Grasping Reality on TypePad, by Brad DeLong

• Killing My Darlings: A "Great Depression Recovery" Outtake from "Slouching Towards Utopia?: An Economic History of the Long Twentieth Century, 1870-2016"

• The Great Depression: An Intake from "Slouching Towards Utopia?: An Economic History of the Long Twentieth Century 1870-2016"

• Historical Nonfarm Unemployment Statistics

• Comment of the Day: Robert Waldmann: "I don't see anything funny happening in the past 8 quarters which isn't fit almost perfectly using the assumption that the government spending multiplier is 1.5 and nothing else matters...

1. Britannica.com: Fasces

2. George Orwell* (1937): The Road to Wigan Pier

3. This Time It Is Not Different: Walter Bagehot and the Persistent Concerns of Financial Macroeconomics: Origins of Central Banking: E.M. Forster's Great Aunt Marianne

4. Peter Temin (1990): _Soviet and Nazi Economic Planning in the 1930s

5. Hans-Peter Ullmann: Organization of War Economies

6. EMB Numbers: Why are Red and Purple "Next to Each Other"?: "I make colored paint by starting with white and adding varying amounts of pigments from my three buckets, CMY. To see 'purple' I add pigment only from the magenta bucket.... I add cyan to magenta to get blue. I add yellow to magenta to get red. Therefore, it makes sense for red and blue to be adjacent on opposite sides of magenta...

7. Adolf Hitler (1941): Top 10 Quotes from World War II: "You only have to kick in the door and the whole rotten structure will come crashing down...

8. Online Etymology Dictionary: Nazi

9. John Maynard Keynes (1936): The General Theory of Employment, Interest and Money: Concluding Notes on the Social Philosophy Towards Which the General Theory Might Lead: "If effective demand is deficient, not only is the public scandal of wasted resources intolerable, but the individual enterpriser who seeks to bring these resources into action is operating with the odds loaded against him. The game of hazard which he plays is furnished with many zeros, so that the players as a whole will lose if they have the energy and hope to deal all the cards. Hitherto the increment of the world’s wealth has fallen short of the aggregate of positive individual savings; and the difference has been made up by the losses of those whose courage and initiative have not been supplemented by exceptional skill or unusual good fortune. But if effective demand is adequate, average skill and average good fortune will be enough...

10. John Maynard Keynes (1936): The General Theory of Employment, Interest and Money: Concluding Notes on the Social Philosophy Towards Which the General Theory Might Lead: "Whilst, therefore, the enlargement of the functions of government, involved in the task of adjusting to one another the propensity to consume and the inducement to invest, would seem to a nineteenth-century publicist or to a contemporary American financier to be a terrific encroachment on individualism. I defend it, on the contrary, both as the only practicable means of avoiding the destruction of existing economic forms in their entirety and as the condition of the successful functioning of individual initiative...

11. John Maynard Keynes (1936): The General Theory of Employment, Interest and Money: Concluding Notes on the Social Philosophy Towards Which the General Theory Might Lead: "The result of filling in the gaps in the classical theory is not to dispose of the ‘Manchester System’, but to indicate the nature of the environment which the free play of economic forces requires... There will still remain a wide field for the exercise of private initiative and responsibility. Within this field the traditional advantages of individualism will still hold good.... These advantages are... partly advantages of efficiency... decentralisation and of the play of self-interest.... Above all, individualism, if it can be purged of its defects and its abuses, is the best safeguard of personal liberty in the sense that, compared with any other system, it greatly widens the field for the exercise of personal choice. It is also the best safeguard of the variety of life, which emerges precisely from this extended field of personal choice, and the loss of which is the greatest of all the losses of the homogeneous or totalitarian state. For this variety preserves the traditions which embody the most secure and successful choices of former generations; it colours the present with the diversification of its fancy; and, being the handmaid of experiment as well as of tradition and of fancy, it is the most powerful instrument to better the future...

12. Jacob Viner (1937): Mr. Keynes on the Causes of Unemployment: "In a world organizedin accordance with Keynes' specifications there would be a constant race between the printing press and the business agents of the trade unions, with the problem of unemployment largely solved if the printing press could maintain a constant lead and if only volume of employment, irrespective of quality, is considered important...

13. J.R. Vernon: Unemployment Rates in Postbellum America: 1869-1899

14. Julia Carrie Wong: 'I See Any Dinosaur, I Buy It': At Home with the Embattled Owner of the Flintstone House: "Florence Fang’s colorful home is a landmark for many in California’s Bay Area. But the town of Hillsborough is suing her, declaring the property a ‘public nuisance’...

