Grasping Reality on TypePad, by Brad DeLong

Live from Capitol Hill: John Scalzi: ATTENTION INTERNET: Please update your memes now:

Live from the Kansas Union: Let me say that we should all pause, and express our sympathy for the sorrow of the family and friends of Ambassador Stevens, Sean Smith, Tyrone S. Woods, and Glen Doherty, murdered in a cowardly fashion in Libya on September 11, 2012.

And let me also say that it is appropriate for us to express, for Boehner, McCarthy, Ryan, Gowdy, and the clown show that is the rest of the Republican caucus in the House of Representatives, our scorn, contempt, and slight regard:

Jeet Heer: Why Republicans Turned Benghazi Hearing into Blumenthal Hearing: "This was supposed to be the eighth congressional hearing...

Live from the Kansas Union: Scott Eric Kauffman: Why Yes, the #BenghaziCommittee Hearings Are a Political Rorschach Test: "The commentators just have the wrong Rorschach:

Idea by SEK — actual mash-up by David Moles. You’re welcome.

Live from the Kansas Union: I must say, it was not the most encouraging thing in the world to hear Kansas State Senator Jim Denning, R-8th (Metcalfe Ave. to Pflumm Rd., 95 St.-135 St.), say that:

1. he knew that they had done bad in 2011, and
2. they had the votes to fix it in 2015, but
3. they didn't dare pass a bill that fixed it,
4. because Brownback had threatened to veto such a bill--and made it very clear he would not welcome having to exercise his veto.

Made me think that someone should put their foot down. Someone should send Senator Denning a copy of Edmund Burke's 1774 Speech to the Electors of Bristol.

And, to quote from the movie "Animal House", that foot is me. So, Senator Denning, here you are:

Live from Crow's Coffee: Nate Silver's http://fivethirtyeight.com is killing it on the 2016 election story.

A squib from Paul Krugman crosses my desk, praising the highly-estimable Nate Silver, and his http://fivethirtyeight.com. Indeed, let us all praise the the highly-estimable Nate Silver, and his http://fivethirtyeight.com. Most recently:

Live from Crow's Coffee: Greg Sargent: Freedom Frauds: "David Brooks is getting a lot of positive attention... for this column...

Must-Read: Not that we know what the right model is, mind you. But Adair Turner believes that it is more likely than not that the model the Federal Reserve is currently using to make its forecasts off of--the model that sees steady non-recessionary U.S. economic growth even with imminent interest-rate lift-off--is the wrong model:

Adair Turner: Debt Déjà Vu: "Financial markets have repeated the same error--predicting that US interest rates will rise within about six months...

"To prohibit... people... from making... employing their stock and industry in the way that they judge most advantageous... is a manifest violation of the most sacred rights of mankind..."

Adam Smith: An Inquiry Into the Nature and Causes of The Wealth Of Nations: "While Great Britain encourages in America the manufacturing of pig and bar iron...

Live from the Roasterie: You do get the feeling that nobody working at Politico--certainly not Eli Stokols or Marc Caputo--has any idea what a "serious" policy proposal might be. Campaigns churn out broad directions and talking points. Democratic campaigns try pretty hard to make the broad directions and talking points consistent with reality because they want them validated by those outside who really know the details of the issues. Republican campaigns by and large do not care about making their broad directions and talking points consistent with reality--they know those outside who want inside jobs will be willing to say whatever is needed to make the candidate sound good;

Richard Mayhew: The Soft Bigotry of No Expectations: "(Trigger Warning: Politico link [by Eli Stokols and Marc Caputo)

Must-Read: I continue to fail to understand the apparent thinking of the center of the Federal Reserve. The following argument seems to me to be obviously correct:

1. Asymmetric risks and the strong desirability of not returning to the zero lower bound after interest-rate lift-off call for raising interest rates not early and slow but late and fast.
2. That plus the strong desirability of making it clear by actions that show their consequences in the data 2%/year for the PCE chain index--2.4%/year for the core-CPI--is a target and not a ceiling means that optimal risk management is to wait until rising inflation is present in the data before beginning lift-off
3. The risks of damaging credibility via error are much less if the policy is to delay lift-off until there are signs of rising inflation as opposed to lifting-off as soon as demand plus the shakily-estimated Phillips curve say rising inflation is coming.
4. Committee harmony is lost, whether there are formal dissents in December or not.

