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January 2015

Linky Linky, Tweety Tweety...


Links and Tweets: http://delong.typepad.com/links/

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Noted for Your Nighttime Procrastination for January 31, 2015

Screenshot 10 3 14 6 17 PMOver at Equitable Growth--The Equitablog

Plus:

Must- and Shall-Reads:

And Over Here:

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Afternoon Must-Read: Paul Krugman: Bad Tayloring

Paul Krugman reads Tony Yates pointing out that John Taylor is, politely, incoherent in his advocacy that his version of the Taylor Rule be legislated in stone to command the Federal Reserve. Either monetary policy is much more powerful than the arguments for Taylor's version of his rule presumes--in which case it is a very bad idea--or the world is much more risky than the arguments for Taylor's version of his rule presumes--in which case it is a very bad idea. There is simply no coherent way to get from the macroeconomic history of the 2000s to the conclusion that John Taylor's version of his rule is a good idea:

Paul Krugman: Bad Tayloring: "The world has turned out to be a much more dangerous place...

...than [John] Taylor-rule enthusiasts imagined, so why impose a rule devised, we know now, by economists who completely misjudged the risks?... Taylor himself... claims that the whole financial crisis thing was because the Fed departed slightly from his version of the rule in the pre-crisis 2000s. But, as [Tony] Yates points out, this assigns an importance to monetary policy that is wildly at odds with the kind of modeling used to justify the rule in the first place... as Yates does not point out... the distinct whiff of someone inventing ever-more bizarre stories to avoid admitting having been wrong about something. This is not the kind of argument on which to base rules that permanently constrain policy.


Live from teh Roasterie: No: Jeb Bush Should Never Be President of Anything

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Michael Kruse: Jeb 'Put Me Through Hell’: "In June, the medical examiner released Terri Schiavo’s autopsy...

...which confirmed what the judges had ruled for years based on the testimony from doctors concerning her prognosis. Her limbs had atrophied, and her hands had clenched into claws, and her brain had started to disappear. It weighed barely more than a pound and a third, less than half the size it would have been under normal circumstances. ‘No remaining discernible neurons,’ the autopsy said. She couldn’t see. She couldn’t feel, not even pain. Forty-one years after her birth, 15 years after her collapse, Terri Schiavo was literally a shell of who she had been.

Bush read the autopsy—then wrote a letter to the top prosecutor in Pinellas County. He raised questions about Michael Schiavo’s involvement in her collapse and about the quickness of his response calling 911. ‘I urge you,’ the governor wrote to Bernie McCabe, ‘to take a fresh look at this case without any preconceptions as to the outcome.’

McCabe, a Republican, responded less than two weeks later, saying he and his staff ‘have attempted to follow this sound advice’--without any preconceptions:

unlike some pundits, some "experts", some email and Web-based correspondents, and even some institutions of government that have, in my view, reached conclusions regarding the controversy...

McCabe’s assessment: ‘all available records’ were ‘not indicative of criminal activity...’.

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Morning Must-Read: Paul Krugman: I See Very Serious Dead People

Theo The Major P002 Patriotic cushion Engage the enemy more closely 12 30cm square cotton cushion

Let me (surprise, surprise!) back up Paul here: There is no doubt that, technocratically, reflation is the low-hanging fruit to boosting equitable growth. Successfully returning to full employment would boost real GDP in the North Atlantic by 10% today, would boost future economic growth substantially as well, and would lift all economic classes more-or-less equally. No plausible policy shifts to produce "structural reform"--save possibly the "structural reform" of raising the price level in Germany and Holland relative to Italy and Spain by 20%--promises North Atlantic-wide benefits even a fifth as much.

But for many, suppose you were to endorse Keynesian fiscal of Friedmanite monetary régime-change policies right now...

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The Rebalancing Challenge in Europe Today: The Honest Broker for the Week of February 8, 2015

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The Rebalancing Challenge###

J. Bradford DeLong :: U.C. Berkeley

OëNB Conference on European Economic Integration :: Vienna :: November 24-25, 2014

https://www.icloud.com/pages/AwBUCAESEHBN_GdfxLmukcgoyRX8ocAaKQdtWwIUBlPWhv0VX8vnODUjfjWOIbeFuUiF3QHyfCeMY9RUd2SgjBXFMCUCAQEEIKm3f8UIYBcEElisfxX1c6APGaWyaYQnStJfTZ2VtGVZ#2015-01-28b--DeLong_Rebalancing_Challenge_in_Europe.pages

There is an important purpose of an opening keynote talk like this one. Its task is to start from first principles and then give a large-scale bird's-eye overview to what is to come. We have panels to come on monetary policy, balance-sheet adjustment and growth, inequality and its role in generating internal macroeconomic imbalances, external macroeconomic rebalancing, and banking sector regulation. They all presuppose that Europe, and within it the regions of Central, Eastern, and Southeastern Europe that we focus on here, need not just higher aggregate demand in the short-term but more. They need large-scale sectoral rebalancing. And that sectoral rebalancing needs to be rapid. Why? Because these economies will not grow smoothly without deep structural reforms--in these reforms need to be not just at the bottom but at the top, reforms of institutions, governance structures, and regulatory practices and mandates need to be carried out as well.

Continue reading "The Rebalancing Challenge in Europe Today: The Honest Broker for the Week of February 8, 2015" »


Liveblogging World War II: January 31, 2015: The Execution of Pvt. Slovik

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Wikpedia: The execution of Pvt. Slovik:

On this day, Pvt. Eddie Slovik becomes the first American soldier since the Civil War to be executed for desertion-and the only one who suffered such a fate during World War II.

