first World War and on the 1930s. I think that people were really stupid back then. I take the Flynn Effect seriously, which suggests that the average IQ several generations back was what today would be considered to be mentally retarded. In my view, this helps to explain how cheerfully the nations went to war in1914. Yes, the war turned out to be worse than what they expected. But how were their expectations not influenced by the Civil War or the Franco-Prussian war?
--Arnold Kling
OMFG, people. World War I happened because world leaders 100 years or so ago were "mentally retarded"? Really?
REALLY?????
So going back another 50 years or so, Abraham Lincoln must have been the intellectual equivalent of a spider monkey?
Go another 100 years back from that. The founding fathers were the mental equivalents of dung beatles?
Or, saying things are bad has been very very good.
Item 1: Nouriel gives an interview on December 28th with CNBC saying housing prices can "only move down".
Item 2: Earlier this month, Nouriel bought a $5.5 million apartment in Manhattan! He got a $2.99 million dollar ARM (so I guess he made a $2.51 million down payment??)!
The Coase theorem, manners, and a variety of madcap exchanges like this:
A: I never liked having to maneuver around strange large dogs in tight offices in my suit
B: what was a dog doing in your suit?
I liked the whole thing. It's ALL good. Yes, I cheated to spend so much time on the computer. But I couldn't help it. I often took "Louis, King of Dogs" to the office in grad school. And Angus would get in some pretty good basketball-doghead-dribbling. Louie had a pretty solid upward head bounce, and was not smart enough to walk away.
"We've become a nation of wusses. The Chinese are kicking our butt in everything. If this was in China do you think the Chinese would have called off the game? People would have been marching down to the stadium, they would have walked and they would have been doing calculus on the way down."
Holy Moly!
I will say this though. If the Communist party wanted the game to go on, it would go on and the people would walk there if ordered to and would do calculus, or even the hokey pokey on the way if ordered to.
KPC is officially "short" on Ed Rendell AND China for 2011.
Christopher Mayer, Tomasz Piskorski & Alexei Tchistyi NBER Working Paper, December 2010
Abstract: This paper explores the practice of mortgage refinancing in a dynamic competitive lending model with risky borrowers and costly default. We show that prepayment penalties improve welfare by ensuring longer-term lending contracts, which prevents the mortgage pools from becoming disproportionately composed of the riskiest borrowers over time. Mortgages with prepayment penalties allow lenders to lower mortgage rates and extend credit to the least creditworthy, with the largest benefits going to the riskiest borrowers, who have the most incentive to refinance in response to positive credit shocks. Empirical evidence from more than 21,000 non-agency securitized fixed rate mortgages is consistent with the key predictions of our model. Our results suggest that regulations banning refinancing penalties might have the unintended consequence of restricting access to credit and raising rates for the least creditworthy borrowers.
It has been the maintained hypothesis here at KPC for some time that the PRIMARY burden of the new nanny regs on financial markets will be poor or risky borrowers. It's actually pretty obvious, when you think of it.
Gotta be tough for the young lady. Hayek is long dead, and she can't use ...well, let's call them battery-powered products. 'Cause no true Hayek-lover would accept artificial stimulus.
Competitive Markets Are the Enemy of Profits, So Wall Street Opposes Market Competition
Reputation, the SEC, and the requirements of SARBOX are extremely effective entry barriers. SARBOX doesn't apply to privately held companies, but no small company could hope to compete with the big companies.
"If Hertz sees much of its rental fleet lying idle, it will cut its prices to better compete with Avis and Enterprise. Chances are that Avis and Enterprise will respond in kind, and the result will be lower profits all around. On Wall Street, the price of various services has been fixed for decades. If Morgan Stanley issues stock in a new company, it charges the company a commission of around seven per cent. If Evercore or JPMorgan advises a corporation on making an acquisition, the standard fee is about two per cent of the purchase price. I asked TED why there is so little price competition. He concluded it was something of a mystery. 'It’s a commodity business,' he said. 'I can do what Goldman Sachs does. You can do what I can do. Nobody has a proprietary edge. And if you do have a proprietary edge you’ll only have it for a few weeks before somebody reverse engineers it.' After thinking it over, the best explanation TED could come up with was based on a theory of relativity: investment-banking fees are small compared with the size of the over-all transaction. 'You are a client, and you are going to do a five-billion-dollar deal,' he said. 'It’s the biggest deal you’ve ever done. It’s going to determine your future, and the future of your firm. Are you really going to fight about whether a certain fee is 2.5 per cent or 3.3 per cent? No. The old cliché we rely on is this: When you need surgery, do you go to the discount surgeon or to the one you trust and know, who charges more?'" [John Cassidy, New Yorker]
Now, you could say it would be hard for new firms to enter this market anyway. But our government makes it impossible.
