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July 2019

Immigration and American Politics

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I want to thank XXXXXX XXXXXX. I confess I had thought that if the President started putting migrant children in cage, the immediate reaction would not be that this might well be a clever political move. I do have a sense that for a lot of people who know better on the Republican side, they think there's mileage to be gained by characterizing bedrock American values as if they were foreign and "cosmopolitan" values. And it is very nice to hear XXXXXX pushing back.

In fact, I really do not understand XXXXXX XXXXXX's claim that the President has "put the Democrats in a box" on immigration. As I read the Gallup Poll, by 64% to 35% Americans want immigration continued at the same level or increased. 37% want the level decreased. The President wants the level of immigration decreased—illegal immigration and legal immigration alike, and we certainly shouldn't have any judges whose parents were born in Mexico. Trump is on the side of the late Sam Huntington—who liked to rant about how the immigration of Cubans had ruined Miami, and "would the last American leaving please remember to bring the flag."

How is abandoning the 64% position for a 35% position putting your opponents in a box?

New High in U S Say Immigration Most Important Problem

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Fairly Recently: Must- and Should-Reads, and Writings... (July 31, 2019)

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  • What Is the Federal Reserve Thinking Right Now?: We have no warrant for believing that our models are more knowledgeable right now than the market. And there is pronounced asymmetry here: we can always deal with too-high inflation via tighter money, but it is not obvious what we could do to fix the situation if a negative demand shock were to push the prime-age employment rate down two or four percentage-points. Hence we will validate market expectations and drop our policy rates by 25 basis points at our next meeting. What will follow that... will be data-dependent...

  • Annual Celebration of the John Bell Hood-Max von Gallwitz Society!: Dedicated to celebrating the memory of two field commanders who may well have been the worst in history. Drink a toast to John Bell Hood on the 7/28 anniversary of his defeat at Ezra Church.... And drink a toast as well to Max von Gallwitz—perhaps the only Imperial German commander who could have turned the Somme into a draw!...

  • Weekly Forecasting Update: July 26, 2019: Back in late 2017 the Trump Administration, the Republicans in the Congress, and their tame economists were all claiming that passing the Ryan-McConnell-Trump upper-income tax cut would permanently boost investment in America by as much as the Clinton economic program of the 1990s had done, and would do so much more quickly—Clinton program was phased-in over five years, while Ryan-McConnell-Trump was phased-in immediately and had been affecting investment behavior even before it was passed. It is simply not happening...

  • I Want My Country Back!: We really don’t know the consequences of this degree of income inequality: the distribution of income was never this bad before, and it continues to get worse. We did have, in the thirty years before the New Deal, a whipsaw...

  • Note to Self: Playing with Sargent-Stachurski QuantEcon http://quantecon.org: I have long been annoyed with the standard presentation of the Solow Growth Model because the state variable k—capital per effective worker—is not observable in the real world, while the capital-output ratio κ is. Moreover, the steady-state capital-output ratio has an easy to remember and intuitive description: it is the savings rate divided by the economy's steady-state investment requirements. Capital per effective worker has no such intuitive description. Plus the capital-output ratio exhibits exponential convergence to the steady-state. Capital per effective worker does not...

  • Note to Self: Consider Alasdair Macintyre: In the beginning: boring.... Today: boring.... But in the middle, along the trajectory... what a thinker! what a powerful awareness of the attractiveness of different positions! what deep insights generated by position and opposition...

  • Note to Self: Homer's Odyssey Blogging: "Like Little Birds... They Writhed with Their Feet... But for No Long While...": Is there somebody I should read who has thought deeply and powerfully about these issues?... How do we educate people to read—listen—watch—properly, so that they become their better rather than their worse selves?...

  • Note to Self: A historical question I want answered: What difference did it make for medieval economies—and for the relative prosperity of the Muslim world in the middle ages—that Muhammed was a merchant?...

  • Hoisted from the Archives: Karl Marx, First Real Business Cycle Theorist: Nine years ago: Karl Marx, First Real Business Cycle Theorist: We see the affinity between Karl Marx and the Pain Caucus in his notes on crises in Theories of Surplus Value. Negative supply shocks and missed collective guesses on what the extent of the market will be in the future create overaccumulation and overproduction. Marx is very clear that the monetary crisis theorists—like John Stuart Mill—must be wrong, and that the system cannot run itself without crises. In Marx this is one of the reasons why the system is abominable and must be overthrown. For the Pain Caucus the conclusion is opposite: because the system is good crises must be suffered...

  • Monday Smackdown/Hoisted from the Archives: Four Huge Mistakes in One Short Piece by John Taylor: None of those have panned out as intellectual bets. Yet John Taylor today exhibits no visible curiosity as to why they did not. This strongly suggests to me that none of them were meant seriously in the first place—that it was always disinformation, and never an analytical judgment, and thus subject to revision as knowledge advanced...

  • Monday Smackdown: Every Time I Try to Get Out, They Pull Me Back In... Clive Crook Edition: Duncan Black has been reading the once-thoughtful Clive Crook again: Duncan Black http://www.eschatonblog.com/2017/07/national-humiliation.html: "People is weird.... [Clive Crook:]... 'Suppose a second referendum was called and the result was Remain; suppose the EU said, "Great, glad to have you back."... This cringing submission would raise instinctive euro-skepticism to new extremes and divide the U.K. even more bitterly... a national humiliation... [that] would surpass the Suez Crisis in 1956 and the country's surrender to trade-union militancy in the 1970s—crushing setbacks with far-reaching political consequences. If there were ever a case of "be careful what you wish for," this is it...' This the thinking that leads to pointless catastrophic wars. Let's shoot ourselves in the face just to prove our gun works...

  • Hoisted from the Archives: Looking Backwards from This Week at 24, 16, 8, 4, 2, 1, 1/2, and 1/4 Years Ago (July 24-30, 2019: It is very common to attribute the collapse of Roman Republican institutions and the rise of Imperial dictatorship to a loss of moral virtue on behalf of the Roman electorate—who are supposed to have fallen prey to demagogues and voted for bread-and-circuses as the underlying foundations of liberty collapsed underneath them. That story is not true. Here Sean Elling sends us to Edward Watts on the real story—recently enriched plutocracy breaking political norm after political norm in an attempt to disrupt what had been the normal grievance-redressing operation of the system: Sean Illing: Mortal Republic: Edward Watts on what America can learn from Rome’s collapse...

  • Comment of the Day: Yes, the failure modes of making jam are pretty scary: Graydon on Homer's Odyssey and David Drake's Hammer's Slammers: "I think you're missing the central thing about Drake's writing... which is a vehicle crew...

  • Comment of the Day: Robert Waldmann: "I disagreed with that analysis in 1980. So did Solow...

  • A Year Ago on Equitable Growth: Fifteen Worthy Reads On and Off Equitable Growth for July 26, 2018: TOP MUST REMEMBER: What I call 'Bob Rubin's End-of-Meeting Questions'. Ask them! They really work!: Annie Duke: Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts: "In fact, questioning what you see or hear can get you eaten. For survival-essential skills, type I errors (false positives) were less costly than type II errors (false negatives). In other words, better to be safe than sorry, especially when considering whether to believe that the rustling in the grass is a lion. We didn’t develop a high degree of skepticism when our beliefs were about things we directly experienced, especially when our lives were at stake...