Jeet Heer: The historian John Lukacs (1924-2019), whose death at age 95 has just been announced.... In 1975... predicting that a post-Soviet Russia would be dominated by a criminal underworld.... Lukacs was born in Hungary in 1924.... Lukacs was a conservative... of a type that is virtually extinct.... a traditionalist wary of mass politics based on nationalism and scapegoating of minorities. He was for that reason properly scornful of American conservative movement. Lukacs' scorn for right-wing populism surfaced in the early 1950s. As a refugee from Hungary he was anti-communist, but still quick to detect and denounce the dangers of demagogues like Joseph McCarthy, who he feared would destablize society and incite war.... Lukacs's anti-populist conservatism... proved prophetic.... He long feared that populist-nationalist-authoritarian demagoguery was the wave of the future.... He once dismissed movement conservatives' worldview as... 'narrow enough to be ignorant, broad enough to be flat'.... Aside from his valuable critiques of nationalist populism, Lukacs was an eloquent defender of historical consciousness as a distinct & valuable form of thinking, with his own work exemplifying how being steeped in history can help illuminate the present and future...

An updated graph that Claudia Goldin had me make two and a half decades ago. The nonfarm unemployment rate since 1890. Then it was 1890-1990, now it is 1869-2015.

What is the status of this Adolf Hitler quote? It is reported by Hermann Rauschning, whom as I recall may not be the most reliable of sources. Or he may be: his principal critics appear to be Nazis and holocaust deniers, after all: Adolf Hitler: We Socialize Human Beings: ""The people about us are unaware of what is really happening to them. They gaze fascinated at one or two familiar superficialities, such as possessions and income and rank and other outworn conceptions. As long as these are kept intact, they are quite satisfied. But in the meantime they have entered a new relation; a powerful social force has caught them up. They themselves are changed. What are ownership and income to that? Why need we trouble to socialize banks and factories? We socialize human beings...

Leo Strauss (1933): To Karl Lowith: "I will also spend my second year in Paris.... I have major 'competition': the entire German-Jewish intellectual proletariat is assembled here. It’s terrible-I’d rather just run back to Germany. But here’s the catch.... I see no acceptable possibility of living under the swastika, i.e., under a symbol that says nothing more to me than: you and your ilk, you are physei subhumans and therefore justly pariahs. There is in this case just one solution. We must repeat: we, “men of science,”-as our predecessors in the Arab Middle Ages called themselves-non habemus locum manentem, sed quaerimus.… And, what concerns this matter: the fact that the new right-wing Germany does not tolerate us says nothing against the principles of the right. To the contrary: only from the principles of the right, that is from fascist, authoritarian and imperial principles, is it possible with seemliness, that is, without resort to the ludicrous and despicable appeal to the droits imprescriptibles de l’homme to protest against the shabby abomination...

No, Brad: The "Great Depression Recovery" chapter needs to be 7000 words, not 30,000. I am willing to torment editors by shipping them 10000 words, but not more:

13.1: Recovery Outside the United States

The rule to memorize about recovery from the Great Depression is: the sooner countries went off the gold standard, the better; and the less that gold standard habits of orthodoxy fettered countries thereafter, the better. The Scandinavian countries bailed first, and did best. Japan and Britain abandoned the gold standard in 1931, but Japan embraced expansionary policies more thoroughly. The U.S. and Germany abandoned the gold standard in 1933, but Hitler had a clearer view that Nazi persistence and success required putting people to work than FDR did with the try-everything-expediency of his New Deal. France stuck it out on the gold standard until 1937, and did worst of all.

Has David Brooks ever before put himself on the line in support of any policy that would make African-Americans' lives better? Asking for a friend: David Brooks: The Case for Reparations: "All sorts of practical objections leapt to mind. What about the recent African immigrants? What about the poor whites who have nothing of what you would call privilege? Do we pay Oprah and LeBron? But I have had so many experiences over the past year—sitting, for example, with an elderly black woman in South Carolina shaking in rage because the kids in her neighborhood face greater challenges than she did growing up in 1953—that suggest we are at another moment of make-or-break racial reckoning...

Jonathan Bernstein: 2020 Elections: Far Left Won’t Take Over the Democratic Party: "Questions of Democratic pragmatism have a relevant history, too, going back to efforts to reform the party’s image after it lost five of six presidential elections through 1988. The Democratic Leadership Council of that era was split, I always thought, between those such as Arizona Governor Bruce Babbitt who favored traditional liberal goals but believed market-oriented means were the best way to achieve them, and those such as Georgia Senator Sam Nunn who believed the Democratic Party had become too liberal and who wanted to preserve a large place in the party for conservatives...

I confess I do not understand why Jeff Miron and Dean Baker disagree with our Fearless Leader Heather Boushey's tame observation that more information relevant to societal well-being is better than less: Emily Stewart: GDP: Democrats Want to Know Who’s Benefiting from the Economy’s Growth: "Democrats are pushing for is for the BEA to produce a new metric, the 'income growth indicator', to be reported quarterly and annually with GDP numbers starting in 2020 that would show who is and isn’t benefiting from economic growth...