Pvt. Eddie Slovik was a draftee. Originally classified 4-F because of a prison record (grand theft auto), he was reclassified 1-A when draft standards were lowered to meet growing personnel needs. In January 1944, he was trained to be a rifleman, which was not to his liking, as he hated guns.

In August of the same year, Slovik was shipped to France to fight with the 28th Infantry Division, which had already suffered massive casualties in France and Germany. Slovik was a replacement, a class of soldier not particular respected by officers. As he and a companion were on the way to the front lines, they became lost in the chaos of battle and stumbled upon a Canadian unit that took them in.

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Evening Must-Read: Josh Barro: Why Obama’s Proposal for 529s Had No Chance

There are two major taxes on the upper middle class in our future--the carbon tax and the tax on "Cadillac" health-care plans. But these tax are coming because they will not be levied on the upper-middle class but on entities classified as unworthy--coal and oil companies and health-insurers. They will just be passed through to the upper middle class.

So a lot rides over the next generation on the upper middle class's remaining confused about tax incidence:

Josh Barro: Why Obama’s Proposal for 529s Had No Chance: "The first rule of modern tax policy is raise taxes only on the rich...

...The second rule is that your family isn’t rich, even if you make a lot of money. President Obama’s State of the Union proposal to end the tax benefits for college savings accounts ran afoul of these rules, which is why he abandoned it, under intense pressure from both political parties, within a week. Tax-free college savings accounts, like the mortgage interest deduction and the state and local tax deduction, principally benefit people who range from affluent to wealthy. In pushing its proposal, the White House pointed to Federal Reserve data showing that 70 percent of balances in the college accounts were held by families making at least $200,000 a year. In theory, tax reform is supposed to be built around cutting back preferences like these....

Continue reading "Evening Must-Read: Josh Barro: Why Obama’s Proposal for 529s Had No Chance" »


Noted for Your Evening Procrastination for January 30, 2015

Screenshot 10 3 14 6 17 PMOver at Equitable Growth--The Equitablog

Plus:

Must- and Shall-Reads:

And Over Here:

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Live from La Farine: Watching Jonathan Chait Summon a Monstrous Regiment of Women from the Vasty Deep...

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**Jonathan Chait:

Mireille Miller-Young... angered by the [anti-abortion] sign... snatched the sign, took it back to her office to destroy it, and shoved one of the Short sisters...

The next Clinton presidential campaign... [Hillary Rodham] Clinton enters... in a much stronger position... her supporters may find it irresistible to amplify p.c. culture’s habit of interrogating the hidden gender biases in every word and gesture against their side...

When Jonathan Chait says "The P.C. Movement", both of these are in what he fears and opposes--everyone from vandals and bullies to the "supporters" of our likely next president, and everyone in between. In Chait's envisioning, they are all, along with everyone in between them part of a single Monstrous Regiment of Women (and others) that needs to be opposed in the interest of something equally if not more amorphous called "liberalism"...

Continue reading "Live from La Farine: Watching Jonathan Chait Summon a Monstrous Regiment of Women from the Vasty Deep..." »


Morning Must-Read: Justin Wolfers @JustinWolfers on Twitter: What This Morning's U.S. Wage Numbers Mean

Justin Wolfers @JustinWolfers on Twitter: What This Morning's U.S. Wage Numbers Mean: "Employment cost index only up 0.6% in the past quarter...

...putting it up 2.2 percent over the year. Consistent with inflation well below 2%. If you think the US labor market is anywhere near capacity, you expect wages to be growing at 3.5-4%. They're growing at 2.2%. There's nothing in these wage data to give the Fed any confidence that inflation is going to drift back up towards its target anytime soon. The good news in these wage data is that this is the economy telling us that it can generate plenty more jobs without hitting bottlenecks. A thought on the Phillips Curve: Perhaps wage data are telling us that both the long-term unemployed & those out of the labor force matter.


Morning Must-Read: Aristotle: Slavery or Technology? From "Politics"

Aristotle: Slavery or Technology? From Politics: "Since then sufficient material resources are necessary for every household...

...the means of procuring them must certainly be part of household management, for without the material necessities it is impossible to live, let alone live well. All the arts share the property that the proper tools must be available if they are to be properly proper conducted. So is it in the art of managing a family. Now of tools, some of them are alive and others are not. With respect to the pilot of the ship, the tiller is not alive, the sailor is alive. In many arts the necessary tools include servants. Property in general is a tool for living. An estate is a collection of such tools. And a slave is a living tool. A tool that can take care of its own self is a more valuable one than any other tool. Suppose if every tool could, at command, or from discerning its owner's desires, carry out its tasks (as the story goes of the automatons of Daedalus; or what the poet tells us of the serving-carts of Vulcan, 'that they rolled of their own will into the gathering of the gods'), so that the shuttle would then weave and the lyre play of itself. Then the architect would not want living servants, or the owner want living slaves...


Morning Must-Read: Paul Krugman: Whitewashing the Crazy, Fed Edition

Alan Rappaport of the New York Times here exemplifies the biggest problem with our current policy dialogue: when it is thought to be unfair to a current of thought to even report in plain language what they have been saying, we are all in big trouble:

Paul Krugman: Whitewashing the Crazy, Fed Edition: "How does one report on politics...

...when a significant wing of the political spectrum is... stark raving mad?.... There’s a temptation to soft-pedal the crazy.... Matt O’Brien notes that Ted Cruz has now joined the ‘anti-Fed crazy train’.... [But] Alan Rappeport [of the New York Times who]... does... convey... how crazy Rick Perry was... uses a euphemism....