  • Liveblogging: The Anglo-Saxon Chronicle: A.D. 617: Edwin the Son of Ella: "A daughter was born to Edwin, whose name was Eanfleda. Then promised the king to Paulinus, that he would devote his daughter to God, if he would procure at the hand of God, that he might destroy his enemy, who had sent the assassin to him. He then advanced against the West-Saxons with an army, felled on the spot five kings, and slew many of their men...

  • Liveblogging: The Anglo-Saxon Chronicle: Penda and Edwin: "Archbishop Justus having departed this life on the tenth of November, Honorius was consecrated at Lincoln Archbishop of Canterbury by Paulinus; and Pope Honorius sent him the pall. And he sent an injunction to the Scots, that they should return to the right celebration of Easter...


  1. Charli Carpenter: Summer Vacation in an Age of Concentration Camps, Part 6: "Protest Matters"

  2. Duncan Black: Obummer: "I don't follow Trump's polls. They don't change much. But at best he's no more popular than Obama was, and the press always treated Obama like an unpopular president, not a POLITICAL GENIUS who CONTROLLED THE NARRATIVE...

  3. Scott Lemieux: The Republican War on Rural Voters: "Always remember that ANTI-ELITIST Josh Hawley’s goal is to ensure massive rural hospital closures nationwide by getting Republican hacks in the federal courts to strike down the Affordable Care Act entirely, and marvel that there are actually professional pundits who will swallow his bullshit. The Republican Party is quite literally indifferent to the lives of the white rural voters that are critical to maintaining control of the Senate, White House and Supreme Court...

  4. Andrew Kaczynski: Mike Pence Argued In An Op-Ed That Disney's "Mulan" Was Liberal Propaganda: "'Obviously, this is Walt Disney's attempt to add childhood expectation to the cultural debate over the role of women in the military', Pence wrote. Obviously...

  5. Jay Rosen: PressThink : "What do you want the candidates to be discussing as they compete for votes? Part of a call to action for an alternative direction in election coverage, originated by the newsroom improvement company, Hearken, and the research project that I direct, Membership Puzzle Project...

  6. Brett Terpstra: nvALT

  7. Robert Armstrong: True Patriots Aren’t Afraid to Tell the Truth: "The life of French historian Marc Bloch holds sobering lessons for us today...

  8. Lobsta Truck: Serving Lobster Rolls in California

  9. NBER: Solomon M. Hsiang

  10. Abbott Payson Usher: A History of Mechanical Inventions: Revised Edition: "Updated classic explores importance of technological innovation in cultural and economic history of the West. Water wheels, clocks, printing, machine tools, more. "Without peer." — American Scientist... #books

  11. Sam Lau, Joey Gonzalez, and Deb Nolan: Principles and Techniques of Data Science #books

  12. Martina Baras: Lawyer Larry Klayman Should Get License Suspended, Panel Says: "Committee finds rule violations in client representation.... Klayman should be required to prove his fitness to practice as a condition of reinstatement, the Board on Professional Responsibility’s ad hoc hearing committee recommended July 24.... The case is In re Klayman, D.C. Ct. App., Board Docket No. 17-BD-063, Board on Professional Responsibility recommendation 7/24/19...

Continue reading "Fairly Recently: Must- and Should-Reads, and Writings... (July 31, 2019)" »


Greatly looking forward to what comes out of this: Equitable Growth: Equitable Growth Announces 2018 Class of Grantees: The impact of Antitrust on Competition: "Fiona Scott Morton (Yale University School of Management) will collect empirical metrics of antitrust enforcement outcomes to create a novel dataset, which she will use to analyze merger effects beyond prices such as employment, and to determine whether mergers in the high-tech sector are motivated by increased efficiencies or by the elimination of competitors...

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William Darity Jr., Darrick Hamilton, Mark Paul, Alan Aja, Anne Price, Antonio Moore, and Caterina Chiopris: What We Get Wrong About Closing the Racial Wealth Gap: "The white household living near the poverty line typically has about 18,000 in wealth, while black households in similar economic straits typically have a median wealth near zero.... The 99th percentile black family is worth a mere $1,574,000 while the 99th percentile white family is worth over 12 million dollars. This means over 870,000 white families have a net worth above 12 million dollars, while, out of the 20 million black families in America, fewer than 380,000 are even worth a single million dollars.... We... contend that a number of ideas frequently touted as 'solutions' will not make headway in reducing black-white wealth disparities... are wholly inadequate to bridge the racial chasm in wealth...

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Liveblogging: The Anglo-Saxon Chronicle: Penda and Edwin

Journey To Normandy Scene 1

The Anglo-Saxon Chronicle (J.A. Giles and J. Ingram trans.): Penda and Edwin: "A.D. 626: This year Penda began to reign; and reigned thirty winters. He had seen fifty winters when he began to reign. Penda was the son of Wybba, Wybba of Creoda, Creoda of Cynewald, Cynewald of Cnebba, Cnebba of Icel, Icel of Eomer, Eomer of Angelthew, Angelthew of Offa, Offa of Wearmund, Wearmund of Whitley, Whitley of Woden.

A.D. 627: This year was King Edwin baptized at Easter, with all his people, by Paulinus, who also preached baptism in Lindsey, where the first person who believed was a certain rich man, of the name of Bleek, with all his people. At this time Honorius succeeded Boniface in the papacy, and sent hither to Paulinus the pall; and Archbishop Justus having departed this life on the tenth of November, Honorius was consecrated at Lincoln Archbishop of Canterbury by Paulinus; and Pope Honorius sent him the pall. And he sent an injunction to the Scots, that they should return to the right celebration of Easter...

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I Want My Country Back!

Mussolini rally Google Search

Council on Foreign Relations: The Future of Democracy Symposium: Session Two: Economics, Identity, and the Democratic Recession: We really don’t know the consequences of this degree of income inequality: the distribution of income was never this bad before, and it continues to get worse.

We did have, in the thirty years before the New Deal, a whipsaw.

First, we saw the rise of the progressive movement. Lots of people, even people for whom America was then doing very, very well, begin to say: "Wait a minute, this can’t go on. There’s something fundamentally wrong!"

Thus you had Teddy Roosevelt attacking the "malefactors of great wealth". You had Andrew Carnegie saying "he who dies rich, dies disgraced"—and that, in fact, if you leave anything at all to your children, you should be ashamed of yourself.

But then we had the whipsaw.

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Andreas Beerli, Jan Ruffner, Michael Siegenthaler, and Giovanni Peri: The Abolition of Immigration Restrictions and the Performance of Firms and Workers: Evidence from Switzerland: "We study a reform that granted European cross-border workers free access to the Swiss labor market.... Regions close to the border were affected more intensely and earlier. The greater availability of cross-border workers increased their employment but also wages and possibly employment of highly educated native workers although the new cross-border workers were also highly educated... the reform increased the size, productivity, innovation performance of some incumbent firms, attracted new firms, and created opportunities for natives to pursue managerial jobs...

