#noted Feed

John Scalzi (2010): Tax Frenzies and How to Hose Them Down https://whatever.scalzi.com/2010/09/26/tax-frenzies-and-how-to-hose-them-down/: 'I really don’t know what you do about the “taxes are theft” crowd, except possibly enter a gambling pool regarding just how long after their no-tax utopia comes true that their generally white, generally entitled, generally soft and pudgy asses are turned into thin strips of Objectivist Jerky by the sort of pitiless sociopath who is actually prepped and ready to live in the world that logically follows these people’s fondest desires. Sorry, guys. I know you all thought you were going to be one of those paying a nickel for your cigarettes in Galt Gulch. That’ll be a fine last thought for you as the starving remnants of the society of takers closes in with their flensing tools...

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Mark Egan, Gregor Matvos, and Amit Seru: The Market for Financial Adviser Misconduct: 'We construct a novel database containing the universe of financial advisers in the United States from 2005 to 2015, representing approximately 10% of employment of the finance and insurance sector. We provide the first large-scale study that documents the economy-wide extent of misconduct among financial advisers and the associated labor market consequences of misconduct. Seven percent of advisers have misconduct records, and this share reaches more than 15% at some of the largest advisory firms. Roughly one third of advisers with misconduct are repeat offenders. Prior offenders are five times as likely to engage in new misconduct as the average financial adviser. Firms discipline misconduct: approximately half of financial advisers lose their jobs after misconduct. The labor market partially undoes firm-level discipline by rehiring such advisers. Firms that hire these advisers also have higher rates of prior misconduct themselves, suggesting “matching on misconduct.” These firms are less desirable and offer lower compensation. We argue that heterogeneity in consumer sophistication could explain the prevalence and persistence of misconduct at such firms. Misconduct is concentrated at firms with retail customers and in counties with low education, elderly populations, and high incomes. Our findings are consistent with some firms “specializing” in misconduct and catering to unsophisticated consumers, while others use their clean reputation to attract sophisticated consumers....

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Very Briefly Noted 2019-12-31:

  1. Wikipedia: Dérogeance https://en.wikipedia.org/wiki/D%C3%A9rogeance...

  2. John Scalzi: The 10s in Review: Whatever Best of 2010–2019 https://whatever.scalzi.com/2019/12/26/the-10s-in-review-whatever-best-of-2010-2019/...

  3. Alissa Wilkinson: Star Wars: The Rise of Skywalker review https://www.vox.com/culture/2019/12/18/21021188/star-wars-rise-of-skywalker-review-no-spoilers: 'Star Wars: The Rise of Skywalker is what happens when a franchise gives up. The new movie is a colossal failure of imagination...

  4. David Albouy http://davidalbouy.net/...

  5. Reading List for: The "Classical" Mediterranean Economy https://www.bradford-delong.com/reading-list-for-the-classical-economy.html...

  6. Ian Morris: The Eighth-Century Revolution http://www.princeton.edu/~pswpc/pdfs/morris/120507: 'In the eighth century BC the communities of central Aegean Greece... and their colonies overseas laid the foundations of the economic, social, and cultural framework that constrained and enabled Greek achievements for the next five hundred years.... Aegean Greeks created a new form of identity, the equal male citizen, living freely within a small polis... defeated all rival models in the central Aegean, and was spreading through other Greek communities...

  7. Ian Morris: The Growth of Greek Cities in the First Millennium BC https://www.princeton.edu/~pswpc/pdfs/morris/120509.pdf: 'I trace the growth of the largest Greek cities from perhaps 1,000- 2,000 people at the beginning of the first millennium BC to 400,000-500,000 at the millennium’s end.... While political power was never the only engine of urban growth in classical antiquity, it was always the most important motor. The size of the largest Greek cities was a function of the population they controlled, mechanisms of tax and rent, and transportation technology...

  8. Max Boot: ‘Downton Abbey’ Reminds Us What ‘Conservatism’ Really Means https://www.washingtonpost.com/opinions/downton-abbey-reminds-us-what-conservatism-really-means/2019/12/20/beb5df3e-235e-11ea-bed5-880264cc91a9_story.html: 'I can’t stand what American conservatism has become. A movement ostensibly devoted to conserving the best of America is instead tearing down the rule of law and tearing the country apart in order to protect a crude and cruel demagogue. Today’s conservatives equate civility with weakness and moderation with selling out. They celebrate boorish behavior with the mantra “At least he fights!”...

  9. David Edelstein: Little Women Movie Review: Greta Gerwig’s 2019 Version https://www.vulture.com/2019/12/little-women-movie-review-greta-gerwigs-2019-version.html...

  10. Francis A. Walker (1888): Recent Progress of Political Economy in the United States https://www.jstor.org/stable/2485572?seq=10#metadata_info_tab_contents...

  11. Stephen Chu: _How to Study: The "Levels of Processing" Framework https://www.samford.edu/departments/academic-success-center/how-to-study...

  12. Wikipedia: Spaced Repetition https://en.wikipedia.org/wiki/Spaced_repetition...

  13. Wikipedia: SuperMemo https://en.wikipedia.org/wiki/SuperMemo...

  14. Melissa Dell: Econ 1342 https://delong.typepad.com/econe_1342.pdf 'This course examines the history of economic growth, beginning with the divergence between human ancestors and other primates and continuing through the end of the twentieth century. Topics covered include the Neolithic Revolution; economic growth in ancient societies; the origins of modern economic growth; theories and evidence about the institutional, geographic, and cultural determinants of growth; the East Asian Miracle; the middle income trap; the political economy of growth; growth and inequality; and theories and evidence about the persistence of poverty in the world's poorest regions. The recorded lectures are from the Harvard Faculty of Arts and Sciences course Economics 1342. Students may not count both ECON E-1340 (offered previously) and ECON E-1342 toward a degree...

  15. Pan Seared Salmon with Lemon Garlic Butter Sauce https://cafedelites.com/crispy-seared-lemon-garlic-herb-salmon/...

  16. Matthew Smith, Danny Yagan, Owen M. Zidar, and Eric Zwick: Capitalists in the Twenty-First Century https://www.nber.org/papers/w25442: 'Tax data linking 11 million firms to their owners show[s]... pass-through profit accrues to working-age owners of closely-held, mid-market firms in skill-intensive industries. Pass-through profit falls by three-quarters after owner retirement or premature death...

  17. Center For American Progress Action Fund: Trump’s False Promise on GM Factories Closing https://www.facebook.com/watch/?v=2308407469209592...

  18. Center For American Progress Action Fund: How Trump is Hurting Farmers https://www.facebook.com/watch/?v=416723402448900...

  19. Alex Tabarrok: Summers on the Wealth Tax https://marginalrevolution.com/marginalrevolution/2019/10/summers-on-the-wealth-tax.html...

  20. Rich Miller: Summers Lambasts Warren, Sanders Plans to Tax Wealth of the Rich https://www.bloomberg.com/news/articles/2019-10-18/summers-lambasts-warren-sanders-plans-to-tax-wealth-of-the-rich...

  21. Emmanuel Saez and Gabriel Zucman: Progressive Wealth Taxation https://www.brookings.edu/wp-content/uploads/2019/09/Saez-Zucman_conference-draft.pdf...

  22. Catherine Rampell: Would a “Wealth Tax” Help Combat Inequality? A Debate with Saez, Summers, and Mankiw https://www.youtube.com/watch?time_continue=1&v=oUGpjpEGTfE&feature=emb_logo...

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Eric Loomis: White Nationalism, the Working Class, and Organized Labor http://www.lawyersgunsmoneyblog.com/2019/12/white-nationalism-the-working-class-and-organized-labor: 'I have the lead article in the new issue of New Labor Forum.... I explore the dubious media-driven proposition that Trumpism is a specifically working class phenomena instead of a white issue that crosses classes. I then go on to discuss the history of racism within the American labor movement and ask if there’s anything very new about Trumpism anyway. I then muse a bit on how the contemporary reinforces white male domination through things such as the hyper-masculine and extremely white cultural references that dominate much union-branded clothing (More angry eagles! More flags! More language and symbols that would look fine at a Trump rally!). Finally, I urge all readers to completely reject the idea that we have to appeal to some mythical white working class to build for the future, both in terms of electoral politics and in terms of the politics that actually makes more long-term change, such as movement-building, since the actual working class is by far the most diverse part of the nation and is growing more so every day. Anyway, check it out....

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Yes, austerity still rules in Europe. Which makes it very likely that the next recession will be a deep one, and that the current expansion will remain an anemic one. Why do you ask?: Barry Eichengreen: The Policy Debate Europe Needs https://www.project-syndicate.org/commentary/eurozone-stimulus-ramp-up-european-investment-bank-by-barry-eichengreen-2019-12: 'National policymakers in a number of eurozone countries, starting with Germany, are dead set against fiscal expansion. Believing that they are being asked to encumber their children with debt in order to provide the stimulus that countries like Italy are unable to deliver, they happily invoke the EU’s fiscal rules to justify not running budget deficits. This impasse has prompted suggestions that the ECB should pursue fiscal policy by stealth.... The legitimacy of the ECB depends on more than legal formalities. Fundamentally, it derives from public support. And public opinion toward quasi-fiscal measures by the ECB would be strongly negative in countries like Germany.... Rather than attempting to circumvent the intent of the ECB’s statute, the resources of the European Investment Bank should be enlisted. The EIB has €70 billion of paid-in capital and reserves and €222 billion of callable capital. It has a board of directors from all 28 EU member states, limiting the danger of capture. Its charge is to fund sustainable investment projects, and it is empowered to borrow for that purpose. Because it is required to place its bonds with private investors, it is subject to market discipline, and it earns positive returns on its investments. Ramping up its borrowing and spending would be entirely consistent with its mandate.... Proposals for doing so will meet with political resistance from those who fear that a larger EIB would be a loss-making EIB. But significant losses are unlikely in an environment where borrowing costs are only a fraction of the return on equity investment. This, in any case, is the debate Europe should be having. Tackling the stimulus issue head-on is more likely to succeed than proceeding by subterfuge...