Republicans have questioned the Fed’s moves to stimulate the economy since the financial crisis, arguing that the expansion of its balance sheet will create economic instability.

Well, actually they have spent the past six years warning about ‘currency debasement and inflation‘. The chart shows how that prediction has turned out. And that in turn makes the fact that the anti-Fed ranks are swelling, not shrinking, a much more remarkable political story than the whitewashed version would indicate.


Noted for Your Morning Procrastination for January 30, 2015

Screenshot 10 3 14 6 17 PMOver at Equitable Growth--The Equitablog

Plus:

Must- and Shall-Reads:

And Over Here:

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On "Identity Politics": Live from La Farine

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Scott Lemieux watches Matthew Yglesias hit one out of the park:

Scott Lemieux: On "Identity Politics": "What Yglesias says here...

...responding to Jon Chait’s definition of “identity politics” as “shorthand for articles principally about race or gender bias” is very true and very necessary:

This is, I think, the problem with idea of “identity politics” as a shorthand for talking about feminism or anti-racism.... The (accurate) observation [is] that social media distribution creates new incentives for publications to be attuned to feminist and minority rights perspectives in a way that was not necessarily the case in the past. But where some see a cynical play for readership, I see an extraordinarily useful shock to a media ecosystem that’s too long been myopic.... The implication of this usage... is that somehow an identity is something only women or African-Americans or perhaps LGBT people have. White men just have ideas about politics that spring from a realm of pure reason.... You see something similar in Noam Scheiber’s argument that New York City Mayor Bill de Blasio went astray by emphasizing an “identity group agenda” of police reform at the expense of a (presumably identity-free) agenda of populist economics.... Not addressing a racially discriminatory status quo in policing is itself a choice... a kind of identity group appeal--to white people... striking the balance between liberty and security... by depriving other people of their civil liberties....

Christopher Caldwell’s assertion that Obama only getting 40% of the white vote suggested that he was racially divisive (something he wouldn’t say about Romney getting less than 10% of the African-American vote or less than 30% of the Hispanic or Asian-American vote) is another classic example. Opposition to “identity politics” generally provides particularly strong illustrations of what it’s decrying.

I would only add that I find it hard to think of a more rock-hard version of take-no-prisoners identity politics than that practiced by a group I call "friends of Marty Peretz"...


Liveblogging 300 BC: Fall: "Stag Hunt" Mosaic Created by Gnosis

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**Gnosis creates the "Stag Hunt" mosaic in the "House of the Rape of Helen" in Pella, Kingdom of Macedonia:

Wikipedia: Stag Hunt Mosaic:

The Stag Hunt mosaic (c. 300 BCE) by Gnosis is a mosaic from a wealthy home of the late 4th century BC, the so-called 'House of the Abduction of Helen' (or 'House of the Rape of Helen'), in Pella, the capital of the Macedonian Kingdom. It is now in the Pella Archaeological Museum. The emblema is bordered by an intricate floral pattern, which itself is bordered by stylized depictions of waves. The mosaic is a pebble mosaic with stones collected from beaches and riverbanks which were set into cement. As was perhaps often the case, the mosaic does much to reflect styles of painting. The light figures against a darker background may allude to red figure painting. The mosaic also uses shading, known to the Greeks as skiagraphia, in its depictions of the musculature and cloaks of the figures. This along with its use of overlapping figures to create depth renders the image three dimensional.

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Afternoon Must-Read: Gernot Wagner: Climate Shock: It's Not Over 'Til the Fat Tail Zing

Gernot Wagner: Climate Shock: It's Not Over 'Til the Fat Tail Zings: "Presenting his new book ‘Climate Shock’...

...co-authored with Martin Weitzman. If you had a 10 percent chance of having a fatal car accident, you’d take necessary precautions. If your finances had a 10 percent chance of suffering a severe loss, you’d re-evaluate your assets. So if we know the world is warming and there’s a 10 percent chance this might eventually lead to a catastrophe beyond anything we could imagine, why aren’t we doing more about climate change right now? We insure our lives against an uncertain future--why not our planet?...


Afternoon Must-Read: Jeet Heer: The New Republic's Legacy on Race: From Du Bois to the Bell Curve

Jeet Heer: The New Republic's Legacy on Race: From Du Bois to the Bell Curve: "Between the late ’30s and the mid-’70s...

...The New Republic was one of the best magazines outside the black press in its coverage of the rise of the civil rights movement. Thomas Sancton, Sr., managing editor from 1942–1943, was a particularly radical advocate, holding FDR’s feet to the fire for his compromises with the Jim Crow South, and doing brave reporting on the Detroit race riots of 1943.... [But when] the country’s conversation about race turned to more ambiguous debates over busing, affirmative action, and overcoming economic hurdles. The owner who would oversee that new era was Martin Peretz...


Morning Must-Read: Jaume Ventura: Capital in the 21st Century

Jaume Ventura: Capital in the 21st Century: "On 19th December...

...CEPR and the Bank of England hosted a joint workshop to discuss Thomas Piketty’s seminal work ‘Capital in the 21st Century’. Chaired by the Bank’s Chief Economist Andy Haldane, the panel comprised Orazio Attanasio, Tim Besley, Peter Lindert, Thomas Piketty and Jaume Ventura...


