Fairly Recently: Must- and Should-Reads, and Writings... (December 17, 2019)

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MUST OF THE MUSTS:

  1. Walter Womacka Stained-Glass Restoration https://www.moz.de/kultur/artikelansicht/dg/0/1/1043774/ https://www.bradford-delong.com/2019/12/walter-womackas-socialist-realist-stained-glass.html in the former State Council building on Berlin's Schlossplatz, now the home of the European School of Management and Technology: How the East German Government Wanted to Pretend It Had Been, Was, and Would Be...

  2. Wendong Zhang et al.: 3 Reasons Midwest Farmers Hurt by the U.S.-China Trade War Still Support Trump https://theconversation.com/3-reasons-midwest-farmers-hurt-by-the-u-s-china-trade-war-still-support-trump-126303: 'Although farmers have lost billions of dollars in exports, China’s strategy hasn’t created the intended effect, with surveys of farmers continuing to show strong support for the president. We conducted our own survey of corn and soybean farmers. Published in October, it suggests three reasons farmers support Trump’s trade policies despite the costs.... Tthe Trump administration’s efforts to ease their pain have paid off. The administration gave soybean, sorghum and other farmers 12 billion in assistance in 2018, which the vast majority of our survey participants found useful. The survey was conducted before an additional 16 billion in payments went to farmers this year.... We also found that farmers largely view the trade disruption as short-term pain for long-term gain. While only 14% think their farm operations will be better off financially a year from now, more than half said they expected something good to ultimately come out of the trade war.... Finally, we found a growing frustration with China’s erratic buying behavior. For example, China shut out U.S. beef for 14 years over a mad cow scare in 2003, keeping the ban more than a decade after other countries like Japan and South Korea lifted theirs. Chinese purchase of products such as distillers grains or corn sometimes just disappear. These may have been offshoots of adjustments China made to its corn support policy, but, from the perspective of U.S. farmers, Chinese demand for certain U.S. agricultural commodities has been annoyingly inconsistent.... “The Chinese do not play by the rules,” one Illinois farmer said. “They cancel shipment orders that are not in their favor. They continue to steal our patents. Only President Trump has tried to stop these unfair trade practices”.... Most farmers recognize that they will continue to be the biggest victims of the U.S.-China trade war.... Yet 56% still said they supported imposing tariffs on Chinese products, while only 30% oppose them...

  3. Hoisted from the Archives: Executive Summary of Obama Transition Economic Policy Work: Note that if 600 billion in fiscal stimulus would have reduced the expected unemployment rate as of the end of 2010 from 9.5% to 8%, 900 billion would still have left the economy with an expected end-of-2010 unemployment rate of 7.25%. And, of course, the memo ought to have highlighted that things had a 50% chance of being worse than expected—even considerably worse, which they were: the end of 2010 unemployment rate was 9.3%. To seek as your economic policy goal a set of policies that would might well have—and did—leave the unemployment rate two years hence above 9% seemed like malpractice on the part of the Obama-Emmanuel-Biden team then. It still seems like it was malpractice now...

  4. Hoisted from the Archives: If You Are So Rich, Why Aren't You Smart?: From Ten Years Ago https://www.bradford-delong.com/2019/12/if-you-are-so-rich-why-arent-you-smart.html: The explicit argument, of course, is that the parents are rich because they are genetically smart, and that the children test well because they have inherited smartness genes from their parents, and all is good because it is right that the worthy should be rich and the most important part of being worthy is being smart. And Mankiw drops it there—without even acknowledging that, say, being able to afford an extra bathroom is a good signal that you can afford to spend more money on your children's education. Without trying to do a quantitative calculation of the expected slope. But, rather, hingeing the entire thing on "good genes". IMHO, merely saying that correlation is not always causation and dropping the issue is profoundly unhelpful—moreover, it shows a... certain lack of work ethic as well.... The rule of thumb, I think, is that half of the income-test score correlation is due to the correlation of your test scores with your parents' IQ; and half of the income-test score correlation is coming purely from the advantages provided by that component of wealth uncorrelated with your parents' (genetic and environmental!) IQ. The curve is less steep, but there is definitely a 'what' here to be thought about. There is no "so what" here at all... The masters at explaining this, of course, are Samuel Bowles and Herbert Gintis...

  5. Brad DeLong Says More...: Project Syndicate https://www.bradford-delong.com/2019/12/brad-delong-says-more-project-syndicate.html: Back in 1992, Larry Summers and I warned participants at the Fed’s annual symposium in Jackson Hole, Wyoming, that low inflation and high equity-return and bond-risk premiums do not play well together. Dealing with a typical recession had, historically, required that the Fed cut the federal funds rate by five full percentage points. A large recession would require even larger cuts How could macroeconomic stability be maintained in a world where the real federal funds rate was 3% at the peak of the business cycle, and the inflation rate was 2% or less? It was a very good question then. It is an even better question today...

  6. Project Syndicate: Eternal September: How Trolls Overran the Public Square https://www.bradford-delong.com/2019/12/project-syndicateannalee.html https://www.project-syndicate.org/commentary/trolls-win-control-of-the-public-square-by-j-bradford-delong-2019-12: The impact of the changing technological, organizational, and productivity foundation on the public sphere of ideas of ideas about politics and societal organization has been one of the most consequential areas...

  7. Project Syndicate: No, We Don’t “Need” a Recession https://www.bradford-delong.com/2019/12/no-we-dont-need-a-recession-by-j-bradford-delong-project-syndicate.html https://www.project-syndicate.org/commentary/myth-of-needed-recession-by-j-bradford-delong-2019-10: It was not uncommon for commentators to argue for a “needed” recession before the big one hit in 2008-2010. But I, for one, assumed that this claim was a decade dead. Who in 2019 could say with a straight face that a recession and high unemployment under conditions of low inflation would be a good thing?...


  1. Walter Womacka Stained-Glass Restoration https://www.moz.de/kultur/artikelansicht/dg/0/1/1043774/ https://www.bradford-delong.com/2019/12/walter-womackas-socialist-realist-stained-glass.html in the former State Council building on Berlin's Schlossplatz, now the home of the European School of Management and Technology: How the East German Government Wanted to Pretend It Had Been, Was, and Would Be...