Equitable Growth alumnus Nick Bunker sends us to the always-valuable Brookings Hamilton Project on how the post-2000 prime-age female labor-force participation define was not due to anything other than a weak economy in which it was hard to get well-paying jobs: Trends in Women’s Labor Force Participation: "much like 2000 is now recognized as a pivotal year for the U.S. labor market, 2015 is beginning to look like another turning point. In part due to the ongoing strengthening of the labor market, both prime-age women’s labor force participation and prime-age men’s participation have increased sharply from 2015 through the beginning of 2019. Figure 1 shows that prime-age women now participate at higher levels than prior to the Great Recession and have now made up 70 percent of their January 2000–September 2015 decline...

Economist: The Story of China’s Economy as Told Through the World’s Biggest Building: The Global Centre: "The world’s biggest building got off to a bad start. On the eve of its opening, Deng Hong, the man who built the mall-and-office complex, disappeared... swept up in a corruption investigation just before the building’s doors opened in 2013. The media focus shifted to his hubris and his wasteful, pharaonic venture. Inside, it had a massive waterpark with an artificial beach, an ice rink, a 15-screen cinema, a 1,000-room hotel, offices galore, two supersized malls and its own fire brigade, but just a smattering of businesses and shoppers. It became a parable for the economy’s excesses and over-reliance on debt. Today, more than five years on, the story has taken a series of surprising turns. For one, the building is not a disaster. During the summer, the waterpark is crowded. The mall has come to life, a testament to the rise of the middle class. The offices are a cauldron of activity: 30,000 people work there in every industry imaginable, from app design to veterinary care. Mr Deng has been released and is back in business, declaring last summer that he had a clean slate...

How did I miss this before? Kate Bahn about how it really is the case that holders of H-1 and H-2 visas really are close to indentured servants—and suffer for it: Kate Bahn: The Search for and Hiring of Guest Workers in the United States Displays the Complexity of Market Concentration and Monopsony Power: "Eric M. Gibbons... Allie Greenman... Peter Norlander... and Todd Sorensen... monopsonistic effects for workers who are employed under guest worker visas such as H-1 and H-2... review lawsuits against employers of guest workers and confirm widely held beliefs about wage theft and abusive employment... The four researchers exploit the application process to the U.S. Department of Labor for guest worker visas to estimate employer concentration for guest workers and how this affects wages.... Guest workers are in a more concentrated set of occupations than the overall U.S. labor market, with more than a third of them working in computer and mathematical occupations on H-1B visas and nearly half working in building, grounds cleaning, and maintenance on H-2B visas... Herfindahl-Hirschman Index...is sufficiently high to warrant U.S. Department of Justice scrutiny of mergers in these sectors of the U.S. economy...

Go watch Michael Kades testify on Capitol Hill on Thursday March 7: Michael Kades: To Combat Rising U.S. Prescription Drug Prices, Let’s Try Competition: "Look at the variety of problems with anti-competitive practices engaged in by U.S. pharmaceutical companies. Take ViroPharma Inc. When faced with the possibility that the U.S. Food and Drug Administration would approve generic versions of its Vancocin product (a drug to treat a potentially life-threatening gastrointestinal infection), the company filed 43 petitions to delay or prevent generic approval. Although none were successful on the merits, it took years before the FDA approved any generic competitors. The Federal Trade Commission alleged the strategy increased costs by hundreds of millions of dollars...

Yes, it is time for the center-left to pass the baton to those further left for the next lap in the race for equitable growth. But what does that mean, concretely, for policies. Paul Krugman gives his opinion: Paul Krugman: "A few thoughts inspired by @delong's 'I am no longer a neoliberal' piece. Brad is really saying two things: [1] there is no center-right, so centrists must deal with the left; and [2] market-oriented policies don't work as well as thought. I've been there on both fronts for a while (although I have been fairly left of center for many years). But I think it's useful to ask what it means for policy proposals in different areas...

From Carole Cadwalladr as she uses TED to try to hold Silicon Valley to account—to get the social media companies to thin of themselves as information utilities rather than misinformation utilities: Carole Cadwalladr: My TED Talk: HJow I Took on the Tech Titans in Their Lair: "The world needs all kinds of brains. But in the situation we are in... not these.... If they’re not sick to their stomach about what has happened in Myanmar or overwhelmed by guilt about how their platforms were used by Russian intelligence to subvert their own country’s democracy, or sickened by their own role in what happened in New Zealand, they’re not fit to hold these jobs.... I don’t think they set out to enable massacres to be live-streamed. Or massive electoral fraud in a once-in-a-lifetime, knife-edge vote. But they did. If they don’t feel guilt, shame and remorse, if they don’t have a burning desire to make amends, their boards, shareholders, investors, employees and family members need to get them out. We can see the iceberg. We know it’s coming. That’s the lesson of TED 2019. We all know it. There are only five people in the room who apparently don’t...

Comment of the Day: Robert Waldmann: May 3, 2019: Weekly Forecasting Update: Little Change: "I can't insert a figure here, so the very few points of raw data are here ,https://rjwaldmann.blogspot.com/2019/05/g-and-gdp-update.html> or do click here or other bears will be angry https://angrybearblog.com/2019/05/fiscal-policy-and-gdp-2019-update.html I don't see anything funny happening in the past 8 quarters which isn't fit almost perfectly using the assumption that the government spending multiplier is 1.5 and nothing else matters...

