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December 2012

The White House Really Needs to Commit Now to the Platinum Coin or the Constitutional Option on the Debt Ceiling

Jared Bernstein: The Cliff Deal in the Offing:

So, here’s my first blush response to this deal.  The thing that worried me most in the endgame is that the WH would be so intent on a deal that they’d lock in too few revenues with no path back to the revenue well, and that they’d leave the debt ceiling hanging out there.  Remember, the ultimate goal of Repubicans here is still to “starve the beast”–to shrink government by hacking away at both sides of its ledger–receipts and outlays.

Those fears will be realized unless the President really and truly refuses to negotiate on the debt ceiling and is willing to blow past those who would stage a strategic default.  If he is not, and if this cliff deal passes, then I fear the WH may have squandered its hard won leverage.

Paul Krugman and Noam Scheiber: Obama Makes Another Strategic Mistake

Paul Krugman:

Conceder In Chief?: OK, I’ve had my own sorta-kinda briefing on the apparent fiscal cliff deal, and I’m pretty much with Noam Scheiber. Viewed on its own, it’s a bad and upsetting deal but not as terrible as initial rumors had it. But the strategic consequences are likely to be very bad indeed, and in very short order too.

As background, it’s important to understand what Obama clearly could have gotten just by going over the cliff. Basically, he could have gotten the whole of the Bush high-end tax cuts reversed, which would mean close to $800 billion in revenue over the next decade. What he couldn’t get, or at least couldn’t count on getting, were various spending items…. So what Obama appears to have done is trade away part of the revenue from high-income taxpayers in return for some of the spending items he wanted. Extended unemployment benefits for a year, and the refundables either extended in perpetuity or for 5 years…. If you want think about the longer-term implications here, they’re ambiguous. The deficit is no problem right now, but there will eventually be a collision between the rising costs of social insurance programs and the inadequacy of the revenue base. Something will have to give.

There were two big risks, from a progressive point of view, in Obama’s eagerness to get a Grand Bargain. One was that he would allow the Bush tax cuts to be locked in, making it very hard to get additional revenue; the other was that he would give in on fundamental benefit cuts. Well, he did #1, partially, but didn’t do #2 at all. This sets up a future confrontation: it will be very hard for progressives to raise taxes, but also very hard for conservatives to cut those social programs….

OK, now for the really bad news. Anyone looking at these negotiations, especially given Obama’s previous behavior, can’t help but reach one main conclusion: whenever the president says that there’s an issue on which he absolutely, positively won’t give ground, you can count on him, you know, giving way — and soon, too. The idea that you should only make promises and threats you intend to make good on doesn’t seem to be one that this particular president can grasp.

And that means that Republicans will go right from this negotiation into the debt ceiling in the firm belief that Obama can be rolled...

Noam Scheiber:

Democrats' Cliff Compromise Is Bad; But The Strategic Consequences Are Disastrous: I’ll be blunt: I hate the fiscal-cliff compromise that Mitch McConnell and Joe Biden are hammering out today, which will make the Bush tax cuts permanent on income below $450,000, renew the current, relatively generous, level of unemployment benefits for a year, along with some low- and middle-income tax credits, and grant the GOP a reprieve on the scheduled reversion of the estate tax to its Clinton-era setup. I think the president made a huge mistake by negotiating over what he’d previously said was non-negotiable (namely, the expiration of the Bush tax cuts on income over $250,000). Then the White House compounded that mistake by sending Biden to “close” the deal when Harry Reid appeared to give up on it. As a practical matter, this signaled to Republicans that the White House wouldn’t walk away from the bargaining table, allowing the GOP to keep extracting concessions into the absolute final hours before the deadline….

My far bigger gripe with the whole fiscal-cliff exercise has always been the strategic dimension—how it affects the next showdown with the GOP, and the one after that. Coming into the negotiation, Obama had two big problems: First, no matter how tough he talked, Republicans always assumed he’d blink in the end, for the simple reason that he pretty much always had. (This is one of the major themes of my book about his first term.) Second, despite the results of the most recent election, in which Obama won a fairly commanding victory on a platform of raising taxes on wealthy people, the GOP continued to believe that public opinion was mostly on its side…. [T]he fiscal cliff offered Obama a chance to solve both these problems. He could afford to be unyielding because the economic consequences of going over the cliff for a few days or weeks would be relatively minimal and almost entirely reversible. And doing so would immediately demonstrate to the GOP that public opinion was emphatically not on its side….

Instead, the emerging deal will reinforce the convictions that have made the GOP such a toxic presence in Washington. If Obama will cave even when he’s got all the leverage, when won’t he cave? Never, the Republicans will assume. If Obama’s too scared to stop bargaining and let the public decide who’s right in this instance, when the polls appear to back him, then he must think our position is more popular than he lets on. Suffice it to say, these are not sentiments you want at the front of Republicans’ mind as they prepare to shake him down over the debt limit in another two months…

And Ezra Klein Says That Republicans Think This Is a Good and Senate Democrats Think This Is a Bad Deal

The key point appears to be that Obama has no plan to avoid having to cave when debt ceiling time comes around.

Ezra Klein says Senate Democrats are unhappy:

Why the White House thinks it’s winning the ‘fiscal cliff’: ”The direction they’re headed is just absolutely the wrong direction for our country,” said Sen. Tom Harkin, a Democrat from Iowa, on the Senate floor today. A top Senate staffer… heard the McConnell-Biden deal was in the range of $660 billion. That’s “$940b below the President’s initial position, $340b below Boehner’s last offer, and $140b below the $800b the President told Boehner he gets for free,” he griped.

Nor is there much confidence that the White House will be willing and able to stick to a dollar-to-dollar match in the next round of negotiations. “Politics-wise, this was the moment of maximum leverage, not the debt ceiling talks. If you are trying to get $1.6t total, getting less than half now--when the most factors are on your side–seems to severely hurt your chances,” said the Senate staffer….

Assuming the details of this deal remains fairly similar to what I’ve outlined here, the question of whether the White House outfoxed the Republicans or capitulated too early won’t be answerable until we know the outlines of the next deal…. [I]f, as Republicans believe and some Democrats fear, the White House folds when confronted with the debt ceiling… this deal will be seen as the moment when the White House blinked and traded away the guaranteed revenue of the fiscal cliff for a lowball offer from the GOP…

And Ezra Klein says Republicans are happy:

Why Republicans think they’re winning the ‘fiscal cliff’: Consider the ongoing “fiscal cliff” negotiations from the Republican Party’s perspective…. First, there was the fiscal cliff…. But after the fiscal cliff comes the debt ceiling…. The question for Republicans has always been how to get to the debt ceiling while giving up the minimum in tax increases. Many of them figured that they’d at least have to give on the Bush tax cuts for income over $250,000…. To the GOP’s delight… the White House offered to raise the threshold from $250,000 to $400,000….

