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40 Economists Say The GOP Has Abandoned Economic Reality

40 Economists Say The GOP Has Abandoned Economic Reality

A survey of forty economists from across the ideological and partisan spectrum has concluded that on some of its most cherished issues, the Republican Party has simply taken leave of economic reality. For instance, economists Betsey Stevenson and Justin Wolfers noted that one of the results from the survey - run by the University of Chicago's Booth School of Business, which is hardly known for a left-wing slant - is an overwhelming agreement that the 2009 Recovery Act (i.e. the stimulus) brought down unemployment.

And the GOP responded by with a long diatribe about socialism and abortion written in crayon.

One of the major differences between people with right of center views on economic policy who know what they're talking about and those who don't know what they're talking about, is that those who don't know what they're talking about tend to prattle a lot about equality of opportunity.

One of the major differences between people with right of center views on economic policy who know what they're talking about and those who don't know what they're talking about, is that those who don't know what they're talking about tend to prattle a lot about equality of opportunity.

Paul Ryan And Equality Of Opportunity | ThinkProgress

Funny but true. Article is well worth the read.

Mexico City Needs Regulatory Reform, Not Underground Buildings

Mexico City Needs Regulatory Reform, Not Underground Buildings

"Living underground is a dystopian scenario for when the surface of the earth becomes uninhabitable, it shouldn't be a go-to response to a regulatory mandate for short buildings."

If the point of building codes is so far removed from what is needed for actual utilization of land, there is clearly something wrong. Mexico city should be looking at a way to have modern structures without losing its uniqueness.

The Copernican Revolution In Macroeconomics

My view, with both all due respect and all due derision, is that the Robert Lucas types are like the early Copernicans here. There's something admirable in their insistence that it ought to all work out to an easily modeled system grounded in compelling theoretically considerations. The New Keynesian model is a mess, like late-Ptolemaic astronomy, thrown together to account for observed reality. But you don't fly to a moon with an elegant model that delivers mistaken predictions about where the moon's going to be. And what we actually need is a Kepler to give us an elegant model that actually predicts the phenomena, and then a Newton who can explain what that model means.

From The Copernican Revolution In Macroeconomics | ThinkProgress


Not sure I agree with the main point, but worth a read.

Actual Class Warfare

With talk of class warfare in the air, it's perhaps useful for the sake of context to re-examine the 1929 platform of the Communist Party of Great Britain, titled "Class Against Class" and representing an avowedly class warfare approach to an economic crisis. Here's what they had to say on tax policy:

(1) Abolition of all indirect taxes.

(2) Exemption from all kinds of taxation for all wage-earners.

(3) Tax exemption for all working farmers.


From Actual Class Warfare


This is what real class warfare looks like. It isn’t pretty. And it is very different from the current GOP stance that if you want oil companies to pay tax rather than receive subsidies, it’s class warfare.

These rogue traders are out there because their bosses don't want to know what they're doing. I never get a "rogue burrito" at Chipotle because the management wants people to get burritos that are rolled properly. But suppose the management wants people to obtain the kind of high returns that can only be achieved through unduly risky trades. Well, you can't very well issue a directive telling people to make unduly risky trades. You certainly can, however, create circumstances under which incentives, control, and supervision are structured so as to make it the case that "rogue traders" will pop up here and there and then there rogueishness can be blamed ex post for undertakings that go badly.

These rogue traders are out there because their bosses don't want to know what they're doing. I never get a "rogue burrito" at Chipotle because the management wants people to get burritos that are rolled properly. But suppose the management wants people to obtain the kind of high returns that can only be achieved through unduly risky trades. Well, you can't very well issue a directive telling people to make unduly risky trades. You certainly can, however, create circumstances under which incentives, control, and supervision are structured so as to make it the case that "rogue traders" will pop up here and there and then there rogueishness can be blamed ex post for undertakings that go badly.
ThinkProgress

McCain Promised Qaddafi To Help Secure Military Equipment From U.S.