This is the current draft of chapter 10 of Slouching Towards Utopia?. I am, again, of several minds with respect to it. I think it says what really needs to be said. I am not sure it says it in the right length. And I am not sure that I have successfully assembled the puzzle pieces in the right way...

So tell me what you think of it:

X. The Great Depression

https://www.icloud.com/pages/0mzIvbURq0n3I0Ct0e3aCZbEw

George Orwell (1937): The Road to Wigan Pier:

Presently the train hove in sight. With a wild yell a hundred men dashed down the slope to catch her as she rounded the bend. Even at the bend the train was making twenty miles an hour. The men hurled themselves upon it, caught hold of the rings at the rear of the trucks and hoisted themselves up by way of the bumpers, five or ten of them on each truck. The driver took no notice. He drove up to the top of the slag-heap, uncoupled the trucks, and ran the engine back to the pit, presently returning with a fresh string of trucks. There was the same wild rush of ragged figures as before. In the end only about fifty men had failed to get on to either train.

We walked up to the top of the slag-heap. The men were shovelling the dirt out of the trucks, while down below their wives and children were kneeling, swiftly scrabbling with their hands in the damp dirt and picking out lumps of coal the size of an egg or smaller. You would see a woman pounce on a tiny fragment of stuff, wipe it on her apron, scrutinize it to make sure it was coal, and pop it jealously into her sack.

10.1: Understanding the Business Cycle

10.1.1: Say’s Law

When market economies emerged, there was great worry that things would not necessarily fit together: Might not the farmers be unable to sell the crops they grew to the artisans because the artisans could not sell the products they made to the merchants who would be unable to make money carrying artisans products to the farmers because the farmers would not purchase anything? Back at the beginning of economics it was Jean-Baptiste Say who wrote that such an idea of a “general glut”—of economy-wide “overproduction” and consequent mass unemployment—was incoherent. Nobody, Say argued, would ever produce anything for sale unless they expected to use the money they earned in order to buy something else. Thus, “by a metaphysical necessity”, as subsequent-generation economist John Stuart Mill outlined Say’s argument in 1829, there can be no imbalance between the aggregate value of planned production-for-sale, the aggregate value of planned sales, and the aggregate value of planned purchases. This is “Say’s Law”.

• May 3, 2019: Weekly Forecasting Update: Little Change: Note that all of the decline in the unemployment rate is a shift of workers from "unemployed" to "out of the labor force", which now stands 800,000 lower than it did in December...

• For the Weekend: Watch a Single Cell Become a Complex Organism in Just Six Minutes

• Weekend Reading: John Maynard Keynes: from The End of Laissez-Faire (1926)

• Weekend Reading: Vachel Lindsay: from Bryan, Bryan, Bryan, Bryan

• Note to Self: Thomas Jefferson born in 1743; Sally Hemings born in 1773; she is pregnant by 1788...

1. John Maynard Keynes (1919): The Economic Consequences of the Peace

2. Jérémie Cohen-Setton, Egor Gornostay, and Colombe Ladreit:: The Aggregate Effects of Budget Stimulus: Evidence From the Large Fiscal Expansions Database: "Large, persistent, and positive effects of fiscal stimulus on GDP with a decrease in net exports that only partly offsets the increase in private domestic demand.... suggestive evidence that fiscal policy is more effective in a slump than in a boom...

3. Noah Smith: Why Macroeconomist Emi Nakamura Deserves John Bates Clark Medal - Bloomberg: "The John Clark Bates Medal almost never goes to a macroeconomist. Emi Nakamura is a worthy exception...

4. Greg Ip: For Lower-Paid Workers, the Robot Overlords Have Arrived: "Software and algorithms are used to screen, hire, assign and now terminate workers...

5. Jessica M. Goldstein: Behind the Scenes with Alexandria Ocasio-Cortez Before Anyone Knew Her Name: "Rachel Lears' documentary 'Knock Down the House' captures a political phenom on the rise—and three other women running for office for the first time...

6. Jason Kottke: Grace Hopper Explains a Nanosecond: "In this short clip from 1983, legendary computer scientist Grace Hopper uses a short length of wire to explain what a nanosecond is...

7. Steve M.: The Rot In The Republican Party Started Long Before Fox 'News' And Trump: "Sorry James Comey, but William Barr didn't need to spend time with Donald Trump to become who he is now...

8. byu/cil3x: MacBook Pro Keyboard Failures: Why Apples dust excuse is bullshit! [Teardown + Explanations] : apple: "What the actual cause is, honestly I don't know. My suspicion is that the metal dome experiences metal fatigue and slowly begin to lose connection, or that that little U-shaped cutout in the centre of the dome weakens and starts to easily bounce when pressed, making contact 2+ times.... Always have AppleCare, even if paying extra to cover a flaw that should be properly dealt with is morally questionable and a shitty thing to do...