The White House plans to insist that it won’t negotiate over the debt ceiling at all. Republicans I’ve spoken to laugh at this bluster. Obama is already negotiating over the debt ceiling, they point out….

All this raises the tantalizing prospect for Republicans that they could end these negotiations having given up less tax revenue than they ever thought possible--less tax revenue than Boehner offered Obama, even--but still getting their entitlement cuts. Oh, and because there was never a big deal, they won’t have to agree to much stimulus, either. All in all, a pretty big win, and it wouldn’t have been possible without the White House’s baffling inability to stick to a negotiating position.

Scott Lemiuex, Jonathan Chait, and Tim Noah Say: Over the Fiscal Cliff We Should Go

Scott Lemieux:

Tight-Weak Is No Way To Negotiate With Republicans: What Chait and Noah said about the deal that hopefully won’t happen. As always, it’s not that I’m opposed to any possible deal that makes concessions on tax rates, but I’m certainly opposed to concessions when the Republicans aren’t actually offering much of anything in return. And, since apparently it can never be pointed out enough, I cannot endorse more strongly what Reeve says about the idea that $250K isn’t an upper-class income bracket. Again, living in a desirable urban area is something you’re getting with your money — if you want to use your high income for more vacations or ivory backscratchers move to the suburbs and put the kids in public school.

Jonathan Chait:

Why Is Obama Caving on Taxes?: In the months before the election, and in the weeks after his victory, Obama had a clear position: The Bush tax cuts for income over $250,000 were ending. He would not sign any extension…. Now, by all accounts, Obama is prepared to extend the Bush tax cuts up to $400,000 a year. Or maybe more. As of Friday, Obama had told Republicans they could have the tax cuts extended on income up to $400,000 if they would accept the estate tax rising from its Bush-set rates. As of last night, Democrats were conceding the estate tax plus the higher exemption on tax rates, which had risen to $450,000. And Republicans still hadn't agreed to it! Why would they, when Democrats keep hurling money at them? By midnight, Republicans might be getting the Saturday Night Live version of Obama's offer ("a 1% raise on the top two Americans — just two people").

The erosion signals not only a major substantive problem in its own right, but it also raises disturbing questions about Obama’s ability to handle his entire second term agenda. To begin with, the $250,000 a year threshold was too high to begin with….

It’s surely true that the historical desire of many Senate Democrats to position themselves in the center of any debate, irrespective of substance, and associated desire not to upset their rich fundraising base posed a strategic problem for Obama. But if Obama fears trying to hold a line that Senate Democrats have abandoned, it’s just as likely they fear the same about him. Obama’s history of foolish negotiating with the Republican Congress gave Democrats every reason to fear he might fail to hold firm on his own line…. Now, the Obama offer to Boehner was not a full extension of tax cuts under $400,000. The plan was to get higher revenue on income below that level by reducing tax deductions rather than raising rates. But the news reporting cast the offer as simply moving up the threshold, and Obama did nothing to correct that impression…. Worse, exposing Obama’s willingness to move his seemingly unmovable demand emboldened Republicans to demand even more…. The negotiating style Obama has displayed in these instances is what poker players call “tight-weak.” A tight-strong player avoids throwing in his chips, saving them for a big hand, which he plays aggressively in hopes of a huge win. A loose-weak player plays lots of hands, bluffing frequently. Tight-weak is the worst of all worlds — when you have a weak hand, you lose, and when you have a strong hand, you fail to maximize your position….

[Obama] is allowing Republicans to whittle down the sum by essentially threatening to shoot themselves in the head. And this is the most ominous thing about it. The big meta question looming over Obama’s term is whether he has learned to grapple with Republican political hostage-taking. Hostage-taking is not simply aggressive or even irrational negotiating. It is the specific tactic of extracting concessions by threatening to withhold support for policies you yourself endorse, simply because your opponent cares more about the damage…. Obama claims, and seems to genuinely believe, that he won’t let Republicans jack him up over the debt ceiling again. But if Republicans could hold the middle class tax cuts hostage, they’ll try to hold the debt ceiling hostage. Indeed, they will probably discover other areas of traditionally routine policy agreement that can be turned into extortion opportunities. Obama may think his conciliatory approach has helped avoid economic chaos. Instead, he is courting it.

Tim Noah: Kill This Pre-2013 Deal

Tim Noah: Kill This Deal:

Dear House and Senate Democrats,

Your president has sold you out.

A deal will likely be announced today canceling the scheduled income-tax increase on all family income below $450,000. It will also extend unemployment benefits and what my colleague Jon Cohn calls the "refundables," i.e., tax credits for lower- and middle-income people, and it will cancel Milkageddon, which is all good. But it isn't clear what it will do about the automatic cuts in the "sequester," and the deal doesn't appear to include extension of the payroll tax cut, which even Bill Kristol wants to extend. Also, the Democrats caved on letting the inheritance tax rise. Oh, and the deal gives Republicans carte blanche to take America hostage all over again in a month or two over raising the debt limit.

Please vote against it so we can greet the new year on the far side of the fiscal cliff, which, notwithstanding the hysteria that the Washington Post is doing its best to spread (with an assist from the Senate chaplain!), is not the Slough of Despond. It is the Promised Land, a place where Democrats will have considerably more leverage than they have today to compel a quick deal far more to their liking.

The White House means well, but it has bargained incompetently. As Jonathan Chait points out, any worry on the White House's part that it will be undercut by Senate Democrats too eager to make an even-worse deal is matched by a well-founded fear on the Senate Democrats' part that the White House won't hang tough. And anyway, the president has veto power, for crying out loud! Ezra Klein reports that the Democrats think they can make a deal now, force another tax increase later, and still get Republicans to back down on the debt ceiling. This is delusional. Any Republican who at this point believes Democratic threats to hang tough must be judged a fool.

You can change this calculus by demonstrating the fortitude that has abandoned President Barack Obama and Vice President Joe Biden. Do not "come together." Stay apart. Until it's 2013.