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Mark Koyama: The End of the Past https://www.bradford-delong.com/2017/11/should-read-mark-koyama-the-end-of-the-pasthttpsmediumcommarkkoyamathe-end-of-the-past-2f028cb970ed-temin.html: 'Temin’s GDP estimates suggest that Roman Italy had comparable per capita income to the Dutch Republic in 1600..... Aelius Aristides celebrating the wealth of the Roman empire in the mid-2nd century AD... a panegyric addressed to flatter the emperor but its emphasis on long-distance trade, commerce, manufacturing is highly suggestive. Such a speech is all but impossible to imagine in an predominantly rural and autarkic society. Aristides is painting a picture of a highly developed commercialized economy that linked together the entire Mediterranean and beyond. Even if he is grossly exaggerates, the imagine he depicts must have been plausible to his audience. In evaluating the Roman economy in the age of Aristides, Schaivone notes that: "Until at least mid-seventeenth century Amsterdam, so expertly described by Simon Schama—the city of Rembrandt, Spinoza, and the great sea-trade companies, the product of the Dutch miracle and the first real globalization of the economy—or at least, until the Spanish empire of Philip II, the total wealth accumulated and produced in the various regions of Europe reached levels that were not too far from those of the ancient world..." This is the point Temin makes. Whether measured in terms of the size of its largest cities—Rome in 100 AD was larger than any European city in 1700—or in the volume of grain, wine, and olive oil imported into Italy, the scale of the Roman economy was vast by any premodern standard. Quantitively, then, the Roman economy looks as large and prosperous as that the early modern European economy. Qualitatively, however, there are important differences...

...Roman history leaves no traces of great mercantile companies like the Bardi, the Peruzzi or the Medici. There are no records of commercial manuals of the sort that are abundant from Renaissance Italy... no political economy or “economics”.... The most obvious institutional difference between the ancient world and the modern was slavery. Recently historians have tried to elevate slavery and labor coercion as crucial causal mechanism in explaining the industrial revolution. These attempts are unconvincing (see this post) but slavery certainly did dominate the ancient economy...

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Mark Koyama: The End of the Past https://medium.com/@MarkKoyama/the-end-of-the-past-2f028cb970ed: '[Aldo] Schiavone suggests that ultimately the economic stagnation of the ancient world was due to a peculiar equilibrium that centered around slavery.... The apparent modernity of the ancient economy... rested largely on slave labor. The expansion of trade and commerce in the Mediterranean after 200 BC both rested on, and drove, the expansion of slavery. Here Schiavone note that the ancient reliance on slaves as human automatons... removed or at least weakened, the incentive to develop machines for productive purposes.... There was also a specific cultural attitude that formed the second leg of the equilibrium: “None of the great engineers and architects, none of the incomparable builders of bridges, roads, and aqueducts, none of the experts in the employment of the apparatus of war, and none of their customers, either in the public administration or in the large landowning families, understood that the most advantageous arena for the use and improvement of machines—devices that were either already in use or easily created by association, or that could be designed to meet existing needs—would have been farms and workshops.” The relevance of slavery colored ancient attitudes towards almost all forms of manual work or craftsmanship. The dominant cultural meme was as follows: since such work was usually done by the unfree, it must be lowly, dirty and demeaning.... The phenomenon coined by Fernand Braudel, the “Betrayal of the Bourgeois,” was particularly powerful in ancient Rome. Great merchants flourished, but “in order to be truly valued, they eventually had to become rentiers, as Cicero affirmed without hesitation: ‘Nay, it even seems to deserve the highest respect, if those who are engaged in it [trade], satiated, or rather , I should say, satisfied with the fortunes they have made, make their way from port to a country estate, as they have often made it from the sea into port. But of all the occupations by which gain is secured, none is better than agriculture, none more delightful, none more becoming to a freeman’”.... Having taken note of the existence of such a powerful equilibrium... resting on both material and cultural foundations, we can now return to Schiavone’s argument for why a modern capitalist economy did not develop in antiquity.... Economic expansion and growth... between c. 200 BCE to 150 CE... generated a growth efflorescence... but it ultimately undermined itself because it was based on an intensification of the slave economy that, in turn, reinforced the cultural supremacy of the landowning aristocracy and this cultural supremacy in turn eroded the incentives responsible for driving growth.... The most advanced economies of early modern Europe, say England in 1700, were on the surface not too dissimilar to that of ancient Rome. But beneath the surface they contained the “coiled spring”, or at least the possibility, of sustained economic growth... a culture of improvement... a commercial or even capitalist culture. According to Schiavone’s assessment, the Roman economy at least by 100 CE contained no such coiled spring...

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Richard Jensen: Unix at 50: How the OS that Powered Smartphones Started from Failure https://arstechnica.com/gadgets/2019/08/unix-at-50-it-starts-with-a-mainframe-a-gator-and-three-dedicated-researchers/: 'Today, Unix powers iOS and Android—its legend begins with a gator and a trio of researchers.... In 1965, the GE 645 that Bell Labs used to develop Multics cost almost as much as a Boeing 737. Thus, there was widespread interest in time sharing.... Multics was conceived with that goal in mind. It kicked off in 1964 and had an initial delivery deadline of 1967. MIT, where a primitive time-sharing system called CTSS had already been developed and was in use, would provide the specs, GE would provide the hardware, and GE and Bell Labs would split the programming tasks.... Thompson bundled up the various pieces of the PDP-7—a machine about the size of a refrigerator, not counting the terminal—moved it into a closet assigned to the acoustics department, and got it up and running. One way or another, they convinced acoustics to provide space for the computer and also to pay for the not infrequent repairs to it.... By September, the computer science department at Bell Labs had an operating system running on a PDP-7—and it wasn’t Multics...

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Duncan Black: Eschaton: Clearly, The Problem Is Our Readers https://www.eschatonblog.com/2019/12/clearly-problem-is-our-readers.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+blogspot/bRuz+(Eschaton): 'One reason I hate the NYT is the absolute contempt it has for the truth and for its readers: Julia Carrie Wong: "Do they actually just think we’re stupid?:

New York Times Editors: Mr. Stephens was not endorsing the study or its authors' views...

Bret Stephens: Jews are, or tend to be, smart. When it comes to Ashkenazi Jews, it’s true. “Ashkenazi Jews have the highest average I.Q. of any ethnic group for which there are reliable data,” noted one 2005 paper. “During the 20th century, they made up about 3 percent of the U.S. population but won 27 percent of the U.S. Nobel science prizes and 25 percent of the ACM Turing awards. They account for more than half of world chess champions”...

So the correction makes it ... worse ?? somehow?

Seems like bad qualities in a newspaper!!! "Sorry I wrote that. It wasn't what I meant to say but that happens sometimes." Would be lie but not a "fuck you, readers" lie...

For some reason, the New York Times is unwilling to say either (1) "yes, Henry Harpending is one of Bret Stephens's go-to authorities, but we have told him not to do it again..." or (2) "Bret Stephens often pretends he has read papers that he has not. He just googles, cherry-picks a couple of reported numbers, and then presents them as if he had actually done some research and gained some knowledge. This time this method of working went wrong. But by and large we are happy with him..."

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John Scalzi: 2019, Professionally Speaking https://whatever.scalzi.com/: 'For 2020, my life project is going to have to be working on that focus, so that my professional time is more productively organized and spent. This is something I’ve talked about a lot previously and have already instituted some steps toward (software to block social media while I’m supposed to be working being the best example of this), but there’s more to be done here, and I’ll be doing it...

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Not a surprise: Aaron Flaaen and Justin Pierce: Disentangling the Effects of the 2018-2019 Tariffs on a Globally Connected U.S. Manufacturing Sector https://www.federalreserve.gov/econres/feds/files/2019086pap.pdf: 'Since the beginning of 2018, the United States has undertaken unprecedented tariff increases, with one goal of these actions being to boost the manufacturing sector. In this paper, we estimate the effect of the tariffs—including retaliatory tariffs by U.S. trading partners—on manufacturing employment, output, and producer prices. A key feature of our analysis is accounting for the multiple ways that tariffs might affect the manufacturing sector, including providing protection for domestic industries, raising costs for imported inputs, and harming competitiveness in overseas markets due to retaliatory tariffs. We find that U.S. manufacturing industries more exposed to tariff increases experience relative reductions in employment as a positive effect from import protection is offset by larger negative effects from rising input costs and retaliatory tariffs. Higher tariffs are also associated with relative increases in producer prices via rising input costs...

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WTF, Sean Wilentz, Victoria Bynum, James M. McPherson, James Oakes, and Gordon S. Wood?!?!?!: Sean Wilentz, Victoria Bynum, James M. McPherson, James Oakes, and Gordon S. Wood: Letter to the Editor: Historians Critique The 1619 Project https://www.nytimes.com/2019/12/20/magazine/letter-to-the-editor-historians-critique-the-1619-project-and-we-respond.html: 'On the American Revolution, pivotal to any account of our history, the project asserts that the founders declared the colonies’ independence of Britain “in order to ensure slavery would continue.” This is not true. If supportable, the allegation would be astounding—yet every statement offered by the project to validate it is false...