9. John Maynard Keynes: Obituary for Alfred Marshall: "Economics does not seem to require any specialised gifts of an unusually high order.... An easy subject, at which very few excel!...

10. Forrest Capie: Money and Business Cycles in Britain, 1870–1913

11. Joseph Schumpeter (1927): The Explanation of the Business Cycle

12. Matthew Yglesias (2011): Demand Denialism: "Frédéric Bastiat... his 'What Is Seen And What Is Not Seen', which I’ve seen a lot of people cite as the foundation for their opposition to stimulus policies. It’s an extremely insightful essay, but I think the correct way to understand it is as precisely laying down the theoretical conditions in which stimulative policies do work...

13. Deficit Denialism: Frederic Bastiat Actually Favored Expansionary Fiscal Policy in Recessions Edition: It has always seemed to me that very, very, very few of the people who cite Frederic Bastiat have actually read him. Most have not even read all of "What Is Seen and Unseen". For example: "There is an article in the Constitution which states: 'Society assists and encourages the development of labor.... through the establishment by the state, the departments, and the municipalities, of appropriate public works to employ idle hands'. As a temporary measure in a time of crisis… this intervention… could have good effects... as insurance. It… takes labor and wages from ordinary times and doles them out, at a loss it is true, in difficult times...

14. Why Can't More People Actually Read Frederic Bastiat?: John Holbo's jaw drops as he reads Alex Tabarrok praise the carried interest rule.... Indeed, Alex Tabarrok does crawl out on a limb and applaud all tax loopholes as islands of freedom on the road to serfdom.... I would say that, in a democracy, one pays a progressive share of one's income to fund the many useful and convenient services and actions the government undertakes.... Methinks Frederic Bastiat would have agreed with me: "Often, nearly always if you will, the government official renders an equivalent service to John Goodfellow. In this case there is... only an exchange.... I say this: If you wish to create a government office, prove its usefulness."... Frederic Bastiat. I wonder how many people really read him these days?...

15. Karl Marx (1857): The Bank Act of 1844 and the Monetary Crisis in England

16. This Time It Is Not Different: Walter Bagehot and the Persistent Concerns of Financial Macroeconomics: Origins of Central Banking: E.M. Forster's Great Aunt Marianne

John Maynard Keynes (1926): The End of Laissez-Faire (1926): "Suppose that by the working of natural laws individuals pursuing their own interests with enlightenment in condition of freedom always tend to promote the general interest at the same time! Our philosophical difficulties are resolved-at least for the practical man, who can then concentrate his efforts on securing the necessary conditions of freedom. To the philosophical doctrine that the government has no right to interfere, and the divine that it has no need to interfere, there is added a scientific proof that its interference is inexpedient. This is the third current of thought, just discoverable in Adam Smith, who was ready in the main to allow the public good to rest on 'the natural effort of every individual to better his own condition', but not fully and self-consciously developed until the nineteenth century begins. The principle of laissez-faire had arrived to harmonise individualism and socialism, and to make at one Hume's egoism with the greatest good of the greatest number. The political philosopher could retire in favour of the business man—for the latter could attain the philosopher's summum bonum by just pursuing his own private profit...

I brag and chant of Bryan, Bryan, Bryan, 
Candidate for president who sketched a silver Zion... 
There were truths eternal in the gab and tittle-tattle, 
There were real heads broken in the fustian and the rattle, 
There were real lines drawn; 
Not the silver and the gold, 
But Nebraska's cry went eastward against the dour and the old, 
The mean and the cold....

Oh, the longhorns of Texas, 
The jay hawks from Kansas, 
The plop-eyed bungaro and giant gassicus, 
The varmint, chipmunk, bugabo, 
The horned-toad, prarie-dog, and ballyhoo, 
From all the newborn states arow... 

And all these in their helpless days 
By the dour East oppressed, 
Mean paternalism 
Making their mistakes for them, 
Crucifying half the West, 
Till the whole Atlantic coast 
Seemed a giant spider's nest...

Robert Waldmann: "I think their contributions to thought about methodology would be worth zero if correctly assessed, but are worth much less due to their influence. This is more true of Prescott, but I think I explain how Lucas's efforts are worth less than nothing here https://t.co/6fJuiQRVRk...

Chye-Ching Huang: Fundamentally Flawed 2017 Tax Law Largely Leaves Low- and Moderate-Income Americans Behind: "The fundamental flaws of the 2017 tax law: 1) it ignores the stagnation of working-class wages and exacerbates inequality; 2) it weakens revenues when the nation needs to raise more; and 3) it encourages rampant tax avoidance and gaming that will undermine the integrity of tax code.... The 2017 tax law largely left behind low- and moderate-income Americans—and in many ways hurts them.... A restructuring of the law can fix these flaws...

The public sphere of discussion and debate definitely feels a lot more broken than it gelt back in the 1980s. But I have not yet seen anybody put forward a plausible explanation for why. A number of people say: increased wealth inequality raises the stakes at risk. But weren't the stakes at risk already high?: Paul Krugman: The Zombie Style in American Politics: "Russia didn’t help Donald Trump’s presidential campaign. O.K., it did help him, but the campaign itself wasn’t involved. O.K., the campaign had a lot of Russian contacts and knowingly received information from the Russians, but that was perfectly fine.... We’re not even talking about an ever-shifting party line; new excuses keep emerging, but old excuses are never abandoned...