  2. António Henriques and Nuno Palma: Comparative European Institutions and the Little Divergence, 1385-1800 http://cgeh.nl/sites/default/files/WorkingPapers/cgehwp84HenriquesPalma.pdf: "Why did the countries which first benefited from access to the New World–Castile and Portugal–decline relative to their followers, especially England and the Netherlands? The dominant narrative is that worse initial institutions at the time of the opening of Atlantic trade explain Iberian divergence. In this paper, we build new quantitative measures which allow for a comparison of institutional quality over time. We consider the frequency and nature of parliamentary meetings, the frequency and intensity of extraordinary taxation and coin debasement, and real interest spreads for public debt. We find no evidence that the political institutions of Iberia were worse at least until the English Civil War...

  3. Wendong Zhang et al.: 3 Reasons Midwest Farmers Hurt by the U.S.-China Trade War Still Support Trump https://theconversation.com/3-reasons-midwest-farmers-hurt-by-the-u-s-china-trade-war-still-support-trump-126303: 'Although farmers have lost billions of dollars in exports, China’s strategy hasn’t created the intended effect, with surveys of farmers continuing to show strong support for the president. We conducted our own survey of corn and soybean farmers. Published in October, it suggests three reasons farmers support Trump’s trade policies despite the costs.... Tthe Trump administration’s efforts to ease their pain have paid off. The administration gave soybean, sorghum and other farmers 12 billion in assistance in 2018, which the vast majority of our survey participants found useful. The survey was conducted before an additional 16 billion in payments went to farmers this year.... We also found that farmers largely view the trade disruption as short-term pain for long-term gain. While only 14% think their farm operations will be better off financially a year from now, more than half said they expected something good to ultimately come out of the trade war.... Finally, we found a growing frustration with China’s erratic buying behavior. For example, China shut out U.S. beef for 14 years over a mad cow scare in 2003, keeping the ban more than a decade after other countries like Japan and South Korea lifted theirs. Chinese purchase of products such as distillers grains or corn sometimes just disappear. These may have been offshoots of adjustments China made to its corn support policy, but, from the perspective of U.S. farmers, Chinese demand for certain U.S. agricultural commodities has been annoyingly inconsistent.... “The Chinese do not play by the rules,” one Illinois farmer said. “They cancel shipment orders that are not in their favor. They continue to steal our patents. Only President Trump has tried to stop these unfair trade practices”.... Most farmers recognize that they will continue to be the biggest victims of the U.S.-China trade war.... Yet 56% still said they supported imposing tariffs on Chinese products, while only 30% oppose them...

  4. Peter J. Klenow, Huiyu Li, and Theodore Naff: Is Rising Concentration Hampering Productivity Growth? https://www.frbsf.org/economic-research/publications/economic-letter/2019/november/is-rising-concentration-hampering-productivity-growth/: 'The initial rise in concentration was accompanied by a burst of productivity growth and that concentration in local markets may actually have declined.... Rising concentration was a byproduct of the information technology (IT) revolution, with effects on productivity growth that vary over time.... Large firms expanded by adding establishments in new locales. To the extent that the number of establishments is connected to the number of products or markets, this evidence suggests that large firms increased their national sales share by adding new markets rather than increasing their sales share within existing markets. This is consistent with the rise in concentration coming from lower costs for managing many establishments as a result of the IT revolution.... IT improvements may have enabled efficient firms to expand into new markets and set the stage for the burst of productivity growth in the decade leading up to 2005. The expansion of large firms also may have intensified competition and cut into profits, discouraging them from innovating within markets. This, in turn, could have contributed to the eventual slowdown of productivity growth in recent years.... Policymakers need to gain a fuller understanding of the tradeoffs to formulate appropriate policy and avoid potential unintended consequences...

  5. Otto von Bismarck's self-portrait of himself as—like Karl Marx—an Atheistic Young Hegelian. How much Bismarck believed what he wrote, and how much Bismarck's beliefs were accurate, are things that I must leave to the judgment of those more expert than I. From _The German Classics: Masterpieces of German Literature Translated Into English: Volume X: Prince Otto Von Bismarck, Count Helmuth Von Moltke, Ferdinand Lassalle: Otto von Bismarck: "Hotel de Prusse, Stettin. (Not dated: written about the end of December, 1846.) TO Herr von Puttkamer : Most Honored Sir: I begin this communication by indicating its content in the first sentence—it is a request for the highest thing you can dispose of in this world, the hand of your daughter. I do not conceal from myself the fact that I appear presumptuous when I, whom you have come to know only recently and through a few meetings, claim the strongest proof of confidence which you can give to any man. I know, however, that even irrespective of all obstacles in space and time which can increase your difficulty in forming an opinion of me, through my own efforts I can never be in a position to give you such guaranties for the future that they would, from your point of view, justify intrusting me with an object so precious, unless you supplement by trust in God that which trust in human beings can not supply. All that I can do is to give you information about myself with absolute candor, so far as I have come to understand myself. It will be easy for you to get reports from others in regard to my public conduct; I content myself, therefore, with an account of what underlay that—my inner life, and especially my relations to Christianity. To do that I must take a start far back...

  6. Great-grandfather Roland: Roland G. Usher (1913): Pan Germanism https://net.lib.byu.edu/~rdh7/wwi/comment/PanGer/PanGerTC.htm: 'BY: ROLAND G. USHER, PH.D. Associate Professor of History, Washington University, St. Louis.... BOSTON AND NEW YORK HOUGHTON MIFFLIN COMPANY The Riverside Press Cambridge.... TO THAT ENERGETIC, CAPABLE ADMINISTRATOR, THAT ENTHUSIASTIC STUDENT OF CONDITIONS, THAT BEST OF COMRADES, THAT DEAREST OF FRIENDS, MY WIFE.... I. THE CAUSES OF GERMAN AGGRESSION.... The logic of facts, proving the necessity of expansion, is, to such Germans as General Bernhardi, unanswerable. The population has increased so rapidly that it is already difficult for efficient, well-trained men to secure any employment. Not only is the superficial area of the country suitable for cultivation practically exhausted, but intensive scientific agriculture is speedily limiting the possibilities of the employment of more hands on the same acres or the further increase of the produce. Industry has grown at a stupendous rate, and the output from German factories is enormously in excess of the needs of even the growing population. Her exports per capita are 24 dollars a year, as against England's 40, and France's 25, and she has not their exclusive colonial markets. Unless some outlet can be found for the surplus population, and a new and extensive market discovered for this enormous surplus production, prosperity will be inevitably succeeded by bankruptcy. There will be more hands than there is work for, more mouths than there is food, and Germany must either get rid of the surplus mouths and hands or swell the surplus product by employing them at home, which cannot be done without entailing national ruin. Expansion is, therefore, the only alternative, for the German considers equivalent to ruin the reduction of the pressure of population by emigration,(2) and the avoidance of overproduction by the proportionate reduction of output. Merely to retain what she now has, Germany is condemned to increase her navy at any pace the English see fit to set. Something more will be absolutely essential if the dire consequences of an economic crisis are not to impoverish her and pave the way for her ultimate destruction at the hands of her hereditary enemies, France and Russia...