Timothy Noah

P.S.: Tell your Republican friends that any vote for a deal before Jan. 1 is most definitely a tax increase, while any vote for a deal after is most definitely a tax cut. You might remind them that the Club For Growth thinks so, too.

"Liquidate Labor, Liquidate Stocks, Liquidate the Farmers, Liquidate Real Estate!… Even a Panic Is Not Altogether a Bad Thing" Weblogging

Robert Murphy says that in the absence of Bernanke's excessive inflationary policies we would now be undergoing deflation at a rate of 10%/year.

But he does not understand "why [predicting] price inflation (and interest rates) are the decisive criteria for whose model and hence policy recommendations are right."

And, in his view, Bernanke's policies remain bad and impious: we would have been better off without the expansion of the Federal Reserve's balance sheet from $700 billion to $3 trillion, and with 10%/year deflation right now.

And Jon Hilsenrath of the Wall Street Journal Gets One Wrong...

Jon Hilsenrath: >Fed's Computer Models Pose Problems:

When the Federal Reserve said in December that it would keep short-term interest rates near zero until the unemployment rate falls to 6.5%, it was backed by… [the] computer-modeling programs the central bank uses…. In December…. Fed officials decided to announce they would keep interest rates near zero until the unemployment rate drops to 6.5%. The models told them such a commitment would help nudge unemployment lower—it was 7.7% in November—and wouldn't risk a big burst of inflation.

But here is the problem: The models are deeply flawed. They failed to foresee the financial crisis in 2008 and have tended to overestimate the strength of the economy for several years. Could they fail the Fed again?… Despite all their complexity and sophistication, they have long been plagued by gaps in how they read and project the economy. One of the biggest is that they have ignored the nuances of the financial system—one of the primary channels through which Fed policy works….

The financial gaps in the models worry Nathan Sheets, a Citigroup C -0.62% economist who was Mr. Bernanke's top international adviser at the Fed from 2007 to 2011. Mr. Sheets points to 1994 as an example of why. Back then, small increases in short-term interest rates by the Fed led to a surge in long-term interest rates. The models didn't foresee the financial chaos that would ensue, including the collapse of investment bank Kidder Peabody & Co., the bankruptcy of Orange County, Calif., and the Mexican peso financial crisis…


I was just last week going through my notes from 1994. Yes, the Federal Reserve's model (and other models) "failed": they all forecast that the 1994 raise in the Federal Funds rate from 3%/year to 6%/year would carry with it an increase in long-term nominal Treasuries from 6%/year to 6.75%/year; instead, long-term Treasuries peaked at 8%/year because of (a) an absence of forward interest rate guidance by the Fed and (b) unexpectedly-large endogenous moves in the duration of MBS.

But the unexpectedly-adverse reaction of the bond market in 1994 did not cause the Mexican peso crisis: an extra 1% rise in U.S. bond interest rates is not big enough to cause the Mexican peso to lose 75% of its value. Neither Orange County nor Kidder Peabody had any business holding a portfolio that would be bankrupted by a 10% fall in the value of the long-term Treasury bond. And it is not the business of the Federal Reserve to make sure that nobody holding an over leveraged portfolio goes bankrupt. The "financial chaos" of 1994 had no effect on the real economy in the United States: there was no recession in 1995, but rather the beginnings of the great dot-com boom.

The point of Hilsenrath's article appears to be that something bad may

happen when Fed officials raise interest rates…. The models make predictions about unemployment and inflation, but Mr. Sheets worries they might not foresee new financial shoes poised to drop. "They've really internalized these models and that's very risky," Mr. Sheets said…. in a lower interest rate, and Ferbus spits out predictions of how much growth and inflation should follow. Punch in some other event—like a sudden contraction in government spending or a jump in tax rates—and it spits out predictions of how the economy should respond…. The fingerprints of Ferbus and its friends are all over the Fed's latest interest-rate decisions…. [G]iven the unknowns about unconventional Fed policies, Mr. Sheets's warning warrants attention.

Mr. Sheets's warning certainly warrants attention if you are a hedge fund or an investment bank thinking of replicating Kidder Peabody's or Orange County's portfolio--but you should have already known not to do that.

But should Mr. Sheets's warnings have led the Federal Reserve to do something different than it has done? In retrospect the Federal Reserve certainly wishes that it had given more guidance at the start of 1994 as to the likely shape of its interest-rate tightening cycle and that it had at the start of 1994 incorporated the endogenous duration of MBS into its models in the way that it had incorporated them by the end of 1994. However, if the employment and output recovery evolves going forward as the recovery of the 1990s evolved in 1994 and thereafter, the Federal Reserve will be not dismayed but ecstatic.

Liveblogging World War II: December 31, 1942

The Battle of Barents Sea:

By the Spring of 1942, Hitler had convinced himself that the Allies were planning an attack on Nazi-occupied Europe and that this attack would come through Norway. The increasing number of commando raids on Norway helped to persuade Hitler that he was correct. He therefore needed a plan to counter this attack. He had no intention of moving any troops from Russia, so he ordered the German Navy to send a powerful fleet of warships to Norway which would then be used to attack any planned amphibious raid by the Allies via the North Sea to Norway. As a result, the 'Prinz Eugen', 'Scharnhorst' and 'Gneisenau' were ordered to move from Brest in France to Norway. They joined the 'Hipper', 'Admiral Scheer' and 'Köln' that were already based in Altenfjord, Norway. Therefore, there was a formidable presence of large German warships based in Norway. There was also one problem regarding their use. Hitler had specifically ordered that the ships could not be used for any other purpose than to attack any invading force and that he would not accept any "undue risk" to the ships there. Therefore, the use of these powerful ships against convoys was forbidden by Hitler as clearly the convoys were not an invading force.

Continue reading "Liveblogging World War II: December 31, 1942" »

Noted for December 31, 2012

  • EconoSpeak: E. Cary Brown on Recent Fiscal Policy

  • Dan Rodriguez smacks down Stephen Bainbridge: PrawfsBlawg: Scapegoating: "Bainbridge takes up the cause of faculty in his own way by a post with the ill-conceived title 'Dean Dan Rodriguez Thinks Making the Faculty Work Harder is the Solution'.  Uh, no, not exactly.  But I'll leave y'all to decide whether my various posts suggesting ways of getting a handle on the too-high costs of legal education can be read as such…. Now, to those insistent that administrators are the main (sole?) problem here.  The claim that law schools are filled with 'administrator bloat' is not an argument, it is a slogan.  Responsible analysis of our current situation requires information and perspective…. [L]et us take a step back and look at what the increase in law school administration over, say, the past quarter century has brought us: (1) Student services….(2) Techology…. (3) Career services…. (4) Alumni relations & development.  One commenter noted that NYU has 32 individuals devoted to ARD. I don't know whether that number is correct, but I do know that they were able to increase their endowment by over one half a billion dollars in the past few years…. [T]he notion that any serious law school leader would suggest that budgets should be balanced and even reduced on the back of faculty members while administrators run riot is a foolish one.  That is not my point."