But... but... but... but:

Jill Lepore: These Truths: A History of the United States https://books.google.com/books?id=v2ZSDwAAQBAJ: '“It is imagined our Governor has been tampering with the Slaves & that he has it in contemplation to make great Use of them in case of a civil war,” young James Madison reported from Virginia to his friend William Bradford in Philadelphia. Lord Dunmore, the royal governor of Virginia, intended to offer freedom to slaves who would join the British army. “To say the truth, that is the only part in which this colony is vulnerable,” Madison admitted, “and if we should be subdued, we shall fall like Achilles by the hand of one that knows that secret.”64 But the colonists’ vulnerability to slave rebellion, that Achilles’ heel, was hardly a secret: it defined them. Madison’s own grandfather, Ambrose Madison, who’d first settled Montpelier, had been murdered by slaves in 1732, apparently poisoned to death, when he was thirty-six...

...In Madison’s county, slaves had been convicted of poisoning their masters again in 1737 and 1746: in the first case, the convicted man was decapitated, his head placed atop a pole outside the courthouse “to deter others from doing the Like”; in the second, a woman named Eve was burned alive.65 Their bodies were made into monuments. No estate was without this Achilles’ heel.

George Washington’s slaves had been running away at least since 1760. At least forty-seven of them fled at one time or another. In 1763, a twenty-three-year-old man born in Gambia became Washington’s property; Washington named him Harry and sent him to work draining a marsh known as the Great Dismal Swamp. In 1771, Harry Washington managed to escape, only to be recaptured. In November 1775, he was grooming his master’s horses in the stables at Mount Vernon when Lord Dunmore made the announcement that Madison had feared: he offered freedom to any slaves who would join His Majesty’s troops in suppressing the American rebellion.

In Cambridge, where George Washington was assembling the Continental army, he received a report about the slaves at Mount Vernon. “There is not a man of them but would leave us if they believed they could make their escape,” Washington’s cousin reported that winter, adding, “Liberty is sweet.”68 Harry Washington bided his time, but he would soon join the five hundred men who ran from their owners and joined Dunmore’s forces, a number that included a man named Ralph, who ran away from Patrick Henry, and eight of the twenty-seven people owned by Peyton Randolph, who had served as president of the First Continental Congress. Edward Rutledge, a member of South Carolina’s delegation to the Continental Congress, said that Dunmore’s declaration did “more effectually work an eternal separation between Great Britain and the Colonies—than any other expedient which could possibly have been thought of.”70 Not the taxes and the tea, not the shots at Lexington and Concord, not the siege of Boston; rather, it was this act, Dunmore’s offer of freedom to slaves, that tipped the scales in favor of American independence....

“All men are by nature equally free and independent, and have certain inherent rights, of which, when they enter into a state of society, they cannot, by any compact, deprive or divest their posterity,” read the Virginia Declaration of Rights and Form of Government, drafted in May 1776 by brazen George Mason.... Mason’s original draft hadn’t included the clause about rights being acquired by men “when they enter into a state of society”; these words were added after members of the convention worried that the original would “have the effect of abolishing” slavery.76 If all men belonging to civil society are free and equal, how can slavery be possible? It must be, Virginia’s convention answered, that Africans do not belong to civil society, having never left a state of nature....

In August 1776, one month after delegates to the Continental Congress determined that in the course of human events it sometimes becomes necessary for one people to dissolve the bands which have connected them with another, Harry Washington declared his own independence by running away from Mount Vernon to fight with Dunmore’s regiment, wearing a white sash stitched with the motto “Liberty to Slaves.” During the war, nearly one in five slaves in the United States left their homes, fleeing American slavery in search of British liberty.... Not many succeeded in reaching the land where liberty reigned, or even in getting behind British battle lines. Instead, they were caught and punished. One slave owner who captured a fifteen-year-old girl who was heading for Dunmore’s regiment punished her with eighty lashes and then poured hot embers into the gashes...

Jefferson-slave-ad

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Jack Goldstone: Efflorescences and Economic Growth in World History https://delong.typepad.com/efflorescences_and_economic_growth_in_world_histor.pdf: ' Jan de Vries (2001) has attacked the notion of disparate 'premodern' and 'modern' growth patterns to argue that extensive, Smithian, and Schumpeterian growth coexisted 'in both the pre-industrial past and the modern present', although their proportions have varied over space and time....I wish to argue that this attack has not gone far enough.... It was been widely recognized that well before the Industrial and French revolutions, European societies and economies departed from the ideal-typical view of "feudal" economically and technologically stagnant agrarian societies dominated by a predatory elite that wasted all surpluses. Rather... from at least the twelfth century onward... a trans-European set of urban networks that combined management of urban and rural market-oriented craft production... with a flourishing intra-European and extra-European global trade; and from at least the sixteenth century national rulers brought their unruly agrarian elites to heel by building bureaucratized central ("absolutist") governments that provided a rule of law and framework for the protection and accumulation of private property and capital... many of the characteristics of 'modern' growth, or of 'modern' political and social structures, in gestation.... Every one of the above trends observed in Europe and labeled as proof of 'early modern' character—technical improvements in agriculture and production providing rising total output and per capital productivity (including aggressive transformation of the natural landscape); vast urban-based regional and global trade networks supporting wealthy merchant classes; and increasingly centralized and bureaucratized political regimes thatcreated ordered territories and subordinated elites—are also widely evident outside of Europe prior to the eighteenth century... often earlier and in a higher state of development.... Let me propose... 'efflorescence," intended as the opposite of 'crisis'. Where a crisis is a relatively sharp, unexpected downturn in significant demographic and economic indices, often accompanied by political turmoil and cultural conflicts, an 'efflorescence' is a relatively sharp, often unexpected upturn... usually accompanied by political expansion and institution building and cultural synthesis and consoliidation.. involv[ing] both Smithian and Schumpeterian growth... often seen by contemporaries or successors as 'golden ages'... often set[ting] new patterns for thought, political organization, and economic life that last for many generations.... Throughout history, all societies have experienced periods of efflorescence, as well as extensive growth, stagnation, and crises—but that these processes are all distinct from Kuznetzian 'modern' economic growth founded on the continual and conscious application of scientific and technological progress to economic activity...

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Fergus Millar (1982): Rich and Poor in the Ancient World https://www.lrb.co.uk/the-paper/v04/n11/fergus-millar/rich-and-poor-in-the-ancient-world: 'By comparison with other societies of the same period, the production of an immense volume of refined consumer goods, sophisticated building techniques, a conscious application of agricultural skills, both local and long-distance trade, the circulation of coins–in short, a market economy–are among the primary characteristics of Graeco-Roman society. It is, moreover, precisely the physical reflections of such an economy which the archaeologist will take as indicating the advance of ‘Hellenisation’ into the Near East, or of ‘Romanisation’ into Western and Central Europe and North Africa. Some understanding of the technology of production, including that of agriculture (the economic predominance of which, obvious and banal as it is, provides another of the parrot-cries of contemporary thought on ancient society), is essential if one is to grasp how there was a surplus at all. If the actual processes in which millions of primary producers engaged (not to speak of shopkeeping, shipping and so forth) are all just taken for granted, as they are in this book, the notion of the crucial importance of the relations of production seems empty. What is said here about the social relations of production, or rather of the extraction of a surplus by the propertied classes, is in any case confined to a number of broad propositions, even if (as we shall see) these are of exceptional interest and importance. But the propositions are essentially confined to the producers (slaves, serfs, debt bondsmen, free labourers). One of his central arguments, or rather assertions, is that wage labour was economically unimportant, and that it must–for lack of any clear alternative–have been specifically the exploitation of slaves which provided the Greek upper classes with their surplus. The ‘possessing classes’ themselves are by and large taken for granted, whether in Classical Greece, the Hellenistic world or the Roman Empire. But it makes a crucial difference whether we are talking of descent-groups which enjoyed a stable possession of wealth inherited over generations (and how stable that possession will itself have been in individual cases will have depended in part on how restrictive the laws of inheritance, gift and dowry were), or whether people could easily rise or fall in the scale of wealth.... The main proposition at which the whole book aims concerns the relevance of class relations and exploitation to the fall of the Roman Empire.... De Ste Croix comes finally to the proposition that the late Roman state, with its vastly increased army (a point which is not now as certain as it used to seem), and its much more elaborate bureaucracy, served to intensify the total burden of exploitation suffered by its economic base–the impoverished peasants on the land.... Whether this was the ‘cause’ of the fall of the Empire is (obviously) not a question which allows a simple answer–and especially not in the context of this book, since most of the Greek-speaking part of the Empire took a very long time to fall, or be pushed.... What he has done is to present a consistent and vigorously argued case for seeing not just the Greek world but the whole of Antiquity in a different way. The argument is often unconvincing or partial, and the structure sometimes loose and self-indulgent; in his incapacity to resist an interesting byway he more resembles Herodotus than Thucydides, whom (along with Aristotle) he so much reveres. On the other hand, it is precisely this width of reference, both ancient and modern, which contributes most to the book’s uniquely personal tone.... It does... leave me wishing even more strongly than before that someone would now write a serious book on the overall pattern of economic relations and social structure in one ancient society, for which Classical Athens is the obvious candidate; and that somebody would now produce a detailed study of property, class, the mechanism of economic exploitation, and the struggle between rich and poor citizens, in the ancient Greek world...

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It seems clear that Gordon Wood has read neither Jill Lepore nor the papers of Edward Rutledge. Perhaps he should?: Gordon Wood: Response to the New York Times’ Defense of the 1619 Project https://www.wsws.org/en/articles/2019/12/24/nytr-d24.html: 'Dear Mr. Silverstein: I have read your response to our letter concerning the 1619 Project.... I have spent my career studying the American Revolution and cannot accept the view that “one of the primary reasons the colonists decided to declare their independence from Britain was because they wanted to protect the institution of slavery.” I don’t know of any colonist who said that they wanted independence in order to preserve their slaves. No colonist expressed alarm that the mother country was out to abolish slavery in 1776...