From Carole Cadwalladr as she uses TED to try to hold Silicon Valley to account—to get the social media companies to thin of themselves as information utilities rather than misinformation utilities:

Carole Cadwalladr: My TED Talk: How I Took on the Tech Titans in Their Lair: "Jack Dorsey, the co-founder of Twitter... saying that Nazism was 'hard to define'.... They needed to go 'deep'.... Anderson gave credit to Dorsey for actually showing up. And it’s true he did. He showed guts for doing what Zuckerberg and Sandberg would not. But... what came across... was the complete absence of emotion–any emotion–in Dorsey’s face.... Dorsey appeared–and I can’t think of any other way of saying this–insentient.... Dorsey can see the iceberg but doesn’t seem to feel our terror. Or understand it. In an interview last summer, US journalist Kara Swisher, repeatedly asked Zuckerberg how he felt about Facebook’s role in inciting genocide in Myanmar–as established by the UN–and he couldn’t or wouldn’t answer...

Jason Kottke: Watch a Single Cell Become a Complex Organism in Just Six Minutes: "...

Today: U.S. Bureau of Labor Statistics: Employment Situation Summary: "Total nonfarm payroll employment increased by 263,000 in April, and the unemployment rate declined to 3.6 percent.... Notable job gains... in professional and business services, construction, health care, and social assistance..." Note that all of the decline in the unemployment rate is a shift of workers from "unemployed" to "out of the labor force", which now stands 800,000 lower than it did in December. The unemployment rate is broken as an indicator of the business-cycle state of the labor market.

Today: Federal Reserve Bank of New York: Staff Nowcast: "May 03, 2019: The New York Fed Staff Nowcast stands at 2.1% for 2019:Q..." In the past week, good news about employment and personal consumption largely offset by bad news about manufacturing.

Key Points:

The right response to almost all economic data releases is: Nothing has changed—your view of the economic forecast today is different from what it was last week, last month, or three months ago in only minor ways. Specifically, it is still the case that:

• U.S. potential economic growth continues to be around 2%/year.
• There are still no signs the U.S. has entered that phase of the recovery in which inflation is accelerating.
• Thus there are till no signs that the U.S. has gone beyond or is even at "full employment".
• There are still no signs of interest rate normalization: secular stagnation continues to reign.
• Printing money (and bonds) to increase the global supply of safe assets and using the proceeds to buy useful stuff continues to look like good business cycle-management policy.
• The unemployment rate is broken as an indicator of the business-cycle store of the labor market.
• The Trump-McConnell-Ryan tax cut:
  • To the extent that it was supposed to boost the American economy by boosting the supply side through increased investment in America, has been a complete failure.
  • To the extent that it was supposed to make America more unequal, has succeeded.
  • Delivered a substantial short-erm demand-side fiscal stimulus to growth that has now ebbed.
    • (A 3.2%/year rate of growth of final sales to domestic purchasers over the seven quarters starting in January 2017, pushing the level of Gross National Income up by 2.1% from this demand-side stimulus.)

• A change from 3 months ago: The Federal Reserve's abandonment of its focus on policies that are likely to keep PCE chain inflation at 2%/year or lower does not mean that it is preparing to do anything to avoid or moderate the next recession.
• A change from 1 month ago: The U.S. grew at 3.2%/year in the first quarter of 2019—1.6%-points higher than had been nowcast—but the growth number you want to put in your head in assessing the strength of the economy is the 1.6%/year number that had been nowcast.
• A change from 1 week ago: The disjunction between household- and establishment-survey views of the labor market continues to grow: since December seasonally-adjusted establishment payrolls have grown by an average of 210000 a month, while the CPS reports that the seasonally-adjusted number of workers with jobs has fallen by 80000 a month.

Sam Bell recalls this from two years ago. The Bernanke and the Yellen Feds are, I think, going to be judged as harshly as the Burns Fed of the 1970s for assuming that they knew the state and structure of the economy. The more tentative, more willing to gather information Greenspan Fed of the 1990s looks much much better in retrospect: Sam Fleming: Is It Finally Time For a Pay Rise for American Workers?: "John Williams... San Francisco Fed president, says that while inflation may have been weak recently, this should not detract from the bigger picture. “It’s not like inflation is moving in the wrong direction or is out of sync with what you’d expect for where the economy is,” he said last month. 'We have gotten rid of all the slack'...