Liveblogging World War II: January 29, 1945: Red Army Encircles Breslau

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World War II Today: 29 January 1944: Bitter struggle as Red Army encircles Breslau:

The tide of war had turned decisively against the Germans and they faced defeat after defeat, retreat after retreat. For the captured German soldier, especially if they belonged to the SS, the fate was in many cases even worse. Some accounts refer to them being ‘given a beating’ but others are more explicit. One female Red Army soldier recalled that any captured German soldiers:

were not shot dead – that would have been too easy for them, we stabbed them like pigs with spears, chopped them to pieces. I saw it with my own eyes. I waited for the moment when their eyes bulged with pain.

She felt no mercy ‘They burned my mother and my young sister at the stake in the middle of the village’.

Continue reading "Liveblogging World War II: January 29, 1945: Red Army Encircles Breslau" »


Morning Must-Read: Daniel Davies: Rules for Contrarians: 1. Don’t Whine. That Is All

Apropos of Jonathan Chait's "Not a Very P.C. Thing to Say" and Hanna Rosin's "The Patriarchy Is Dead", some constructive advice from Daniel Davies:

Daniel Davies: Rules for Contrarians: 1. Don’t whine. That is all: "I like to think that I know a little bit about contrarianism...

...So I’m disturbed to see that people who are making roughly infinity more money than me out of the practice aren’t sticking to the unwritten rules of the game.... The whole idea of contrarianism is that you’re... setting out to annoy people.... If annoying people is what you’re trying to do, then you can hardly complain when annoying people is what you actually do. If you start a fight, you can hardly be surprised that you’re in a fight. It’s the definition of passive-aggression and really quite unseemly, to set out to provoke people, and then when they react passionately and defensively, to criticise them for not holding to your standards of a calm and rational debate. If [Levitt and Dubner's] Superfreakonomics wanted a calm and rational debate, this chapter would have been called something like: ‘Geoengineering: Issues in Relative Cost Estimation of SO2 Shielding’ [rather than the book being subtitled 'Global Cooling'], and the book would have sold about five copies....

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Belle Waring on Jonathan Chait: Political Correctness Gone Mad OMG I’m Scared: Live from La Farine

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It is a true fact that Jon Chait's extremely ill-advised New York Magazine article crossed my desk at the same moment that I was watching this equally ill-advised piece by Meg Perrett and Rodrigo Kazuo go by. They try to condemn an eight-person classical moral-philosopher reading list for various sins against leftism1. The interesting thing is that they get no traction whatsoever, even though they are here at the University of California Berkeley at what Jonathan Chait imagines to be the hotbed of American crazy leftism.

Belle Waring administers the smackdown:

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Noted for Your Nighttime Procrastination for January 28, 2015

Screenshot 10 3 14 6 17 PMOver at Equitable Growth--The Equitablog

Plus:

Must- and Shall-Reads:

And Over Here:

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Hoisted from the Archives: Special David Gelernter and Michael Kinsley Feel-Bad Piece of the Month of July 2005

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The feel-bad piece from the month of July 2005 is, of course, David Gelernter and his editor Michael Kinsley, beating out--mirabile visu!--even the works of Donald Luskin.

Here's the quote from David Gelernter, the thing that Michael Kinsley thought worth spending the Los Angeles Times's space on back in July of 2005. I put it below the fold. Don't look at it unless you are willing to be triggered:

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On the Fed's Policy of Quantitative Easing Coupled with Promises Not to Let Prices Recover Any of the Ground Relative to Trend They Lost in the Recession: Hoisted from the Archives from Three Years Ago

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Hoisted from the Archives: The conventional Fisher-Friedman approach to the determination of nominal spending and income focuses on the equilibrium demand and supply of money through the quantity theory:

(1) PY = MV(i)

If the economy’s money-supply process has produced “too little” money for the current level of spending, businesses and households attempt to shift their portfolios and accumulate more money by (i) trying to sell some of their other financial assets for cash, and (ii) cutting back on their spending. Thus the flow of spending—and income, and production—falls until PY has fallen by enough to make households and businesses no longer seek to increase their money holdings. Combine this focus on money supply and money demand equilibrium with some model of price theory and price adjustment, and the result is a theory of the monetary business cycle.

Continue reading "On the Fed's Policy of Quantitative Easing Coupled with Promises Not to Let Prices Recover Any of the Ground Relative to Trend They Lost in the Recession: Hoisted from the Archives from Three Years Ago" »


Over at Project Syndicate: What Failed in 2008?

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Over at Project Syndicate: For a while the best book on the macroeconomic catastrophe that struck the North Atlantic starting in 2007 was Gary Gorton's Slapped by the Invisible Hand. Them for a while the best book was Alan Blinder's After the Music Stopped. Now these have been superseded by two: the extremely-observant sensible Tory Martin Wolf's The Shifts and the Shocks; and my friend, patron, teacher, and (until the last reshuffle) office neighbor Barry Eichengreen 's Hall of Mirrors. Read and grasp the messages of both of these, and you are in the top 0.001% of the world in terms of understanding what has happened to us--and what the likely scenarios are for what comes next.

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Over at Equitable Growth: The Macroeconomic Situation and Macroeconomic Policy: Insiders and Outsiders

Over at Equitable Growth:

Somebody Is Inside an Echo Chamber. But Who?

Paul Krugman fears that somebody is trapped inside an echo chamber, hearing only things that confirm what they already believe:

Disagreement... over US monetary policy... [between those] very worried that the Fed may be gearing up to raise rates too soon... [and the] sanguine... seems to depend on one thing: whether the economist in question is currently in a policy position.... We don’t have access to different facts; we don’t, in any fundamental sense, have different economic models...