Jill Lepore: These Truths: A History of the United States https://books.google.com/books?id=v2ZSDwAAQBAJ: 'In November 1775... Lord Dunmore... offered freedom to any slaves who would join His Majesty’s troops in suppressing the American rebellion.... Five hundred men... ran from their owners and joined Dunmore’s forces, a number that included a man named Ralph, who ran away from Patrick Henry, and eight of the twenty-seven people owned by Peyton Randolph, who had served as president of the First Continental Congress. Edward Rutledge, a member of South Carolina’s delegation to the Continental Congress, said that Dunmore’s declaration did “more effectually work an eternal separation between Great Britain and the Colonies—than any other expedient which could possibly have been thought of.” Not the taxes and the tea, not the shots at Lexington and Concord, not the siege of Boston; rather, it was this act, Dunmore’s offer of freedom to slaves, that tipped the scales in favor of American independence...

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Hyman Minsky (1988): Review of "Secrets of the Temple: How the Federal Reserve Runs the Country" by William Greider. New York: Simon and Schuster, 1987, 799 pp. , $24.95 https://www.jstor.org/stable/pdf/40720477.pdf: 'Secrets of the Temple is a long and tedious book with a core that could have been interesting and important. The subtitle of William Greider's book... announces... its chief conceit: the Federal Reserve runs the country. As the only unqualified true proposition in economics is that there are no unqualified true assertions, the conceit is false.... Embellished with sleep-inducing asides on psychology, history, anthropology, and politics. The tone is iconoclastic; implicit conspiracies are suggested, but the evidence is anecdotal. The aim might be to demythicize money and the Federal Reserve, but ultimately Greider' s weak command over the relevant economic theory blunts his message. This reader feels that Greider set out to prove a conspiracy but he couldn't marshall the evidence. The main policy recommendation-to bring the Federal Reserve under the control of the administration-is weak, especially in light of Greider' s strong views. Given the economic weirdos that recent administrations have favored, I am reluctant to endorse such a concentration of power.... During the 12 years of Nixon, Ford, and Carter, the Federal Reserve and the central banks of the advanced capitalist countries seemed impotent validators of price levels resulting from the exercise of market power by unions, firms, and cartels of raw material suppliers. No strong claims that the Federal Reserve runs the country were put forth. Proposals for incomes policies were rife.... The Reagan Administration had an incomes policy... high unemployment... welcom[ing] imports, it kept the minimum wage constant, and it bashed unions. Breaking the air controllers strike was the key anti-inflationary act of the Reagan Administration. The second most important such act may have been the acceptance of the flood of imports.... Ultimately, Greider cannot sustain his conceit because his command of economics is incomplete.... Especially when the financial structure is fragile, the Federal Reserve is mainly a crisis-containing mechanism, rather than the agency of a conspiracy to bias income distribution.... In spite of the evident shortcomings in his understanding of economics, Greider had the makings of a good, forceful, 200-page book that could have... opened a public discussion of the proper use of the Federal Reserve. His text runs to 717 pages. In this case, more is clearly less...

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Fairly Recently: Must- and Should-Reads, and Writings (December 27, 2019)...

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MUST OF THE MUSTS:

  1. Looking forward to the next recession, and to the unwillingness of politicians to reserve fiscal space for fighting it, makes Keynes message more urgent than ever: Paul Krugman: Introduction to Keynes's General Theory https://delong.typepad.com/sdj/2006/03/krugmans_intro_.html: 'In the spring of 2005 a panel of “conservative scholars and policy leaders” was asked to identify the most dangerous books of the 19th and 20th centuries.... Charles Darwin and Betty Friedan ranked high on the list. But The General Theory of Employment, Interest, and Money did very well, too. In fact, John Maynard Keynes beat out V.I. Lenin and Frantz Fanon. Keynes, who declared in the book’s oft-quoted conclusion that “soon or late, it is ideas, not vested interests, which are dangerous for good or evil,” would probably have been pleased.... It’s probably safe to assume that the “conservative scholars and policy leaders” who pronounced The General Theory one of the most dangerous books of the past two centuries haven’t read it. But they’re sure it’s a leftist tract, a call for big government and high taxes.... The arrival of Keynesian economics in American classrooms was delayed by a nasty case of academic McCarthyism. The first introductory textbook to present Keynesian thinking, written by the Canadian economist Lorie Tarshis, was targeted by a right-wing pressure campaign aimed at university trustees. As a result of this campaign, many universities that had planned to adopt the book for their courses cancelled their orders, and sales of the book, which was initially very successful, collapsed. Professors at Yale University, to their credit, continued to assign the book; their reward was to be attacked by the young William F. Buckley for propounding “evil ideas.” But Keynes was no socialist—he came to save capitalism, not to bury it. And there’s a sense in which The General Theory was... a conservative book.... Keynes wrote during a time of mass unemployment, of waste and suffering on an incredible scale. A reasonable man might well have concluded that capitalism had failed, and that only... nationalization... could restore economic sanity.... Keynes argued that these failures had surprisingly narrow, technical causes... because Keynes saw the causes of mass unemployment as narrow and technical, he argued that the problem’s solution could also be narrow and technical: the system needed a new alternator, but there was no need to replace the whole car...

  2. Josiah Ober: Agamemnon's Cluelessness https://delong.typepad.com/files/ober-agamemnon-selections.pdf: 'For Aristotle, ethics and politics must take into account “merely living” (zên) as the foundation for the end of living well (eu zên)... in a way... cognizant of the kinds of expertise necessary for living, without losing sight of the ultimate goal of living well. The domain of expertise... concerned with natural material conditions and forms of authority (especially master-slave) required by the end of self-sufficiency is designated oikonomia. But the definition of oikonomia and especially its relationship to money-making (chrêmatistikê) is, Aristotle says, contested.... Among the many goals of Politics book 1 is to put chrêmatistikê–as expert knowledge of a particular relationship among production (poiêsis), exchange (allangê/metablêtikê), and consumption/possession (ktêsis), all characteristically involving coined money—into the normatively correct place in his naturalized hierarchy of value. The critical conclusion is that chrêmatistikê (or one specific type of chrêmatistikê) is a subordinate part of oikonomia. It is not “according to nature” (kata phusin) but rather a technê arising from practical experience (empeiria). It aims the possession and increase of wealth, at accumulation of money, as an end. That accumulation is by its internal logic unbounded and unconstrained, insofar as wealth denominated in monetary terms has no natural limit. Chrêmatistikê thus is a matter of maximizing a single resource (one thought to give access to all other resources), rather than optimizing or satisficing in respect to other values. It is at once contrary to the true end of human existence, a prevalent approach to the management of material goods, and (at least potentially) an essential instrument for both the oikonomos and the politikos. Among the delicate tasks of book 1 of the Politics is, then, to demonstrate that Aristotle knows enough about this dangerous and vulgar (phortikon) instrument to specify its proper uses, while avoiding appearing to honor it as a science worthy of a detailed treatment. Much of Politics book 1.8-11 is devoted to sorting out the contested relationship between chrêmatistikê and oikonomia...

  3. I object to Doug Jones's characterization of the past 100,000 years. It is true that wild mammal biomass is only 1/6 of what it was before the Anthropocene. But total mammal biomass is four times what it was. As far as TEAM MAMMAL biomass is concerned, we have been excellent player-coaches. Doug Jones: 7 Billion | Logarithmic History https://logarithmichistory.wordpress.com/2019/12/26/7-billion-2/: 'The biomass of wild mammals (terrestrial and marine) is only about 1/6 of what it was before humans came on the scene, and total plant biomass is about ½ of what it was before humans, largely as a result of deforestation...

  4. It is well known that systems in which there is too much feedback and too little reliance on fundamentals become unstable: I believe that this is how nicotine and caffeine and chocolate work in their evolved function as nerve poisons for bugs: excite the neurons to fire more often, and rational coordination breaks down, and the bugs that ate the tobacco leaves die. Here we are the bugs, and social media is our tobacco leaf: Charles Stross: Artificial Intelligence: Threat or Menace? http://www.antipope.org/charlie/blog-static/2019/12/artificial-intelligence-threat.html: 'Today's internet ads are qualitatively different from the direct mail campaigns of yore. In the age of paper, direct mail came with a steep price of entry, which effectively limited it in scope—also, the print distribution chain was it relatively easy to police. The efflorescence of spam from 1992 onwards should have warned us that junk information drives out good, but the spam kings of the 1990s were just the harbinger of today's information apocalypse. The cost of pumping out misinformation is frighteningly close to zero, and bad information drives out good: if the propaganda is outrageous and exciting it goes viral and spreads itself for free. The recommendation algorithms used by YouTube, Facebook, and Twitter exploit this effect to maximize audience participation in pursuit of maximize advertising click-throughs. They promote popular related content, thereby prioritizing controversial and superficially plausible narratives. Viewer engagement is used to iteratively fine-tune the selection of content so that it is more appealing, but it tends to trap us in filter bubbles of material that reinforces our own existing beliefs. And bad actors have learned to game these systems to promote dubious content. It's not just Cambridge Analytica I'm talking about here, or allegations of Russian state meddling in the 2016 US presidential election. Consider the spread of anti-vaccination talking points and wild conspiracy theories, which are no longer fringe phenomena but mass movements with enough media traction to generate public health emergencies in Samoa and drive-by shootings in Washington DC. Or the spread of algorithmically generated knock-offs of children's TV shows proliferating on YouTube that caught the public eye last year...