Congratulations to the Mexican drug cartels, who've had a very good 2010. They now allegedly control 75% of neighboring Guatemala (with the deployment of only 800 operatives), and have muscled out the Colombians for the European cocaine distribution routes.
KPC is officially "long" on Mexican drug lords for 2011.
Mrs. Angus and I wait til just before Christmas and buy a live tree which we plant afterwards. Today was the day and we got an awesome Blue Atlas Cedar. Here's the before and after:
It's beginning to look at lot like Christmas at Chez Angus.
I decided to go with a different kind of top ten list this year:
1. Great music not found on many year-end lists.
Big Troubles: “Worry” If I had to pick one work as “album of the year” this would be it. Simply fantastic. “Bite yr Tongue”, “Georgia” & “Freudian Slips” are my current favorite songs from this album, but it is an absolute monster! You can stream the whole thing here, and buy it here.
Harlem: “Hippies”. Harlem blew me away with their debut album “Free Drugs” and “Hippies” is even better. Here's a video from the album:
No Joy: “Ghost Blonde” If it wasn't for Big Troubles, this would be my record of the year. Kevin Shields should be very proud. You can buy it here, and here's a video:
The National: “High Violet” I still can’t decide if I like this better than “Boxer”. I think “Boxer” is more consistently great, but the high points of “High Violet” are incandescent.
LCD Soundsystem: “This is Happening”. James Murphy outdoes himself. I loved “Sound of Silver” but have now grown to believe that “This is Happening” is even better. Not sure where Murphy can go from here.
Joanna Newsom: “Have one on me”. It’s a bit un-nerving how she keeps changing her voice, but this triple CD is a nice step forward for her.
3. Good music from old favorites
Clinic, Spoon, No Age, Teenage Fanclub, Wolf Parade, Phosphorescent & The Fall all put out very good, listenable albums. Just not their best work ever.
4. Biggest disappointments
I can’t put Arcade Fire as a disappointment; I expected them to stink it up and they did. So my two biggest disappointments are M.I.A.’s “Mia” and Sufjan Stevens’ “Age of Adz”. These are artists who’ve made some of my alltime favorite music and this year’s works are crap. Sufjan is a particularly troubling case; I guess he’s now “too good” for the kind of music he’s made in the past and wants to be a freakin’ composer or something.
5. Best 2010 discoveries of existing artists
Kurt Vile (discovered from “Eastbound & Down”). This guy is awesome! Highly recommended to buy his whole catalog and soak.
Radar Brothers (discovered by arriving unfashionably early to the Vaselines / Teenage Fanclub show in DC). The above advice also applies here.
6. Best live shows I saw in 2010
Dan Mangan / Wooden Birds
Radar Brothers / Vaselines / Teenage Fanclub.
7. Winter 2011 release I’m most looking forward to
Deerhoof: “Deerhoof vs. Evil”
8. Best re-issues
Orange Juice: “Coals to Newcastle”, and the double CD versions of Galaxie 500’s three albums.
9. Best rap/hip-hop (NB I am not an extremely qualified person here)
Earl Sweatshirt: “Earl Sweatshirt” All I can say about this is “wow”. Pretty amazing stuff.
10. Favorite artist on Twitter
Wayne Coyne of the Flaming Lips from right up the road in OKC. You should definitely follow him.
I have often joked that grandparents should strive to keep low achieving grandkids out of college because it can be very very bad for the grandparents' health, especially around exam times. I guess the poor seniors just can't take the stress of worrying about their progeny's academic progress.