For all the braying by the Senate's top three hawks about how the U.S. wasn't doing enough to oust Libyan dictator Col. Muammar Qaddafi from power, one might be surprised to learn that exactly two years ago, Sens. John McCain (R-AZ), Joe Lieberman (I-CT) and Lindsey Graham (R-SC) were in Tripoli meeting with the erratic leader and giving him assurances that relations between the nations were on the mend.

According to a leaked August 2009 U.S. diplomatic cable released by WikiLeaks recounting the Senators' junket, the neoconservative Connecticut Senator captured the dynamic of aligning with a brutal dictator:


From ThinkProgress

They were for it before they were against it and against it before they were for it.

Tweets for 2011-08-26

  1. #ThinkProgress Fox News: 'Facts Are Certainly' On The Side O f Global Warming, But 'It Doesn't Matter ' http://t.co/c8F6aa8
  2. Not fully prepared for hurricane season. Back up plan is daiquiris. http://t.co/x7i4K6P
  3. Preparing for hurricane by boarding up neighbor's windows. Keeping boards up until neighbor buys blinds… http://t.co/PkXgVny
  4. Gov. Rick Perry's Cash Machine #cronycapitalism #NYT #RickPerry http://t.co/JzL6NhD

The Anti-Keynesian Two-Step

the way the dialogue works is that first a Keynesian observes that fiscal stimulus can increase growth in a depressed economy. Second, as an attempted reductio, a conservative says "if that was true, then you could increase growth by breaking a bunch of windows." Third, the Keynesian accurately points out that you could, in fact, increase growth by breaking windows. Fourth, the conservative accuses Keynesians of wanting to break windows or believing that window-breaking increases wealth. But nobody ever said that! The point is that we have very good reasons to think smashing windows would be a bad idea-there's more to life than full employment-and that's why Keynesians generally want to boost employment by having people do something useful like renovate schools or repair bridges.

From The Anti-Keynesian Two-Step

Nice summary of the argument.

Tweets for 2011-08-23

  1. The GOP Global Warming Deniers Club http://t.co/97oL6nO
  2. Bartlett: “Rick Perry’s an idiot, and I don’t think anyone would disagree with that” #CrooksAndLiars http://t.co/V5sQfqF
  3. Florida’s Welfare Drug Testing Costs More Than It Saves #CrooksAndLiars http://t.co/ydZOUDa
  4. Gaddafi is growing out his beard and planning return to Libya as Ganddalfi the White. http://t.co/rS8LqGM
  5. Libyans Applaud President Obama And International Allies With Large Thank You Sign #ThinkProgress http://t.co/5q8yAPp

Maybe Someone Should Do Something

A major Bronx water supply line burst this morning just before 6:30 a.m., flooding Jerome Avenue for several blocks near 177th Street, halting traffic, disrupting subway and bus service, and damaging two nearby gas mains. The water flow was capped by 9:20 a.m., officials said. Speaking at a news conference, Mayor Michael R. Bloomberg said it was not clear why the pipe, which was installed in 1903, had burst. "It has been doing yeoman's work, but unfortunately, after 108 years, it's not," he said.

What's difficult to think is a good reason for the United States of America to have this problem. The United States can current sell five year bonds at a negative real interest rate. The United States has plenty of unemployed construction workers. Are we suffering from a metal shortage of some kind that makes it impossible to take advantage of cheap lending to hire construction workers to fix broken pipes? If so, I haven't heard about it. Instead, we seem to be suffering from a shortage of effective political leadership. Not coincidentally, we're talking about a rich, low-tax country that's also the world's military hegemon losing its AAA-rated bond status.


From Maybe Someone Should Do Something

I think the problem is worse than that. There is a large segment of the political establishment that thinks the problem is the lack of private water companies. Because if the government got out of the way, there would be plenty of people willing to start private water companies to run pipes everywhere and they could do it cheaper and better than the government. And if you point out the numbers suggest this is not the case and demonstrate the game theory that explains why such a thing is unlikely; then they just toss up their hands and insist that government water is slavery. You can not have a sane policy discussion with people who find the concept of policy illegitimate.