But how can we tell which side has lost contact with the reality out there?

Well, I think--as does Paul--that it is the "insiders" who are being optimistic and unrealistic in their plans to start raising short-term safe interest rates from zero in June 2015 and then, if past tightenings are any guide, raise them to what they regard as a full-employment growth-along-the-potential-path level of 5%/year or so by the end of 2017. READ MOAR

Continue reading "Over at Equitable Growth: The Macroeconomic Situation and Macroeconomic Policy: Insiders and Outsiders" »


Macroeconomics: Listening to Reality: A Note from Twitter I Want to Save

.@MikePMoffatt: Things like this have raised and greatly sharpened my estimate of current ZLB fiscal multiplier: http://delong.typepad.com/sdj/2015/01/over-at-equitable-growth-yes-the-past-four-years-are-powerful-evidence-for-the-keynesian-view-of-what-happens-at-the-zero-l.html

Since 2007, reality has spoken.

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Liveblogging the American Revolution: January 28, 1777: John Burgoyne

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Wikipedia: John Burgoyne:

On the outbreak of the American war, he was appointed to a command, and arrived in Boston in May 1775.... In 1776, he was at the head of the British reinforcements that sailed up the Saint Lawrence River and relieved Quebec City, which was under siege by the Continental Army. He led forces under General Guy Carleton in the drive that chased the Continental Army from the province of Quebec. Carleton then led the British forces onto Lake Champlain, but was, in Burgoyne's opinion, insufficiently bold when he failed to attempt the capture of Fort Ticonderoga after winning the naval Battle of Valcour Island in October.

Burgoyne, seeking to command a major force, proposed to isolate New England by an invasion from Quebec into New York. This had already been attempted by General Carleton in 1776, although he had stopped short of a full-scale invasion due to the lateness of the season. Carleton was heavily criticized in London for not taking advantage of the American retreat from Quebec, and he was also intensely disliked by Germain. This, combined with rival Henry Clinton's failed attempt to capture Charleston, South Carolina, placed Burgoyne in a good position to get command of the 1777 northern campaign.

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Morning Must-Read: Tim Duy: While We Wait For Yet Another FOMC Statement

Given the inability of the Federal Reserve to attain traction at the ZLB, its current frame of mind--which appears to be doing certainty-equivalence policy--makes no sense to me. Certainty-equivalence is appropriate only with a symmetric loss function and a symmetric ability to compensate for deviations on either side of the target. We do not have either of those.

Has there been an explanation of why the Federal Reserve's policy is appropriate given the asymmetry of the loss function and the asymmetry of the control levers that I have missed? If so, where is it?

Tim Duy: While We Wait For Yet Another FOMC Statement: "The Fed recognizes that hiking rates prematurely...

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Noted for Your Afternoon Procrastination for January 27, 2015

Screenshot 10 3 14 6 17 PMOver at Equitable Growth--The Equitablog

Plus:

And Over Here:

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Afternoon Must-Read: Heather Boushey: On "Capital in the Twenty-First Century"

Heather Boushey: On "Capital in the Twenty-First Century": "We... have lived through an era...

...where the presumption is that our society marches always towards greater equality or less discrimination, even if slowly. But if Thomas is right... this era could be at an end... Downton Abbey... no other way for Grantham’s three daughters to maintain their standard of living other than marrying well. So, the show’s first season focuses on whether the eldest daughters would concede to marry her cousin Matthew.

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Afternoon Must-Read: Simon Wren-Lewis: Post-Recession Lessons

A generation or two ago, the push for central-bank independence was all about harnessing central banks' credibility as inflation fighters in a context in which it was feared that elected legislators would lean overboard on the excessive spending side.

Today, Simon Wren-Lewis calls for transferring not just monetary policy but fiscal policy stabilization authority over to central banks, on the grounds that their technocratic chops are much better for fiscal policy then relying on elected legislators who are the prisoners of ordoliberal ideologies, the belief the governments like households need to balance their budgets, and of the austerity-loving 0.1%.

What could possibly go wrong?

Simon Wren-Lewis: Post Recession Lessons: "I regard 2010 as a fateful year for the advanced economies...

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Morning Must-Read: Stephanie Lo and Kenneth Rogoff: Secular Stagnation, Debt Overhang, and Other Rationales for Sluggish Growth, Six Years on

I have a very easy time believing that debt overhangs--private, international, and public--can be enormous headwinds and exert substantial drag on growth and recovery. What I cannot understand is how debt can do so without also being an impaired asset to those who hold it. Debt that is painful enough to bear that it discourages enterprise and spending is also debt that may not be collected in the end, and thus debt that sells at a low price and carries a high face interest rate.

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Liveblogging 300 BC: Summer: Rights of Roman Citizens

File Roman conquest of Italy PNG Wikipedia the free encyclopedia

Titus Livius: The History of Rome:

During this consulate of Marcus Valerius and Quintus Appulcius, affairs abroad wore a very peaceable aspect. Their losses sustained in war, together with the truce, kept the Etrurians quiet. The Samnites, depressed by the misfortunes of many years, had not yet become dissatisfied with their new alliance. At Rome, also, the carrying away of such multitudes to colonies, rendered the commons tranquil, and lightened their burthens.