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Halving child poverty is attainable, and remarkably cheap: Janet Currie: We Can Cut Child Poverty in the United States in Half in 10 Years: "Means-tested supports and work incentives.... More universal benefits... a combination of work incentives, economic security programs, and social inclusion initiatives.... Expand the Earned Income and Child and Dependent Care tax credits, while adding a $2,000 child allowance to replace the current Child Tax Credit.... 'Work-oriented' programs (the Earned Income and Child and Dependent Care tax credits, an increase in the minimum wage, and a nationwide roll-out of a promising demonstration program called “Work Advance”).... Far too many full-time jobs... without other assistance, leave parents and children in poverty...

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Note to Self: "Consider Alasdair Macintyre... In the beginning: boring naive and jejune Marxisant socialist... Today: boring, naive, and jejune neo-Thomist... But in the middle, along the trajectory, Herbert Marcuse: An Exposition and a Polemic through Against the Self-Images of the Age to Hegel and After Virtue... what a thinker! what a powerful awareness of the attractiveness of different positions! what deep insights generated by position and opposition—even if he never gets to aufhebung—composition!...

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Monday Smackdown/Hoisted from the Archives: Four Huge Mistakes in One Short Piece by John Taylor

Smackdown

Hoisted from the Archives: Four huge mistakes in this here by John Taylor:

  1. That the low-interest rate economy of 2004-2007 was in an inflationary boom, rather than an economy that barely managed to reach any definition of "full employment" even though supercharged boy three things—low interest rates, expansionary fiscal policy, plus a huge irrationally-exuberant asset-price bubble.

  2. That low interest rates since 2007 represent a discretionary choice by central banks, rather than reflecting the fact that any central bank wanting to avoid permanent depression must accommodate itself to the low level fo the Wicksellian neutral interest rate.

  3. That as of 2017 interest rates were about to normalize.

$. That the Republican policy package of regulatory rollback and tax cuts for the rich would provide a large boost to investment spending and, through that channel, productivity growth.

None of those have panned out as intellectual bets.

Yet John Taylor today exhibits no visible curiosity as to why they did not.

This strongly suggests to me that none of them were meant seriously in the first place—that it was always disinformation, and never an analytical judgment, and thus subject to revision as knowledge advanced:

John Taylor (March 2017): Sluggish Future: Policy Is The Problem: "Secular stagnation... raises inconsistencies and doubts. Low policy interest rates set by monetary authorities... before the financial crisis were associated with a boom characterized by rising inflation and declining unemployment—not by the slack economic conditions and high unemployment of secular stagnation. The evidence runs contrary to the view that the equilibrium real interest rate—that is, the real rate of return required to keep the economy’s output equal to potential output—was low prior to the crisis. And the fact that central banks have chosen low policy rates since the crisis casts doubt on the notion that the equilibrium real interest rate just happened to be low. Indeed, in recent months, long-term interest rates have increased with expectations of normalization of monetary policy.... The United States needs another dose of structural reform—including regulatory, tax, budget, and monetary—to provide incentives to increase capital investment and bring new ideas into practice.... There is hope for yet another convincing swing in the policy-performance cycle to add to the empirical database...

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There are lots and lots of business practices that could and should be ruled illegal restrains on trade: Colleen Cunningham, Florian Ederer, and Song Ma: Killer Acquisitions: "This paper argues incumbent firms may acquire innovative targets solely to discontinue the target’s innovation projects and preempt future competition. We call such acquisitions “killer acquisitions.” We develop a parsimonious model illustrating this phenomenon. Using pharmaceutical industry data, we show that acquired drug projects are less likely to be developed when they overlap with the acquirer’s existing product portfolio, especially when the acquirer’s market power is large due to weak competition or distant patent expiration. Conservative estimates indicate about 6% of acquisitions in our sample are killer acquisitions. These acquisitions disproportionately occur just below thresholds for antitrust scrutiny...

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Quinn Slobodian: Perfect Capitalism, Imperfect Humans: Race, Migration and the Limits of Ludwig von Mises’s Globalism: "The Habsburg Empire... was a silent and open partner in the writings of Austrian economist Ludwig von Mises on international order, especially on questions of migration and the management of a polyglot population. After 1918 Mises conceived of robust forms of multinational governance capable of protecting a world of what he called ‘perfect capitalism’ with total global mobility of labour, capital and commodities. Yet, by 1945 he had scaled back his proposals to the effective recreation of the Habsburg Empire.... Mises’s international theory was cleft by a faultline between a normative theory of an open borders world and the empirical reality of a closed borders world, underwritten by what he saw as the stubborn obstacles of human ignorance and racial animus. "How can we expect that the Hindus, the worshipers of the cow, should grasp the theories of Ricardo and of Bentham?" —Ludwig von Mises, 1944...

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Reed Hunt, Brad DeLong, and Joshua Cohen: Neoliberalism and Its Discontents | Commonwealth Club: "MON, SEP 9 / 7:00 PM: Outdoor Art Club, One West Blithedale, Mill Valley, 94941...

...Reed Hundt: Chairman from 1993–1997, Federal Communications Commission; Founder and CEO, Coalition for Green Capital

Brad DeLong: Professor of Economics, UC Berkeley; Former U.S. Deputy Assistant Secretary of the Treasury for Economic Policy Under President Bill Clinton

Joshua Cohen: Editor, Boston Review; Distinguished Senior Fellow, UC Berkeley; Faculty, Apple University

7 p.m. check-in and complimentary light hors d'oeuvres. 7:30–9 p.m. program

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Monday Smackdown: Every Time I Try to Get Out, They Pull Me Back In... Clive Crook Edition

Stop or I Shoot Myself TV Tropes

Hoisted from Two Years Ago: I must say, afgter two years I think Duncan Black was much too kind here. My remarks at the time: Monday Smackdown: Every Time I Try to Get Out, They Pull Me Back In... Clive Crook Edition_: So after a pep talk from Noah Smith Saturday night about how it is time to become kinder and gentler—to look for opportunities to praise for being smart people who in the past I have criticized for being really really really dumb—I wake up Monday morning, and I wince because Duncan Black has been reading the once-thoughtful Clive Crook again....

Duncan Black http://www.eschatonblog.com/2017/07/national-humiliation.html: "People is weird.... [Clive Crook:]...

Suppose a second referendum was called and the result was Remain; suppose the EU said, "Great, glad to have you back."... This cringing submission would raise instinctive euro-skepticism to new extremes and divide the U.K. even more bitterly... a national humiliation... [that] would surpass the Suez Crisis in 1956 and the country's surrender to trade-union militancy in the 1970s—crushing setbacks with far-reaching political consequences. If there were ever a case of "be careful what you wish for," this is it...

This the thinking that leads to pointless catastrophic wars. Let's shoot ourselves in the face just to prove our gun works...

Continue reading "Monday Smackdown: Every Time I Try to Get Out, They Pull Me Back In... Clive Crook Edition" »


Duncan Black: Lynching Postcards: "The sad truth is a decent chunk of the population is pretty damn cruel. I don't mean indifferent or selfish or merely 'I got mine, f--- you', but actively cruel, taking enjoyment in the suffering of others. Every time someone says or writes 'this is not who we are' as if America is a special angelic country filled with nothing but good and nice people and any deviation from that is just a momentary aberration, I get angry. This is who 'we' are. Not all of us, but enough. Trump's continued significant support is enough proof of that...