Well, it turns out that the full extent of this insidious problem has been scientifically investigated, in a classic research paper entitled "The Dead Grandmother/Exam Syndrome and the Potential Downfall Of American Society" (ungated version available here).
Here is one of the many "shout it from the rooftops" results:
"The FDR (family death rate) is climbing at an accelerating rate. Extrapolation of this curve suggests that 100 years from now the FDR will stand at 644/100 students/exam. At that rate only the largest families would survive even the first semester of a student's college career."
People, it just never ends. Now a group in California is suing Mickey D's over their happy meals. It turns out that kids like them and get mad if mom says no. So mom is suing!!
I am not making this up.
Of course mom is not "just" a mom; she's an employee of a state funded vegetable advocacy group.
(We like the reindeer outfit for the BMW. And before you ask, Tanzi was off camera rolling in something disgusting, so nobody wanted to grab her and get her to sit down)
KPC has used its considerable influence to negotiate the following deals for its readers (just enter KPCROCKS as the promotional code when doing online check out):
I have been trying to lay low. In fact, flat. MAG brought me over a massage table, which is like a sturdy cot, but with a frame with a hole in the middle so I can lie face down and read through the hole.
The first procedure was 8 days ago; the second procedure was Monday, 5 days ago. There is an enormous bubble in my left eye (well, a small bubble, but it's all I can see). The retina appears to have reattached in a physical sense. The problem is that the nerves all need to mate up again, and of course only some of them will. So vision from left eye will always be dim, wrinkled, and unfocused. At BEST.
The primary variable that affects the improvement of vision over the next month is lying face down and motionless. The larger the proportion of time I can do that, the more likely I get back at least some vision in the left eye. (Have always slept on stomach, so that's a help). Anyway, all I can do is look down. And dr says to stay off computer. Eye movements are too rapid, and too large.
So, I read. May I recommend:
Chernow's GEORGE WASHINGTON: A Life Manchester's THE ARMS OF KRUPP Strasser and Becklund's SWOOSH: The Story of Nike
Three huge books. Only the Chernow one is remotely new. But all well done. Finished GEORGE and SWOOSH, just started KRUPP. Read it years ago, but thought I would give it another go.
"Bargaining. This stage usually begins as an earnest attempt to buckle down and grade. The instructor might say, “If I grade five papers, I can watch one episode of House,” or, “For every page I grade, I get to eat a piece of candy.” This process starts well, but as the instructor progresses the amount of work required to achieve the reward generally becomes smaller and smaller..."
You'll have to excuse me now, grades are due in on Monday so I'm off to buy a big bag of Reese's cups!
As my good friend Doug Nelson likes to say, "you have to be a very highly trained economist to come to that conclusion".
Now maybe the Fed is playing the long con and deliberately misinformed the public about the true purpose of their policy. Could you see the Ben Bernank announcing "We want to raise inflation expectations and long term interest rates"?
I think that they actually expected to lower long rates and the episode should be viewed as an example of the idea that the further out in the term structure the Fed aims, the less control they actually have over rates.
I guess there are two kinds of people in this world; those who think the Fed is always wrong and those who think the Fed is always right.
I guess I am the last person with an internet connection to see this video.
Yes he's an entertaining and enthusiastic guy. Yes, the rise of China and India is amazing and fantastic. Yes there is a large "middle class" of countries.
But people, have you looked at the horizontal axis of his chart? The distance between $400 and $4000 is the same as the distance between $4000 and $40000.
That is incredibly misleading.
Properly plotted on a linear scale, it would be clear that there was way way way LESS income inequality in 1810 or that magic year of 1948 than there is in 2010.
We are NOT living in an "age of convergence" with respect to per-capita incomes.
It is NOT only Sub-Saharan African countries stuck at the bottom.
Latin America is NOT catching up to the USA.
The whole thing is pretty much horse hockey.
Then the press grabs ahold and starts to exaggerate the exaggerations. Here's David Brooks:
"Then, over the last few decades, the social structure of the world changes. The Asian and Latin American countries begin to catch up. With the exception of the African nations, living standards start to converge. Now most countries are clumped toward the top end of the chart..."
Just keep repeating this to yourself people: "The left half of the chart covers a range of $3,600, but the right half of the chart covers a range of $36,000.