  7. The point of the Senate majority's and of the current political appointees at HHS's actions here is not to create flexibility, but to make it legal to provide not-insurance: Sarah Gantz: A Philly Woman’s Broken Back and $36,000 Bill Shows How Some Health Insurance Brokers Trick Consumers into Skimpy Plans https://www.inquirer.com/health/consumer/limited-benefit-skimpy-health-plans-sales-pitch-20191114.html?__vfz=medium%3Dsharebar: 'She was left with $36,000 in hospital bills that she’s still paying off. “What the hell did I do? How did I get into this mess?” said Martin, 54, of Horsham, recalling the panic she felt after the December 2017 fall. “I have a broken wrist, a broken back, and I don’t have real health insurance.”... Access to these plans was limited under the Affordable Care Act, but the websites selling such plans have gotten bolder in their marketing as President Trump and free-market Republicans chip away at ACA rules, saying people need more affordable alternatives. But shopping savvy isn’t necessarily enough to protect consumers. The insurance brokers who rely on such websites for leads use scripts carefully worded to instill trust and push consumers to act quickly...

  8. A bunch of Obama's governing not as a left-populist but as "Third Way" was, IMHO, bait-and-switch. And a bunch was his own incoherence: he alternated between presenting himself as a left-populist who would get things deon and as a purple-America unifier. But a bunch was the realities for power and process. This is very smart from; Henry Kraemer: "Obama ran as a populist https://twitter.com/HenryKraemer/status/1195012774633648128, & governed as something closer to Third Way. At least one big reason is that the realities of governing in a republic tend to moderate policy. Running as Third Way more or less guarantees governing as a conservative: Adam Jentleson: 'This. The Deval/Pete recasting of candidate Obama as a Third Way, unity candidate is revisionist history. He ran as an outsider attacking a broken and corrupt system...

  9. Civil Liberties: I have always tended to be an advocate of "playing your position". But there are times when one's position involves looking far afield. These days, on what surveillance and information-collection mechanism are doing to our society. Here we have Marcy Wheeler saying "I told you so" about how the FBI's use of FISA for searches has long been unreasonable, and hence—if the fourth amendment has any meaning—unconstitutional: Marcy Wheeler: How Twelve Years of Warning and Six Years of Plodding Reform Finally Forced FBI to Do Minimal FISA Oversight https://www.emptywheel.net/2019/10/12/how-twelve-years-of-warning-and-six-years-of-plodding-reform-finally-forced-fbi-to-do-minimal-fisa-oversight/: "A condemnation of how the government has been using 702 (and its predecessor PAA) for 12 years. A (partial—but thus far by far the most significant one) success of the new oversight mechanisms put in place post-Snowden. An opportunity to reform FISA—and FBI—more systematically.... 12 years after this system was first moved under FISA... we’re only now going to start getting real information.... We will learn (even more than we already learned from the two reported queries that this pertained to vetting informants) the degree to which back door searches serve not to find people who are implicated in national security crimes, but instead, people who might be coerced to help the FBI find people who are involved in national security crimes. We will learn that the oversight has been inadequate. We will finally be able to measure disproportionate impact on Chinese-American, Arab, Iranian, South Asian, and Muslim communities. DOJ will be forced to give far more defendants 702 notice. Irrespective of whether back door searches are themselves a Fourth Amendment violation (which we will only now obtain the data to discuss), the other thing this opinion shows is that for twelve years, FISA boosters have been dismissing the concerns those of us who follow closely have raised (and there are multiple other topics not addressed here). And now, after more than a decade, after a big fight from FBI, we’re finally beginning to put the measures in place to show that those concerns were merited all along...

  10. Eric Hobsbawm (1998): The Communist Manifesto in Perspective https://www.transform-network.net/en/publications/yearbook/overview/article/journal-112012/the-communist-manifesto-in-perspective/: 'It is, of course, a document written for a particular moment in history. Some of it became obsolete almost immediately.... More of it became obsolete as the time separating the readers from the date of writing lengthened. Guizot and Metternich have long retired.... The Tsar (though not the Pope) no longer exists. As for the discussion of “Socialist and Communist Literature”, Marx and Engels themselves admitted in 1872 that even then it was out of date.... Though Marx and Engels reminded readers that the Manifesto was a historical document, out of date in many respects, they promoted and assisted the publication of the 1848 text.... Unlike Marxian economics, the “materialist conception of history” which underlay this analysis had already found its mature formulation in the mid-1840s. and remained substantially unchanged in later years. In this respect the Manifesto was already a defining document of Marxism. It embodied the historical vision, though its general outline remained to be filled in by fuller analysis...