  • Mark Thoma sends us to Simon Wren-Lewis: Is academic macroeconomics flourishing?

  • MS: The fiscal cliff: How can Republicans change their minds?: "Hardline conservative and nationalist parties in many countries often maintain or intensify their commitment to catastrophic policies, even as those policies lose majority support. For the constituents of such parties, criticism from opponents tends to be irrelevant: they believe their cosmopolitan, effeminate, ethnically/sexually/religiously/ideologically deviant adversaries have always been united in a conspiracy against them. Fresh attacks from the out-group tend to merely confirm their pre-existing insular biases, and the fact that the out-group appears to be growing often inspires them to visions of Spenglerian decline rather than prompting them to ask whether there might be a good reason why they're turning people off…. How, I asked my friend, can organisations like this change their minds? The more they get pounded down by the response to their actions, the more hardened they get. 'You've seen this kind of thing play out', I asked my friend, who grew up in Serbia. 'How does it end?' 'It ends when certain very powerful people and institutions decide they can no longer do business with these people', she said. The text of the Business Roundtable's letter from December 11th, supporting both tax hikes and spending cuts, is here. The day after the Roundtable sent this letter, Dave Camp, the Republican chair of the House Ways and Means Committee, dismissed this group of CEOs representing $7.3 trillion in annual revenues in insulting terms: 'Big business may support raising tax rates on small businesses, but I do not'…. [I]t's clear who is standing in the way of the kind of deal corporate CEOs want. I can't see the GOP changing its mind on taxes because of any change of heart on the part of Republican voters, but at the point where Republican politics meet the policy preferences of American business, I could imagine a lot of action starting to happen soon."

Continue reading "Noted for December 31, 2012" »

Ezra Klein Points Out How Big a Fool Obama Would Be to Agree to Republican Demands This Year

Ezra Klein:

The Republican Party in one tweet:


Today’s Republican Party thinks the key problem America faces is out-of-control entitlement spending. But cutting entitlement spending is unpopular and the GOP’s coalition relies heavily on seniors. And so they don’t want to propose entitlement cuts. If possible, they’d even like to attack President Obama for proposing entitlement cuts. But they also want to see entitlements cut and will refuse to solve the fiscal cliff or raise the debt ceiling unless there are entitlement cuts. You can see why these negotiations aren’t going well.

Mark Thoma: Obama Finally Realizes Who Today's Republicans Are

Economist's View: The Republican's 'Biggest Priority': Is Obama finally figuring it out?:

“They [Republicans] say that their biggest priority is making sure that we deal with the deficit in a serious way, but the way they’re behaving is that their only priority is making sure that tax breaks for the wealthiest Americans are protected,” he said. “That seems to be their only overriding, unifying theme.”

Seems to be?

Noted for December 30, 2012

Continue reading "Noted for December 30, 2012" »

Liveblogging World War II: December 30, 1942

Eleanor Roosevelt:

WASHINGTON, Tuesday—One of the most interesting points in Vice President Wallace's speech is the realization that education in the aggressor countries must be watched in the future. Implicit, however, in that acknowledgement is the fact that education must be watched everywhere.

If we are going to live in a world ruled by true democracy, then it is essential that every human being receives the kind of education that will best develop his faculties. In addition, each and every one of us must become conscious of the fact that we have an obligation to think for ourselves so that we may function as citizens. We must base our actions on facts and use them to determine what type of action we want taken by our representatives in government.

The importance of all education lies far more in the training of minds than in any facts which may be absorbed, for trained minds will ascertain the facts as they need to know them. Having learned to reason and to weigh the information they discover, people with such minds will be more nearly educated than any amount of cramming of definite facts into their heads will make them.

If we look at education not as something to end at any special point, but as a preparation whereby we can attain the means to acquire whatever we need in life, we shall have a truer perspective on what we want to achieve through our educational system.

In the early grades the tools must be provided. We must learn to read, write and figure. After that, it depends on the individual. Some people develop better mentally through the use of their hands. To others, a classic type of education brings the greatest satisfaction. To others, scientific studies make a greater appeal. Once you have your tools in hand, then the development should be along individual lines.

I am going to New York City this morning in order to speak this afternoon on the radio for the Federation of Protestant Welfare Agencies, and then to attend the dinner for Senator Norris, where I am to have the honor of presenting him the bust made by Mr. Jo Davidson. I am anxious to see this bust, because I think no artist has a greater gift for catching and reproducing the real personality of his subject. I shall be back here for breakfast tomorrow morning.

Robert Murphy's Bet That Inflation Was Just Around the Corner Has Gone Absolutely Horribly Wrong

FRED Graph  St Louis Fed 1

Terrifying to see:

Robert Murphy: October 2011: Update on My Inflation Bets: I know that a while ago I made two inflation bets… [with] David R. Henderson… [the] terms:

At any point between now and January 2013, if there is a year/year increase in seasonally adjusted CPI that is at least 10%, then [Henderson pays Murphy] at that time $500.

If we get to January 2013, and there has not been any 12-month stretch in which the above happened, then [Murphy pays Henderson] $500 at that time….

I made the above bets in December 2009. Things are obviously not progressing on the timetable I had thought…. If it weren’t for the crisis in Europe (which is pushing people to flock into dollars), I would still be fine [as of October 2011[!!!!]] with [the bet with Henderson], but it may turn into a nail biter…

The most terrifying thing of all is that being completely, comprehensively, unmistakably, fundamentally, fatally, totally wrong has not led Robert Murphy to rethink or modify any of his analytical positions or ideological beliefs by even one iota.

I mean, one would expect an announcement on his weblog like: "I have been totally wrong, about everything. I am closing down this weblog for five years to avoid misleading readers while I intellectually retool. You will find me sitting at the feet of Paul Krguman, chanting 'om mani padme hum' until I achieve enlightenment."

Not gonna happen...

Brad DeLong: Why Next to No Political Reaction to the Second Gilded Age?