Rahm Emanuel as Coriolanus" "The price is to ask it kindly"
A bizarre modern remake of Coriolanus was enacted in a basement hearing room in Chicago yesterday. (nod to Anonyman for the NTY link)
Listening to the questions, and the tone of the answers, reminded me of this speech by Coriolanus, after he agreed to submit to the questions of the idiot voters of Rome. Coriolanus has asked one voter what is the "price" of the office he seeks; the voter tartly responds that "the price is to ask it kindly."
Later, Coriolanus says this:
Better it is to die, better to starve, Than crave the hire which first we do deserve. Why in this woolvish toge should I stand here, To beg of Hob and Dick, that do appear, Their needless vouches?
Coriolanus thinks he deserves the office; how dare the voters make him beg for it? Sorry, Rahm, democracy sucks.
(An aside: I was surprised the article author called the Chicago train the "L", because I always thought it was the "El", short for "elevated train." But the city of Chicago itself has gone with "L" trains. Who knew?)
Nick "The Jacket" Gillespie Prepares Balanced Budget
This is cute, for several reasons.
First, the content is good, and the video works just based on the premise.
But for the cognescenti, all of whom know that Nick's "nickname" (sorry) is "The Jacket", the fact that he is wearing the leather jacket UNDER the apron is terrific. Nick is 90% in on the joke, but the fact is that he DOES always wear "the jacket."
Angry Alex asks whether Nick EVER takes off the jacket. My understanding is that, like the Bandit's hat, he takes it off for one thing, and one thing only.
City come through with the money and the bases We let 'em know we bout that cake straight up the case uh We independent owners, some mistake us for whores I'm sayin‘, why spend mine when I can spend yours Disagree? Well that's you and I’m sorry Imma keep playing these cats out like Atari
LA Clippers owner Donald Sterling is many things, slumlord, racist, sexual harasser, astute business man (he bought the Clips for 12.5 mil, now worth over 200 mil).
It’s not uncommon to hear Los Angeles Clippers fans heckle Baron Davis. Of late, however, the jeers directed at the team’s struggling point guard are coming from a far more surprising source: The man paying Davis, Clippers owner Donald Sterling.
Sterling has expressed his displeasure about Davis’ play by taunting him from his courtside seat at Clippers’ home games, several sources told Yahoo! Sports. Among Sterling’s verbal barbs:
– “Why are you in the game?”
– “Why did you take that shot?”
– “You’re out of shape!”
While Sterling has also taunted other Clippers players since the middle of last season, none have received it worse than Davis, the sources said.
Why?
Sterling “started getting a lot more vocal during the second half of last season,” one team source said. “He never had done that before at games. Baron’s his pet project. He absolutely hates Baron. He wants to get his money back.”
Now it's true that B-Dizzle has been a big fizzle for the Clips, but heckling him during the game seems like a move designed to make sure he won't get any better.
Appalling American Propadanda Video, With Donald Duck
I laughed at first, but it becomes increasingly racist and disturbing. Still, an interesting piece of history...Donald Duck? Really? Plus, the song is catchy. But then so is syphillis.
Harry Reid and the Senate democrats think they know what President O and the Republicans evidently don't: how to lure the House Dems into supporting the tax deal.
And their answer is........
PORK!!!!
A few billion here and there for ethanol subsidies and wind and solar subsidies is all they figure it'll take to get the bill past the opposition of the Democratic Caucus in the House.
I bet it works, but I'm surprised they didn't throw in a lil bit more high speed rail money just to clinch it.
Of all the weird stuff surrounding the tax deal (Bill Clinton and President O, mortal enemies, now together??), I think the weirdest of all is the idea that cutting the payroll tax imperils Social Security.
Let's sort this one out right here, OK people?
First, at the meta-level, money is fungible. It's very difficult, if not impossible, to earmark funds even when you try. This is what makes humanitarian aid to oppressive dictatorships such a morally murky area.
Second and most relevant though, is the fact that payroll taxes are NOT dedicated only to paying social security benefits. That's right, not only are your personal contributions NOT saved to fund your social security benefits, aggregate annual payroll taxes are not used explicitly to fund social security. The money is spent, period. On what? it's really impossible to say (see the above paragraph).