Even if the center of the Federal Reserve has not internalized Staiger, Stock, and Watson and pretends that their estimated Phillips curve is is the eternal truth of The One Who Is--on the grounds that "you need a forecast to make policy"--interest rate increases in December make no sense, and interest rate increases in March make no sense unless core inflation starts trending up right now:

Tim Duy: Fed Struggles With The High Water Mark: "If we get two more reports hovering around 200k a month [in employment growth]...

Live from UMKC: America's loonier fragments of both its left and its right agree on something that makes all of us worse off!

Ann Marie Marciarille: Important Health Message: Mumps: "What the Important Health Message doesn't say...

Must-Read: Marshall I. Steinbaum and Bernard A. Weisberger: Economics was Once Radical: Then It Decided Not to Be: "When it was first formed in 1885, the AEA was a radical challenge to the orthodoxy of classical, free-market economics...

Must-Read: Paul Krugman is musing about and rethinking his 1998 analysis of Japan and its macroeconomic problems:

Paul Krugman: Rethinking Japan: "[How] would change what I said in my 1998 paper...

Live from the Roasterie: David Jackson** (2012): Obama Notes that Biden Opposed bin Laden Raid: "Discussing the raid that killed Osama bin Laden in 2011...

...Obama told Romney:

Those decisions generally are not poll-tested. And even some in my own party, including my current vice president, had the same critique as you did.

Must- and Should-Reads:

• Mark Thoma: The Lofty Promise and Humble Reality of International Trade
• Martin Sandbu: "In response to Federal Reserve vice-chairman Stanley Fischer’s latest speech, Brad DeLong succinctly explains why the challenge of reducing interest rates below zero means central banks should optimally aim to stay behind the curve rather than ahead of it--that is to say, better tighten too late than too soon..."
• Paul Krugman: "It’s also worth noting the difference in perspective that comes from having your original intellectual home in international versus domestic macroeconomics. I would say that Brainard’s experience is dominated not so much by the Great Moderation as by the Asian financial crisis and Japan’s stagnation; internationally oriented macro types were aware earlier than most that Depression-type issues never went away..."
• Francesco Saraceno: "Inflation-targeting central banks, like the ECB, de facto target the output gap, but timidly and without explicitly saying so. This leads to low reactivity and opaque communication.... Those who followed the EMU policy debate in the past few years will know what I am talking about.... [at] the Fed the opacity results from an ongoing debate on how to best attain an objective that is clear and shared.... The ECB opacity is intrinsically linked to the confusion between its mandate and its actual action, and as such it cannot lead to any meaningful discussion, but just to legalistic disputes..."
• Daniel Bell (1960): The End of Ideology: On the Exhaustion of Political Ideas in the Fifties, with "The Resumption of History in the New Century"
• Albert O. Hirschman: Development Projects Observed
• Paul Krugman: Nutcases and Knut Cases
• Macro Advisors: GDP Tracking
• William Dudley: Too Early to Think About a Rate Rise
• Martin Sandbu: Europe's Orphan: The Future of the Euro and the Politics of Debt
• W. Arthur Lewis (1978): Evolution of the International Economic Order
• MathBabe's Guest: Dirty Rant About The Human Brain Project

Must-Read: MathBabe's Guest: Dirty Rant About The Human Brain Project: "Some simple observations must be made, which are true now...

Over at Equitable Growth: Paul Krugman: Milton, Money, and Interest Rates: "I have a moderate disagreement with Brad DeLong...

...[who] has been arguing that demands for tight money are, in fact, contrary to the bankers’ own interests:

It was Milton Friedman who insisted, over and over again, that in any but the shortest of runs high nominal interest rates were not a sign that money was tight–that the central bank had pushed the market interest rate above the Wicksellian natural rate–but rather that money had been and probably was still loose, and that market expectations had adjusted to that.

Friedman did in fact make that claim. But... he was wrong. READ MOAR

Comment of the Day: Charles Steindel: Monday Smackdown: An Excellent Nobel Prize for Angus Deaton--But Was Eugene Fama Always Such a Total [Redacted]?: "Well, the strip is pretty cute...

*Live from La Farine: I gotta get back to posting and praising *real DeLong smackdowns--or at least get back to making more fun of David Graeber.