Google Image Result for http images fineartamerica com images medium large abe lincoln the rail splitter war is hell store jpg 1

Oh dear, that's really tough.

I want to sharpen that question and give it historical context.

During the Gilded Age of the 1890s and 1900s you had strong political movements saying "something is going remarkably wrong with this, this isn’t the country we thought we were going to live in". The way that the historian--I'm blanking--Ray Ginger?

Harley Shaiken: Yes, Ray Ginger.

Brad DeLong: Ray Ginger put it in two absolutely brilliant books--Altgeld’s America and The Age of Excess--even the Republicans thought that they wanted to live in Abe Lincoln’s America, where when you are young you split wood into fence rails and go to law school at night and when you are middle-aged you become a lawyer and get rich and when you are old you enter politics and save the union and free the slaves. They wanted to live in that kind of world, of upward mobility, in which opportunity is wide open even to the son of a penniless and not very successful rural farmer.

By 1890 they discovered that they weren’t living in Abe Lincoln's America at all.

Continue reading "Brad DeLong: Why Next to No Political Reaction to the Second Gilded Age?" »

Hoisted from Comments: Thoughts on Lincoln

Brad DeLong: Kate Masur Works Remarkably Hard to See a Different "Lincoln" Than I Saw--and, I Would Argue, a Different "Lincoln" than Spielberg and Company Made:

Harold said...

Masur and Robin also saw Mrs. Keckly gazing up adoringly and gratefully at the Lincolns whereas the film saw her glaring angrily at the Lincolns and other white people and pointing out that she gave up her son as the Lincolns are frantically trying to prevent their own son from sacrificing himself.

J. Bradford DeLong said in reply to Harold...

Touché... Once again, the sense that they are trying much too hard to see a different movie than the one in front of their noses...

Ed B. said...

The structural problem here is the inability of history as a profession over the last thirty years to figure out how to deal with political activity, including political leadership. The mandate for rendering visible the effects of history made from below has been transformed into an incapacity to admit that political decisions made from "above" can 1) have positive effects 2) be made in any degree out of independent agency. The #1 flashpoint of these contradictions in the study of US history is surely the figure of Abraham Lincoln. Many historians so routinely seek ways to undermine the myth of Lincoln as Great Emancipator that they erase distinctions between him and the fifteen who proceeded him in the Presidency. Yet only Lincoln used the power of the federal government to promote emancipation, even before 1862. Any President could have sought emancipation in the District of Columbia. Only Lincoln did this. And that was only the beginning.

Bloix said in reply to Ed B....

This comment captures my reaction to the Robin post much better than I was able to say it, even to myself.

J. Bradford DeLong said in reply to Ed B....

Nicely put...

You could have two different narrative lines running--the high-politics one, and the lived-experience one of how high politics shapes life on the ground and how what is happening on the ground shapes high politics. And Spielberg and company do do a little bit of that. Were I King of the World, I would have made them do considerably more...

Ben Bernanke's Secret Message to Congress: More Stimulus, Please

Matt O'Brien:

Ben Bernanke's Secret Message to Congress: More Stimulus, Please: The Fed is already buying $85 billion of bonds a month on an open-ended basis and has promised not to raise rates before unemployment falls below 6.5 percent or inflation rises above 2.5 percent.

But it still thinks inflation will remain subdued, despite its bond-buying.

In other words, the Fed is telling us it will tolerate a bit more inflation, but it won't create it. That's as good an invitation as Congress is going to get to cut taxes or increase spending, at least until inflation is around 2.5 percent. Now, the Fed might buy fewer bonds than it otherwise would if Congress does more, but we know it won't raise rates--there's little guessing how much fiscal stimulus the Fed will allow. The multiplier is big now.

It's right out of Ben Bernanke's playbook. As Tim Duy, a professor at the University of Oregon, points out, Bernanke's often cited "helicopter drop" speech about how to stop deflation -- the idea was you could drop money from the sky as a last resort -- did not say a central bank could do this on its own. Bernanke said a "determined government" could "always generate higher spending and hence positive inflation," emphasis on the word government.

Bernanke wants Congress to help him, and he's doing everything he can to let them know.

DeLong Smackdown Watch: Duncan Black on the Unwisdom of Clinton Administration Budget-Balancing Policies

Duncan Black:

But They Will Always Smash It On The Floor DeLong:

Remember the context: Mankiw loved the Bush-era fiscal policies to create long-run structural budget deficits, and worked hard to implement them--the unfunded war and unfunded tax cut and unfunded entitlement policies that did so much to create our structural deficit. Mankiw did his best to join in the process of taking the work that we in the Clinton administration had done in the 1990s to restore America's fiscal balance--work that was very well done, very important, and work that we were and are very proud of--and casually smashing it on the floor.

But Republicans will inevitably see a balanced budget as an opportunity to give money to rich people (tax cuts and crony capitalism).

The reward for liberals for "this well done very important work" [of raising taxes and cutting back spending in order to balance the budget]? Tax cuts for rich people and unpaid for disastrous wars.

Liberals should spend their time in office figuring out how to implement a sticky liberal agenda, one which is hard to dislodge, not figuring out how to create a pot of money for Republicans to steal when it is their turn [in power].

At Least Ten Years too Late, Budget Arsonist Veronique de Rugy Is Sorry…

Budget arsonist Veronique de Rugy:

Salon (2003): With bipartisan opposition to the [new Bush tax cut] plan already evident, there is some question about how much of this [tax cut] proposal will actually survive the legislative centrifuge. For now, though, the die-hard supply-siders are thrilled. One of those happy tax cutters is Veronique De Rugy, an analyst with the libertarian Cato Institute based in Washington. She says she has been critical of administration proposals in the past — such as bills to boost education spending and federal farm subsidies — but she couldn’t be happier with the latest White House proposal. “I wasn’t expecting something so bold,” she says. “No one was expecting them to come with such a big cut in the tax on dividends”…

says now that she is sorry:

The Corner - National Review Online (2012): I have been saying for a while that the kind of fiscal deal it looks like the president and Speaker Boehner want may avoid broad-based tax hikes, but it won’t address our fundamental fiscal problems…. I understand that no one likes to pay more taxes. I also understand the negative consequences of raising taxes on everyone or  on higher income taxpayers only. However, there is a point at which Americans are going to have to make a choice between paying for the big government they claim they want or cutting spending. If we want a big government and the services it provides, we will have to pay for it or at least to pay more for it than we do now. And make no mistake, if we choose to maintain a big government, raising taxes on the rich alone won’t be enough. Taxes will have to go up for everyone, and they will have to go up much beyond a simple return to Clinton levels… 

