Grasping Reality on TypePad, by Brad DeLong

1. Sixteen Links for 2007-06-29 http://www.bradford-delong.com/2007/06/links-for-200-8.html Most important: Saskia Scholtes and Gillian Tett warn of bad financial trouble: Worries grow about the true value of repackaged debt https://www.ft.com/content/547fe852-24da-11dc-bf47-000b5df10621: "As head of the financial stability unit at the Banque de France, Imène Rahmouni-Rousseau travelled to America this month to look at the current turmoil in the US subprime mortgage world... she wanted to assess the risks. What she discovered surprised her. There was little confidence about how to value the holdings. “Pricing data are difficult to obtain,” she says. It is a discovery being shared by numerous other policymakers and investors around the world as the fallout widens from a subprime lending boom, in which US banks provided vast amounts in home loans to financially stretched borrowers who put little money down and gave no proof of income. Among the casualties have been two hedge funds run by Bear Stearns, the Wall Street investment bank..."

2. Ronald Reagan's Alzheimer's was well advanced in 1983: Ronald Reagan on Ambassador Hinton! http://www.bradford-delong.com/2007/06/ronald-reagan-o.html: "From Douglas Brinkley, ed. (2007), The Reagan Diaries (New York: Harper Collins: 9780060876005): "Thur Feb 17 1983: Jeanne Kirkpatrick reported on her trip to Central America. A grim story. Our Ambas. Hinton under the direction of the same kind of St. Dept. bureaucrats who made Castro possible are screwing up the situation in El Salvador. I'm now really mad. Bill C. is bringing George S. up to date and then I'm determined heads will roll, beginning with Ambas. Hinton.... Thu Jun 9 1983: Ambas. Hinton just relieved as Ambas. to El Salvador, stopped by. He's a good man and did a fine job under extremely difficult circumstances. I hope he can convince some of our left leaning Congressmen how wrong they are..." I have little patience for those who say that Ronald Reagan was oriented to time, place, and identity. When you fire somebody, it's not hard to remember that you were the one who fired him. There is the deeper question: just what did George Shultz think that he was doing in letting Jeanne Kirkpatrick talk to Reagan without a handler present?...

3. Justin Fox on the Washington Post's take on Cheneynomics http://www.bradford-delong.com/2007/06/justin-fox-on-t.html: "Ed Lazear apparently needed Cheney to tell him that the mortgage-interest tax deduction is popular: 'When Edward P. Lazear... broached the idea of limiting the popular mortgage tax deduction, he said he quickly dropped it after Cheney told him it would never fly with Congress...'" This is really too bad. One role of the CEA is to keep chipping away at issues that are not politically possible now, but may become so in ten years. Curbing the mortgage interest deduction is one of these...

4. The Highest Broderism of All: Keeping Ones Eyes Closed for Six Years as a Favor to Dick Cheney (Why Oh Why Can't We Have a Better Press Corps?) http://www.bradford-delong.com/2007/06/the-highest-bro.html: I think that Broder--like me--knew pretty much the story back in July 2001. I think that he didn't write about it because it didn't suit his purposes and interests for him to inform his readers what he believed to be the case about the workings of the White House. Now it suits his purposes and interests to pretend that Gellman and Becker are bringing a lot of genuinely new information to the table, rather than just filling in the details of a picture that has been known in broad outline for six years...

5. Truly Unforgettable Moments on the Internet: First in a Series http://www.bradford-delong.com/2007/06/truly-unforgett.html: From Making Light: "Dog-eating Jew-counters for McCain!..."

All from Ten Years Ago:

• Dr. Dow-Jones and Mr. Wall Street Journal and Rupert Murdoch http://www.bradford-delong.com/2007/06/dr-dow-jones-an.html: "Dr. Jekyll, meet Mr. Hyde. Some Journal insiders--even some on the news side--say that this Jekyll-and-Hyde relationship is all to the advantage of the good Dr. Jekyll. Nobody serious believes the editorial page, they say; it serves as a comics page for the older and more-wingnutty subscribers, a source of daily comfort food for those who still denounce, "that Communist, Franklin Roosevelt".... The editorial page delivers up perhaps half a million extra subscribers a year, and that money flow pays for the finest news-reporting operation in the world. Other Journal insiders say that it is the bad Mr. Hyde that is sucking the blood of Dr. Jekyll...

