Grasping Reality on TypePad, by Brad DeLong

For reasons I won't get into, I wanted to track some recent comments by one-time NY Lt. Governor Elizabeth "Betsy" McCaughey about the Obama Administration's health care proposals. Ms. McCaughey has had three big moments in the spotlight in talking about medical care. One happened in the early Clinton years, when she was a prominent (and, as I argue here, completely misinformed and destructive) voice opposing "Hillarycare." Another was early this year, when she again launched a willfully misinformed attack, this time on "Obamacare." The third is just this month, when she has come up with another wild assertion about provisions of Obama's plan.

"But his posts have a downside. After reading his harsh denunciations of Obama's decision not to release the latest batch of torture photos, I began to lose sight of the persuasive arguments that other commentators have made in support of the President's position." How does one lose sight of persuasive arguments if they are indeed persuasive? It sounds to me as if he's describing being swayed by GG's arguments, but even as that is happening he still needs to consider the "other side's" arguments as having the same standing. Isn't the point of having a debate to consider all arguments, persuasive as they may be, and hopefully find one that makes more sense? How is that a downside? Reflexive attempts at 'balance' indeed.

In the Western Hemisphere, one small country has outperformed its larger, richer, neighbors to the north. Its export-dependent economy has weathered the global credit tsunami in good shape. Its stock market, which took a big hit in 2008, has more than doubled this year, spurring investment firms to introduce products allowing Americans to invest there directly. Its public finances seem to be sound, and the authorities appear to be making the right countercyclical moves. What's the name of this mystery country that finds itself on an economic shining path? If you guessed Peru, you're right.... In December 2008, García announced a stimulus program... 10 percent of Peru's GDP.... The central bank's 2008 vigilance against inflation left it with plenty of room to cut rates. So far this year, it has reduced the benchmark lending rate from 6.5 percent to 2 percent.

Andrew Sullivan had a fascinating piece on the evolution of the New York Times' willingness, or lack thereof, to use the term "torture" to describe, well, torture (for definite lack of a better word).  As Sullivan demonstrates, prior to the Bush administration, the Times repeatedly and reflexively referred to interrogation methods such as sleep deprivation, waterboarding, hypothermia, stress positions and physical beatings as torture.  No euphemism, no equivocation, no even-handed airing of the torturers' rationale/argument and no concern for the associated political controversy.  It was simply torture.  In recent years, however, the Times has begun to use euphemisms to describe those exact same techniques

Well, the relocation family, sale of a home, and entry into life with a commuting partner all for the sake of a 4/4 teaching load, it's in full swing. Myself and almost-4-ohmygod-year-old-V and sometimes Mr. V are here and without any major trips on the horizon to distract us from the fact that we live here now. I am finding this period to be particularly awkward - school hasn't started (for me or the kid), but I have some shit to do, but not a whole lot of shit honestly, any routines little V and I establish over the next few weeks will just have to be replaced by the more laborious routines of the school year, so we're just sort of floating through the days.

The completely democratic constitution of the Paris Commune, based on universal suffrage, on the immediate recall of every office-holder by the simple decision of his electors, on the suppression of bureaucracy and the armed force as opposed to the people, on the electiveness of all offices – that is what constitutes, according to Marx, the essence of the dictatorship of the proletariat. He never thinks of opposing such a dictatorship to democracy.

The answer that reformers have come up with is that you don't change the current system. In the short term, you strengthen it with subsidies and regulations on insurers. You make it kinder and gentler. But you also build the beginnings of a new, better health-care system off to the side. You let it demonstrate its efficiencies and improvements. You let the lure of lower costs and higher quality persuade Americans to migrate over of their own accord. This is what the health insurance exchange is designed to do. It is arguably the single most important element of health-care reform, because it is the bridge between the system we have and the system we want. But amid the clamor over public insurance options -- which, incidentally, would be housed on the exchange -- and employer tax exclusions and all the other points of controversy, the health insurance exchange is hardly being discussed. And there are signs that it, and thus the long-term promise of reform, might be in danger.

Technically, Brown's wording is correct.  But it's not helpful, since most people don't have even a vague notion of how much cumulative inflation there's been since 1977.  The revised wording, however, is helpful: it gives people a correct impression of how much more we spend treating heart attacks these days.  Namely, two to three times as much as 30 years ago. This wasn't just a slip of the keyboard.  Brown and his editor obviously made a deliberate decision to use nominal figures even though this doesn't give the average reader a very good idea of how much costs have actually risen.  I'd sure like to hear their explanation for why they made this decision.

Bubbles are also less common with more experienced traders - this is one of the strongest findings.  Don't get too excited about this, however, it's experience with bubbles that counts not just trading experience.  I once asked Vernon, for example, how the lab evidence generalized to the larger economy.  In particular, I asked whether 3 bubble experiences in the lab--the number which seems to be necessary to dampen bubbles--might translate to 3 big bubbles in the real world such as the dot com, commodity and housing bubbles (rather than to experience with your run of the mill bubble in an individual stock).  He thought that this was a reasonable inference from the evidence.  Thus we may not see too many big bubbles during the trading lifetime of current market participants but experience is a very costly teacher.  Can we do better? The last factor that does seem to make a difference is that bubbles liftoff and reach higher peaks when there's a lot of cash floating around...

On Monday, I espoused my theory on Twitter about the birth of Politico, which led The Columbia Journalism Review to compare that thesis to the much different Politico-birth mythology created by its Editor-in-Chief, John Harris.  Some mischevous Politico editors seem to have wanted to take my side in that dispute, as they today provide a perfect illustration of what I meant.

Appearing on Larry King Live, Colin Powell criticized the Republican Party for not standing up to Rush Limbaugh. "The problem I'm having with the [Republican] Party right now is that when he says something that I consider to be completely outrageous and I respond to it, I would like to see other members of the party do likewise, but they don't," said Powell.