Noted for December 29, 2012

Worth Reading:

Continue reading "Noted for December 29, 2012" »

Historic, Touristic, Lawrence Kansas

The "What Would John Brown Do?" t-shirts are awesome!:

Google Image Result for http kansascowgirlmurals files wordpress com 2011 12 john brown painting jpg 1

Disappointed that the Free State Hotel--built in 1855, sacked and destroyed by U.S. Senator (D-MO) Davey Atchison and his border ruffians in 1856, rebuilt by Colonel Shalor Eldridge and Company in 1857, sacked and destroyed by Copperhead William Quantrill and his terrorist guerrillas in 1863, rebuilt in 1865, rebuilt again in 1926, and then thoroughly renovated in 1985--is now called the Eldridge Hotel rather than the Free State Hotel.

I mean, Shalor Eldridge was a good man, a hero, well worth remembering--but I want to stay at the Free State Hotel, particularly in Room 506 with its portal to the Spirit World…

Continue reading "Historic, Touristic, Lawrence Kansas" »

Duncan Black: There's Another No Work Option: Laid Off

Eschaton: There's Another No Work Option: Laid Off:

Ed Glaeser writes a lot of words dancing around the obvious issue:

I believe that recipients of the [SSDI] aid are typically in pain, but many have a choice between suffering at work and going on disability. In boom times, the work option may seem more attractive, but as labor options contract, a steady check from the federal government can seem the better choice. The recession surely explains much of the 24 percent increase in the number of people receiving Social Security disability insurance since 2007.

It's an economist way to think about things, that someone being in the labor force means they're choosing the "work option." But in recession the options for some are no work and no money (otherwise known as "homelessness") or managing to qualify for disability (average monthly payment about $1100, max benefit about $2500). If you have some form of disability, you might be able to work if you have a job and employer that can accommodate you, but lose that job and you're probably going to be out of luck.

This isn't really mysterious stuff. Someone is 61, has a moderate disability, and loses his/her job. There is no work option.

As Over the Cliff We Go…

Google Image Result for http cryandhowl files wordpress com 2012 10 wile coyote e beep beep jpg

Over the Cliff We Go by J. Bradford DeLong - Project Syndicate: BERKELEY – Unless something unexpected happens, the United States’ many legislated reductions in taxes over the past 12 years – all of which have been explicitly temporary – will expire simultaneously at the start of 2013. American tax rates will revert overnight to their Clinton-era levels.

Some of these reductions were implemented to fight what was seen four years ago as a temporary downturn. Although their supporters wanted to make them permanent, claiming that they were temporary allowed for the circumvention of procedural requirements in the legislative process that Democrats had created in a vain effort to guarantee fiscal sanity.

The immediate increase in tax rates is only part of the story. At the same time, automatic reductions in the defense budget and “discretionary” domestic spending – agreed to by both Democrats and Republicans in the summer of 2011 – will take effect.

Couple these tax increases and spending cuts with the provisions of “Obamacare,” the US health-care reform championed by President Barack Obama, and, as of January 1, 2013, America’s  long-run structural budget deficit disappears. The restored tax rates will, for the foreseeable future, be sufficient to support the US defense establishment, the growing US social-insurance system, and a moderate – albeit inadequate and suboptimal – amount of other “discretionary” federal spending. The US national debt/GDP ratio will be on track to fall from its current level of 75% to 50% by 2035. Moreover, the US will begin running primary budget surpluses – the fiscal balance minus interest payments on existing debt – by 2015.

Continue reading "As Over the Cliff We Go…" »

DeLong Smackdown Watch: Paul Krugman vs. Invisible Bond Vigilantes Weblogging Edition

Paul Krugman:

Bond Vigilantes and the Power of Three: The popular story about how an attack by bond vigilantes can cause an interest rate spike and turn America into Greece… is incoherent…. Think of a simplified world in which there are three kinds of assets: short-term securities, long-term government bonds, and foreign assets…. Individual investors can shuffle their portfolios…. [T]here are three prices… short-term interest rates, long-term interest rates, and the exchange rate. At any given time, however, one of these is fixed, leaving it up to the other two to do the adjusting. Which two? That depends on the monetary regime….

The United States has independent monetary policy and a floating exchange rate. The Fed uses its independence to set the short-term interest rate… long-term rates and the exchange rate do the adjusting…. If you think short-term rates are heading up [because the Fed thinks the depression is about to end]… long-term bonds become less attractive; better to park your money and wait for better yields…. In such a case long-term rates rise--but because this rise is driven by greater optimism about the future, it's hard to see how it can have a contractionary effect on the economy.

Incidentally, this seems to me to be a big problem with the story Brad DeLong tells about bond vigilantes in the very early 1990s. He argues that the wide gap between short-term and long-term rates reflected market expectations that deficits would eventually cause higher inflation…. But why would such expectations be a drag on the economy? Yes, nominal rates would be higher than otherwise; but real rates would, if anything, be lower. It's not at all easy to tell a coherent story in which the effect of future expected deficits on today's interest rates is contractionary….

Continue reading "DeLong Smackdown Watch: Paul Krugman vs. Invisible Bond Vigilantes Weblogging Edition" »

Which Technological Advances Are Bad?: Over at Crooked Timber, Chris Bertram Comes Out Against Literacy **UPDATE** and Musical Instruments too!

No. I'm not going to give him a link. UPDATE: Chris Bertram asks for a link and promises "this post was a dig at generalized uncritical tech-enthusiasm, a more nuanced post is in preparation." /UPDATE

Chris Bertram: Noah Smith had me going for a minute there:

I just love econobloggers, with their capacity for Swiftian satire. Dry as dust, yet clearly having a laugh, they aim to reel in the poor saps who are take them seriously, but they are big enough to continue to play along, making as if they really mean it. Until now, I’d thought of Tyler Cowen, Bryan Caplan and, perhaps, even Arnold Kling as being the true masters of the genre. But I’m pretty sure that Noah Smith surpasses them all with a new blog on eyeglasses and literacy.