Yes, I know, Al Gore told us there's a lockbox with our "contributions" safe inside.
People, it's a lockbox with a 100% skim rate (i.e. not a lockbox at all)! Get Al to let you look inside; that sumbich is empty!
In truth, there really isn't much "imperiling" social security; it's the stream of future health spending obligations that are unsustainable. A combination phasing in partial means testing for benefits, and phasing in a slight rise in eligibility age could easily solve any "problems" that might be conjured up.
But the cut in the payroll tax doesn't "imperil" social security any more than it "imperils" the defense budget or the Pell grant budget.
If benefits aren't altered, then the day that payroll tax revenues fall below benefit payouts, what will happen? Nothing! Benefits will be paid out of general revenues just like they've effectively always been paid.
While tax cuts may imperil future spending (that's the essence of "starve the beast", no?), there is no real link between the type of tax being cut and the type of spending being imperiled.
Kindred, you ignorant slut. Of course, I mean that in a loving way, because Mr. Winecoff has given me a chance to explain an objection that many people may have had.
A. You can buy this car for $10,000 B. You can buy this car for a 60% discount, or $4,000 C. You can buy this car for $4,000 down, and finance $6,000
My claim was that the Republican tax cuts pretended to offer us deal B (big free discount), but in fact offered us deal C (borrow part of price). Deal B is WAY better than Deal C, but it was fake. If someone offered you B, but your contract said C, that would be fraud.
Kindred's objection was that many people prefer Deal C (borrow part of price) to Deal A (pay full price). Um...yes. That's why it is, as he rightly notes, very common. But his objection is a non sequitur. (He's a smart guy, and knew this, I'm pretty sure.)
I never said A was better than C. I said it is a lie to offer B, and then get C.
And Kindred, one other thing: when you cite Wimpy on time preference, you really should cite Chapter 10 of my ANALYZING POLICY book. That is the primary source on Wimpy, I'm pretty sure. Check p. 323...
*****************************
On the surgery: I can see a whole bunch of bubbles, and the giant red/blue disk of detached retina is getting less opaque, though not smaller. I type this looking straight down over my laptop. Can't use regular computer, or do much of anything else. We'll know by Monday if the surgery is going to work....
"Ireland and the southern European countries must reduce their debt burden and sharply enhance their economies’ competitiveness. It is hard to see how they can achieve both aims while remaining in the eurozone.
The Greek and Irish bailouts are only temporary palliatives: they do nothing to curtail indebtedness, and they have not stopped contagion. Moreover, the fiscal austerity they prescribe delays economic recovery. The idea that structural and labor-market reforms can deliver quick growth is nothing but a mirage. So the need for debt restructuring is an unavoidable reality.
Even if the Germans and other creditors acquiesce in a restructuring – not from 2013 on, as German Chancellor Angel Merkel has asked for, but now – there is the further problem of restoring competitiveness. This problem is shared by all deficit countries, but is acute in Southern Europe. Membership in the same monetary zone as Germany will condemn these countries to years of deflation, high unemployment, and domestic political turmoil. An exit from the eurozone may be at this point the only realistic option for recovery."
So, I came up with a joke to try to illustrate the problem with the "cut taxes, raise deficit" view of policy.
Guy walks onto a used car lot. Guy has a sweater on that says, "I <3 Republicans".*
Salesman sees guy looking at 2006 Ford, marked "$10,000"
Salesman says, "Since you are a Republican, I'll cut the price to $4,000. You'll save $6,000, a 60% cut!"
Republican boy says, "Wow! That's great. Let's do the paperwork."
Salesman writes it up: "$4,000 now, and you owe $6,000, plus accumulated interest, sometime in the future when we feel like charging you."
Buyer starts screaming, "That's not what we agreed on! You said you were cutting the price 60%!"
Salesman says, "Yeah, but somebody has to pay for the car. Besides, I thought you Republicans couldn't tell the difference."
**********************
I said it wasn't funny. But why, when we "cut" taxes by X%, adding that amount to the deficit, do we feel like we are getting a benefit from the government, when if a used car company did the same thing we'd have a fit?