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I want more about this. I want to know what I should read in order to understand what cognitive narratologists think. Clearly, Comeuppancer, but what else? Arkady Martine: The Mysterious Discipline of Narratologists: Why We Need Stories to Make Sense: "That is the power of the mysterious discipline of narratologists: it tells us why stories make sense, and why we want them to so very desperately...

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Annual Celebration of the John Bell Hood-Max von Gallwitz Society!

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Hoisted from the Archives: The John Bell Hood-Max von Gallwitz Society!: Dedicated to celebrating the memory of two field commanders who may well have been the worst in history. Drink a toast to John Bell Hood on the 7/28 anniversary of his defeat at Ezra Church:

Hood... moved his troops out to oppose the Union army... planned to intercept them and catch them completely by surprise.... Unfortunately for Hood... Howard had predicted such a maneuver based on his knowledge of Hood from their time together.... His troops were already waiting in their trenches when Hood reached them. The Confederate army also had not done enough reconnaisance... and made an uncoordinated attack.... In all, about 3,642 men were casualties; 3,000 on the Confederate side and 642 on the Union side...

And drink a toast as well to Max von Gallwitz—perhaps the only Imperial German commander who could have turned the Somme into a draw!...

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Liveblogging: The Anglo-Saxon Chronicle: A.D. 617: Edwin the Son of Ella

Journey To Normandy Scene 1

The Anglo-Saxon Chronicle (J.A. Giles and J. Ingram trans.): Edwin the Son of Ella: "A.D. 617. This year was Ethelfrith, king of the Northumbrians, slain by Redwald, king of the East-Angles; and Edwin, the son of Ella, having succeeded to the kingdom, subdued all Britain, except the men of Kent alone, and drove out the Ethelings, the sons of Ethelfrith, namely, Enfrid. Oswald, Oswy, Oslac, Oswood. Oslaf, and Offa.

A.D. 624. This year died Archbishop Mellitus.

A.D. 625. This year Paulinus was invested bishop of the Northumbrians, by Archbishop Justus, on the twelfth day before the calends of August.

A.D. 626. This year came Eamer from Cwichelm, king of the West-Saxons, with a design to assassinate King Edwin; but he killed Lilla his thane, and Forthere, and wounded the king. The same night a daughter was born to Edwin, whose name was Eanfleda. Then promised the king to Paulinus, that he would devote his daughter to God, if he would procure at the hand of God, that he might destroy his enemy, who had sent the assassin to him. He then advanced against the West-Saxons with an army, felled on the spot five kings, and slew many of their men.

This year Eanfleda, the daughter of King Edwin, was baptized, on the holy eve of Pentecost. And the king within twelve months was baptized, at Easter, with all his people. Easter was then on the twelfth of April. This was done at York, where he had ordered a church to be built of timber, which was hallowed in the name of St. Peter. There the king gave the bishopric to Paulinus; and there he afterwards ordered a larger church to be built of stone...

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Martin Wolf: States Create Useful Money, but Abuse It: "What then are the problems with MMT?... Suppose holders of money fear that the government is prepared to spend on its high priority items, regardless of how overheated the economy might become... fear that the central bank has also become entirely subject to the government’s whims.... They are then likely to dump money.... The focus of MMT’s proponents on balance sheets and indifference to expectations that drive behaviour are huge errors.... If politicians think they do not need to worry about the possibility of default, only about inflation, their tendency may be to assume output can be driven far higher, and unemployment far lower, than is possible without triggering an upsurge in inflation...

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Sebastian Doerr, José-Luis Peydró, and Hans-Joachim Voth: Failing Banks and Hitler's Path to power: "Polarised politics in the wake of financial crises echo throughout modern history, but evidence of a causal link between economic downturns and populism is limited. This column shows that financial crisis-induced misery boosted far right-wing voting in interwar Germany. In towns and cities where many firms were exposed to failing banks, Nazi votes surged. In particular, places exposed to the one bank led by a Jewish chairman registered particularly strong increases of support–scapegoating Jews was easier with seemingly damning evidence of their negative influence...

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Note to Self: Is there somebody I should read who has thought deeply and powerfully about these issues?: Homer's Odyssey Blogging: "Like Little Birds... They Writhed with Their Feet... But for No Long While...": I love [David] Drake. I love the Odyssey. But I am distressed to find myself somewhat more sympathetic than I want to be with Plato's recommendation that only "hymns to the gods and praise of famous men" be allowed in the Just City because allowing more would lead to sensation and melodrama and would excite the baser instincts of men. And I have now opened up the following can of worms: How do we educate people to read—listen—watch—properly, so that they become their better rather than their worse selves? Mind you, I do not wish that the Odyssey were otherwise (or that David Drake wrote otherwise). But I do wish we teachers taught better how to read—and listen—and watch...

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Comment of the Day: Yes, the failure modes of making jam are pretty scary: Graydon on Homer's Odyssey and David Drake's Hammer's Slammers: "Like Little Birds... They Writhed with Their Feet... But for No Long While...": "I think you're missing the central thing about Drake's writing. It is not so much that, yeah, these are not the best circumstances and our feels are in abeyance; that happens, that's depicted. But among that depiction you get what I think of as the essential Drake thing, which is a vehicle crew. They may not like each other much; they may not, in some senses of the word, trust one another. But they are entirely predictable to one another, and reliable. And it's that obligation of reliability that lets people get their head out of hell, whether as imperfectly as Danny Pritchard does it or as entirely as the protagonist of Redliners does. (You can see much the same flavour of reliable between Gunnar and Brennu-Njáll)...

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Looking Backwards from This Week at 24, 16, 8, 4, 2, 1, 1/2, and 1/4 Years Ago (July 24-30, 2019)

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Three Months Ago (April 24-30, 2019):

  • SEDAC: Population Estimation Tools:
     

  • It is very common to attribute the collapse of Roman Republican institutions and the rise of Imperial dictatorship to a loss of moral virtue on behalf of the Roman electorate—who are supposed to have fallen prey to demagogues and voted for bread-and-circuses as the underlying foundations of liberty collapsed underneath them. That story is not true. Here Sean Elling sends us to Edward Watts on the real story—recently enriched plutocracy breaking political norm after political norm in an attempt to disrupt what had been the normal grievance-redressing operation of the system: Sean Illing: Mortal Republic: Edward Watts on what America can learn from Rome’s collapse...

  • Rosa Luxemburg: "Freedom only for the supporters of the government, only for the members of one party... is no freedom at all. Freedom is always and exclusively freedom for the one who thinks differently.... All that is instructive, wholesome and purifying in political freedom depends on this essential characteristic, and its effectiveness vanishes when ‘freedom’ becomes a special privilege...

