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January 2017

Weekend Reading: Bonnie Kristian: We're All Public Intellectuals Now

Cursor and We re All Public Intellectuals Now The National Interest

Bonnie Kristian: We're All Public Intellectuals Now: "Michael C. Desch, ed., Public Intellectuals in the Global Arena: Professors or Pundits? http://amzn.to/2kx3M6U (Notre Dame, IN: University of Notre Dame Press, 2016), 416 pp., $55.

If there is a single theme running through Public Intellectuals in the Global Arena: Professors or Pundits?, a new anthology edited by Michael C. Desch, it is a word of caution for those who would guide the public mind.

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Procrastinating on January 27, 2017

Cursor and We re All Public Intellectuals Now The National Interest

Over at Equitable Growth: Must- and Should-Reads:

  • Paul Krugman: Reagan, Trump, and Manufacturing: "It’s hard to focus on ordinary economic analysis amidst this political apocalypse...
  • Mark Thoma: What if “alternative facts” spread to economic data?: "Donald Trump’s inability to accept news that disagrees with [his] view...
  • Larry Summers: Time for Business Leaders to Wake Up: "I wonder what the business leaders who have been waxing enthusiastic about our new pro-business administration are thinking right now...
  • Dani Rodrik: What Did NAFTA Really Do?: "The overall efficiency gains are quite small...
  • Heather Boushey: [The challenging and continuing slide in U.S. unionization rates | Equitable Growth][]
  • Nick Bunker: [Weekend reading: the fiscal multipliers, childcare, and maximum employment edition | Equitable Growth][]

Continue reading "Procrastinating on January 27, 2017" »


Live from the Orange-Haired Baboon Cage: The orange-haired baboon is far from being the only baboon in the cage:

Scott Lemieux: Just How Monstrous is the Contemporary GOP?: "Matt Lewis discovers that why Republicans never have an alternative health care plan. Perhaps the most instructive part of the piece is this bit of throat-clearing:

Conservative philosophy—from Burke to Hayek—suggests that comprehensive plans are a fatal conceit; the world is too complex to plan. The notion that Republicans could magically “fix” the largest sector of the world’s largest economy is dubious, at best.

Sure, every other liberal democracy in the world uses more government intervention to deliver health care to everyone for considerably less money. But “philosophy” tells us that this is unpossible! Cf. Edumund Burke on the French Revolution.

Continue reading "" »


Must-Read: This does not seem to me to be terribly helpful. Dani Rodrik says, apropos of NAFTA:

  1. "The aggregate [distributional] effects were rather small..."
  2. "Impacts on directly affected communities were quite severe..."
  3. "Overall... a 'welfare' gain of 0.08% for the U.S. That is, eight-hundredth of 1 percent!..."
  4. "Trade volume impacts were much larger: a doubling of U.S. imports from Mexico..."

That is all true. But in today's context it seems to me to be... a very partial truth... a somewhat truthy truth... unhelpful. In my view he should, instead, have written:

  1. "NAFTA did very little to change any of the wages of unskilled labor, the wages of skilled labor, the rent of land, or the profits of capital in the U.S. The aggregate [distributional] effects were rather small..."
  2. "Impacts on directly affected communities were quite severe." But these communities were quite small, and could have been substantially compensated--and would have been had American voters not elected Republican majorities in Congress in 1994 and thus installed Gingrich as Speaker and Dole as Majority Leader..."
  3. "Overall in an HOV or Ricardian model we calculate net a 'welfare' gain of 0.08% for the U.S. But we believe that there are not only "Ricardian" but substantial "Smithian" gains from trade. As a rule of thumb, each $1 of extra imports that the U.S. took in from NAFTA was paid for by products that before NAFTA had sold for some $0.75 to $0.80 cents--a good deal on average..."
  4. "U.S. imports from Mexico doubled from a low base: from about 1% to about 2% of GDP.

And, most important, Dani should not have allowed his readers to keep their illusion that NAFTA is responsible for any appreciable part of the decline in the manufacturing employment share:

Dani Rodrik: What Did NAFTA Really Do?: "The overall efficiency gains are quite small...

Continue reading "" »


Live from Cyberspace: Apple really cannot do the cloud over anything other than a rock solid high-bandwidth connection—and not even all the time then—can it?


DRAFT for IAMA Reddit: Friday: 4 PM PST: Afterthoughts 2

Cursor and bradford delong com Grasping Reality with Both Hands

IAMA economist Brad DeLong, an economist to be found at http://bradford-delong.com and @delong, a Berkeley professor and a former Clinton administration official. I am here to talk about why Trump's trade policies are highly likely to be disastrous failures—the normal result of a moron singularity.

But ask me anything.