But this is such a target-rich environment! Outsourced to the extremely sharp Scott Lemieux:

Scott Lemieux**: "That Word 'Extremism', I Do Not Think...": "Michael Kinsley is, in 2015, being paid to write a column...

...and this month’s insight is that Donald Trump is not qualified to be president. You can’t get that kind of analysis from just anybody! You would think that pursuing this line of argument wouldn’t be much a challenge, but he manages to step into a rake or ten along the way:

Must-Read: If you work really, really hard, you might be able to make something not completely unintelligible out of Andrew Sentance. You might agree with Paul Krugman that interest rates need to be even lower to provide people with an incentive to consume and invest at the economy's sustainable non-inflationary potential. But you might go on to say that interest rates need to be higher to curb people's desires to engage in overleverage, bubbles, and Ponzi schemes--that debts of extraordinarily long duration with extraordinarily low rates of amortization is asking for trouble.

But if you did that, you would be advocating not tight money but, rather, a higher inflation target. Amortization rates and durations of debt, you see, depend primarily on nominal interest rates. While the Wicksellian real rate to balance aggregate supply and aggregate demand and make Say's Law true in practice is a real interest rate. And a higher inflation target is the way to make a bigger wedge between the two.

So even if you try really, really hard to make something not completely unintelligible out of Andrew Sentance, you conclude that he has no idea what he is talking about:

Paul Krugman: Nutcases and Knut Cases: "Monetary permahawkery takes two forms...

Live from Crow's Coffee: The time for David Brooks to say "Wait a minute! This Affordable Care Act is a lot like RomneyCare--why are Republican office-holders pretending it isn't?" was 2009. The time for David Brooks to say "Wait a minute! The Federal Reserve is following Milton Friedman's economic policies--why are Republican office-holders pretending it isn't?" was 2010. Given that he has done so much to help create the problems with the Republican Party today, at least he could own his own past words, and apologize to all of us. Is David Frum that much braver than David Brooks?

Ezra Klein: David Brooks: The Republican Party Is Producing "Leaders of Jaw-Dropping incompetence": "There is an oddity to Brooks's nostalgia...

Indictment:

INDICTMENT: INTERNATIONAL MILITARY TRIBUNAL THE UNITED STATES OF AMERICA, THE FRENCH REPUBLIC, THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND, AND THE UNION OF SOVIET SOCIALIST REPUBLICS

-against-

HERMANN WILHELM GOERING, RUDOLF HESS, JOACHIM VON RIBBENTROP, ROBERT LEY, WILHELM KEITEL, ERNST KALTENBRUNNER, ALFRED ROSENBERG, HANS FRANK, WILHELM FRICK, JULIUS STREICHER, WALTER FUNK, HJALMAR SCHACHT, GUSTAV KRUPP VON BOHLEN UND HALBACH, KARL Doenitz, ERICH RAEDER, BALDUR VON SCHIRACH, FRITZ SAUCKEL, ALFRED JODL, MARTIN BORMANN, FRANZ VON PAPEN, ARTHUR SEYSS-INQUART, ALBERT SPEER, CONSTANTIN VON NEURATH, and HANS FRITZSCHE, Individually and as Members of Any of the Following Groups or Organizations to which They Respectively Belonged, Namely: DIE REICHS REGIERUNG (REICH CABINET); DAS KORPS DER POLITISCHEN LEITER DER NATIONALSOZIALISTISCHEN DEUTSCHEN ARBEITERPARTEI (LEADERSHIP CORPS OF THE NAZI PARTY); DIE SCHUTZSTAFFELN DER NATIONALSOZIALISTISCHEN DEUTSCHEN ARBEITERPARTEI (commonly known as the 'SS') and including DER SICHERHEITSDIENST (commonly known as the 'SD'); DIE GEHEIME STAATSPOLIZEI (SECRET STATE POLICE, commonly known as the 'GESTAPO'); DIE STURM ABTEILUNGEN DER NSDAP (commonly known as the 'SA'); and the GENERAL STAFF and HIGH COMMAND of the GERMAN ARMED FORCES, all as defined in Appendix B, Defendants.

George Washignton: GGeneral Orders, October 18, 1777:

Head Quarters, at Wentz's, Worcester Township, October 18, 1777. Parole: Reading. Countersigns: Rochester, Ridgefield.