  11. Jacobo Timmerman (1990): A Summer in the Revolution https://www.bradford-delong.com/2013/11/i-cannot-find-jacopo-timmermann-on-gabriel-garcia-marquez-on-fidel-castro.html: ': 'When I read one of Gabriel Carcia Marquez's essays on the [Cuban] Commandante [Fidel Castro], I was remind of paeans to Stalin—of the whole state of mind described by Arthur Koestler in Darkness at Noon. Garcia Marquez praises Fidel Castro for needing only six hours of sleep after a day's hard work—the same six hours that were often presented as proof of Josef Stalin's vitality, extolled in writings that also described his Kremlin window lit until the small hours of the night—and praises the wisdom of the Commandante in stating that "learning to rest is as important as learning to work". If the cumulative tasks in Fidel Castro's workday as it is describe by Garcia Marquez are counted up, the Castro who emerges is a prodigy—someone who triumphs by supernatural intelligence: "His rarest virtue is the ability to foresee the evolution of an event to its farthest-reaching consequence..." and: "He has breakfast with no less than two hundred pages of news from the entire world..." (a long breakfast, surely), and: "He has to read fifty-odd documents [daily]..." And the list goes on: "No one can explain how he has the time or what method he employs to read so much and so fast.... A physician friend of his, out of courtesy, sent him his newly-published orthopedic treatise, without expecting him, of course, to read it, but one week later he received a letter from Castro with a long list of observations.... There is a vast bureaucratic incompetence affection almost every realm of daily life, especially domestic happiness, which has forced Fidel Castro himself, almost thirty years after victory, to involve himself personally in such extraordinary matters as how bread is made and the distribution of beer.... He has created a foreign policy of world-power dimensions..." Fidel Castro, then, has a secret method, unknown to the rest of mankind, for reading quickly, and he knows a lot about orthopedics, and yet thirty years after the Revolution he has not managed to organize a system for baking bread and distributing beer...

  12. William J. Connell: New Light on Machiavelli’s Letter to Vettori, 10 December 1513 https://www.storiadifirenze.org/pdf_ex_eprints/143-connell.pdf: 'What makes the subscription to the Borromeo letter so especially interesting are three factors: (1) The letter’s recipient was Machiavelli’s friend and patron, Francesco Vettori. (2) The letter was produced in the very chancery office that Machiavelli had directed for 14 years. (3) The date, 12 November 1513, was only two days after the completion of Machiavelli’s relegatio. Perhaps–just perhaps–the subscription altered to «N. Mach(e)l.» represented a way for one of Machiavelli’s chancery friends to confirm to Vettori in Rome that the confinement had ended uneventfully. Machiavelli was in official good standing and able to leave the dominion from 10 November. We know that Vettori received the letter from the Ten with its curious subscription on 18 November89. On 23 November Vettori, who had been out of touch with Machiavelli since August, at last sent his friend a long, warm letter, inviting him to visit him in Rome. And, on 10 December 1513, Machiavelli replied with his famous letter. That letter’s opening words, «Tarde non furon mai grazie divine» [Divine favors were never late], are a comment not so much on the completion of the relegatio (which occurred one month earlier), but on the arrival of Vettori’s let- ter and invitation after more than three months of silence...

  13. Back late in the decade of the 2000s, Barry Eichengreen opined that China's middle-9nc0me trap growth slowdown might began... now... Barry Eichengreen: Escaping the Middle-Income Trap https://pdfs.semanticscholar.org/4d9b/9d3f8041e4bc9e133182180ea2a5d85b11a5.pdf: 'Growth slowdowns typically occur at per capita in- comes of 16,700. At that point, the per capita growth rate slows from 5.6 percent to 2.1 percent, or by an average of 3.5 percentage points. For purposes of comparison, note that China’s per capita GDP, in constant 2005 international (purchasing power parity) prices, was 8,500 in 2007. Extrapolating its growth rate between then and now, China will reach the threshold value of 15,100 around 2016—that is to say, five years from now...

  14. Michael Nielsen: Notes on the Dynabook http://mnielsen.github.io/notes/kay/dynabook.html: 'Computing as envisioned circa 1960: "The only surviving computing system paradigm seen by MIT students and faculty was that of a very large International Business Machine in a tightly sealed Computation Center: the computer not as a tool, but as a demigod."–Wesley Clark.... Alan Kay's "A Personal Computer for Children of All Ages" (1972, what I'll call “the Dynabook paper”): Many of the ideas in the Dynabook paper now appear commonplace, even banal. That's because those ideas won. At the time, this kind of thinking was a big change in perspective from computers-as-demigods. The Dynabook paper (and related work) was posing a fundamental new question: what might personal computing for everyone be? By facing squarely up to this (and some related) questions, PARC invented much of the foundation for modern personal computing...

  15. Elimination of "the influence of the working-class movement" understood as demands for equitable growth and limitations on inequality, yes. Elimination of "democracy", no. As Hitler is claimed by Hermann Rauschning to have said, "Why need we trouble to socialize banks and factories? We socialize human beings!" Fascists are very happy to have majorities on their side. Today's Republican Party which seeks to rule as a minority is an anomaly. Boris Johnson is not unhappy that he beat Jeremy Corbyn by 14%-points in the December 12, 2019 British general election. And Adler's assumption that there is a ruling class is naive. Fascism can be turned to serve the interests of an economically dominant class, yes; but it can also be turned to serve the interests of other groups defined and that define themselves in other ways: Rakesh Bhandari: 'Max Adler on fascism https://twitter.com/postdiscipline/status/1205721944126939137: "The conscious exploitation of all the various currents of discontent, declassement and worker-hatred, as well, of course, as antisemitism, to construct a movement by means of which, despite the opaque and mutually antagonistic interests of these various groups, democracy and with it the influence of the working-class can be eliminated." The autonomy of the fascist state from all classes is illusory: "When government appears to free itself from the interests of particular classes, even of the ruling class, and become, as it were, common property in its relations to everyone without exception. this process of dissociation in actual fact only takes place in the minds of those who believe in it"...

  16. Wikipedia: 2019 United Kingdom General Election https://en.wikipedia.org/wiki/2019_United_Kingdom_general_election: 'Boris Johnson: Conservative: 43.6%. Jeremy Corbyn: Labour: 32.1%. Jo Swinson: Liberal Democrats: 11.6%. Nicola Sturgeon: SNP: 3.9%...

  17. *Charles Stross: Artificial Intelligence: Threat or Menace? http://www.antipope.org/charlie/blog-static/2019/12/artificial-intelligence-threat.html: 'Changes happen faster, and there are more disruptive unknown-unknowns hitting us from all quarters with every passing decade. This is a long-established trend: throughout most of recorded history, the average person lived their life pretty much the same way as their parents and grandparents. Long-term economic growth averaged less than 0.1% per year over the past two thousand years. It has only been since the onset of the industrial revolution that change has become a dominant influence on human society. I suspect... 85% of the world of 2029 is here today, about 10% can be anticipated, and the random, unwelcome surprises constitute up to 5% of the mix. Which is kind of alarming, when you pause to think about it...