Bret Stephens's claims that although "people" do, he would never never use an official position to retaliate against someone who had annoyed him are worth what you think they are. His promises are worthless because, somewhat paradoxically, his claim that people do retaliate is wrong. Most people, and sane people, have considerable tolerance for those who punch up. someone who claims people don't is telling you who they are:

Laura McGann: NYT Columnist Bret Stephens Inadvertently Explains Why Women Don’t Report Sexual Harassment: "In an exchange about the price of rude emails, Stephens confirms retaliation is real.... Stephens explains... if someone like Kalaf.... offends a person who is important or ends up important in the industry, he risks being blackballed from jobs and prizes—even years later.... 'Imagine, for instance, that one day you are up for a big journalism award. Imagine, next, that someone you’ve insulted sits on the prize committee. Or suppose you apply for a dream job at a major publication, and your CV gets passed around. It’s fine to make unnecessary friends, but extremely unwise to make unnecessary enemies.' Stephens writes in a postscript to Kalaf that he’s judged the Livingston Award and the Pulitzers, but he’s ethical and wouldn’t behave this way...

Dan Drezner: Let’s Grade the State Department’s Director of Policy Planning on Her Grand Strategy Musings!: "Once upon a time, the director of policy planning for the State Department was a pretty prestigious job.... Brian Hook, the director of policy planning under Rex Tillerson, was granted a tremendous amount of authority but stumbled badly. He was a relative neophyte attempting to counsel a complete neophyte on the ins and outs of the job. He did... poorly. When Mike Pompeo came on, he hired Kiron Skinner.... She has thought about this stuff for a while. She has the academic credentials and publishing record.... Since coming on in September of last year, however, Skinner has made some odd statements...

Professional Republican economists against Moore: Mankiw. Professional Republicans for Moore: Lindsey, Siegel, Taylor (secondhand). Staying silent on Moore was, I think, a damaging vice signal—and a lot of people were willing to send it. Opposing Moore was not a virtue signal or even an exercise of virtue but rather a no-brainer: only Mankiw would do it: Reuters: Moore Withdraws for Consideration from Fed Post: Trump - Reuters: "U.S. President Donald Trump’s pick to fill a seat on the Federal Reserve has withdrawn from consideration... Trump said on Twitter.... Just hours earlier, Moore had told Bloomberg TV that he was “all in” and that he expected to be nominated within three weeks...

In the absence of global warming such a 95%-ile cyclone would have a maximum windspeed at landfall of 220 km/hr rather than 240: Hilzoy: "'With winds expected to be 240 kilometers per hour (150 mph) at landfall,: Tropical Cyclone Fani would be the strongest storm to hit the region since a similar system struck Odisha in 1999, resulting in at least 10,000 deaths.... A storm surge in excess of 6.5 feet is likely to occur in some locations, with the surge affecting millions in low-lying areas. The Bay of Bengal is notorious for allowing storms like this one to pile huge amounts of water into highly populated areas'...

Half of the opening paragraphs of War and Peace are in French: Leo Tolstoy: War and Peace: "Еh bien, mon prince. Genes et Lucques ne sont plus que des apanages, des поместья, de la famille Buonaparte. Non, je vous previens, que si vous ne me dites pas, que nous avons la guerre, si vous vous permettez encore de pallier toutes les infamies, toutes les atrocites de cet Antichrist (ma parole, j'y crois)—je ne vous connais plus, vous n'etes plus mon ami, vous n'etes plus мой верный раб, comme vous dites. Ну, здравствуйте, здравствуйте. Je vois que je vous fais peur, садитесь и рассказывайте...

It's not a disconnect between utility and happiness, its a disconnect between revealed preference and happiness. And a disconnect between revealed preference and happiness is properly solved via educating people to become their best selves—I do not think it poses grave philosophical conundrums: Noah Smith: What We Want Doesn’t Always Make Us Happy: "Facebook users in order to get them to deactivate the Facebook app for one or two months. They found that the median amount was $100, and the average was $180 (the latter being larger because a few users really loved Facebook). This suggests that Facebook, which is free to use, generates a huge amount of utility—more than $370 billion a year in consumer surplus in the U.S. alone. This bolsters the argument of those who believe that free digital services have added a lot of unmeasured output to the global economy. But Allcott et al. also found that the people who deactivated Facebook as part of the experiment were happier afterward...

Ben Thompson: Apple’s Earnings, Google’s Earnings, Amazon Earnings: "Available evidence strongly suggests that iPhone demand in China is very elastic: if the iPhone is cheaper, Apple sells more; if it is more expensive, Apple sells less. This is, of course, unsurprising, at least for a commodity, and right there is Apple’s issue in China: the iPhone is simply less differentiated in China than it is elsewhere, leaving it more sensitive to factors like new designs and price than it is elsewhere...

Note to Self: Thomas Jefferson born in 1743; Sally Hemings born in 1773; she is pregnant by 1788...

1. Lindsey Graham: CNN New Day: “You Know How You Make America Great Again? Tell Donald Trump To Go To Hell”:n "Trump’s a Race-Baiting, Xenophobic, Religious Bigot. He Doesn’t Represent My Party. He Doesn’t Represent The Values That the Men And Women Who Wear the Uniform are Fighting For...