  • Edmund Wilson (1940): Trotsky, History, and Providence: Weekend Reading: "These statements make no sense whatever unless one substitutes for the words history and dialectic of history the words Providence and God.... There sometimes can turn out to be valuable objects cast away in the garbage-pile of history.... From the point of view of the Stalinist Soviet Union, that is where Trotsky himself is today; and he might well discard his earlier assumption that an isolated individual must needs be 'pitiful' for the conviction of Dr. Stockman in Ibsen's Enemy of the People that 'the strongest man is he who stands most alone'...

  • The Knot of War 1870-1914: An Intake from "Slouching Towards Utopia?: An Economic History of the Long Twentieth Century 1870-2016"

  • Henry Farrell and Bruce Schneier: Information Attacks on Democracies: "Democracies, in contrast, are vulnerable to information attacks that turn common political knowledge into contested political knowledge. If people disagree on the results of an election, or whether a census process is accurate, then democracy suffers. Similarly, if people lose any sense of what the other perspectives in society are, who is real and who is not real, then the debate and argument that democracy thrives on will be degraded. This is what seems to be Russia’s aims in their information campaigns against the U.S.: to weaken our collective trust in the institutions and systems that hold our country together. This is also the situation that writers like Adrien Chen and Peter Pomerantsev describe in today’s Russia, where no one knows which parties or voices are genuine, and which are puppets of the regime, creating general paranoia and despair...

 

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Very nice review of a very good—if very cranky, and very much subject to not-invented-here syndrome—book. I still am unclear about the "three rungs" of Pearl's Ladder, however, largely because I do not think you can talk about causation at all without counterfactuals, except by fooling yourself: Lisa R. Goldberg: Review of Dana Mackenzie and Judea Pearl: The Book of Why: The New Science of Cause and Effect: "Pearl’s work on causal inference is often described as 'influential', and it is especially appreciated by computer scientists, but it is not the only approach...

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A Year Ago on Equitable Growth: Fifteen Worthy Reads On and Off Equitable Growth for July 26, 2018

stacks and stacks of books

TOP MUST REMEMBER: What I call 'Bob Rubin's End-of-Meeting Questions'. Ask them! They really work!: Annie Duke: Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts: "In fact, questioning what you see or hear can get you eaten. For survival-essential skills, type I errors (false positives) were less costly than type II errors (false negatives). In other words, better to be safe than sorry, especially when considering whether to believe that the rustling in the grass is a lion. We didn’t develop a high degree of skepticism when our beliefs were about things we directly experienced, especially when our lives were at stake...

Continue reading "A Year Ago on Equitable Growth: Fifteen Worthy Reads On and Off Equitable Growth for July 26, 2018" »


Comment of the Day: Robert Waldmann: "I disagreed with that analysis in 1980. So did Solow. The argument was gradually reducing inflation was possible, would work fine, and wouldn't cause such a severe recession. I still think that. But why are the 70s so memorable? (For us, obviously, our teens are memorable.) Krugman thinks they are remembered with horror because they were very bad for investors. Also it was part of a general ideological shift. But it is amazing how inflation around 10% (mostly a transfer which can be avoided with indexed contracts not a welfare loss) had such a huge effect on policy and academic economics and the great recession had such a small effect. I think it is very hard to reconcile this with the idea that economics is a science or that policymakers have well defined objectives and models. Also, it is clear that a bit of suffering for me and people I know has more effect than huge suffering of people of another social class. You didn't explain where the 2% target came from or why a 4% target is rejected. I don't think you can. Given the liquidity trap it makes no sense (as you and Larry Summers argued decades ago)...

Comment of the Day: Charles Steindel: in reply to Robert Waldmann: "You are precisely right about the 70's (I wuz there). Even with the big 73-75 recession it was essentially a period of strong growth; a lot of jobs created as our generation flooded the labor market. A major reason for the runup in inflation, as has been fairly well-documented (by Athanasios Orphanides), was the unexpected drop in productivity growth—that led to overestimates of how much tightening of policy would reduce inflation. A key issue examined by some in that era was the real cost of the inflation. At least as I saw it careful analysis suggested little (of course, some misallocation of resources reflecting the non-indexed tax code, but that is a fairly straightforward matter to correct). I was amused a few years ago when Olivier Blanchard may have been apparently implicitly relying on that line of reasoning in suggesting higher inflation targets; I got that message back then from the long paper Stan Fischer and Franco Modigliani wrote and it could be Olivier heard it the same as I did...

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Note to Self: Playing with Sargent-Stachurski QuantEcon http://quantecon.org: I have long been annoyed with the standard presentation of the Solow Growth Model because the state variable k—capital per effective worker—is not observable in the real world, while the capital-output ratio κ is. Moreover, the steady-state capital-output ratio has an easy to remember and intuitive description: it is the savings rate divided by the economy's steady-state investment requirements. Capital per effective worker has no such intuitive description. Plus the capital-output ratio exhibits exponential convergence to the steady-state. Capital per effective worker does not:

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Barbara Biasi: School Finance Equalisation Increases Intergenerational Mobility: "Rates of intergenerational mobility vary widely across the US. This column investigates the effects of reducing differences in revenues and expenditures across school districts within each state on students’ intergenerational income mobility, using school finance reforms passed in 20 US states between 1986 and 2004. Equalisation has a large effect on mobility, especially for low-income students. The effect acts through a reduction in the gap in inputs and in college attendance between low-income and high-income districts...

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Another passage from To the Finland Station (pp. 431-2): Edmund Wilson: Leon Trotsky: "We who of recent years have seen the State that Trotsky helped to build in a phase combining the butcheries of the Robespierre Terror with the corruption and reaction of the Directory, and Trotsky himself figuring dramatically in the role of Gracchus Babeuf, may be tempted to endow him with qualities which actually he does not possess and with principles which he has expressly repudiated. We have seen the successor of Lenin undertake a fabulous rewriting of the whole history of the Revolution in order to cancel out Trotsky's part; pursue Trotsky from country to country, persecuting even his children and hounding them to their deaths; and at last, in faked trials and confessions more degrading to the human spirit than the frank fiendishness of Ivan the Terrible, try to pin upon Trotsky the blame of all the mutinies, mistakes and disasters that have harassed his administration—till he has made the world conscious of Trotsky as the accuser of Stalin's own bad conscience, as if the Soviet careerists of the thirties were unable to deny the socialist ideal without trying to annihilate the moral authority of this one homeless and hunted man. It is not Trotsky alone who has created his role: his enemies have given it a reality that no mere self-dramatization could have compassed. And as the fires of the Revolution have died down in the Soviet Union at a time when the systems of thought of the West were already in an advanced state of decadence, he has shown forth like a veritable pharos, rotating a long shaft of light on the seas and the reefs all around...

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A snippet on the history of GPS systems: Carmen Roxana: Dr. Gladys West, The Black Woman Who Invented The GPS, Gets Honored By U.S. Air Force At The Pentagon: "In 1986, West published 'Data Processing System Specifications for the Geosat Satellite Radar Altimeter', a 60-page illustrated guide, which was based off data created from the radio altimeter on the Geosat satellite, which went into orbit on March 12, 1984. She worked at Dahlgren for 42 years and retired in 1998...