• Sixteen Links for 2007-06-29 http://www.bradford-delong.com/2007/06/links-for-200-8.html Most important: Saskia Scholtes and Gillian Tett warn of bad financial trouble: Worries grow about the true value of repackaged debt https://www.ft.com/content/547fe852-24da-11dc-bf47-000b5df10621: "As head of the financial stability unit at the Banque de France, Imène Rahmouni-Rousseau travelled to America this month to look at the current turmoil in the US subprime mortgage world... she wanted to assess the risks. What she discovered surprised her. There was little confidence about how to value the holdings. “Pricing data are difficult to obtain,” she says. It is a discovery being shared by numerous other policymakers and investors around the world as the fallout widens from a subprime lending boom, in which US banks provided vast amounts in home loans to financially stretched borrowers who put little money down and gave no proof of income. Among the casualties have been two hedge funds run by Bear Stearns, the Wall Street investment bank..."

• Truly Unforgettable Moments on the Internet: First in a Series http://www.bradford-delong.com/2007/06/truly-unforgett.html: From Making Light: "Dog-eating Jew-counters for McCain!..."

• The Highest Broderism of All: Keeping Ones Eyes Closed for Six Years as a Favor to Dick Cheney (Why Oh Why Can't We Have a Better Press Corps?) http://www.bradford-delong.com/2007/06/the-highest-bro.html: I think that Broder--like me--knew pretty much the story back in July 2001. I think that he didn't write about it because it didn't suit his purposes and interests for him to inform his readers what he believed to be the case about the workings of the White House. Now it suits his purposes and interests to pretend that Gellman and Becker are bringing a lot of genuinely new information to the table, rather than just filling in the details of a picture that has been known in broad outline for six years...

• The Weak Link Theory of Economic Development http://www.bradford-delong.com/2007/06/the-weak-link-t.html

• Top Ten Substantive Items About Brad DeLong on Google: June 28, 2007 http://www.bradford-delong.com/2007/06/top-ten-substan.html: "The 'Cognitive Elite'... The Invisible College... New Orleans's Hurricane Evacuation 'Plan'... Does China's Exchange-Rate Policy Matter?... John Kenneth Galbraith... 'Neighbor, How Stands the Union?'... Dark Matter... North of the Border... On Think 'Tanks'... What Kinds of Social Security Reform Are Tantamount to a Bond Default?..."

• Annals of Government Failure: Silphium Edition http://www.bradford-delong.com/2007/06/annals-of-gover.html

• Stupidest Men Alive: Lifetime Achievement Addition http://www.bradford-delong.com/2007/06/stupidest-men-a.html: "Matthew Yglesias directs us to this inspired bit of psychotic creepiness from National Review: its admission that its patron saint Frank Meyer's "casual reference to 'the totalitarian implications of the federal school lunch program" was "not... wholly positive" http://article.nationalreview.com/?q=MGM2ODMzYzY1N2Y0ODA3ZDk3MjE0OTdkNTNiMGQ4ZGQ...

• The Economics of the iPod http://www.bradford-delong.com/2007/06/the-economics-o.html

• Does China's Rise Make Things Harder for Other Developing Countries? Yes. http://www.bradford-delong.com/2007/06/does-chinas-ris.html: Michael Kremer convinced me the answer was "yes." Now Dani Rodrik weighs in... The problem is that we now more-or-less now how to do light-industrial export-led development. We don't know how to do much of anything else. So "adopt a pro-development industrial policy" isn't much help. For China's rise has made it much harder for Mexicos, South Africas, and Perus to take that road... http://www.bradford-delong.com/2007/06/does-chinas-ris.html

• Six Links for 2007-06-28 http://www.bradford-delong.com/2007/06/links-for-200-7.html: Robert Waldmann catches Washington Post reporters Gellman and Becker "includ[ing] a minor but extreme example of generous granting of anonymity—ex post anonymity for public statements"...

• Justice for Seamus!: The Wall Street Journal Needs to Employ More Dog People http://www.bradford-delong.com/2007/06/the-wall-street.html: Amy Schatz is clearly not a dog person. If so, she would know that it is extremely unusual and a sign of great distress for [Mitt Romney's] dog to defecate in anything that it regards as its den--like a dog carrier...

• Stupidest Woman Alive Nomination: Kathryn Jean Lopez http://www.bradford-delong.com/2007/06/stupidest-woman.html

• The American Scene http://www.bradford-delong.com/2007/06/the-american-sc.html

• Eddie Lazear Has Jumped the Shark http://www.bradford-delong.com/2007/06/eddie-lazear-ha.html: An economic adviser who finds himself not advising but being advised by a vice president is doing no good at all: "Lazear, who is otherwise known as a fierce advocate for his views, said that he may argue a point with Cheney 'for 10 minutes or so' but that in the end he is always convinced. 'I can't think of a time when I have thought I was right and the vice president was wrong'." This is not good...