  5. Rana Foroohar: America’s Competitiveness Problem https://www.ft.com/content/419b6a42-2254-11ea-92da-f0c92e957a96?segmentid=acee4131-99c2-09d3-a635-873e61754ec6: 'A dysfunctional dance between business and politics is at the root of the country’s woes: Carly Fiorina, the former Republican presidential candidate and Hewlett-Packard boss, made news last week when she gave voice to a hypocrisy common in the American business community. She insisted that it was “vital” that President Donald Trump be impeached. Yet she wouldn’t rule out the possibility of voting for him, depending on “who the Democrats put up”. She’s presumably referring to the possibility of an Elizabeth Warren candidacy. I understand why people like Ms Fiorina are allergic to any wealth-distributing progressive. But business people who’ve supported Mr Trump because of cuts to corporate taxes or promises of deregulation are playing a sucker’s game. They are also part of a bigger dysfunctional dance between business and politics that is explored in a new Harvard Business School report on US competitiveness. More accurately, the report focuses on an increasing lack of competitiveness, evidenced by everything from pessimism about America’s medium- to long-term growth prospects, the divide between the fortunes of business and workers, to the country’s declining fiscal position and skills gap.... Business itself is another big reason for government gridlock, since it has “funded, perpetuated, and profited” from political dysfunction. Business was part of the diabolical process of gerrymandering that has led to the partisan redrawing of voting districts.... Yet business stubbornly refuses to accept that it is part of the problem. Survey results show that most business leaders believe that corporations influence politics in ways that erode not only democracy but the competitiveness of the economy as a whole. But most deny that their own companies are at fault.... In 2016, too many people in important leadership positions paid to elect Mr Trump. Many more (though not all) have stayed quiet as he has taken a wrecking ball to the postwar order because they knew that, in the short term, they’d get tax changes they wanted, not to mention a highly profitable, though unproductive, asset bubble. In exchange for that, we also got a trade war, an immigration debacle, and a crisis of the rules-based order that underpins corporate America’s own license to operate. Not a great return on investment. The complicity of business in the US in the current system of money politics is reaching a crisis point. My plea to the C-suite? Don’t follow Ms Fiorina and try to have it both ways in 2020...

  6. Hank Reichman: On Blacklists, Harassment, and Outside Funders: A Response to Phil Magness https://academeblog.org/2017/04/11/on-blacklists-harassment-and-outside-funders-a-response-to-phil-magness/: 'In a recent series of tweets Magness repeatedly accused UnKoch of being Soros-funded (they are not, although I’ll bet they’d like to be) and, more ominously, of being “Soviets” or even “Stalinists.” Here’s one such tweet: “Things that strongly correlate: 1. support for UnKoch My Campus. 2. posting sentimentalism for the Soviet Union on social media.” (March 10) Here’s another: “A good expose of the type of ‘journalism’ produced by the Soviets in the UnKoch crowd:” (March 21) And then there’s the series of tweets beginning, so far as I can tell, with a Magness message to UnKoch charging that “there’s plenty of overt Soviet sympathizing in your organization to historically contextualize you with them.” (March 24)  This was followed by a tweet later that day claiming that “Your own co-founder is quite the fanboy of genocidal Soviet types” offering as proof a tweet that reveals how UnKoch co-founder Ralph Wilson participated in the carving of a Halloween pumpkin with the faces of Marx, Engels, and Lenin!  How damning! There’s more like that. Of course, to call any of the five young UnKoch staffers “Soviet” is totally ludicrous, since looking at their photographs online I’m pretty sure they were no more than children, and perhaps not yet born, when the Soviet Union collapsed in 1991.  As a scholar of Soviet history myself, I can assure Magness that the Soviet Union is no more and that Communism (in any meaningful sense) is dead.  But it’s not funny, since this sort of red-baiting recapitulates the kind of activity that made blacklisting so dangerous in the 1950s.  Although I don’t seem to agree with Magness about much, having read many of his comments I had hoped he would be above such base crudity...

  7. Wolfgang Münchau: Austerity, Not the Populists, Destroyed Europe’s Centre Ground https://www.ft.com/content/be3ca48a-2344-11ea-b8a1-584213ee7b2b: 'From Brexit to fiscal policy, the EU’s largest member states have seen the mainstream wrongfooted: There were tell-tale signs early on. In 2009, Peer Steinbrück, a former German finance minister and later the Social Democrats’ candidate for chancellor, introduced the constitutional balanced budget rule. This later gave rise to Germany’s permanent fiscal surpluses and under-investment in critical infrastructure. In a joint study, Germany’s employers and trade unions recently put the investment shortfall at a staggering €450bn. So it is unsurprising that the SPD has lost political support during the years of its grand coalition with Angela Merkel’s Christian Democrats. In 2012, Italy’s government of technocrats, led by Mario Monti, imposed procyclical austerity in the middle of a recession. The goal was to prove that Italy was a good follower of the eurozone’s fiscal rules. The country has still not fully recovered from that shock. In 2014, François Hollande, the former French president, outed himself as a rightwing supply-sider when he cited Say’s law—that supply creates its own demand. Since then his Socialist party has in effect disappeared as a political force, along with its old rivals on the centre right. In late 2015 in the UK, I overheard a group of pro-Remain politicians, academics and commentators persuading themselves that the easiest way to win the forthcoming Brexit referendum would be to scare the hell out of the electorate. We all know how that went. What these disparate stories have in common is that they paint a picture of the decline of the political centre in Europe. I consider this, not the rise in populism, to be the main development in the EU’s largest member states. If there was one common policy that accelerated that trend, it was austerity. We have come to judge austerity mainly in terms of its economic impact. But it is the political fallout from public spending cuts that is most likely to persist. Austerity as a policy is the consequence of a poor understanding of economics coupled with a self-righteous mind and a tendency to spend too much time with your chums at places like Davos...

  8. Blogging: What to Expect Here... https://www.bradford-delong.com/2019/12/blogging-what-to-expect-here.html: The purpose of this weblog is to be the best possible portal into what I am thinking, what I am reading, what I think about what I am reading, and what other smart people think about what I am reading: "Bring expertise, bring a willingness to learn, bring good humor, bring a desire to improve the world—and also bring a low tolerance for lies and bullshit..." — Brad DeLong...

  9. What Is the Political-Economic Agenda After Piketty? https://www.bradford-delong.com/2019/12/what-is-the-political-economic-agenda-after-piketty.html: Introduction: Let me write, overwhelmingly, about inequality understood as inequality between people who regard themselves as members of a common culture, economy, nation. There is the separate issue of inequality between the different cultures, economies, nations that make up the world, but let me leave that for the very end, and then deal with it only briefly...

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Ben Thompson: The Value Chain Constraint https://stratechery.com/2019/the-value-chain-constraint/: 'What matters is not “technological innovation”; what matters is value chains and the point of integration on which a company’s sustainable differentiation is built; stray too far and even the most fearsome companies become also-rans.... Google... has been predicated on “technological innovation”. This was possible because the company’s core product—Internet search—entered a value chain with no integrations whatsoever. On the supply side there were countless websites and even more individual web pages, increasing exponentially, and on the demand side were a similarly increasing number of Internet users looking for specific content. Crucially, all of the supply was easily accessible... and all of the demand was capturable.... This meant that the best search engine... could win, and so it did. Google was leaps and bounds better than the competition, thanks to its focus on understanding links—the fabric of the web—instead of simply pages, and consumers flocked to it. This set off the positive cycle I have described in Aggregation Theory: owning demand gave Google increasing power over supply, which came onto Google’s platform on the search engine’s terms, first by optimizing their web pages and later by delivery content directly to Google’s answer boxes, AMP program, etc., all of which increased demand, resulting in a virtuous cycle.... Things have not gone so well for Google Cloud.... The problem... is that the company’s value chain is completely wrong. The world of enterprise software is not a self-serve world (and to the extent it is, AWS dominates the space); what is necessary is an intermediary layer to interact with relatively centralized buyers with completely different expectations from consumers when it comes to product roadmap visibility, customer support, and pricing. It has taken Google many years to learn this lesson: Google Cloud remains a distant third to AWS and Microsoft with a strategy that simply wasn’t working.... The technical attributes of a product are only one piece of what matters to success in the enterprise. Just as important are customization, support, and the ability to sell. Google is widely regarded as being the worst in all three areas. In short, what Google Cloud needs is not a CEO that fits the culture, because the culture of Google is about making the best product technologically and waiting for customers to line-up. That may have worked for Search and for VMWare, but it’s not going to work for Google Cloud. Instead the company needs to actually get out there and actually sell, develop the capability and willingness to tailor their offering to customers’ needs, be willing to build features simply because they move the needle with CIOs, and actually offer real support.... Google Cloud is competing in a different value chain than is Google search, and it needs to build new integrations accordingly...