But, that things might not be tranquil on all sides, a contention was excited between the principal persons in the commonwealth, patricians on one hand, and plebeians on the other, by the two Ogulnii, Quintus and Cneius, plebeian tribunes, who, seeking every where occasions of criminating the patricians in the hearing of the people, and having found other attempts fruitless, set on foot a proceeding by which they might inflame, not the lowest class of the commons, but their chief men, the plebeians of consular and triumphal rank, to the completion of whose honours nothing was now wanting but the offices of the priesthood, which were not yet laid open to them. They therefore published a proposal for a law, that, whereas there were then four augurs and four pontiffs, and it had been determined that the number of priests should be augmented, the four additional pontiffs and five augurs should all be chosen out of the commons.

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Re-Reading My Weblog: June 2005

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June 2005 saw me debate John Shoven on the Bush Social Security Privatization plan--without, apparently, the Bush Administration giving him paper on what the plan currently was. So we couldn't really talk about anything other than general principles, on which we broadly agreed:

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Barack Obama's 23 Hurricane Katrinas: Live from teh Roasterie

I have not yet heard anybody say on Fox News that the current Nor'easter is "Obama's Katrina", but surely somebody will. And in the meantime:

  1. Weigel: "Swine Flu: The swine flu outbreak of April 2009!... Hugh Hewitt asked whether a botched response would destroy the Obama presidency. 'A death toll is a death toll, and if one begins to pile up in the U.S. the at least four-day delay in moving decisively to control legal entry into the country from Mexico will be entered in President Obama's account.'"

  2. Weigel: "The Underwear Bomber: Then-DHS Secretary Janet Napolitano responded to the lucky apprehension of a dim terrorist by saying 'the system worked,' inspiring a NYT news analysis.... 'Hurricane Katrina was a crisis on a different order of magnitude than this event,' wrote Peter Baker, 'certainly, but the politics of attack and parry do not dwell on context or proportionality.'"

  3. Weigel: "*The Haiti earthquake: Dan Kennedy argued that Haiti was not 'Obama's Katrina,' as Haiti is not part of the United States.... But... the *Wall Street Journal... a guest op-ed titled 'Haiti: Obama's Katrina,' and pointing out that 'the death toll from Katrina was under 2,000 people' while 'deaths in Haiti as of yesterday are at least 150,000.'"

  4. Weigel: "The BP oil spill: 'This was, of course, New Orleans' Katrina and Mississippi's Katrina,' said Brian Williams during an interview with the president. 'And you're familiar now that it's getting baked in a little bit in the media that BP was President Obama's Katrina. And it's also getting baked in that the administration was slow off the mark. Is that unfair?' Spoiler: He did think it was unfair."

  5. Weigel: "Hurricane Sandy: To be fair, it was mostly just Sean Hannity saying this. 'With the horrifying images of Sandy’s devastation now contrasted with the president’s constant campaigning,' he said on Nov. 1, 2012, 'this is starting to look like, in my opinion, Obama’s Katrina'... before the administration's response to Sandy, and Chris Christie's praise for it, helped make New York and New Jersey two of the only states where the Obama vote increased from 2008 to 2012. (The others? Mississippi and Louisiana.)"

  6. Weigel: "Benghazi/IRS/NSA: 'If the president does not soon regain control of the narrative,' wrote Todd Eberly, 'he is likely to suffer the same fate as his predecessor--a collapse in public confidence and a vastly diminished second term.'"

  7. Weigel: "Obamacare: Ron Fournier even argued that the website crisis might be Obama's Katrina and Iraq. 'The crises came after a series of unrelated events that had already caused doubt among voters about the presidents,' explained Fournier. 'To borrow a cliché, Katrina was the last straw.'" And @LOLGOP: "Hope this blizzard isn't another Obama's Katrina.... One before... 10 million gained insurance...”

  8. @LOLGOP: Ebola: "Hope this blizzard isn't another Obama's Katrina. In the last one, no Americans died of Ebola..."

  9. The Unaccompanied Children: "CHUCK TODD: 'Speaking of immigration, are you surprised that the president is going to be in Texas and not go to the border?...' SUSAN PAGE: 'It's a Katrina moment, right?... And you're going to the fundraiser and you're not going to the border where there's this crisis?' --MSNBC 7/7/14"

  10. No More Mister Nice Blog: "The IRS: 'It has been a rough week or so for the Obama administration. From Benghazi to the tapping of reporters' phones to the IRS admitting that it targeted conservative groups for extra scrutiny, the press is in a frenzy, and many are questioning President Barack Obama's future.' --Todd Eberly, Baltimore Sun, 5/17/13"

  11. No More Mister Nice Blog: "Sexual Assault in the Military: 'Scandals Represent Obama's "Katrina Moment"' --Darryl Watson, PolicyMic, 5/16/13"

  12. No More Mister Nice Blog: "Hurricane Isaac: 'On August 30, 2012, Obama held a campaign rally at the University of Virginia. At that same time 'people in Louisiana were dealing with what the National Hurricane Center called "life-threatening hazards" caused by Hurricane Isaac.' --Conservative Daily News blog, 8/31/12"

  13. No More Mister Nice Blog: "MF Global: 'MF Global collapse is Obama's Hurricane Katrina' --The Market Oracle blog, 3/25/12"

  14. No More Mister Nice Blog: "**The S&P Downgrade: 'Obama's Katrina Moment?' --Patrick Ruffini, 8/24/11"

  15. No More Mister Nice Blog: "Missouri River Floods: 'My friend Andy in Nebraska City says that city is expecting the flood waters to rise to a point where it will cover 1st and 2nd street. My friend Brian in Council Bluffs already has his truck packed up in case he and his wife have to leave quickly.... The only national news coverage, at all, is concerning Ft. Calhoun Nuclear Plant.... Why is the media silent? Why is the national media refusing to cover this story fully, and point out what is going on? Because, this is Obama's Katrina moment, and he has blown it.' --For God and Liberty blog, 6/27/11"