• Ronald Reagan looks to have been senile in 1981: Ronald Reagan on the Budget Deficit! http://www.bradford-delong.com/2007/06/ronald-reagan-2.html: From Douglas Brinkley, ed. (2007), The Reagan Diaries (New York: Harper Collins: 9780060876005). Interesting how Reagan never asked his economic advisers: "Well, isn't what you are telling me now inconsistent with what you told me last year?" Easy to bamboozle. And nobody appears to have tried to unbamboozle him...

• The Small Place of Economists in a President's Mind http://www.bradford-delong.com/2007/06/the-small-place.html: From Douglas Brinkley, ed. (2007), The Reagan Diaries (New York: Harper Collins: 9780060876005). It is interesting--but depressing--to recognize that Ronald Reagan did not know the difference between a group of prominent outside economists brought in to the White House compound for a day or so--an economic advisory council--and the economists on his personal staff who worked for him--the Council of Economic Advisers, a group of three who were headed during the Reagan administration by Murray Weidenbaum, Marty Feldstein, Bill Niskanen, and Beryl Sprinkel...

• Justin Fox on the Washington Post's take on Cheneynomics http://www.bradford-delong.com/2007/06/justin-fox-on-t.html: "Ed Lazear apparently needed Cheney to tell him that the mortgage-interest tax deduction is popular: 'When Edward P. Lazear... broached the idea of limiting the popular mortgage tax deduction, he said he quickly dropped it after Cheney told him it would never fly with Congress...'" This is really too bad. One role of the CEA is to keep chipping away at issues that are not politically possible now, but may become so in ten years. Curbing the mortgage interest deduction is one of these...

• Two Links for 2007-06-27 http://www.bradford-delong.com/2007/06/links-for-200-6.html

• Good News for the Newsweek Readers of the World! http://www.bradford-delong.com/2007/06/good-news-for-t.html

• Ronald Reagan looks to have been senile in 1981: Ronald Reagan on Survivable Total Thermonuclear War! http://www.bradford-delong.com/2007/06/ronald-reagan-1.html: "From Douglas Brinkley, ed. (2007), The Reagan Diaries (New York: Harper Collins: 9780060876005): :Thur Dec 3 1981: NSC meeting--I approved starting a Civil Defense buildup. Right now in a nuclear war we'd lose 150 million people. The Soviets could hold their losses down to less than were killed in WWII." I don't know which is sadder: that he was so easily bamboozled, that he was surrounded by people so eager to bamboozle him, or that nobody found that they had either a material or a moral interest in unbamboozling him...

• Ronald Reagan was definitely senile in 1983: Ronald Reagan on Ambassador Hinton! http://www.bradford-delong.com/2007/06/ronald-reagan-o.html: "From Douglas Brinkley, ed. (2007), The Reagan Diaries (New York: Harper Collins: 9780060876005): "Thur Feb 17 1983: Jeanne Kirkpatrick reported on her trip to Central America. A grim story. Our Ambas. Hinton under the direction of the same kind of St. Dept. bureaucrats who made Castro possible are screwing up the situation in El Salvador. I'm now really mad. Bill C. is bringing George S. up to date and then I'm determined heads will roll, beginning with Ambas. Hinton.... Thu Jun 9 1983: Ambas. Hinton just relieved as Ambas. to El Salvador, stopped by. He's a good man and did a fine job under extremely difficult circumstances. I hope he can convince some of our left leaning Congressmen how wrong they are..." I have little patience for those who say that Ronald Reagan was oriented to time, place, and identity. When you fire somebody, it's not hard to remember that you were the one who fired him. There is the deeper question: just what did George Shultz think that he was doing in letting Jeanne Kirkpatrick talk to Reagan without a handler present?...

• The Social Impact of Microsoft Once Again http://www.bradford-delong.com/2007/06/the-social-impa.html: The big issues with Microsoft have to do with its effect on the pace of innovation...

• Ezra Klein: Every Man A Doctor, Purchaser, and HMO http://www.bradford-delong.com/2007/06/ezra-klein-ever.html: Funny--in a sick sort of way: Ezra Klein: Every Man A Doctor, Purchaser, and HMO: "It's pretty funny to watch Michael Cannon explain how, if you didn't hurt yourself too badly, and you happen to be a professional health care expert deeply steeped in theories of consumer cost control, you can use an HSA to bring down costs on your torn ACL..."