2. Ben Thompson: Microsoft, Slack, Zoom, and the SaaS Opportunity: "For all of the disruption that the enterprise market has faced thanks to the rise of software-as-a-service (Saas), Microsoft was remarkably well-placed to take advantage of this new paradigm, if only they could get out of their own way...

3. Charlie Stross: [Social Architecture and the House of Tomorrow(http://www.antipope.org/charlie/blog-static/2019/04/architecture-and-the-house-of-.html): "The bedroom, wardrobe, bathroom, and some type of food storage/preparation area, aren't going away. Other spaces will also be around, and social/spatial insulation will be in demand. At the high end, the elite (whoever they are) will try to ape the living arrangements of previous century's elites, as a status signal if nothing else. What else is conceivable? What am I missing that should be as obvious as the multimodal shipping container in 1950, or photovoltaic panels on house rooftops in 1990?...

4. Students who come to a country to study are one of the most important elements of any country's soft power: they should be encouraged and cosseted. They become its friends. And God knows the Britain that Cameron and May have made will need lots of friends: Financial Times: British Universities and the Brexit Dimension: "Britain’s universities are a rare export success for its services-driven economy.... As well as the monetary benefits the UK gains soft power and ties of affection with future business leaders, technocrats and politicians. Whatever happens, Britain will need these friends...

5. Neil Turok: The Astonishing Simplicity of Everything

6. Amrita Chakrabarti Myers: The Erasure and Resurrection of Julia Chinn, U.S. Vice President Richard M. Johnson’s Black Wife

7. David Mills: The Vice President and the Mulatto: "Race, sex and politics in 19th-Century America.... Brenda Gene Gordon, a 67-year-old white woman in Chandler, Ariz.... How on earth could Brenda Gordon not have known that her great-great-great-grandfather was Vice President Richard M. Johnson? Wasn’t this fact passed proudly from generation to generation inside her family? No, it was not.... Julia Chinn... was, by law, a Negro. And in Johnson’s time (not to mention since), this was scandalous. 'I grew up never hearing the names Richard M. Johnson (even in Kentucky history classes) or Julia Chinn', Mrs. Gordon wrote to me during a recent email exchange...

8. Henry R. Robinson: An Affecting Scene in Kentucky

9. Abigail Adams: Letter to John Adams, 31 March - 5 April 1776

10. Wikipedia: Otto Bauer

11. I would suggests to Senator Rick Scott—indeed, I would suggest to all the Republican senatorså—that this is sufficient reason to vote against Stephen Moore, unless this is the face the REpublican Party wants to put forward to minority voters for the next two generations: Margaret Hoover: Firing Line: "Stephen Moore explains his 2016 joke about Donald Trump moving into the White House and kicking 'a black family out of public housing'. Moore says, 'That is a joke I always made', adding he didn’t mean it 'like a black person' lived there. 'I shouldn’t have said it', he says...

12. Ella Nilsen: Infrastructure: Trump and Democrats’ maybe-doomed meeting on infrastructure, explained - Vox: "2 trillion in the nation’s roads, bridges, and rural broadband, according to Democratic leaders.... Democrats are thrilled with that number; Republicans likely won’t be. Trump himself admitted his plan 'may not be typically Republican', according to the source...

13. Emily Stewart: How Occupy Wall Street Animated Bernie Sanders, AOC, and the Left: "Occupy Wall Street was seen as a failure when it ended in 2011. But it’s helped transform the American left...

14. Nisha Gopalan: China's Bay Area Plan Has Holes, Concerns for Hong Kong: "The plan gives scant detail on how Hong Kong and Macau will be integrated without eroding their special status.... Late Monday, the official Xinhua News Agency released details of the State Council’s Greater Bay Area plan—a project to knit together Hong Kong and Macau with nine mainland cities into a global innovation hub to rival California’s Silicon Valley. The trouble is, there’s little new on how authorities plan to make this grand vision into a reality...

15. The Hoarse Whisperer: "The last time Barr engineered a cover-up, people didn’t have cellphones, e-mail or the internet. He’s the caveman of coverups. No wonder he’s so bad at it...

16. Katherine Eriksson, Katheryn Russ, Jay C. Shambaugh, and Minfei Xu: Trade Shocks and the Shifting Landscape of U.S. Manufacturing

This is so great! And so deserved! I have always thought that the principal benefit to beiong an economist at U.C. Berkeley is how incredibly lucky we all are with our colleagues. It's nice to see the world recognizing that: American Economic Association: 2019 John Bates Clark Medal: "Emi Nakamura is an empirical macroeconomist who has greatly increased our understanding of price-setting by firms and the effects of monetary and fiscal policies. Nakamura’s distinctive approach is notable for its creativity in suggesting new sources of data to address long-standing questions in macroeconomics. The datasets she uses are more disaggregated, or higher-frequency, or extending over a longer historical period, than the postwar, quarterly, aggregate time series that have been the basis for most prior work on these topics in empirical macroeconomics. Her work has required painstaking analysis of data sources not previously exploited, and at the same time displays a sophisticated understanding of the alternative theoretical models that the data can be used to distinguish...