  16. No More Mister Nice Blog: "Unemployment: 'Expect unemployment to remain over 9% through the midterm elections--compared to a rate of just 6.9% in November 2008, when Obama was elected. It's that number, rather than anything going on right now in the Gulf of Mexico, which is really "Obama’s Katrina".' --Felix Salmon, 6/4/10"

  17. No More Mister Nice Blog: "Fort Hood: 'Could Be Obama's Katrina' --Lynne Wooley at Human Events, 11/11/2009"

  18. No More Mister Nice Blog: "The ARRA: 'Is the Stimulus Obama’s Katrina?' --Bill Dupray, American Conservative, True/Slant, 11/17/09. 'Make no mistake, the economic crisis and Obama's failure to create real jobs with his stimulus package means we're looking at this president's Katrina.' --James Pinkerton, Fox News, 7/6/09

  19. No More Mister Nice Blog: "Swine Flu: 'Coming epidemic of swine flu could be Obama's Katrina' --Martin Schram, Scripps Howard News Service, 8/28/09

  20. No More Mister Nice Blog: "General Motors: Republicans hope General Motors is President Obama's Hurricane Katrina' --Politico, 6/28/09"

  21. No More Mister Nice Blog: "Kentucky Ice Storm: 'Obama's Katrina on Ice: More than 700,000 homes are still without power in Kentucky due to a massive ice storm that struck the state six days ago, forcing Gov. Steve Beshear to mobilize his entire state's Army and Air National Guard, a total of 4,600 men and the largest call-out in Kentucky's history.... Our Hawaiian-borne President, basking in the glow of an overheated Oval Office and dining on $100/lb steak, has been utterly disinterested...' --Confederate Yankee blog, 2/1/09"

  22. Sabrina Siddiqui: "Hurricane Katrina: "A new Public Policy Polling survey... found that 29 percent of Louisiana Republicans said Obama was responsible for the Katrina response. Twenty-eight percent put the blame on President George W. Bush, whose administration did in fact oversee the federal response to Katrina. Nearly half (44 percent) of the Louisiana Republicans polled didn't know who to blame..." --August 21, 2013

  23. No More Mister Nice Blog: "Affordable Housing: 'A friend emails: "Obama's KATRINA. A little dramatic?" Maybe. Obama's record on "affordable housing," as described in the Globe story, isn't a case of gross ineptitude in a catastrophic regional emergency. It's not even a symbol of endemic governmental dysfunction. (Although: Is there a bigger Petri dish for corrupt incompetence than the "public-private partnership"? Think cable TV franchises.) But the Globe account does seem to capture what's most likely to be wrong with an Obama administration.' --Mickey Kaus at Slate, 6/30/08"

There needs, I think, to be some sort of special prize for the last two...


David Weigel

No More Mister Nice Blog


Noted for Your Afternoon Procrastination for January 26, 2015

Screenshot 10 3 14 6 17 PMOver at Equitable Growth--The Equitablog

Plus:

Must- and Shall-Reads:

And Over Here:

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Afternoon Must-Read: Nick Bunker: Did Credit Replace Wage Growth in the Mid-2000s?

Let me highlight the last paragraph of Nick Bunker's piece over at our Value Added, just for those of you who don't click through either from the home page or from the title list at right:

Nick Bunker: Did Credit Replace Wage Growth in the Mid-2000s?: "So were the middle class and the rich...

...were taking out much larger loans than before or more mortgages? According to Adelino, Severino, and Schoar... more so the latter... new borrowers entering the market.... Adelino, Severino and Schoar’s paper would seem to indicate that what caused the run up in mortgage debt wasn’t due to a change in ‘lending technology’ such as securitization or looser government policies. Rather, the debt was built by the same kind of bubble dynamics that leads to investors betting that an asset will never lose value. Which story is true is still up for debate, but it could just be that this time wasn’t no different after all...


Afternoon Must-Read: Brian Buetler: Repealing Obamacare Would Be Immoral

Brian Buetler: Repealing Obamacare Would Be Immoral: "As a political matter Obamacare probably can’t be repealed outright...

...Strain also notes that conservatives might ‘have their way with Obamacare’ if ‘the Supreme Court deals it a death blow.’... [Strain's] wishing for this outcome is morally dubious, and Strain’s counterclaim is unusually weak. 'In a world of scarce resources, a slightly higher mortality rate is an acceptable price to pay for certain goals--including more cash for other programs, such as those that help the poor; less government coercion and more individual liberty; more health-care choice for consumers.... Such choices are inevitable. They are made all the time.' This argument about ends is concise, unobjectionable, and completely unresponsive to the situation at hand. If the Supreme Court eliminates ACA subsidies... the federal government will indeed spend less.... But none of the other tradeoffs Strain lists will happen... [no] programs that help the poor... individual liberty will not increase... a wider array of health plans will not materialize. Millions will lose their coverage, insurance markets will collapse.... The moral implications of this outcome are hideous...


Afternoon Must-Read: Ann Friedman: Heather Boushey on Can We Solve Our Child-Care Problem?

Ann Friedman: Heather Boushey on Can We Solve Our Child-Care Problem?: "I called economist Heather Boushey to find out...

What’s interesting about the cost question is that it presumes that no one is paying the costs right now.... We are paying for it, we’re just paying for it in this inefficient way that doesn’t work for families and isn’t good for kids.