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Jim Stock: Global Temperature and Human Activity: "Two co-authors and I conducted an analysis published in 2006 that used cointegration methods to estimate the relationship between total energy impacting the earth (called radiative forcing) and global mean temperature. Radiative forcing is the sum of solar radiative forcing and radiative forcing from greenhouse gases. The figure plots temperature and its predicted value, using the relationship we estimated using data from 1860-1994 (all the data we had at the time, because of data availability lags). Because our data ended in 1994 (denoted by the vertical line in the figure), the past 20 years of data provide a true out-of-sample test of our regression relationship between radiative forcing and temperature. The red dashed line post-1994 is the predicted temperature, using our published regression estimate and post-1994 data on radiative forcing but not using temperature data for that period (the shaded region shows 67 percent confidence interval for the prediction). The figure illustrates that the published regression does a very good job predicting the path of temperature post 1994. For fifteen years starting in 1998, there was a warming 'hiatus', which has been used to argue against warming being linked to ever-increasing concentrations of carbon dioxide. In our model, the hiatus is due to increased emissions of sulfur oxides (which reflects sunlight back into space) from new coal plants in China, and a long lull in the solar cycle. Since then, temperatures have been rising, just as the regression predicts...

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Danny Yagan: Employment Hysteresis from the Great Recession: "This paper uses U.S. local areas as a laboratory to test whether the Great Recession depressed 2015 employment. In full-population longitudinal data, I find that exposure to a 1-percentage-point-larger 2007-2009 local unemployment shock caused working-age individuals to be 0.4 percentage points less likely to be employed at all in 2015, likely via labor force exit. These shocks also increased 2015 income inequality. General human capital decay and persistently low labor demand each rationalize the findings better than lost job-specific rents, lost firm-specific human capital, or reduced migration. Simple extrapolation suggests the recession caused most of the 2007-2015 age-adjusted employment decline...

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Joe Weisenthal: "Imagine the level of privilege that is thinking you're entitled to a positive real rate of return without taking any risk. In all seriousness, it's interesting that a lot of hard money types who rail against socialism also think that 'savers' (people who have accumulated capital over time) deserve free money for just holding their money in a bank. Something else that's interesting to me is that virtually 100% of the people who blast low Fed rates for causing inequality are themselves from the upper echelons of society...

Matt Busigin: "The extent to which your 2019 twitter feed looks like my 2011/2012 twitter feed is almost spooky (link: https://twitter.com/mbusigin/status/220273621254418432)...

Joe Weisenthal: "If I'm just 7 years behind you, then that's pretty good...

Matthew C. Klein: Positive real rates make a lot more sense if you think of them as compensation for forgoing consumption during periods when resource scarcity limit overall spending—just not the world we live in now...

Greg Ip: "A lot of non-wealthy, non-hard money types, many retired, are upset they can't get a real return on T-Bills and bank deposits like they could for most of recorded history. I'm not saying they're right, but they're not speaking from privilege or hypocrisy...

Brad DeLong: They got their interest when bond prices exploded upwards. They may not be speaking from privilege or hypocrisy, but they are ignorant, thoughtless, and easily-grifted morons...

Matthew C. Klein: "Depends on their duration...

Brad DeLong All right. Then they missed out on their interest because they let Fox News grift them into buying overpriced gold funds & gold bullion. Their foul. Not our tent, not our circus, not our clowns, not our monkeys, not our problem...

Jacob Robbins: "True. About half of treasury returns post-2000 are from capital gains, 25% post-1980. Compare this with pre-1980, where inflation wiped out coupon yields and rising interest rates led to capital losses on bonds...

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From the Twitterverse: Dave Weigel: "'Nobody's plan will change' is an electoral suicide note. It hands the power to Aetna and Blue Cross etc to change their plans, raise their prices, while the party in power absorbs blame...

Brad DeLong: Your good private insurance options are going away: each year finds you choosing between still-narrower networks & yet-higher premiums, both with more bureaucratic hassles. the public option gives you a lifeboat to escape from the private-insurance ship rapidly taking on water...

XLProfessor: "'We aren't going to force anyone to switch to Medicare, but we are going to offer people the choice and are confident that over time, pretty much everyone will want to'...

Richard Yeselson: "If the 'universal, but still incremental, so not quite totally de-commodified single payer transition' candidates want to intelligently and honestly own their PO position, below is what to say—anything else is being cynical or stupid...

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From the Twitterverse: Florian Ederer: "This tremendously bold claim about the degree and pervasiveness of competition in Jaffe et al (2019) is rather unusual for a recent economics textbook:

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Justin Wolfers: "It’s indefensible...

Brad DeLong: I confess that it had never occurred to me that someone would adopt affinity fraud as a marketing strategy for a textbook. Yet another piece of evidence that I have an inadequate imagination, I guess...

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What Is the Federal Reserve Thinking Right Now?

The Federal Reserve is not an intelligence: it does not think. Individual members of the Federal Open Market Committee, however, do think. And the center of gravity of their individual thoughts now runs something like this:

1980-1985 was a disaster: 3 x 6 x 0.5 = 9%-point-years of lost jobs for Americans, jobs that would not have been lost had the Federal Reserve done its proper job and kept inflation under control in the 1970s:

Employment Rate Aged 25 54 All Persons for the United States FRED St Louis Fed

Inflation exploded in the 1970s because of demand-pull: the Federal Reserve let employment get above full employment, and outgo workers and firms rapidly concluded that this was a permanent situation in which they had to act first to boost their incomes:

Consumer Price Index for All Urban Consumers All Items Less Food and Energy FRED St Louis Fed

We cannot let this happen again: hence three times since 2010—in 2013, 2016, and 2018—we have used our policy tools of rates, quantities, and jawboning to push interest rates higher because we thought we were rapidly closing in on the full employment point at which inflation would start to move up substantially:

Real Gross Domestic Product FRED St Louis Fed

All three times we were wrong: we were not rapidly closing in on the full employment point at which inflation would start to move up substantially.

Real Gross Domestic Product FRED St Louis Fed

Now the inverted yield curve tells us that the market thinks that we have overdone interest rate increases, and will be substantially cutting rates by 100 basis points over the next two years:

FRED Graph FRED St Louis Fed

The market could be right and it could be wrong. An inverted yield curve has been a reliable warning signal in the past, but the world is different now, and perhaps that matters. However, failing to begin to validate market expectations now would shake confidence and raise uncertainty. We have no warrant for believing that our models are more knowledgeable right now than the market. And there is pronounced asymmetry here: we can always deal with too-high inflation via tighter money, but it is not obvious what we could do to fix the situation if a negative demand shock were to push the prime-age employment rate down two or four percentage-points.

Hence we will validate market expectations and drop our policy rates by 25 basis points at our next meeting. What will follow that... will be data-dependent...

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July 26, 2019: Weekly Forecasting Update

Back in late 2017 the Trump Administration, the Republicans in the Congress, and their tame economists were all claiming that passing the Ryan-McConnell-Trump upper-income tax cut would permanently boost investment in America by as much as the Clinton economic program of the 1990s had done, and would do so much more quickly—Clinton program was phased-in over five years, while Ryan-McConnell-Trump was phased-in immediately and had been affecting investment behavior even before it was passed.

It is simply not happening.