Angus put it really well in his post today: We are just moving money around by "cutting" taxes, it is not a tax cut at all. Yet...we are all really happy. The used car salesmen in Washington are right: We DON'T know the difference.
*(For you old people, "<3" is "heart"; look at it)
I recently posted (and firmly believe) that, without any spending cuts, the proposed set of "tax cuts" are not real, but rather just represent a temporal re-arrangement of when I will be paying taxes.
Yet somehow, I find myself invested in the cuts passing. I am almost titillated by the prospect of a 2 percentage point cut in the payroll tax.
3. More realistically, maybe I can make it into a lower tax bracket (i.e. retire) before the day of reckoning arrives?
4. Maybe large spending cuts are right around the corner?
People, which is more likely; I get to retire before the tax hammer comes down enough or big spending cuts materialize to prevent the hammer from falling?
If this post makes no sense to you, please to refer to point #1 above.
In the Stone Age, unemployment was 0%. For some reason, Paul Krugman wants to go back there. The objective is not full employment, P-Kroog. The objective is prosperity.
Second, my friend Bill Lumaye bridled when I called him a "Keynesian" on air on WPTF Monday for supporting temporary extensions of the Bush tax cuts. Bill, if you won't believe me, maybe you'll believe that lefty Charles Krauthammer. Short-term, uncertain duration "tax cuts" are not tax cuts at all, but deficit-financed spending.
It's just a crackpot Keynesian stimulus policy! Don't be fooled that it's the "Republican Way." To have an effect on economic activity, tax cuts have to be credibly permanent.
As I say in the Sun-Sentinel article: If you hate taxes, cut spending.
I know it's Halliburton, and you can't do business in Nigeria without paying substantial bribes to pretty much every government wanker with his hand out. But still....Pot, meet Kettle!
This is why the internet was created. Or it should be. Or it is a benefit of the spontaneous order called "the interwebs" that no one could have foreseen. Or something like that.
Perhaps not soon to be heard on your local radio station.
But for a class project, not half bad.
Except for the dancing at 0:25, and 2:01. That's pretty bad. People from Utah may be the whitest people in the world. Not that THAT's a bad thing, mind you.
In this case, the article itself (in WaPo) plays it straight. In fact, this is great, fair journalism.
The amazing stuff is the content of the article. I'm not sure the author, Andrew Becker, was going for this. But each successive revelation about how ICE "broke" the record is more preposterous and outrageous. Have we completely lost respect for the basic rule of law? And then to have these bureaucrats just LIE....Wow. I mean, the guy who outed the administration's fibs is the head of their own union. The admin lied about changing the rules, and artificially decreed that the year would be longer, on both ends. Good lord.
WaPo is hardly some right wing blogger. There actually appears to be something moving, where fair-minded people on the left are sick and tired of the Obama shenanigans.
Anyway... your favorite parts, highlighted in comments. Go!
Nick "The Jacket" Gillespie and KPC friend Veronique de Rugy have a plan to balance the budget. It does not involve tax increases, but it does involve spending cuts. Here it is...
I do want to be clear on my opposition to "The Deal" out of Washington. It's fine with me to extend/preserve the tax cuts. But since we have a growing deficit, that just means we are failing to pay for our spending.
And as Angus said this morning, the total spending cuts in "The Deal" are....negative! The Deal increases spending.
Any deal that does not involve spending cuts is no deal at all. DAFT!
So President O and the Congressional Republicans have displayed their latest arrangement of the deck chairs on the USS Titanic.
There's something for everyone. No rise in income tax rates, lower payroll taxes, re-extended unemployment benefits, a compromise on the inheritance tax (35% on estates over $5 million) and a bunch of other directed tax breaks.
The two year "cost" is around $900 Billion
Number of spending cuts included in the plan? Around $0.00.
As my co-blogger has so forcefully stated recently: Deficits are future taxes.
Without spending cuts, all we are doing is shuffling the deck on the timing.
As for "stimulus", well the economy will turn around on its own at some point, perhaps soon, so these cuts may be lucky enough to be enacted at an opportunistic point in time whereby they will get the "credit".
And so it continues.
People, the search for grown-ups in government is not going well.