  18. MSW: The Black Watch at Fontenoy https://weaponsandwarfare.com/2019/07/14/the-black-watch-at-fontenoy/: 'off they went at the double led by Lieut.-Col. Sir Robert Munro, and stormed forward against the French positions about Fontenoy with tremendous spirit and elan. The French, protected by field fortifications and in considerable strength, were much shaken by this unusual attack launched by Highland furies armed – thanks to the granting of a request that this day they should fight with their native weapons – with broadsword and targe. Over the first line of entrenchments poured the Highlanders, but the French musketry was sustained and deadly and many of them fell and died before the fortifications. After a bitter struggle the Highlanders had to retreat, carrying with them the Lieutenant-Colonel, a man of such tremendous girth that he stuck in one of the entrenchments and barely escaped being made prisoner.... [Later] the Highlanders and another battalion were detailed to cover the inevitable retreat, a difficult duty even though there was no sustained pursuit, and the regiment was singled out for special praise by Cumberland in his report of the battle....

  19. I believe Greg Leiserson does as well as anyone can to lay out how the PWBM reaches the very odd conclusion that deficit reduction at full employment slows growth over the next decade. It is not coherent: Penn Wharton Budget Model: The Wealth Tax Debate https://budgetmodel.wharton.upenn.edu/events-1/2019/11/14/the-wealth-tax-debate: 'Presidential candidates such as Elizabeth Warren and Bernie Sanders have proposed taxes on wealth. Why a wealth tax? Will it likely raise the money they hope? What are the trade-offs? What has been the experience of other countries?... Kimberly Burham... Greg Leiserson... Richard Prisinzano... Natasha Sarin...

  20. Bret Devereaux: Collections: Where Does My Main Battery Go? https://acoup.blog/2019/11/29/collections-where-does-my-main-battery-go/: 'This week, we’re going to have a bit of fun. We’re going to take a look at a science fiction ship design–the eponymous Battlestar Galactica–through the lens of some ship design principles developed for early dreadnoughts. We’re going to be talking about gun position.... These... issues–what sort of main battery to have, and where should it go–bedeviled naval design in the late 1800s and early 1900s, both before and for the first few years after the development of HMS Dreadnought (launched 1906).... Better loading systems and range-finding had improved accuracy (especially at long range) and rate of fire on the big guns, reducing the dependence of fast-firing secondaries (whose duties were, in many cases, offloaded onto escorting cruisers anyway), while improvements in battleship armor made it increasingly clear that anything less than the heaviest artillery was likely to be useless. Since all of the work was likely to be done by the main battery, it made sense to prioritize it more heavily.... There are a lot of really fascinating designs in the early years after Dreadnought and in terms of main battery layout.... Dreadnought cannot face all of her guns in any direction–of the five turrets, only four can fire to port or starboard (the two wing turrets being the problem here), only one turret can fire directly aft (due to the placement of the rear tower). In theory, three turrets can fire forward, but in practice–remember I said we’d come back to this–actually firing the wing guns directly forward was likely to blow out the conning tower (whoops…).... The South Carolina with just four double-turrets could put all four to either side, 2 to the aft and two to the fore, without any danger of accidentally blowing out her own conning tower. Now, there were some challenges for superfiring gun arrangements–taller turrets meant moving more mass up on the ship, bringing the center of gravity up and potentially destabilizing the entire ship. That, in turn, put a sharp limit to the number of turrets which could be ‘stacked’ (typically just two). Which was just as well, because it rapidly became apparent that–forced to choose between more guns and bigger guns–bigger was generally the best option. While it took a few years to fully catch on, for battleships, superfiring gun layouts eventually dominated battleship design, because it allowed the ship in question to concentrate all of its big-gun anti-capital ship firepower on a single target...

  21. Willem Jongman: Gibbon Was Right: The Decline and Fall of the Roman Economy https://delong.typepad.com/jongman-gibbon-was-right.pdf: 'To qualify as real economic growth, both population and per capita incomes... must move in the same direction, and for a lengthy period of time. Did this ever happen before the Industrial Revolution? It is my contention that Rome in the late Republic and early Empire was one of those rare examples... [like] the Dutch Republic and England in the centuries just before the Industrial Revolution.... Roman material culture of the early Empire was unprecedented, and would remain unsurpassed for many centuries (until, perhaps, a century ago).... Roman grandeur was more than brick and marble, and included a new prosperity for many if not all.... Only archaeology... can provide the large datasets... for a time series analysis of long term economic change in antiquity.... The independent repetition of the same pattern in a large number of separate archaeological datasets argues firmly against too much scepticism.... Hopkins... Roman shipwrecks.... Calatay... metal extraction.... Wood... from western and southern Germany.... We can see an improved standard of living... in the face of a rising population.... This new wealth was also, I now believe, shared more widely than earlier pessimistic critics of Roman society such as myself were willing to acknowledge.... New fruits and vegetables... Pigs, cows, sheep, or horses, and even chickens, were much larger than ever before, and for a long time after...

  22. Peter J. Klenow and Andres Rodriguez-Clare (1997): The Neoclassical Revival in Growth Economics: Has It Gone too Far? https://delong.typepad.com/klenow-rodriguez-clare.pdf: "We find a very modest role for growth in human capital per worker in explaining growth.... We find that TFP growth accounts for most of the growth of output per worker in Hong Kong, South Korea, and Taiwan. And we stress that this relative importance of TFP growth for three of the four Asian tigers generalizes to our sample of 98 countries: we find that roughly 90% of country differences in Y/L growth are attributable to differences in A growth. Combining these growth results with our findings on levels, we call for returning productivity differences to the center of theorizing about international differences in output per worker...

  23. Moving to carbon-free electricity by 2050 appears to be remarkably cheap: Geoffrey Heal: The Cost of a Carbon-Free Electricity System in the U.S. https://www.nber.org/papers/w26084: 'I calculate the cost of replacing all power stations in the U.S. using coal and gas by wind and solar power stations by 2050, leaving electric power generation in the U.S. carbon free. Allowing for the savings in the cost of fossil fuel arising from the replacement of fossil fuel plants this is roughly 55 billion annually. Allowing in addition for the fact that most fossil plants in the U.S. are already old and would have to be replaced before 2050 even if we were not to go fossil free, this annual cost is reduced to 23 billion...

