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

  • Mark Thoma sends us to Simon Wren-Lewis: Is academic macroeconomics flourishing?: "Having lots of ideas that are relevant to policy is not sufficient to make an academic discipline useful. It also needs to respond to the evidence…. Consider monetary policy. I would argue that we have made great progress…. One important reason… [is] macroeconomists working in central banks…. The framework that most of these economists find most helpful is the New NeoClassical Synthesis, or equivalently New Keynesian theory…. [T]o say ‘the jury is still out' on whether prices are sticky is wrong. The relevant jury came to a verdict long ago. It is obvious that when it comes to using fiscal policy in short term macroeconomic stabilisation there can be no equivalent claim to progress or consensus…. The science of fiscal policy is not inherently more complicated. What I have called a pure countercyclical increase in government spending (higher government spending now, financed by debt which is paid off by lower government spending once we are no longer at the Zero Lower Bound) can hardly fail to be expansionary in a New Keynesian framework if that debt can be sold. What has been missing with fiscal policy has been the equivalent of central bank economists whose job depends on taking an objective view of the evidence and doing the best they can with the ideas that academic macroeconomics provides…. As a result, when fiscal policy was required to perform a stabilisation role, policymakers had to rely on the academic community for advice, and here macroeconomics clearly failed. Pretty well any outside observer would describe its performance as rotten. The contrast between monetary and fiscal policy tells us that this failure is not an inevitable result of the paucity of evidence in macroeconomics. I think it has a lot more to do with the influence of ideology…. Two issues remain unclear for me. The first is how extensive this ideological bias is. Is the over dominance of the microfoundations approach related to the fact that different takes on the evidence have an unfortunate Keynesian bias? Second, is the degree of ideological bias in macro generic, or is it in part contingent on the particular historical circumstances of the New Classical revolution? These questions are important in thinking how this bias can be overcome."

  • Daniel Kuehn: Facts & other stubborn things: DeLong on Murphy: "What's interesting is that in Bob's defense of himself (a year ago!) he cites the eurozone crisis and the flight to quality. This is quite close to admitting the Keynesian position, if only he would make that leap. A flight to quality in the face of revised expectations about returns to capital investments of any sort in an uncertain future is precisely the mechanism here. That will give you what we observe today - not the realization of a discoordinated capital structure followed by expansionary monetary policy."

  • John Sides: Were Obama's Early Ads Really the Game Changer?

  • Single-molecule motor sits on a single-atom ball bearing

Peter Orszag Chart Shows Medicare Costs Slowing  Business Insider 1