Here is the article. The internal bookmarks aren't set up right, so go here, and then go forward to pages (page 14, mnscrpt page 12) to the article on poinsettias.
The economic argument in the paper made me want to know more about Dr. Godfrey Ejimakor. If you share that want, go here.
Now, perhaps there are disagreements in Ag Econ I don't know about. But is the history of grower marketing agreements in Africa and here in the U.S. really so attractive?
Our policy is daft. DAFT! Because *D*eficits *A*re *F*uture "T*axes. The DAFT Republicans want to borrow money to pay for tax cuts. And the DAFT Democrats want to borrow money to pay for unemployment benefit extension. It's DAFT! Deficits Are Future Taxes! I'm going to get t-shirts made: "End the DAFT!" It's easy.... Instead of "Hell no, I won't go!" we can try, "Like Hell I say, I won't pay!"
It's a temptation that, as we've seen from the class of '94, some of them can't withstand." EWWWW! Stop him before he schtoops again. (Nod to Kevin Lewis)
Nothing the "greedy" banks are doing is irrational. It makes perfect to gamble with house money.
The question is why the "house" puts up with it. And the answer is that the "house" (meaning the Fed) is playing with taxpayer money. Nobody who is deciding anything has any skin in the game.
Over at MR, Tyler asks if we should value economists who are like Ronald Coase or those who are more like Nolan Ryan. (I am not making this up!). This is an instant classic Tyler post containing the sentence "Nobody calls him (Greg Oden) the Ronald Coase of rebounding."
I think he's asking if we should value people with a high "home run" percentage in their output or those with a lot of output.
I think there is an easy way out of this and that is to look at citations, not raw output. After all a rebound is a rebound is a rebound, but not all articles are created equal!
It's possible to have a very long vita without making any discernible impact on the profession and (this should go without saying, but sometimes doesn't) a very short vita is not necessarily a sign of high quality.
So on the citation front, it's no contest. According to Google Scholar, Ronald Coase has over 31,000 cites to his two classic articles. Nolan Ryan only has 9!!
A more serious comparison might be to someone like Alberto Alesina. When I look at the first four pages (40 articles) of his cited articles in Google Scholar, I count roughly 27,000 cites, while his two most cited articles ring up a total of around 4900 cites.
I am somewhat already agreeing with Tyler in that I'm using total citations rather than citations per author here (i.e. not penalizing Alberto for having a lot of co-authored articles).
Who's better?
Hard to say really in this case, but I think total citations are the metric to compare scholars with different vita lengths.
I'm not sure what to make of this post from Bruce Bartlett, called "Why fixing the budget is hopeless"
He cites a survey where 848 Americans think 25% of the Federal budget is spent on foreign aid and 10% is given as the ideal amount.
He then points out that official bilateral foreign aid in 2009 was less than 1% of the Federal budget.
First, taking everything at face value, I am not sure why this means fixing the budget is hopeless.
Second, there is a hell of a lot more to foreign aid that "bilateral foreign aid". There's US contributions to multilateral aid agencies, then there's NATO, there's our military presence in Japan, South Korea, etc., there's whatever the heck we're still doing in Iraq after a second president has said "mission accomplished". I'm not saying it's 25%, but it's way way way more than 0.6%.
Why take a question where the definition of aid is not given and could easily be construed broadly and match the answer to a very distinct, narrow definition of aid?
He got kicked out of Baghdad for singing too good, so he moved to Spain.
Once there, he did NOT rest on his laurels though.
He put more strings on the oud. He opened up a chain of beauty parlors. He invented toothpaste. And, just to top it all off, he invented the three course meal.
"The Federal Reserve, Congress and the president need to reaffirm that they will do whatever it takes to restore the economy to full health... They should follow up with powerful fiscal and monetary actions to create jobs — coupled with a concrete plan for tackling our long-run budget problems."
Look, I know the Times only pays $1,000 per column, but this has got to be a joke, right?
What exactly are these mysterious "powerful" policy actions and why didn't the government try them when Dr. Romer was head of the CEA?
Angus has been called a "libertarian clown," and Mungowitz has been called a "vanity candidate." And
those are our FRIENDS. Still, here they are....
The Cheesiest!!