  24. An excellent piece from Fiona Scott Morton on the current state-of-play in antitrust: Fiona Scott Morton: Modern U.S. Antitrust Theory and Evidence Amid Rising Concerns Of Market Power and Its Effects: An Overview Of Recent Academic Literature: "The experiment of enforcing the antitrust laws a little bit less each year has run for 40 years, and scholars are now in a position to assess the evidence. The accompanying interactive database of research papers https://equitablegrowth.org/research-paper/modern-u-s-antitrust-theory-and-evidence-amid-rising-concerns-of-market-power-and-its-effects/ for the first time assembles in one place the most recent economic literature bearing on antitrust enforcement.... Horizontal mergers.... Vertical mergers.... Exclusionary conduct.... Loyalty rebates.... Most Favored Nation clause.... Predation.... Common ownership.... Monopsony power.... Macroeconomics and market power...

  25. Ben Thompson: The Google Squeeze https://stratechery.com/2019/the-google-squeeze/: 'In 3Q 2014 Google had 16.5 billion in revenue and 2.8 billion in profit. I proceeded to write an article entitled Peak Google. Fast forward to last quarter, and Google had 36 billion in revenue and 6.7 billion in profit, increases of 118% and 139% respectively. It is difficult to imagine being more wrong! For the record, my thesis was... that... Google would continue to grow but that its relevance had peaked, in large part because brand marketing would become much more important on the web.... What truly misses the mark... is the suggestion that Google’s relevance has in any way decreased.... The biggest mistake... was in underestimating just how far Google could go in terms of showing users more ads, even once you accounted for more users using Google more often... more ads into mobile search results.... Google started to transform mobile results... instead of forcing users to click a link for an answer... Google would give it to them; they didn’t even need to “feel lucky”. Most importantly, though, when it came to vertical search categories, Google would offer an entirely new kind of results page.... What we saw was a continued shift of essentially the free links further down the page, by other modules that were inserted.... Note just how many screens you now have to scroll to reach organic results—at least 3 on an iPhone 11 Pro.... With the hotel module, Google captures demand more efficiently, which not only makes Google search more attractive to end users, but also transforms OTAs into suppliers, paying to provide the service that Google doesn’t want to. It is a textbook example of what Tren Griffin calls Wholesale Transfer Pricing: "Wholesale transfer pricing—the bargaining power of company A that supplies a unique product XYZ to Company B which may enable company A to take the profits of company B by increasing the wholesale price of XYZ." In this case the unique product is demand—users.... The most compelling pitch I have heard Yelp give... “The big companies are full of spam and misinformation, while we take the time to get reviews right.” It is hard not to wonder just how much more popular Yelp’s product might be if this message were spread as stridently as its anti-Google arguments. And, of course, there is Amazon: more product searches start on Amazon than Google, not because Amazon spent its energy complaining about Google favoring its own shopping results, but because Amazon went out and delivered a better experience for users. I remain very concerned about monopoly, particularly, when it comes to consumer tech, digital advertising; this Wall Street Journal story is an excellent overview of how Google makes it extremely difficult to compete (for competitive ad-tech companies) and extremely difficult to go elsewhere (for its customers)...

  26. Barry Eichengreen, Poonam Gupta, and Oliver Masetti: On the Fickleness of Capital Flowsl https://voxeu.org/article/fickleness-capital-flows: "According to conventional wisdom, capital flows are fickle. Focusing on emerging markets, this column argues that despite recent structural and regulatory changes, much of this wisdom still holds today. Foreign direct investment inflows are more stable than non-FDI inflows. Within non-FDI inflows, portfolio debt and bank-intermediated flows are most volatile. Meanwhile, FDI and bank-related outflows from emerging markets have grown and become increasingly volatile. This finding underscores the need for greater attention from analysts and policymakers to the capital outflow side...

  27. Claire Montialoux: "Thrilled to present the new version of https://twitter.com/cmontialoux/status/1179783865331638272 'Minimum Wages and Racial Inequality' with Ellora Derenoncourt: http://clairemontialoux.com/files/DM2019.pdf. Key finding: 20% of the decline in the racial earnings gap during Civil Rights Era stemmed from one single reform of the minimum wage...

  28. Andy Matuschak and Michael Nielsen: How Can We Develop Transformative Tools for Thought? https://numinous.productions/ttft/: 'We’ll begin with three principles we used when writing the cards in Quantum Country. Note that these are just three of many more principles–a more detailed discussion of good principles of card construction may be found in Augmenting Long-term Memory...

  29. And I am ashamed that I still have not read Steve Greenhouse's new book, Beaten Down, Worked Up: The Past, Present, and Future of American Labor https://www.google.com/books/edition/Beaten_Down_Worked_Up/bBl5DwAAQBAJ: Joseph A. McCartin: The Future of American Labor https://www.commonwealmagazine.org/squeeze-stranglehold: 'From Squeeze to Stranglehold: No writer is better equipped than Steven Greenhouse to assess how both American workers and the American labor movement are doing in the early twenty-first century.... Greenhouse has spent the past five years freelancing important labor stories and stepping back to write his new book.... He opens with a string of disturbing vignettes that illustrate workers’ current struggles, including rampant wage and hour violations, deteriorating workplace-safety enforcement, unpredictable scheduling practices, stagnant wages, retirement insecurity, lack of paid sick or vacation days, and abusive management...