The remarkable thing is that the Republicans would not have had to get any concessions out of Obama in order to justly and accurately sell ObamaCare as a profoundly conservative policy initiative--as an attempt to sustain a market-oriented health-care financing system. Obama pre-conceded everything except for Medicaid-expansion block grants to the states, and there is certainly enough wiggle room in the waiver process as it has developed to claim that we effectively have that as well:

David Frum (2010): Waterloo: "Conservatives and Republicans today suffered their most crushing legislative defeat since the 1960s.

...It’s hard to exaggerate the magnitude of the disaster. Conservatives may cheer themselves that they’ll compensate for today’s expected vote with a big win in the November 2010 elections. But:

Must-Read: Macro Advisors is currently at a 2.5%/year real GDP growth rate forecast for the fourth quarter of 2015, a 1.5%/year tracking estimate for the third quarter of 2015, 3.9% for the second quarter, and 0.6% for the first quarter. That's 2.1% for the year--that's not an economic growth rate that would make anyone think that inflationary pressures are building in the mantle underneath even though they are not visible anywhere in the crust:

Macro Advisors: GDP Tracking:

Must-Read: William Dudley: Too Early to Think About a Rate Rise: "The situation changed over the last few months...

• Simon Wren-Lewis: "Political journalists... try hard to be unbiased in a party-political sense... because there are political machines that try and hold them to that..... Being unbiased towards the facts and... their duty to inform, are at least as important.... [But] there are no equivalent mechanisms..."
• Helaine Olen: "Donald Trump, Ben Carson, and Jeb Bush have something in common: ‘multilevel marketing’ companies that prey upon the desperate and broke..."
• John Quiggin: "For-profit education has been a disastrous failure wherever it has been tried, and particularly where for-profit firms can gain access to public funds through policies designed to enhance ‘consumer choice’..."
• Scott Keyes: "A second House Republican has now conceded that the overarching purpose of the House Select Committee on Benghazi has been to attack former Secretary of State Hillary Clinton.... Rep. Richard Hanna (R-NY) argued on Wednesday that the Majority Leader had it right..."
• Ben Thompson: "Venture capitalists are arbitrageurs... [with] more information than those with the capital... more capital than those with information... exploiting the mismatch.... This is not a bad thing! Our entire economy is predicated on middlemen... an entire supply chain of middlemen that results in $4 toast from wheat that costs $4/bushel..." https://www.evernote.com/l/AAGZsgOTOgFARpJlNxF8VZZaehwg5x96TwsB/image.png

Must- and Should-Reads:

• Simon Wren-Lewis: "Political journalists... try hard to be unbiased in a party-political sense... because there are political machines that try and hold them to that..... Being unbiased towards the facts and... their duty to inform, are at least as important.... [But] there are no equivalent mechanisms..."
• Helaine Olen: "Donald Trump, Ben Carson, and Jeb Bush have something in common: ‘multilevel marketing’ companies that prey upon the desperate and broke..."
• Sara Goldrick-Rab: Make College Free
• Paul Romer: Speeding-up and Missed Opportunities: Evidence
• Joshua Gans: The Romer Model turns 25
• Maury Obstfeld: The quest for robust and synchronised growth
• Mike Konczal: Four Ways of Looking at a TBTF Subsidy: A Reply to Dean Baker

Live from Where the Willamette Meets the Columbia: Urban Farmer Portland:

Live from Crow's Coffee: Ezra Klein: Donald Trump Has Figured Out Jeb Bush's Greatest Weakness: "I don't know if... Trump will win the... nomination...

...But... it's increasingly clear he's going to destroy Jeb Bush....

Live from Where the Willamette Meets the Columbia: There is no honor anywhere in the Bush clan, and no pride in their deeds at all:

Jeb Bush**: "Does anybody actually blame my brother for the attacks on 9/11?...

...If they do they're totally marginalizing our society. It's what he did afterwards that matters. And I'm proud of him....

Josh Ritter: Getting Ready to Get Down:

Wages and Technology: Substitutes and Complements, Teamsters and Handloom Weavers (with tweets) · delong · Storify:

Brad DeLong in conversation with Peter Leyden: Uncharted 2015: Are our economic problems new (robots) or old (forgetting Keynes)?