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Alexander Zaitchik: Is Josh Hawley For Real? https://newrepublic.com/article/154526/josh-hawley-real: 'How the junior senator from Missouri has become the face of the post-liberal movement—and positioned himself as the philosophical heir to Trump.... For a nakedly ambitious up-and-comer in D.C.’s corridors of power, there is obvious logic to the theater of telling Mark Zuckerberg, “I’m coming for you.” Public opinion has begun to turn on the tech giants, and the populist art of taking on a villainous monopoly is something Hawley, author of an admiring biography of Teddy Roosevelt, understands better than most. As he told The Washington Post, “My great worry ... is an economy that works for a small group of billionaires and then everybody else gets their information taken from them and monetized.”... Hawley, a devout evangelical Presbyterian... [is] something other than just another fresh-faced family values Republican or opportunistic trust-buster. In his very first speech on the Senate floor in May, Hawley invoked an “epidemic of loneliness and despair... a society increasingly defined not by the genuine and personal love of family and church, but by the cold and judgmental world of social media.” These lines illuminated the edges of a worldview bigger than the sum of its policy expressions. Behind this weltanschauung is an emergent conservative tendency dubbed “post-liberalism”—a stewing amalgam of long-marginalized ideas on the right that have found new life, like ancient spores released by an earthquake, in the aftermath of the 2016 election. While the lead thinkers of this movement might more accurately be dubbed “pre-liberals,” they claim Hawley as one of their own, and it is through the prism of their crabbed, reactionary political thought that Hawley’s tech crusade is best understood.... Stated simply... [it is] a profound and widespread if inchoate dissatisfaction with the Enlightenment legacy of pluralism, the primacy of individual rights, and the hard separation of church and state. Lockean ideas about “liberty” have led to an “Epicurean liberalism” that consecrates “the right to choose your own meaning, define your own values, emancipate yourself from God by creating your own self,” Hawley has said. The post-liberals propose an alt-liberty grounded in place and tradition, bound by social relations and obligations, rooted in the Bible. For the post-liberals, Big Tech is basically Armageddon.... The post-liberal project seeks to cage the furies loosed by Donald Trump and put them at the service of an intellectually coherent movement without the baggage of a leader accused by multiple women of rape. Last week, this project marked a milestone in Washington with the inaugural conference of the Edmund Burke Foundation, a post-liberal think tank hatched in January. The only elected politician on the schedule was the junior senator from Missouri, who delivered the dinner keynote on the last night. In it, Hawley blasted sinister, Janus-faced “cosmopolitan elites” whose “old political platforms have grown stale.” He called on like-minded conservatives to fight for their definition of liberty, a fight “born of love for the place we call home” . Hawley’s speech, condemned by some Jewish leaders for trading in anti-Semitic tropes and by liberals for sending coded messages about the dangers of racial diversity, did little to counter the perception that post-liberalism is just high-concept lipstick applied to the Trumpian pig...

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Narrator:"The Chilean Economy had not done very well when Pinochet, to his own surprise, lost his plebiscite to remain": PBS: Commanding Heights https://www.pbs.org/wgbh/commandingheights/shared/minitext/int_miltonfriedman.html#10: INTERVIEWER: "You don't see Chile as a small turning point, then?" MILTON FRIEDMAN: "It may have been a turning point, but not because it was the first place to put the Chicago theory in practice. It was important on the political side, not so much on the economic side. Here was the first case in which you had a movement toward communism that was replaced by a movement toward free markets. See, the really extraordinary thing about the Chilean case was that... the military adopted the free-market arrangements instead of the military arrangements...." INTERVIEWER: "In the end, the Chilean [economy] did quite well, didn't it?" MILTON FRIEDMAN: "Oh, very well. Extremely well. The Chilean economy did very well, but more important, in the end the central government, the military junta, was replaced by a democratic society. So the really important thing about the Chilean business is that free markets did work their way in bringing about a free society..."

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This policy makes absolutely no sense whatsoever—neither social sense, economic sense, or political sense. Yet it rolls forward, with no resistance from legislators of the president's party: American Progress: Cruelty for Cruelty's Sake: 'This week, President Donald Trump issued a new, cruel rule that will strip nearly 700,000 struggling people of Supplemental Nutrition Assistance (SNAP) benefits. In its announcement of the rule, the U.S. Department of Agriculture cited a strong economy and protection of U.S. taxpayer money as reasons for the changes to SNAP benefits. But a new CAP survey on voter opinions on the economy, government, and poverty finds that despite headlines touting a booming economy, a majority of voters are still struggling economically, with more than half reporting that they or their family faced a serious personal economic hardship over the past year. Furthermore, a broad majority of voters across party lines not only oppose cuts to SNAP but want to see the program expanded to ensure families can afford nutritious food throughout the month. If the current economy isn't working for everyday Americans and voters oppose cuts to the program, what excuse is left for the passing of this new rule other than cruelty for cruelty's sake?...

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David Baqaee and Emmanuel Farhi: Networks, Barriers, and Trade https://www.nber.org/papers/w26108: 'We study a non-parametric class of neoclassical trade models with global production networks. We characterize their properties in terms of sufficient statistics useful for growth and welfare accounting as well as for counterfactuals. We establish a formal duality between open and closed economies and use it to analytically quantify the gains from trade. Accounting for nonlinear (non-Cobb- Douglas) production networks with realistic complementarities in production significantly raises the gains from trade relative to estimates in the literature. We use our general comparative statics results to show how models that abstract away from intermediates, no matter how well calibrated, are incapable of simultaneously predicting the costs of tariff and non-tariff barriers to trade. Given trade volumes and elasticities, accounting for intermediates doubles the losses from tariffs. Better quantitative accuracy demands the use of more complicated, oftentimes computational, models. This paper seeks to help bridge the gap between computation and theory...

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Doug Jones: Enjoy It While It Lasts https://logarithmichistory.wordpress.com/2019/10/09/enjoy-it-while-it-lasts-5/: '"If a man were called to fix the period in the history of the world, during which the condition of the human race was most happy and prosperous, he would, without hesitation, name that which elapsed from the death of Domitian [96 CE] to the accession of Commodus [180 CE]. The vast extent of the Roman empire was governed by absolute power, under the guidance of virtue and wisdom. The armies were restrained by the firm but gentle hand of four successive emperors, whose characters and authority commanded involuntary respect."... Gibbon doesn’t include China in this assessment of the state of the world, but for that country too, under the Eastern Han dynasty, there was a period of stability and prosperity, lasting from the death of the usurper Wang Mang in 24 CE to the outbreak of the Yellow Turban peasant uprising in 184 CE. During this time, the Roman and Han empires so completely dominated their respective portions of Eurasia that they enjoyed relative peace. Toward the end of the second century CE, both empires had populations around 50-60 million; world population was perhaps 190 million. In the succeeding centuries both empires would experience major population declines and political collapse. As a result, the world’s total population may have declined as well. Of course Gibbon’s view is a retrospective one, and didn’t anticipate the vast rise in standards of living that eventually followed the industrial revolution...

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We will not be ready to fight the next recession. Gavyn Davies tries a Hail Mary: Gavyn Davies: Can Automatic Fiscal Stabilisers Replace Monetary Policy? https://www.ft.com/content/7c3498c0-0523-11ea-a984-fbbacad9e7dd?segmentid=acee4131-99c2-09d3-a635-873e61754ec6: 'Monetary policy, whether conventional or unconventional, will be found wanting in the face of the next global recession.... Central bankers now admit that they will need help from fiscal policy in such circumstances. However, in the past, discretionary budgetary injections have usually been implemented with long delays, and political wrangling has resulted in tax and spending measures that have failed to stabilise demand in the economy. An example of these problems came after the financial crash in 2008.... The eventual ARRA stimulus was not large enough to stabilise the US economy and was reversed too quickly during the recovery. It prevented a financial collapse, but it did not avoid high and persistent unemployment. Even having Democratic control of the White House and Congress did not stop political roadblocks hindering the fiscal stimulus from shortening the recession. Meanwhile, in the eurozone, meaningful fiscal response was prevented by the absence of a mechanism that allowed significant risk-sharing among member states.... The proven disadvantages of discretionary budgetary changes to cushion a recession explain why there is growing interest in enhancing the so-called automatic fiscal stabilisers. Macroeconomists have argued for decades that the scale and effectiveness of built-in methods to raise spending or cut tax revenue should be increased to make fiscal policy more successful...

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Megan N. Fontenot: Exploring the People of Middle-earth: Sauron—Craftsman, Ring-giver, and Dark Lord https://www.tor.com/2019/05/30/exploring-the-people-of-middle-earth-sauron-craftsman-ring-giver-and-dark-lord/: 'Early drafts depicting Sauron’s coming are intense and leave no room for confusion. As the ship approaches the island a great wave, high as a mountain, lifts it up and casts it upon a high hill. Sauron disembarks and from there preaches, an image that recalls Christ’s sermon on the mount and establishes Sauron’s dominance. He offers a message of “deliverance from death,” and he “beguile[s] them with signs and wonders. And little by little they turned their hearts toward Morgoth, his master; and he prophesied that ere long he would come again into the world” (The Lost Road and Other Writings, hereafter LR, 29). He also preaches imperialism, telling the Númenoreans that the earth is theirs for the taking, goading them to conquer the leaderless rabble of Middle-earth (LR 74). He attempts to teach them a new language, which he claims is the true tongue they spoke before it was corrupted by the Elves (LR 75). His teaching ushers in an age of modern warfare in Númenor, leading “to the invention of ships of metal that traverse the seas without sails […]; to the building of grim fortresses and unlovely towers; and to missiles that pass with a noise like thunder to strike their targets many miles away”...

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A. Pluchino, A. E. Biondo, A. Rapisarda: _ Talent vs Luck: The Role of Randomness in Success and Failure_ https://arxiv.org/abs/1802.07068: 'The largely dominant meritocratic paradigm of highly competitive Western cultures is rooted on the belief that success is due mainly, if not exclusively, to personal qualities such as talent, intelligence, skills, efforts or risk taking. Sometimes, we are willing to admit that a certain degree of luck could also play a role in achieving significant material success. But, as a matter of fact, it is rather common to underestimate the importance of external forces in individual successful stories. It is very well known that intelligence or talent exhibit a Gaussian distribution among the population, whereas the distribution of wealth - considered a proxy of success - follows typically a power law (Pareto law). Such a discrepancy between a Normal distribution of inputs, with a typical scale, and the scale invariant distribution of outputs, suggests that some hidden ingredient is at work behind the scenes. In this paper, with the help of a very simple agent-based model, we suggest that such an ingredient is just randomness. In particular, we show that, if it is true that some degree of talent is necessary to be successful in life, almost never the most talented people reach the highest peaks of success, being overtaken by mediocre but sensibly luckier individuals. As to our knowledge, this counterintuitive result - although implicitly suggested between the lines in a vast literature - is quantified here for the first time. It sheds new light on the effectiveness of assessing merit on the basis of the reached level of success and underlines the risks of distributing excessive honors or resources to people who, at the end of the day, could have been simply luckier than others. With the help of this model, several policy hypotheses are also addressed and compared to show the most efficient strategies for public funding of research in order to improve meritocracy, diversity and innovation...