  30. Marshall Berman: The Signs in the Street: A Response to Perry Anderson https://newleftreview.org/issues/I144/articles/marshall-berman-the-signs-in-the-street-a-response-to-perry-anderson: "This isn’t Anderson’s problem alone.... It’s an occupational hazard for intellectuals... to lose touch with the stuff and flow of everyday life.... This is a special problem for intellectuals on the Left.... If our years of study have taught us anything, we should be able to reach out further, to look and listen more closely, to see and feel beneath surfaces, to make comparisons over a wider range of space and time, to grasp hidden patterns and forces and connections, in order to show people who look and speak and think and feel differently from each other—who are oblivious to each other, or fearful of each other—that they have more in common than they think. We can contribute visions and ideas that will give people a shock of recognition, recognition of themselves and each other, that will bring their lives together. That is what we can do for solidarity and class-consciousness. But we can’t do it, we can’t generate ideas that will bind people’s lives together, if we lose contact with what those lives are like. Unless we know how to recognize people, as they look and feel and experience the world, we’ll never be able to help them recognize themselves or change the world. Reading Capital won’t help us if we don’t also know how to read the signs in the street...

  31. The best thing I have seen on the dilemmas produced by trying to rope parties opposed on a fundamental level to democracy into a democratic system Daniel Ziblatt: Conservative Parties and the Birth of Democracy https://www.cambridge.org/core/books/conservative-parties-and-the-birth-of-democracy/919E566A69893DA8E25F845349D5C161#fndtn-information: 'How do democracies form and what makes them die? Daniel Ziblatt revisits this timely and classic question in a wide-ranging historical narrative that traces the evolution of modern political democracy in Europe from its modest beginnings in 1830s Britain to Adolf Hitler's 1933 seizure of power in Weimar Germany. Based on rich historical and quantitative evidence, the book offers a major reinterpretation of European history and the question of how stable political democracy is achieved. The barriers to inclusive political rule, Ziblatt finds, were not inevitably overcome by unstoppable tides of socioeconomic change, a simple triumph of a growing middle class, or even by working class collective action. Instead, political democracy's fate surprisingly hinged on how conservative political parties–the historical defenders of power, wealth, and privilege–recast themselves and coped with the rise of their own radical right. With striking modern parallels, the book has vital implications for today's new and old democracies under siege....

  32. In all his columns on Project Syndicate about how dangers of global warming are overblown, Bjorn Lomborg does not appear to have ever called for a carbon tax—at least, searching the website for "Bjorn Lomborg carbon tax" produces no hits, and I cannot recall a call for one. If he does, it's not a central part of his thought. I wonder why not. What's the upside to you of our not yet having implemented a carbon tax, Bjorn?: Bjørn Lomborg: Humans Can Survive Underwater https://www.project-syndicate.org/commentary/rising-sea-levels-media-alarmism-by-bjorn-lomborg-2019-11: 'Climate change is a problem we need to tackle, and we should be particularly mindful of how it will hurt the poorest in society. But the bigger, unreported story is that today’s climate policies will do very little to resolve the “challenge” of more people living below the high-tide mark.... Even when we read stories from the world’s top media outlets, we need to maintain perspective. Deaths from climate-related causes (floods, hurricanes, droughts, wildfire, and extreme temperatures) have declined by 95% over the past hundred years. Furthermore, despite the constant barrage of claims that the global climate crisis is spiraling out of control, the cost of extreme weather as a proportion of GDP has been declining since 1990. Alarming media stories that twist the facts about rising sea levels are dangerous because they scare people unnecessarily and push policymakers toward excessively expensive measures to reduce greenhouse-gas emissions. The real solution is to lift the world’s poorest out of poverty and protect them with simple infrastructure...

  33. A brilliant must-read: Kevin Rinz: Did Timing Matter? Life Cycle Differences in Effects of Exposure to the Great Recession https://equitablegrowth.org/working-papers/did-timing-matter-life-cycle-differences-in-effects-of-exposure-to-the-great-recession/: 'Exposure to a recession can have persistent, negative consequences, but does the severity of those consequences depend on when in the life cycle a person is exposed? I estimate the effects of exposure to the Great Recession on employment and earnings outcomes for groups defined by year of birth over the ten years following the beginning of the recession. With the exception of the oldest workers, all groups experience reductions in earnings and employment due to local unemployment rate shocks during the recession. Younger workers experience the largest earnings losses in percent terms (up to 13 percent), in part because recession exposure makes them persistently less likely to work for high-paying employers even as their overall employment recovers more quickly than older workers’. Younger workers also experience reductions in earnings and employment due to changes in local labor market structure associated with the recession. These effects are substantially smaller in magnitude but more persistent than the effects of unemployment rate increases...

  34. Somin Park: _Wealthier Individuals Receive Higher Returns to Wealth _ https://equitablegrowth.org/wealthier-individuals-receive-higher-returns-to-wealth/: 'Why do the wealthy get higher returns from their wealth? In part, it’s because they invest a higher share of their assets in the stock market and other risky assets, and therefore are rewarded for their risk tolerance with higher average returns. Wealthier investors also benefit from the scale of their wealth, for example, by using checking accounts that pay higher rates for larger deposits and buying financial advice that leads to higher returns—what the authors call “economies of scale in wealth management.” Yet the authors also find that risk compensation and scale, while important, are not enough to fully account for the variation in returns, or, in economic parlance, “return heterogeneity.” Bank deposit accounts are safe assets that bear essentially no risk. If return heterogeneity were explained by compensation for risk-taking, then there should be no variation in the returns that people get from deposit accounts holding the same amount of wealth. The authors find, however, that there is sizable heterogeneity: People with more education tend to deposit at high-return banks. Persistent variation in returns is therefore also explained, in part, by differences in financial sophistication and differences in ability to access and use superior information about investment opportunities...