Families that can scrape together the money for safe, inspected day-care facilities are forgoing other priorities like saving for retirement or buying new shoes. Families who can’t afford day care are relying on a relative or a neighbor to provide informal care, which may or may not be paid.... Obama’s suggested tax credit is a first step. But he was not proposing a network of state-run, quality day-care facilities--which actually did exist, during World War II, when men were at war and women flooded the workplace.... Nixon vetoed a bill that would have established a network of federally subsidized child-care centers, open to all parents on a sliding scale. He cited the bill’s ‘family-weakening implications’.... The notion that affordable day care is harmful to families sounds downright crazy today.... Sure, personal politics play a role in how each family makes child-care decisions. But in the vast majority of cases, the economics matter far more...


Live from La Farine: In Which We Watch the Daily Cal Foreclose a Discussion of the Classical Social Theory Syllabus...

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As someone who thinks that the "great books" approach to classical social theory is past its sell-by date, I am now distressed. I confess that I believe that, over in sunny California, the Daily Cal is trolling us all when it decides to print this:

Rodrigo Kazuo and Meg Perrett: Occupy the Syllabus: "We are calling for an occupation of syllabi...

...in the social sciences and humanities. This call to action was instigated by our experience last semester... [with] a standardized canon of theory that began with Plato and Aristotle, then jumped to... Hobbes, Locke, Hegel, Marx, Weber and Foucault, all of whom are white men... pretend[ing] that... economically-privileged white males from five imperial countries (England, France, Germany, Italy and the United States)... are the only people to produce valid knowledge.... We must demand the inclusion of women, people of color and LGBTQ* authors on our curricula...

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The Future of the European Project, and the Future of the Eurozone: A Talk from 2013: The Honest Broker for the Week of January 25, 2015

The Future of the European Project, and the Future of the Eurozone

J. Bradford DeLong :: U.C. Berkeley and NBER :: April 16, 2013 http://eurofuture2013.wordpress.com/1

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My problem this morning is that I have four starting points. Or maybe my problem is that I have five starting points:

 

I. A Little Dutch History

My first starting point is the history of the Netherlands.

I would have to be more rash indeed than the fifteenth century's Charles de Valois-Burgogne,2 the last sovereign Duke of Burgundy, to dare to opine about classical Dutch history with Jan de Vries in the room. But my read of it tells me that "political union" is a very vague and sketchy concept indeed. Consider the "political union" of what was surely the strongest power in seventeenth-century Western Europe: the seven United Provinces of the Netherlands that dominated the economy and were the political-military lynchpin of the coalition to contain the aggressive King Louis XIV Bourbon of France. READ MOAR

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Monday Smackdown: Robert Waldmann: Fiscal Multipliers and the Fiscal Cliff: Focus

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Over at Equitable Growth: I was writing a piece about the rather strange belief I hear that the failure of the U.S. economy to fall into a recession in 2013-2014 demonstrates that fiscal multipliers are relatively small. But Robert Waldmann did it first, and better than I was doing:

Robert Waldmann: 2013 and All That: "There is continued discussion...

...of how fiscal tightening in the first quarter of 2013 (the fiscal cliff in January and Sequestration in March) was followed by decent growth in the second half of 2014.... I have two more thoughts. First... there was a contractionary fiscal shock... and a contractionary forward guidance of monetary policy shock.... No matter what one’s view of the relative effectiveness of fiscal policy and of non standard monetary policy at zero lower bound, one would expect disappointing growth... very disappointing compared to forecasts of rapid growth reducing the output gap as all past US output gaps have shrunk. READ MOAR

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Liveblogging World War I: January 26, 1915: Harry S. Truman to Bess Wallace

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Letter from Harry S. Truman to Bess Wallace, January 26, 1915:

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Dear Bess:

I am going to try and send you a Wednesday letter.

I have been chasing to town every day on account of Uncle Harry. He has been almost on the point of cashing in. I can't get him to come home. I took Mamma in yesterday and she couldn't even get him to come. I took her to the Orpheum in the afternoon. She sure enjoyed it. It is a fairly good bill, but if Martin Beck pays Lina Abarbanell two thousand dollars a week he'd better save his money and buy booze. She claims to be the Bernhardt of song. She has the movement all right but not the voice.

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Nighttime Must-Read: Kenneth Thomas: What Is Noah [Smith] Thinking?

Kenneth Thomas: What Is Noah [Smith] Thinking?: "Noah Smith put up a post Sunday...

...purporting to show that things aren’t so bad for the middle class... immediately shows us a chart of median household income. Stop right there..... We need to look at individual data, aggregated weekly... to know what’s going on.... The individual real weekly wage is still below 1972 levels, [so] households... have traded time and debt for current consumption. This is not an improvement in the middle class lifestyle.... Richard Serlin points out that we also need to consider risk.... The middle class is less secure than it was in 1972. Noah has lots of interesting things to say, and you should check out his blog if you haven’t already. But this is an error on his part, and I don’t understand what he’s thinking.


Yes. Actual English Politics in the Fifteenth Century Was Weirder than Anything in "Game of Thrones". Why Do You Ask?

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"[Richard Duke of] York ran into severe difficulty in early 1456.... His authority was almost visibly ebbing away. In public he was scorned: a display of five severed dogs’ heads was erected on Fleet Street in London in September, with each dog’s dead mouth bearing a satirical poem against York, 'that man that all men hate'...”

--Dan Jones: The Wars of the Roses: The Fall of the Plantagenets and the Rise of the Tudors