Gross Private Domestic Investment Nominal Potential Gross Domestic Product FRED St Louis Fed

Yet I have heard no explanations for why not. For example, a Tyler Cowen would write, in November 2017, that: Yes, a Corporate Tax Cut Would Increase Investment - Bloomberg: "Republicans have science on their side when it comes to this part of their tax plans.... The most likely result is that lower corporate tax rates will lead to more investment projects and thus more aggregate economic activity.... [The] worry... that companies will take their cash windfalls and simply return them to investors.... The evidence doesn’t support this fear.... When the critics allege that corporate tax rate cuts won’t boost investment, that’s going against basic economics..."

Has there been a peep from him since marking his beliefs to market? No.

The Ryan-McConnell-Trump tax cut did nothing other than make America even more unequal. Macroeconomically, we are where we were three years ago: Relatively stable growth at a trend a bit above 2% per year, with slowly rising employment, and no signs of rising inflation or a rising labor share.

The only significant difference that the Fed has now recognized that its hope of normalizing the Fed Funds rate in the foreseeable future is vain, and has now recognized that its confidence over the past six years that we were close to full employment was simply wrong.

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Martin Wolf: Donald Trump’s Boom Will Prove to Be Hot Air: "While the long-term effect on growth seems nugatory, the impact on the finances of the federal government is not. That may well be the main point, for congressional Republicans at least. Tax cuts do not pay for themselves. But they help 'starve the beast', in common Republican parlance. The ratio of federal receipts to GDP fell to 17 per cent in the first quarter of 2019, against 18.8 per cent two years before. The gap between receipts and spending also hit 5.5 per cent of GDP in the first quarter of 2019 at what must be close to the peak of the cycle. This could be justified if these deficits were funding investment. But they are doing no such thing. The fiscal incontinence of the Republicans will also have told Democrats that fiscal responsibility is senseless. That realisation will have big long-term effects...

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It is very curious, given Stigler and Becker's "De Gustibus...", that so many of their students, grand-students, and great-grandstudents happen, as Kate Bahn says, to mistake constraints for differences in preferences: Kate Bahn: On Twitter: "Looking forward to the day when economists stop interpreting constraints as preferences. E.g. women just choose to earn less at jobs that give them flexibility to do all of the caregiving and unpaid household work in their families!...

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There are still no signs of any acceleration in measured productivity growth from the low "new normal" that emerged with the financial crisis of 2007-9. Least of all are there signs of an acceleration in investment and productivity growth produced by the late-2017 McConnell-Ryan-Trump tax cut. Moreover, the growth rate of the labor force now falls off of a demographic cliff. If there were a moment over the past two and a half centuries when we would like for the economy's sake for immigration to be higher than usual, it is now:

John Fernald and Huiyu Li: Is Slow Still the New Normal for GDP Growth?: "Estimates suggest the new normal pace for U.S. GDP growth remains between 1½% and 1¾%, noticeably slower than the typical pace since World War II. The slowdown stems mainly from demographic trends that have slowed labor force growth, about which there is relatively little uncertainty. A larger challenge is productivity. Achieving GDP growth consistently above 1¾% will require much faster productivity growth...

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Karl Marx, First Real Business Cycle Theorist: Hoisted from the Archives

J Bradford DeLong s Awesome Presentation On The History Of The Bank Bailout Business Insider

Hoisted from the Archives: Nine years ago: Karl Marx, First Real Business Cycle Theorist: We see the affinity between Karl Marx and the Pain Caucus in his notes on crises in Theories of Surplus Value. Negative supply shocks and missed collective guesses on what the extent of the market will be in the future create overaccumulation and overproduction. Marx is very clear that the monetary crisis theorists--like John Stuart Mill--must be wrong, and that the system cannot run itself without crises.

In Marx this is one of the reasons why the system is abominable and must be overthrown. For the Pain Caucus the conclusion is opposite: because the system is good crises must be suffered.

Karl Marx:

Theories of Surplus-Value, Chapter 17: "When speaking of the destruction of capital through crises, one must distinguish between two factors...

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Adam Samson: German Manufacturing Reports Industry ‘In Freefall’: "Key survey points to weakest sentiment in nine years.... The Ifo Institute’s manufacturing business climate index slumped to minus 4.3 in July from positive 1.3 the previous month. The reading was the lowest in more than nine years and echoes a separate survey released on Wednesday that pointed to mounting troubles in Europe’s powerhouse economy. The broader Ifo sentiment gauge, which also covers Germany’s services sector, declined as well, hitting the lowest level since 2013...

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Fairly Recently: Must- and Should-Reads, and Writings... (July 25, 2019)

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  • Weekly Forecasting Update: July 19, 2019: We are where we were a year ago: Stable growth at 2% per year with no signs of rising inflation or a rising labor share. The only significant difference that the Fed has recognized that its hope of normalizing the Fed Funds rate in the foreseeable future is vain, and has now recognized that its confidence over the past six years that we were close to full employment was simply wrong...

  • Monday Smackdown: Batshit Insane American Nat-Cs Department: Intellectual Leading Light Samuel P. Huntington: Apropos of our National Conservatives—our Nat-Cs—here in America today. It is worth remembering how batshit insane is right-wing "class of civilizations" urberguru Samuel Hintington. Witness his firm belief that immigrants from Cuba have ruined Miami: "Anglos had three choices... [i] accept their subordinate and outsider position... [ii] assimilate into the Hispanic community—“acculturation in reverse”... [iii] they could leave Miami, and between 1983 and 1993, about 140,000 did just that, their exodus reflected in a popular bumper sticker: 'Will the last American to leave Miami, please bring the flag'...

  • Monday Smackdown/Hoisted from the Archives: Scott Sumner Knew Better than to Do This!: "They are both basically saying: 'if we hold nominal spending constant, fiscal policy can’t fix it.'... [I]t’s really rather sad when people like Krugman and Brad DeLong keep insisting that these guys don’t understand basic macro principles.... I don’t know for sure that Fama was using the same implicit assumption... [but] I think it quite likely that Fama was also cutting corners.... Lots of brilliant people talking past each other.... Welcome to elite macroeconomics, circa 2011.... If I was going to assign blame I’d single out Krugman/DeLong for rudeness and Fama/Cochrane for poor communication skills..." Me: Economists' Views of Fiscal Policy: RetCon Department: The argument that Sumner attributes to Cochrane and Fama (and, wrongly, to Barro) is not a coherent argument: if you say "if I assume that fiscal policy does not affect nominal spending, then fiscal policy does not affect nominal spending, and so I have proved my case" you haven't made an argument at all...

  • Monday Smackdown: Let Me Smackdown Jared Bernstein on International Trade Here...: I really, really wish Jared Bernstein would not do this. It is simply not the case—as he knows well—that policymakers "quickly forgot about the need to compensate for the losses" from expanded international trade. Democratic policymakers—of whom Jared is one—well-remembered this, but after November 1994 did not have the power. Republican policymakers did not see the need as a need at all: they did not forget it: they ignored it...

  • Note to Self: My sense is that "we need to raise reserve requirements in a boom" is very good policy; but that "we need to pop this bubble" is almost always very bad policy. And we do not appear to have any (large) equity bubble. The weirdness is all in bond prices...