Suppose the government had two choices. It could either pay for infrastructure improvements as it went along out of tax revenue or it could borrow money build the infrastructure now and then repay the money with tax revenues. Ordinarily the question would be, does the advantage of building quickly outweigh the cost of the interest. However, right now the interest cost is negative. The government saves money by borrowing now rather than waiting and paying cash. ThinkProgress

Michigan Woman Faces Jail Time For Vegetable Garden

The fact that this kind of thing doesn't seem to prompt much in the way of outrage from the very same people who are scandalized by increased regulation of light bulbs tells you a lot about American politics. For one thing, there are several giant industries willing and eager to put up lots of money to fund people to complain about the work of climate change activists, so these stories get blown up. But it's also just a reminder that, in practice, things like support for free markets, belief in freedom, hostility to government regulation, support for small government, etc. play no actual role in American politics. It's interesting that the political movement to which a plurality of Americans belong likes to talk a lot about these ideas. But there's no nationwide tea party backlash against lawn regulations.

From Michigan Woman Faces Jail Time For Vegetable Garden


This is just another instance of how the people who are against regulations of industry where there is a real problems of industry shifting its problems onto others by all kinds of externalities don’t seem to be willing to expend that much energy on regulations on individuals where the externalities are trivial.

A Hamiltonian Solution For Europe

It would start with the recognition that Greece is insolvent. It can't pay the money it owes. One or two or maybe three other countries also may be insolvent. And the existence of solvency problems in some states is creating liquidity problems for other larger states. So there's some insolvency, and even though the insolvency is concentrated in a relatively small number of small states it's a problem for a much broader set of European people. At the same time, if you look at the total amount of sovereign debt in Europe and compare it to the Eurozone's total fiscal capacity, the debt is very manageable. The Eurozone as a whole is a very solvent, creditworthy entity. So in principle you could consolidate all that outstanding European debt into a single Eurozone-wide debt financed by a modest European Solidarity VAT Surcharge. Then you'd have to severely curtail (if not eliminate) the EU member states' ability to engage in deficit spending, limiting them to some kind of authority to borrow from a central European entity. The EU itself would become a debt-issuing, taxing entity like a real country.

From A Hamiltonian Solution For Europe


Yglesias comparison of the current European Union and the US under the Articles of Confederation is flawed but not without merit.

Mercatus Institute Study Refutes Libertarian Conception of Freedom

The Mercatus Center, a libertarian think tank, produced a study today purporting to show that New York and California are the least-free places in the United States while New Hampshire and South Dakota are the freest:

From Mercatus Institute Study Refutes Libertarian Conception of Freedom

I’m waiting for headline “Mercatus relocates to South Dakota”. More importantly, there should be a distinction between most freedom and most opportunity to exercise your freedom.

The Ongoing Conservative Recovery

Over the past year, we've consistently seen the economy engage in so-so private sector job growth offset by job losses in the public sector. The results are, if you ask me, bad. But in a decent world, conservatives would be forced to acknowledge that these are the results they claim to want. The private sector's not being held back by the grasping arm of big government. Government is shrinking. And the shrinking of the government sector isn't leading to any kind of private sector explosion. It's simply offsetting meager private sector growth.

From The Ongoing Conservative Recovery


This is assuming that conservatives want that because they think that it is good economics policy. I think its much more likely that they want those results irregardless of the economic consequences. They want to shrink government to shrink government.

Rand Paul Defender Of Civil Liberties Calls For Jailing People Who Attend Radical Political Speeches

if someone is attending speeches from someone who is promoting the violent overthrow of our government, that's really an offense that we should be going after - they should be deported or put in prison.

From Think Progress

There are libertarians with sincere belifs that I might disagree with but still respect. And then there are libertarians who seem to be little more than pseudo-intellectual trolls. Rand Paul is in the latter category.