Tony Blair Screws the Pooch in Spring 2002 More Massively than I Would Ever Have Believed:

A correspondent sends me: Stephen Pinker (2013): How My Mind Works

Let me underscore how profoundly uninterested I am in vain and flailing attempts to defend Pinker in comments. That's a rapid road toward getting you out of here. To repeat myself:

Don't hit on students. No matter how much you think you are a nice guy, they can never know whether or not you are threatening to withhold the grades, letters, and mentoring they deserve if they don't come across. To put any young person in such a position is the act of a real asshole. And you are probably less of a nice guy than you think you are.

Professor Edwin Ervin [sic]
Department of Philosophy   University of Miami 
Miami, FL 

June 13, 2013 

Dear Professor Ervin [sic],

I join you and other scholars, writers, and activists in protesting the threat of dismissal of a brilliant and distinguished scholar, Colin McGinn, from the University of Miami for apparently nothing more serious than exchanging sexual banter with a graduate student.

Live from La Farine: io9 sends us to Ann Leckie writing about her ten favorite science fiction books:

Ann Leckie**: The 10 Best Science Fiction Books: "These are ten of my favorites.... If your favorites aren't here...

Live from La Farine: The Good, the Bad, and the Uber

There are two bad things about Uber:

Must-Read: Paul Romer: Speeding-up and Missed Opportunities: Evidence: "The bar I set for a model is that it should yield answers we believe...

I must say, this time through the story of the Norman Conquest I find myself surprised at how pro-William the Conquerer I have become.

Must- and Should-Reads:

• Martin Sandbu: Free Lunch: Mutiny at the Fed
• Stephen Breyer (2014): NLRB v. Canning
• Jason Furman and Peter Orszag: A Firm-Level Perspective on the Role of Rents in the Rise in Inequality
• Rajiv Sethi: Threats Perceived When There Are None
• Matthew Yglesias: The Budget Deficit Is Way too Low
• Katharine Trendacosta: Rejoice Researchers: Court Rules That Google Books Is Not Infringement
• Angus Deaton: Weak States, Poor Countries
• Mike the Mad Biologist: Surprisingly, Something Involving Henry Kissinger Turned To Sh-t: Theranos Edition

Over at Equitable Growth--The Equitablog

• Nick Bunker: Weekend Reading
• A Reader's Guide to the Secular Stagnation Debate: The Honest Broker for the Week of October 12, 2015
• Trekonomics Panel at New York Comic Con: The Annotated Transcript: The Honest Broker for the Week of September 28, 2015 - Equitable Growth

Plus:

Hendrik Hertzberg: Reviewing "An American Life": "We knew about Reagan and war movies...

...What Cannon adds is that Reagan loved peace movies, too.

Wikipedia: Surrender of General Burgoyne: October 17, 1777:

Armenian Genocide: Timeline: 1915:

Immunity from prosecution is guaranteed to those carrying out the massacres of the Armenians in Der-el-Zor. 16,000 Armenian deportees from Bursa and Izmid leave Afiyon-Karahisar for Konia. Lord Bryce remarks that Germany could stop the massacres if it wished to do so.20,000 Armenian deportees in transit are murdered in the city and environs of Urfa.

History.com: Vichy leader executed for treason:

Pierre Laval, the puppet leader of Nazi-occupied Vichy France, is executed by firing squad for treason against France.

Joe Romm: Republicans are going all out to sabotage a global climate deal: "Over the past year, GOP leaders, driven by Senate Majority Leader Mitch McConnell (R-Ky.)...

...have made a radical shift in the party’s public position on climate change. They are now actively seeking to destroy a global climate deal. In any other universe this would be a major news story. But I guess the mainstream media has become so jaded to what the Koch brothers and Tea Party have done to the Republican party at a national level, that this radical shift seems just like another dog-bites-man-story, albeit one where the wound is fatal.

: Trekonomics Panel at New York Comic Con (October 11, 2015)

I have been playing with FOLD, and having fun. Here I take the transcript of the New York Comic Con "Trekonomics" panel created by the extremely-productive-on-long-airplane-flights Izabella Kaminska, add to it, and annotate it...

Hey! Why hasn't the Financial Times paid for her to step back from Alphaville and turn her Beyond Scarcity series of weblog posts into a book?