Continue reading "Which Technological Advances Are Bad?: Over at Crooked Timber, Chris Bertram Comes Out Against Literacy **UPDATE** and Musical Instruments too!" »

Glenn Hubbard's Countrywide Deposition Taibbi observes:

Glenn Hubbard, Leading Academic and Mitt Romney Advisor, Took 1200 an Hour to Be Countrywide's Expert Witness: What's fascinating in the deposition is the way Hubbard repeatedly tries to avoid answering the question about what kind of research he did, or didn't do…. His sneering annoyance shines through as brightly as it did in Inside Job, but this time he couldn't just say, "You've got three more minutes." Here, for instance, he actually tries to play dumb when asked if he looked into Countrywide's origination practices:

Q. Did you make any inquiry into how Countrywide actually originated its loans?

A. I'm not sure exactly what you mean by that.

Continue reading "Glenn Hubbard's Countrywide Deposition" »

Liveblogging World War II: December 27, 1942

World War II Day-by-Day: 27th December 1942: The life of an ATS ‘Ack Ack’ Girl:

From 1941 all unmarried women between 20 and 30 years old were called up to join one of the auxiliary services. These were the Auxilliary Territorial Service (ATS), the Women’s Royal Naval Service (WRNS), the Women’s Auxiliary Air Force (WAAF) and the Women’s Transport Service. Later this conscription was extended to some married women. They were not intended to serve in the front line of battle but for much of the war the front line was indistinguishable from the home front, especially with regard to Anti Aircraft gunnery. 731 women died serving in these Auxilliary units during the war. Mary Latham was just one of hundreds of thousands of young women who suddenly found their lives completely transformed:

Continue reading "Liveblogging World War II: December 27, 1942" »

Noah Smith vs. Macroeconomics as a Whole

Noah Smith:

Macro, what have you done for me lately? What has macro done for the human race in the last 40 years?… Today, in 2012, do we know much more about the "shocks" that cause recessions than we knew in 1972?… The question of whether these shocks are mainly "real" or mainly "monetary" is not settled…. [T]he actual cause of recessions is basically still one huge mystery.

What about the question of how the economy responds to the shocks?… [I]n terms of impulse responses… we have as many different guesses as we have macro theory papers. And macro theory papers are as numberless as the stars in the night sky. 

What about the question of policy? Do we know how governments can damp out the swings in the business cycle? Here there seems to be very little agreement… huge diversity of opinion on both the efficacy and the proper conduct of monetary policy, fiscal policy, and other recession-fighting measures. That there is no consensus means that the question is still unanswered…. [M]odern macro models - at least, the DSGE variety - are basically not regarded as useful by private industry…. Given this state of affairs, can we conclude that the state of macro is good?…

[The] policy consensus (basically interest rate targeting by the Fed, with a Taylor Rule… [that led to the] Great Moderation… [was] mostly inspired by the Volcker episode rather than by the models that came after it; the New Keynesian "consensus" was always rather fragile, accepted by central banks but pooh-poohed by the academics that Krugman calls "freshwater" macroeconomists; and Taylor-type rules were originally estimated as Fed reaction functions, describing Fed behavior rather than prescribing it….

Continue reading "Noah Smith vs. Macroeconomics as a Whole" »

Brad DeLong: Money and Politics


Chilean Audience Member: Hello. Can you hear me? Can you hear me now? Okay. If we agree with the statement that political structure defines the economic structure. And if we agree with the second statement that our countries--Chile at least--are losing the battle against inequality, do you think that an economic discussion is enough for winning this battle? Or we should start thinking about some political changes in the way politics and economics dialogue? When you said money has too much power, that you can’t defeat money, are you having this discussion in the United States?

Brad DeLong: Not very constructively. The Supreme Court, especially, has been playing an extraordinarily unhelpful role. With moderate Republican Senators who had been advocates of campaign finance reform and campaign funding equalization in the past falling in line behind their party in spite of their expressed policy preferences. Norm Ornstein from the American Enterprise Institute was here last June giving an extremely bitter discussion of the disappearance of the Republican moderates, and the cowardice of those who remain.

Continue reading "Brad DeLong: Money and Politics" »

Noted for December 27, 2012

Worth Reading:

  • Paul Krugman: Is Growth Over?: "Big Data — the use of huge databases of things like spoken conversations — apparently makes it possible for machines to perform tasks that even a few years ago were really only possible for people. Speech recognition is still imperfect, but vastly better than it was and improving rapidly, not because we’ve managed to emulate human understanding but because we’ve found data-intensive ways of interpreting speech in a very non-human way. And this means that in a sense we are moving toward something like my intelligent-robots world; many, many tasks are becoming machine-friendly. This in turn means that Gordon is probably wrong about diminishing returns to technology. Ah, you ask, but what about the people? Very good question. Smart machines may make higher GDP possible, but also reduce the demand for people — including smart people. So we could be looking at a society that grows ever richer, but in which all the gains in wealth accrue to whoever owns the robots."

  • Refi Program Expansion Eyed

  • Tim Duy: Missing The Big Japan Story

  • David Romer: Short-Run Fluctuations

  • Duncan Black: Crapo: "DUI is bad. People with access to cabs and willing staff who can drive them who get busted for it are extra bad. And as is always the case, people who put forth a public face of false "morality" that they are violating in private are also, too, bad. I don't care that he's a Mormon who drinks, that's between him and his conscience and his church. I care a bit that he lied about it."

  • Claire Berlinski: Turkey: Anatomy Of A Power Struggle: Erdogan vs. Gülen

  • David Hemenway: Gun Threats and Self-Defense Gun Use

Continue reading "Noted for December 27, 2012" »

Yes, It Looks Very Much as Though the Austerity Bomb Is Going to Go Off...

Joshua Green:

With five days to go… Republicans and Democrats… can barely bestir themselves to maintain the pretense that they’re working to avoid the $600 billion of tax hikes and spending cuts due to arrive next week. President Obama is flying back from Hawaii tonight to keep up appearances. But almost nobody expects a deal before Jan. 1. Negotiations essentially ended after John Boehner’s Plan B fell apart…. As the political scientist Jonathan Bernstein noted:

[N]ot only do liberals believe that the expiration of Bush-era tax rates gives them a bargaining advantage, but many Republicans may well prefer that outcome as well. I think if there was any information generated by the Plan B fiasco, it might have been just that: some Republicans really would prefer an eventual outcome that involves relatively higher tax rates as long as they don’t have to make an affirmative vote for it.