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The Age of Incompetence: No Longer Live from Project Syndicate

Clowns (ICP)

The Age of Incompetence: BERKELEY – On January 20, 2017, US President-elect Donald Trump will take office having received almost three million fewer votes than his opponent; and he will work with a Republican Senate majority whose members won 13 million fewer votes than their Democratic opponents. Only the Republican majority in the House of Representatives, led by Speaker Paul Ryan, has any claim to represent a numerical majority of the 55% of Americans who voted on Election Day 2016. Trump will also begin his presidency with an approval rating below 50%. This is unprecedented – or “unpresidented,” as one of his semi-literate tweets put it (before he deleted it) – in the history of such ratings... **Read MOAR at Project Syndicate

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Procrastinating on January 26, 2017

Over at Equitable Growth: Must- and Should-Reads:

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Live from Bloomberg News: "Tom Keene... featured your excellent Vox essay as his Morning Must Read...

...on Bloomberg Surveillance.... He would be honored to speak with you tomorrow about the essay. Are you available at 9:30am ET/6:30am PT [Thursday] on the phone on Bloomberg Radio?

Yes I am available. It should be fun...


Must-Read: This is a different degree of idiocy than we saw under Bush-Cheney or Cameron-Osborne. It could have been the case that Saddam Hussein had an active nuclear-weapons program. It could have been the case that the confidence benefits from fiscal austerity would have made it a good policy choice after 2010. It was unlikely in both cases. But there were possible worlds in which those things were true.

There is no possible world in which a VAT rebated at the border is an export subsidy:

Martin Wolf: Donald Trump and Xi Jinping’s Battle Over Globalisation: "[The Trumpists] believe, for example, that a value added tax not levied on exports is a subsidy to exports...

Continue reading "" »


Should-Read: Remember--I was a soft TPP skeptic: I thought the IP protections and dispute resolution provisions were more likely than not to be unwise for the world (although probably profitable for the United States, and very profitable for the U.S. overclass.

Kevin Drum has a "shorter Brad DeLong":

Kevin Drum: Who's Afraid of the Trans-Pacific Partnership?: "The responsibility of trade deals for the decline of manufacturing in the US has become practically holy writ over the past year...

Continue reading "" »


Procrastinating on January 24, 2017

Over at Equitable Growth: Must- and Should-Reads:

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Trade Deals and Jobs: The Elevator Pitch: Afterthoughts 1

Shenzhen skyline 2015 Google Search

Want the elevator pitch version of: NAFTA and other trade deals have not gutted American manufacturing—period?

Here it is: Technology has driven our manufacturing share of non-farm employment down from 30% to 12%. Lousy macroeconomic policies--Reagan and Bush 43's generation of large wrong-time government deficits, an inappropriate overly strong dollar policy kept long past its sell-by date, etc--further pushed it down from 12% to 9%. Our assisting in the extraordinarily rapid industrialization of China from 9% to 8.7%. NAFTA from 8.7% to 8.6%. And given all the benefits we have gotten from NAFTA--and the much bigger ones Mexico has gotten--NAFTA was a good (albeit small) deal for the U.S.

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NAFTA and Other Trade Deals Have Not Gutted American Manufacturing—Period: Live at Vox.com

NewImage

Live at Vox.com: NAFTA and Other Trade Deals Have Not Gutted American Manufacturing—Period: Politically speaking, there was no debate on United States international trade agreements in 2016: All politicians seeking to win a national election, or even to create a party-spanning political coalition, agree that our trade agreements are bad things.... From the left... Bernie Sanders.... From the right—I do not think it’s wrong but it’s not quite correct to call it “right,” at least not as Americans have hitherto understood what “right” is—but from somewhere... now-President Donald Trump....

From the center establishment... popular vote–winning (but Electoral College–losing)... Hillary Rodham Clinton.... “I will stop any trade deal that kills jobs or holds down wages, including the Trans-Pacific Partnership. I oppose it now, I’ll oppose it after the election, and I’ll oppose it as president.…” The rhetoric of all three candidates resonates with the criticism of trade agreements that we heard way back when NAFTA was on the table as a proposal—not, as today, something to blame all our current economic woes on... Read MOAR at http://vox.com

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Michael DeLong: Will Competition in Health Insurance Survive? The Odds Are Better After Yesterday

Cursor and Preview of Michael DeLong Will Competition in Health Insurance Survive The Odds Are Better After Yesterday

Will competition in health insurance survive?

The answer now is “perhaps”.

The federal courts, at their lowest district court level, have just weighed in on the side of more competition and fewer behemoth health insurance companies; on the side of more competition and fewer monopolies and near monopolies. This matters for consumers: monopolies are bad news, and monopolies where what is being sold is a very expensive necessity—which health insurance coverage is—very bad news for consumers, and so for societal well-being. If we are to retain a market-based health insurance system, people need effective options. A market in which there is only one insurance company, or two companies that collude to match each other’s prices, has all the bureaucratic drawbacks of a single-payer system plus all the drawbacks of a monopoly.