  • Looking Backwards from This Week at 16, 8, 4, 2, 1, 1/2, and 1/4 Years Ago: July 23, 2019: Highlights of Highlights: The 1870 Inflection Point in Transport and Trade: An In-Take from "Slouching Towards Utopia": An Economic History of the Long 20th Century: Everyplace in the world was, as long as there were docks and railroads, cheek-by-jowl to every other place. Everyone’s opportunities and constraints, not, as before, just the consumption patterns of the elite, depended on what was going on in every other piece of the world economy.... And once a comparative advantage was established it tended to stick....
     
    Reading Notes for Robert Skidelsky: "Keynes: A Very Short Introduction"...: John Maynard Keynes was brought up a classical liberal and a classical economist... believed in free trade, economic progress, cultural uplift, and political reason... found himself watching as the classical economic mechanisms he had been taught to admire all fell apart. He then picked himself up. After World War I Keynes used what power he had to—don't laugh—try to restore civilization.... And when he lost in the 1920s and the 1930s he picked himself up yet again, and tried yet again in the mid-1930s and thereafter to lay the groundwork for future victories for prosperity, rationality, and technocracy. And, in the end, he succeeded....
     
    A Teaching Note on Barro's (2005) "Rare Events and the Equity Premium" and Rietz's (1988) "The Equity Premium: A Solution": Barro's paper follows Rietz (1988).... A greater fear of future catastrophe is a source of high, not low, price-dividend and price-earnings ratios. THIS CAN ONLY WORK BECAUSE THERE ARE NO BONDS IN THE MODEL: SAFE ASSETS ARE IN ZERO SUPPLY: THE ONLY WAY TO INSURE AGAINST A BAD FUTURE IS TO BUY RISKY EQUITIES NOW IN AN ATTEMPT TO MOVE PURCHASING POWER FORWARD IN TIME!!!!....
     
    World War II at the Operational Level: The Fall of France 1940 (Prompted by the Forthcoming Release of "Dunkirk")_: Three days into the battle it was clear that a major Nazi attack was coming through the Ardennes, and the French began to respond... threw 800 tanks in four armored divisions plus between six and ten infantry divisions in front of the Nazi breakthrough in plenty of time to make a difference—yet (de Gaulle's division aside) they were completely ineffective in a running fight against seven Nazi panzer divisions, which had no more tanks and somewhat fewer soldiers than the French reserves committed to oppose them.... But before we scorn the French army of 1940 as cheese-eating surrender monkeys, remember what happened to the U.S. 106th Infantry Division when Hitler’s Third Reich was on its very last legs, and what happened to Major General Lloyd Fredendall’s U.S. II Corps at Kasserine Pass. Everybody who faced the Nazis did more-or-less equally badly, in their initial encounters at least....
     
    Obama Has Always Been for Premature Fiscal Austerity: January 7 [2009]: TAPPER: "Your team has talked about the stimulus package being 675 to 775 billion. But at the same time... you're going to distribute a memo in which economists say it should be between 800 billion and 1.3 trillion. How do you reconcile that difference...?" OBAMA: "Well, we are still in consultation with members of Congress about the final size of the package. We expect that it will be on the high end of our estimates, but [it] will not be as high as some economists have recommended because of the constraints and concerns we have about the existing deficit...

  • Comment of the Day: Graydon: "It's quite possible to look at the Chinese per-city bans on combustion-powered busses and taxis... as drifting toward the Chinese banning sales of new private combustion-powered automobiles by 2022 or so...

  • Comment of the Day: Grebmorts: ": "Seven thorns. 'Yt' is an abbreviation for 'þat' https://en.wiktionary.org/wiki/yt..." Touché... Why þ and &—not to mention æ, ð, œ—have not made more of a comeback in this Age of Twitter is a mystery to me...

  • For the Weekend: Aretha Franklin: Who's Zoomin' Who?

  • Weekend Reading: Francis Wilkinson: Gun Safety Takes a Back Seat to Gun Culture and Children Die

  • Weekend Reading: Dwight D. Eisenhower (1954): Letter to Edgar Newton Eisenhower: "Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history. There is a tiny splinter group, of course, that believes you can do these things. Among them are H. L. Hunt (you possibly know his background), a few other Texas oil millionaires, and an occasional politician or business man from other areas. Their number is negligible and they are stupid...

  • Weekend Reading: Roger Zelazny: For a Breath I Tarry...


  1. Abraham Lincoln: On the Know Nothing Party: Letter to Joshua F. Speed: "I am not a Know-Nothing. That is certain. How could I be? How can any one who abhors the oppression of negroes, be in favor of degrading classes of white people? Our progress in degeneracy appears to me to be pretty rapid. As a nation, we begin by declaring that 'all men are created equal'. We now practically read it 'all men are created equal, except negroes'. When the Know-Nothings get control, it will read 'all men are created equal, except negroes, and foreigners, and catholics'...

  2. Colin Leys: Samuel Huntington and the End of Classic Modernization Theory

  3. John Ronald Reuel Tolkien (1966): The Homecoming of Beorhtnoth Beorthelm's Son: "Beorhtwold... utters the famous... 'Hige sceal þe heardra, heorte þe cenre/mod sceal þe mare þe ure maegen lytlað' 'Will shall be the sterner, heart the bolder, spirit the greater as our strength lessens'. It is here implied, as is indeed probable, that these words were not "original," but an ancient and honoured expression of heroic will; Beorhtwold is all the more, not the less, likely for that reason actually to have used them in his last hour...

  4. Greg Sargent: "Central to Trump’s racism—and more broadly to Trumpism writ large—is... asserting the right to engage in public displays of racism without it being called out for what it is... to flaunt his racism with impunity.... Nonwhite lawmakers who were born here... are in some sense not members of the American nation.... The flat-out denial that any of this is racist is... crucial to the overall statement: The explicit idea here is that Trump is free to engage in public racism without it being called out for what it really is, that is, with no apology or capitulation to those who label it as such...

  5. Wikipedia: Višegrad Massacres

  6. Jennifer Craig: Value of Shipwreck Data in Databases

  7. Justin Leidwanger: From Time Capsules to Networks: New Light on Roman Shipwrecks in the Maritime Economy

  8. QuantEcon: QuantEcon Notebook Library

  9. A. J. Parker: Artifact Distributions and Wreck Locations: The Archaeology of Roman Commerce

  10. William Bradford: History of Plimoth Plantation

  11. Joseph R. McConnell et al.: Lead Pollution Recorded in Greenland Ice Indicates European Emissions Tracked Plagues, Wars, and Imperial Expansion During Antiquity

  12. Roger Zelazny: For a Breath I Tarry...

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Why is Google selling this as AI rather than as functioning human-AI teams?: Chris Smith: Surprise: The ‘AI Bot’ People Talk to on Google Duplex Calls Is Sometimes Actually a Person: "25% of calls placed through Duplex started with a human. Beyond that, 15% of calls that started off with the Duplex AI bot had a human intervene at some point.... Yes, maybe Duplex needs human oversight and the best way to train AI is by having it work with a lot of examples to learn from. But Google never really mentioned this human aspect of Google Duplex, which sort of ruins the magic of it all...

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