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Gabriel Chodorow-Reich, Plamen Nenov, and Alp Simsek: Stock Market Wealth and the Real Economy: A Local Labor Market Approach https://scholar.harvard.edu/chodorow-reich/publications/stock-market-wealth-and-real-economy-local-labor-market-approach: "We provide evidence on the stock market consumption wealth effect by using a local labor market analysis and regional heterogeneity in stock market wealth. An increase in stock wealth increases local employment and payroll in nontradable industries and in total, while having no effect on employment in tradable industries. In a model with consumption wealth effects and geographic heterogeneity, these responses imply a marginal propensity to consume out of a dollar of stock wealth of 2.8 cents per year. We also use the model to quantify the aggregate effects of a stock market wealth shock when monetary policy is passive. A 20% increase in stock valuations, unless countered by monetary policy, increases the aggregate labor bill by at least 0.85% and aggregate hours by at least 0.28% two years after the shock...

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Wolfgang Münchau: Austerity, Not the Populists, Destroyed Europe’s Centre Ground https://www.ft.com/content/be3ca48a-2344-11ea-b8a1-584213ee7b2b: 'From Brexit to fiscal policy, the EU’s largest member states have seen the mainstream wrongfooted: There were tell-tale signs early on. In 2009, Peer Steinbrück, a former German finance minister and later the Social Democrats’ candidate for chancellor, introduced the constitutional balanced budget rule. This later gave rise to Germany’s permanent fiscal surpluses and under-investment in critical infrastructure. In a joint study, Germany’s employers and trade unions recently put the investment shortfall at a staggering €450bn. So it is unsurprising that the SPD has lost political support during the years of its grand coalition with Angela Merkel’s Christian Democrats. In 2012, Italy’s government of technocrats, led by Mario Monti, imposed procyclical austerity in the middle of a recession. The goal was to prove that Italy was a good follower of the eurozone’s fiscal rules. The country has still not fully recovered from that shock. In 2014, François Hollande, the former French president, outed himself as a rightwing supply-sider when he cited Say’s law—that supply creates its own demand. Since then his Socialist party has in effect disappeared as a political force, along with its old rivals on the centre right. In late 2015 in the UK, I overheard a group of pro-Remain politicians, academics and commentators persuading themselves that the easiest way to win the forthcoming Brexit referendum would be to scare the hell out of the electorate. We all know how that went. What these disparate stories have in common is that they paint a picture of the decline of the political centre in Europe. I consider this, not the rise in populism, to be the main development in the EU’s largest member states. If there was one common policy that accelerated that trend, it was austerity. We have come to judge austerity mainly in terms of its economic impact. But it is the political fallout from public spending cuts that is most likely to persist. Austerity as a policy is the consequence of a poor understanding of economics coupled with a self-righteous mind and a tendency to spend too much time with your chums at places like Davos...

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Barry Eichengreen, Donghyun Park, Kwanho Shin: When Fast Growing Economies Slow Down: International Evidence and Implications for China https://www.nber.org/papers/w16919: 'Using international data starting in 1957, we construct a sample of cases where fast-growing economies slow down. The evidence suggests that rapidly growing economies slow down significantly, in the sense that the growth rate downshifts by at least 2 percentage points, when their per capita incomes reach around $17,000 US in year-2005 constant international prices, a level that China should achieve by or soon after 2015. Among our more provocative findings is that growth slowdowns are more likely in countries that maintain undervalued real exchange rates....

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Hank Reichman: On Blacklists, Harassment, and Outside Funders: A Response to Phil Magness https://academeblog.org/2017/04/11/on-blacklists-harassment-and-outside-funders-a-response-to-phil-magness/: 'In a recent series of tweets Magness repeatedly accused UnKoch of being Soros-funded (they are not, although I’ll bet they’d like to be) and, more ominously, of being “Soviets” or even “Stalinists.” Here’s one such tweet: “Things that strongly correlate: 1. support for UnKoch My Campus. 2. posting sentimentalism for the Soviet Union on social media.” (March 10) Here’s another: “A good expose of the type of ‘journalism’ produced by the Soviets in the UnKoch crowd:” (March 21) And then there’s the series of tweets beginning, so far as I can tell, with a Magness message to UnKoch charging that “there’s plenty of overt Soviet sympathizing in your organization to historically contextualize you with them.” (March 24)  This was followed by a tweet later that day claiming that “Your own co-founder is quite the fanboy of genocidal Soviet types” offering as proof a tweet that reveals how UnKoch co-founder Ralph Wilson participated in the carving of a Halloween pumpkin with the faces of Marx, Engels, and Lenin!  How damning! There’s more like that. Of course, to call any of the five young UnKoch staffers “Soviet” is totally ludicrous, since looking at their photographs online I’m pretty sure they were no more than children, and perhaps not yet born, when the Soviet Union collapsed in 1991.  As a scholar of Soviet history myself, I can assure Magness that the Soviet Union is no more and that Communism (in any meaningful sense) is dead.  But it’s not funny, since this sort of red-baiting recapitulates the kind of activity that made blacklisting so dangerous in the 1950s.  Although I don’t seem to agree with Magness about much, having read many of his comments I had hoped he would be above such base crudity...

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John Holbo: 'This seems true and important https://twitter.com/jholbo1/status/1210400656139243522: Kevin Drum: "White evangelicals are terrified that liberals want to extinguish their rights" https://motherjones.com/kevin-drum/2019/12/white-evangelicals-are-terrified-that-liberals-want-to-extinguish-their-rights/. I would add one thing. One thing that makes it hard to meet these terrified Christian cons halfway is that one thing that has freaked them out is the degree to which the public culture has converged on the position that tolerating gay people is morally absolutely good. So being on the other side of the tolerance question is just to be a morally bad person. Intolerable! Some conservative Christians (e.g. Dreher) find this sort of heaped opprobrium oppressive. I'm sure it's uncomfortable. But you can't demand those who believe it's just bad to be intolerant of gays not to believe that. They have arguments! So the 'religious liberty' ask is incredibly high-bar. 'I can believe what I like and no one is allowed to believe that whatever I believe is a bad belief. But, if I believe you or your belief is bad I get to be half-believed about it, because religion.' This sort of high epistemological privilege simply can't be accommodated. It's too aggressive. But, not realising how much they are asking for, the cons feel aggressed against...

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Team-mammal

I object to Doug Jones's characterization of the past 100,000 years. It is true that wild mammal biomass is only 1/6 of what it was before the Anthropocene. But total mammal biomass is four times what it was. As far as TEAM MAMMAL biomass is concerned, we have been excellent player-coaches. Doug Jones: 7 Billion | Logarithmic History https://logarithmichistory.wordpress.com/2019/12/26/7-billion-2/: 'The biomass of wild mammals (terrestrial and marine) is only about 1/6 of what it was before humans came on the scene, and total plant biomass is about ½ of what it was before humans, largely as a result of deforestation...

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Martin Wolf: How to Reform Today’s Rigged Capitalism https://www.ft.com/content/4cf2d6ee-14f5-11ea-8d73-6303645ac406: 'We must address weakened competition, feeble productivity growth, high inequality and degraded democracy: “It is clear then that . . . those states in which the middle element is large, and stronger if possible than the other two [wealthy and poor] together, or at any rate stronger than either of them alone, have every chance of having a well-run constitution.” Thus did Aristotle summarise his analysis of the Greek city states. The stability of what we would now call “constitutional democracy” depended on the size of its middle class. It is no accident that the US and UK, long-stable democracies today succumbing to demagogy, are the most unequal of the western high-income countries. Aristotle, we are learning, was right. My September analysis of “rigged capitalism” concluded that “we need a dynamic capitalist economy that gives everybody a justified belief that they can share in the benefits. What we increasingly seem to have instead is an unstable rentier capitalism, weakened competition, feeble productivity growth, high inequality and, not coincidentally, an increasingly degraded democracy.” So what is to be done? The answer is not to overthrow the market economy, undo globalisation or halt technological change. It is to do what has been done many times in the past: reform capitalism. That is the argument I made in a recent debate with former Greek finance minister Yanis Varoufakis on whether liberal capitalism should be saved. I argued, in effect, that “if we want everything to stay the same, everything must change”, as the Italian author Giuseppe Tomasi di Lampedusa wrote. If we want to preserve our freedom and democracy we need to embrace change. Here are five policy areas that need to be addressed. First, competition.... Second, finance.... Third, the corporation. The limited liability joint stock corporation was a great invention, but it is also a highly privileged entity. The narrow focus on maximising shareholder value has exacerbated the bad side-effects.... Fourth, inequality. As Aristotle warned, beyond a certain point, inequality is corrosive.... Finally, our democracies need refurbishing. Probably, the most important concerns are over the role of money in politics and the way the media works. Money buys politicians. This is plutocracy, not democracy. The malign impact of fake news (which is the opposite of what the US president means by the term) is also clear. We need public funding of parties, complete transparency of private funding and also far greater use of consultative forums...