That strikes me as exactly right, although I’d characterize the Republican motivation slightly differently…. [A]ll recognize that taxes will rise on Tuesday… to their Clinton-era levels…. Plan B… called on House Republicans to cast a career-threatening vote to raise taxes… [but] the cliff would do the dirty business of raising taxes for them if they just waited a week…. [O]nce rates reset, Republicans (and Democrats, too) would find themselves in the much more comfortable position of negotiating tax cuts for the vast majority of Americans. Given this reality, the question to ask in the days and hours leading up to the fiscal cliff is not whether the two parties will strike a deal, but why they would want to.

Why would the parties want to? How about this. Running up to the explosion time of the austerity bomb has already reduced likely year-2013 real GDP growth from 3.0% to 2.5%. If no deal is reached until June 30 then our likely year-2013 real GDP growth rate will be -0.5%. And each day from January 1 to June 30 the damage to the year-2013 economy is roughly linear: each day a deal is delayed the year-2013 likely real GDP growth rate falls by 0.0084%--and that is if a deal is ultimately reached that would have held the economy harmless in 2013 had it been reached on November 10.

Does Thomas Nagel Reject All of Quantum Mechanics as Well as Evolution and Cognitive Science?

Thomas Nagel: Mind and Cosmos: Why the Materialist Neo-Darwinian Conception of Nature Is Almost Surely False:

  • But it seems to me that, as it is usually presented, the current orthodoxy about the cosmic order is the product of governing assumptions that are unsupported, and that it flies in the face of common sense…

  • My skepticism is… just a belief that the available scientific evidence, in spite of the consensus of scientific opinion, does not… rationally require us to subordinate the incredulity of common sense…

  • Everything we believe, even the most far-reaching cosmological theories, has to be based ultimately on common sense, and on what is plainly undeniable…

  • I have argued patiently against the prevailing form of naturalism, a reductive materialism that purports to capture life and mind through its neo-Darwinian extension…. I find this view antecedently unbelievable— a heroic triumph of ideological theory over common sense…

If you are going to reject scientific theories because they fail to match up to your "common sense"...

Continue reading "Does Thomas Nagel Reject All of Quantum Mechanics as Well as Evolution and Cognitive Science?" »

Now I Understand Why There Are 12 Million People in Dallas-Houston and Only 2 Million People in Kansas City...

64113 Weather Current Conditions and Temperature  weather com 1

At first glance, when you consider that Kansas City is located on a major natural transportation route and in the middle of four states of the best farmland in the world, the fact that Dallas and Houston--located in the middle of scrub, in transportation nowheresville--has six times Kansas City's population is distinctly odd.

It puzzled me.

Not any more...

Stimulus or Stymied? The Macroeconomics of Recessions (E0) (Panel Discussion): 10:15 AM-12:15 PM, Friday **Sunday** January 6, 2013

San Diego, CA: Manchester Grand Hyatt, Elizabeth Ballroom F

Panel Moderator: J. BRADFORD DELONG (University of California-Berkeley)

  • PAUL KRUGMAN (Princeton University)
  • HARALD UHLIG (University of Chicago)
  • VALERIE A. RAMEY (University of California-San Diego)
  • CARLO COTTARELLI (International Monetary Fund)

What would people like to see happen here? What questions should I ask the four panelists?


Republican Grifters Waving Guns

If you lobby for or give to or vote for these people, shame on you.

Amy Gardner:

The day after Labor Day… FreedomWorks, the Washington-based tea party organization…. Richard K. Armey, the group’s chairman and a former House majority leader, walked into the group’s Capitol Hill offices with his wife, Susan, and an aide holstering a handgun at his waist. The aim was to seize control of the group and expel Armey’s enemies: The gun-wielding assistant escorted FreedomWorks’ top two employees off the premises, while Armey suspended several others who broke down in sobs at the news.

The coup lasted all of six days. By Sept. 10, Armey was gone — with a promise of $8 million — and the five ousted employees were back. The force behind their return was Richard J. Stephenson… founder of the for-profit Cancer Treatment Centers of America… [who] agreed to commit $400,000 per year over 20 years in exchange for Armey’s agreement to leave the group….

Until this year, the partnership between Kibbe and Armey worked well…. The partnership came to a crashing end when Armey marched into FreedomWorks’s office Sept. 4 with his wife, Susan, executive assistant Jean Campbell and the unidentified man with the gun at his waist — who promptly escorted Kibbe and Brandon out of the building. “This was two weeks after there had been a shooting at the Family Research Council,” said one junior staff member…. “So when a man with a gun who didn’t identify himself to me or other people on staff, and a woman I’d never seen before said there was an announcement, my first gut was, ‘Is FreedomWorks in danger?’ It was bizarre.’ ”

By nearly all accounts, including from those loyal to him, Armey handled his attempted coup badly. Armey says he was stepping in because of ethical breaches by Kibbe and Brandon, accusing them of improperly using FreedomWorks staff resources to produce a book…

Liveblogging World War II: December 24, 1942

The Tatsinskaya Raid:

The Tatsinskaya Raid was a Soviet armoured raid deep into the German rear conducted by 24th Tank Corps under the command of Major General Vasily Mikhaylovich Badanov in late December 1942, during the last phases of the Battle of Stalingrad (Operation Little Saturn)…. The Soviet force captured its objective, the Luftwaffe airfield at Tatsinskaya, destroying over 72 aircraft on the ground, but was left cut off and without supplies. Despite the loss of most of the tank corps during the ensuing breakout, the raid was a great operational victory.

Continue reading "Liveblogging World War II: December 24, 1942" »

Veni, Veni Emmanuel

VENI veni, Emmanuel
captivum solve Israel,
qui gemit in exsilio,
privatus Dei Filio.
R: Gaude! Gaude! Emmanuel
nascetur pro te Israel!

Veni, O Sapientia,
quae hic disponis omnia,
veni, viam prudentiae
ut doceas et gloriae.

Veni, veni, Adonai,
qui populo in Sinai
legem dedisti vertice
in maiestate gloriae.

Veni, O Iesse virgula,
ex hostis tuos ungula,
de spectu tuos tartari
educ et antro barathri.

Veni, Clavis Davidica,
regna reclude caelica,
fac iter tutum superum,
et claude vias inferum.

Veni, veni O Oriens,
solare nos adveniens,
noctis depelle nebulas,
dirasque mortis tenebras.

Veni, veni, Rex Gentium,
veni, Redemptor omnium,
ut salvas tuos famulos
peccati sibi conscios.

VENI veni, Emmanuel
captivum solve Israel,
qui gemit in exsilio,
privatus Dei Filio.