  35. Paul Krugman: The Family Values Time Warp: 'Regular readers know that I’m somewhat obsessed with the economic contrast between U.S. regions, which... have been diverging again since around 1980.... Today’s column delved into... growing disparities in life expectancy... the remarkable fact that conservatives are still placing blame for all our social ills on the decline of religiosity and its supposed destruction of traditional family values, despite decades of evidence that this whole line of argument was and is totally wrong. There were several striking things about William Barr’s October speech denouncing “militant secularists” for destroying American society. It was much more partisan than we used to expect from the attorney general, who is after all supposed to serve the nation, not just the president and his party. It also seemed well over the line in violating the separation between church and state. What really struck me, however, was that Barr seems to be stuck in a time warp, repeating claims about family values and social order that were standard right-wing fare a generation ago but have since been utterly refuted by experience. Back in the mid-1990s, conservatives pointed to two trends—the decline of traditional families and rising crime—and insisted that the first had caused the second. For example, The Heritage Foundation put out a report titled “The Real Root Causes of Violent Crime: The Breakdown of Marriage, Family, and Community.” The report ridiculed claims that rising crime and social breakdown had something to do with declining economic opportunity, and suggested among other things that the reduced influence of organized religion was one of the causes of declining family values. Some people on the right went even further, arguing, for example, that mass shootings were happening because we were teaching children the theory of evolution—a claim you still see sometimes. Since then... traditional families have continued to decline... violent crime has plunged... deaths of despair... have... manifested... among rural and small-town whites... in places that have suffered, yes, a decline in economic opportunity... worst-hit states happen to be among the states where an unusually large number of people say that they are “highly religious.”... Experience since the 1990s has completely refuted the God-and-family-values theory of American social problems, and confirmed the view—associated in particular with the sociologist William Julius Wilson—that family collapse is mainly a consequence of lost economic opportunity, and that social ills are caused largely by economic forces, not mysterious changes in values. But here we have the nation’s chief law enforcement officer talking as if none of that had happened, and basically declaring both that faith in God is the answer to our problems and that sinister secularists are our mortal enemies. Then again, why should we be surprised?...

  36. Guo Xu and Hans-Joachim Voth: Patronage and Performance in the Age of Sail https://voxeu.org/article/patronage-and-performance-age-sail: 'People in power may use their discretion to hire and promote family members and others in their network. While some empirical evidence shows that such patronage is bad, its theoretical effects are ambiguous–discretion over appointments can be used for good or bad. This column examines the battle performance of British Royal Navy officers during the Age of Sail and finds that patronage ‘worked’. On average, officers with connections to the top of the naval hierarchy did better on every possible measure of performance than those without a family connection. Where top administrators have internalised meritocratic values and competition punishes underperformance, patronage may enhance overall performance by selecting better individuals...

  37. Back in 2005, the very wise Raghu Rajan tried to warn the assembled economic policymakers of the world about the heightened risks of a financial meltdown. They did not listen: Raghu Rajan (2005): Has Financial Development Made the World Riskier? https://www.kansascityfed.org/publicat/sympos/2005/pdf/rajan2005.pdf: 'Risk never can be reduced to zero, nor should it be. We should be prepared for the low probability but highly costly downturn. In such an eventuality, it is possible the losses that emanate from a financial catastrophe cannot be entirely borne by current generations and are best shared with future generations. Some of the mechanisms for sharing such systematic risks with future generations, such as (defined benefit) social security, are being changed. While there are gains from doing so, and from ensuring their sustainability, we need to ensure that the intergenerational risk-sharing mechanism they offer is not overly weakened. We also need to continue improving the intrinsic flexibility of our economies, so as to better ride out the downturns that, almost inevitably, will occur...

  38. Dan Wang: How Technology Grows (a Restatement of Definite Optimism) https://danwang.co/how-technology-grows/: 'Technology should be understood in three distinct forms: as processes embedded into tools (like pots, pans, and stoves); explicit instructions (like recipes); and as process knowledge, or what we can also refer to as tacit knowledge, know-how, and technical experience. Process knowledge is the kind of knowledge that’s hard to write down.... When firms and factories go away, the accumulated process knowledge disappears as well. Industrial experience, scaling expertise, and all the things that come with learning-by-doing will decay. I visited Germany earlier this year to talk to people in industry. One point Germans kept bringing up was that the US has de-industrialized itself and scattered its production networks. Whereas Germany responded to globalization by moving up the value chain, the US manufacturing base mostly responded by abandoning production. Brad Setser has shown that the US stands out amongst rich countries for its low level of manufactured goods exports. Call me simple-minded, but I believe that the world’s most developed country ought to be responsible for exporting goods around the world...

  39. Strom Thurmond (1959): Against Hawaii Statehood https://delong.typepad.com/files/thurmond-hawaii.pdf: 'There are also those in this world who are the devisees of a totally different heritage and with whom we have no identity in either antiqulty or modern times.... Our society may well be said to be... the exemplification of the maximum development of the Western civilization.... At the opposite extreme exists the Eastern heritage, different in every essential, not necessarily in a way that it is inferior, but different.... The chasm of difference between the two... is in heritage, the force that shapes the man to form unchangeable, except, if at all, by the infinite passage of time.... Oriental and Hawaiian groups constitute in excess of 70% of Hawaii's population. This large segment of the population has a heritage... in a word, Eastern.... There is serious doubt in my mind as to whether the Hawaiian people would not be seriously handicapped, possibly even precluded, in defending themselves from such as the communist-dominated Longshoremans Union by the imposition upon them of Western institutions of government, since their heritage has not equipped them to comprehend the philosophy essential to the effective operation of these institutions.... There is even greater doubt in my mind that the Hawaiian people could contribute to the degree of harmony remaining in the conduct of affairs of our Federated Republic.... An abandonment of the United States of America in favor of a United States of America and Pacific—precedenting a United States of the World—would actually benefit no one but toll the death-knell of our Federated Republic...

  40. Nixon, Reagan, Trump—the truth is that Republican presidents have never regarded the independence of the Federal Reserve as something to be respected. They did, however, before Trump, regard appearing to respect the independence of the Federal Reserve as something to try to accomplish: Bob Bryan: [Ronald Reagan Pressure on Fed Chair Volcker Worse than Trump Attacks https://www.businessinsider.com/ronald-reagan-fed-chair-volcker-trump-2018-10?r=US&IR=T: 'Trump's attacks on the Fed may be intense, but they're nothing compared to a wild new story about Ronald Reagan from former Fed Chairman Paul Volcker.... Volcker recounts being privately ordered by Reagan's chief of staff to not raise interest rates prior to the 1984 election while Reagan was in the room. Volcker was not planning to raise interest rates at the time, but said he was 'stunned' by the direct violation of the Fed's independence.... According to Volcker, Reagan did not say a word, but Baker delivered a strong message: 'The president is ordering you not to raise interest rates before the election', Baker told Volcker.... Reagan's apparent intimidation also echoed former President Richard Nixon's disastrous pressure on former Fed Chair Arthur Burns to keep rates low, which is seen as one of the reasons for the inflation of the 1970s...



#noted #weblogs #2019-12-17

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