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Procrastinating on January 23, 2017

Over at Equitable Growth: Must- and Should-Reads:

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Brad DeLong: Office Hours: Spring 2017

San Francisco Bay

Scheduled: Evans Hall 691A: M 3:30-4:30 pm; W 11-12 noon

By appointment: email delong@econ.berkeley.edu

By internet (depending on your course):


Links for the Week of January 22, 2016

Must-Reads:


Most-Recent Should-Reads:


Most-Recent Links:

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Reading: Robert Allen (2011): Global Economic History: A Very Short Introduction, chapter 4

Robert Allen (2011): Global Economic History: A Very Short Introduction (New York: Oxford), chapter 4 http://amzn.to/2iloEx6

As you read, focus on:

  1. The "standard package" of economic policies that, if successfully implemented, allows a 19th century economy to catch up to the world's then industrial leaders.

  2. The absence of large gaps in technological competence across the North Atlantic--how by 1870 or so the more advanced parts of western Europe and North America were very close to being one single engineering technical community. Note also that nobody outside was able to join.

  3. Up until 1870 or so technological progress was focused on the "old industries"--steam, iron, and textiles--of the Industrial Revolution. Starting in 1870 we get "new industries": automobiles, petroleum, electricity, chemicals. Does Allen provide us with a way to understand why there was this sudden spreading-out of the front of invention and innovation from narrow to broad?

  4. Allen's has a tidy explanation of why Zimbabwe, Malawi, and India are poor today--that it is unprofitable to invest in machines because labor is cheap and labor is cheap because nobody has invested in machines. Thus even though the technological knowledge is in the air, and even though finance for profitable projects is easily raised throughout the world, the poor stay poor. Is this an adequate theory? Isn't it close to being a tautology--or, alternatively, to being a simple declaration that anything can happen? How could we make more intellectual progress on this issue?

Continue reading "Reading: Robert Allen (2011): Global Economic History: A Very Short Introduction, chapter 4" »


Reading: Robert Allen (2011): Global Economic History: A Very Short Introduction, chapters 2 and 3

Robert Allen (2011): Global Economic History: A Very Short Introduction (New York: Oxford), chapters 2 and 3 http://amzn.to/2iloEx6

  1. Bob Allen has his own theory of what laid the foundations of the Industrial Revolution of 1750-1870. It is a smart theory. It is a good theory. It is a well-argued theory. It is an evidence-based theory. But it is a contested theory. Others, as smart as Allen, think it is wrong.

  2. In this chapter Allen presents his theory.

  3. He takes occasional swipes at other theories. Treat them more seriously than he does.

  4. Allen's theory is, basically, that technological developments in ocean sailing and cannon produce maritime empires that encourage and dominate trade; that trade produces high wages in the imperial center; and thus it becomes, for probably the only time in history, profitable to develop the steam engine--if you also have a culture of mechanical engineers, really cheap coal, and excellent water transport. Thereafter what your engineers have learned from building the first generation of steam engines allows them to improve it and build other machines. And the Industrial Revolution is off and running. Try to grasp the whole theory as you read.

Continue reading "Reading: Robert Allen (2011): Global Economic History: A Very Short Introduction, chapters 2 and 3" »


Reading: David Landes (2006): Why Europe and the West? Why Not China?

David Landes (2006): Why Europe and the West? Why Not China? http://tinyurl.com/dl20161210b

As you read, note:

  • Adam Smith laid out what went wrong as the background for his picture of how things can go right, while Landes is as interested in the roots of relative--and absolute--economic failure as of success.

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Reading: Jared Diamond (1997): Agriculture: The Worst Mistake in the History of the Human Race

Jared Diamond (1997): Agriculture: The Worst Mistake in the History of the Human Race http://tinyurl.com/dl20161210a

The coming of agriculture would seem to have only pluses:

  1. You can obtain a lot more food with less work compared with hunting-and-gathering.
  2. You no longer have to carry your babies around the landscape when they are most vulnerable.
  3. You don't have to carry all of your useful stuff with you--hence you can spend more time making durable, useful stuff because it will still be around when you need it.

What's the downside? Jared Diamond says that there are very powerful downsides to the invention of agriculture and the adoption of an agricultural lifestyle? What are they? Is he right?

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Reading: Alan Taylor (2012): Colonial America: A Very Short Introduction

Alan Taylor (2012): Colonial America: A Very Short Introduction (New York: Oxford University Press: 019538914X) http://amzn.to/2j29W9S

  1. This is what you need for background: Know this, and the pre-1800 part of the American economic history course will make sense. Don't know this, and it won't... Housekeeping:

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Reading: Paul Boyer (2012): American History: A Very Short Introduction

Paul Boyer (2012): American History: A Very Short Introduction (New York: Oxford University Press: 019538914X) http://amzn.to/2gQw7QE

  1. This is what you need for background: know this, and the American economic history course will make sense. Don't know this, and it won't...

Continue reading "Reading: Paul Boyer (2012): American History: A Very Short Introduction" »