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Very Briefly Noted 2019-12-26:

  1. The Edge of Democracy https://www.youtube.com/watch?v=xLe24M_PB5E: 'A cautionary tale for these times of democracy in crisis-the personal and political fuse to explore one of the most dramatic periods in Brazilian history. Combining unprecedented access to leaders past and present, including Presidents Dilma Rousseff and Lula da Silva, with accounts of her own family's complex past, filmmaker Petra Costa (ELENA) witnesses their rise and fall and the tragically polarized nation that remains...

  2. Mortimer Adler and Charles van Doren (1972): How to Read a Book https://delong.typepad.com/files/adler-read.pdf...

  3. I.A. Richards (1942): How to Read a Page: A Course in Efficient Reading with an Introduction to a Hundred Great Words https://delong.typepad.com/files/richards-page.pdf...

  4. Edward Bellamy (1887): Looking Backward 2000-1887 https://delong.typepad.com/files/bellamy-backward.pdf...

  5. Karl Polanyi (1944): The Great Transformation https://delong.typepad.com/files/polanyi-transformation.pdf...

  6. Roam Research https://roamresearch.com/: 'A note taking tool for networked thought...

  7. Julia Buckley: Roman Shipwreck in the Eastern Mediterranean Is 'Biggest Ever' http://edition.cnn.com/travel/article/roman-shipwreck-kefalonia-fiskardo/index.html: 'Dated to between 100 BCE and 100 CE... the largest classical shipwreck found in the eastern Mediterranean. The wreck of the 110-foot (35-meter) ship, along with its cargo of 6,000 amphorae, was discovered at a depth of around 60m (197 feet) during a sonar-equipped survey of the seabed off the coast of Kefalonia...

  8. eBook to PDF https://ebook2pdf.com/...

  9. Aldo Schiavone: The End of the Past: Ancient Rome and the Modern West https://www.google.com/books/edition/The_End_of_the_Past/YcWVMCqaRwcC...

  10. Weekend Reading: Ernest Gellner (1990): : From The Civil and the Sacred https://www.bradford-delong.com/2017/02/weekend-reading-from-ernest-gellner-1990-the-civil-and-the-sacred.html...

  11. Reading: Hoyt Bleakley and Jeffrey Lin (2012): Portage and Path Dependence https://www.bradford-delong.com/2017/02/reading-hoyt-bleakley-and-jeffrey-lin-2012-portage-and-path-dependence.html...

  12. Wikipedia: Battle of Killiecrankie https://en.wikipedia.org/wiki/Battle_of_Killiecrankie...

  13. John Scalzi: Thoughts on a Year of Exercise https://whatever.scalzi.com/2019/12/26/thoughts-on-a-year-of-exercise/...

  14. Laura Hercher: The List Returns: My Top 10 Stories in Genetics in 2019 https://thednaexchange.com/2019/12/26/the-list-returns-my-top-10-stories-in-genetics-in-2019/...

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It is well known that systems in which there is too much feedback and too little reliance on fundamentals become unstable: I believe that this is how nicotine and caffeine and chocolate work in their evolved function as nerve poisons for bugs: excite the neurons to fire more often, and rational coordination breaks down, and the bugs that ate the tobacco leaves die. Here we are the bugs, and social media is our tobacco leaf: Charles Stross: Artificial Intelligence: Threat or Menace? http://www.antipope.org/charlie/blog-static/2019/12/artificial-intelligence-threat.html: 'Today's internet ads are qualitatively different from the direct mail campaigns of yore. In the age of paper, direct mail came with a steep price of entry, which effectively limited it in scope—also, the print distribution chain was it relatively easy to police. The efflorescence of spam from 1992 onwards should have warned us that junk information drives out good, but the spam kings of the 1990s were just the harbinger of today's information apocalypse. The cost of pumping out misinformation is frighteningly close to zero, and bad information drives out good: if the propaganda is outrageous and exciting it goes viral and spreads itself for free. The recommendation algorithms used by YouTube, Facebook, and Twitter exploit this effect to maximize audience participation in pursuit of maximize advertising click-throughs. They promote popular related content, thereby prioritizing controversial and superficially plausible narratives. Viewer engagement is used to iteratively fine-tune the selection of content so that it is more appealing, but it tends to trap us in filter bubbles of material that reinforces our own existing beliefs. And bad actors have learned to game these systems to promote dubious content. It's not just Cambridge Analytica I'm talking about here, or allegations of Russian state meddling in the 2016 US presidential election. Consider the spread of anti-vaccination talking points and wild conspiracy theories, which are no longer fringe phenomena but mass movements with enough media traction to generate public health emergencies in Samoa and drive-by shootings in Washington DC. Or the spread of algorithmically generated knock-offs of children's TV shows proliferating on YouTube that caught the public eye last year...

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On the one hand, this type of paper feels to me like engineered wheel-reinvention. It is microfoundations tuned to give a desired macroeconomic result, but its microfoundations are not real: we have no statistical mechanics in economics to get us from the real microfoundations to emergent macro properties like pressure and temperature. All we have are just-so stories: "if these were the microfoundations, then..." Nevertheless, this is a very, very nice example of the genre. And lots of people find this kind of thing very useful, or at least comforting. So I am probably wrong in my lack of enthusiasm here: Daniel Murphy: Excess Capacity in a Fixed Cost Economy https://economics.virginia.edu/sites/economics.virginia.edu/files/macro/murphy.pdf: '[When] firms... face only fixed costs over a range of output... equilibrium output and income depend on consumer demand rather than available supply, even when prices are flexible and there are no other frictions. The theory matches the procyclicality of capacity utilization, firm entry, and markups. A heterogeneous household version of the model demonstrates how an economy can enter a capacity trap in response to a temporary negative demand shock: When demand by some consumers falls temporarily, other consumers’ permanent income (and hence their desired consumption) falls. Since output is demand-determined, the permanent fall in desired consumption causes a permanent state of excess capacity...

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I was convinced by Burfisher &al. back in 2001 http://www2.hawaii.edu/~noy/362texts/NAFTA-US.pdf that old NAFTA had been a net plus for United States autoworkers—and a huge plus for North American autoworkers. The downside industries seemed to be furniture, timber, and possibly apparel. But I do agree with Sandy and Harley that worker-rights violations ought to be as subject to trade sanctions as other violations of the rules of the international trading game. Sherrod Brown and company did not get that from Trump's underbriefed negotiators, but they did get a lot: Sander M. Levin and Harley Shaiken: _How Can Americans Compete With Mexicans Making a Tenth of What They Do? https://www.nytimes.com/2019/11/19/opinion/UAW-GM-Mexico-Nafta.html: 'Despite financial gains won recently by the United Auto Workers in a new contract that ended a nearly six-week-long strike against General Motors, the longest in a half-century, the deal will not rectify the major problem that has hurt American autoworkers and will continue to do so. The problem has been the longstanding lack of workers’ rights in Mexico. Wages there are roughly one-tenth of what American workers earn and the unions are often tools of the employer. This has warped the playing field and resulted in the transfer of American manufacturing jobs to south of the border. American autoworkers have been hit particularly hard. This situation can be blamed in part on a flawed 1993 North American Free Trade Agreement and addendum that, though it included provisions to protect workers, failed to ensure adequate monitoring and enforcement. Transgressions of workers’ rights were not subject to trade sanctions.... Congress must insist that Mexico first demonstrate that workers there can form independent unions and bargain collectively before agreeing to any new trade deal.... Mexico should focus on worker rights in the auto industry, which accounts for 37 percent of the country’s exports to the United States...

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Alice Dreger: Napoleon Chagnon Is Dead https://www.chronicle.com/interactives/20191023-dreger-chagnon?key=mi0Bff1vaLHL09_no2Emg5PWXO__JoamjKQr2Gq1TY9HA2L6VXvdoh4Rvoh8qT3jdHhUVUhoODlYamhvVlh6UU9CV3lfUzl2cjZPaV81b3ZjSzhuRmttZlBrYw: "Consider the recent blog post published by science journalist John Horgan at Scientific American’s website, in which, in light of Nap’s death, he revisits his review of Darkness in El Dorado for the New York Times Book Review. Horgan now confesses that, warned by Chagnon’s most prominent allies not to support Tierney’s falsehoods, he doubled down in his influential review: 'I ended up making my review of Darkness more positive. I wanted Darkness to get a hearing'. He apologizes now not for amplifying a work full of lies, but only for understating the subtleties in Chagnon’s work. In his 2000 review of Darkness for the Washington Post, the anthropologist Marshall Sahlins also endorsed Tierney’s bullshit. In that review, speaking of things he knew nothing about, Sahlins seconded Tierney’s sharp criticism of Chagnon for pressing the Yanomamö for information about their dead: 'As for the dead', Sahlins wrote, 'they are completely excluded from Yanomami society, ritually as well as verbally, as a necessary condition of the continued existence of the living'. 'It’s a goddamned lie', Hames told me when we talked soon after Nap died. 'You walk into any Yanomamö village on any evening, and you will hear people mourning their beloved deceased family members. You will hear the sobbing. They never forget.' The Yanomamö dead, Ray told me, 'are not forgotten and obliterated from memory. They’re kept alive by the people who love them'. After we hung up, I thought about why Ray was harping on this particular factual error. Then it came to me. The people who became like kin to Chagnon never expected the people who considered themselves journalists and scholars to love Nap. They did, however, expect that journalists and scholars would feel as Nap did—that we ought to always be aiming for the earthly truth. Because that is how we can begin to take care of each other...

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Ernest Gellner: The Price of Velvet: Thomas Masaryk and Vaclav Havel https://www.ssoar.info/ssoar/bitstream/handle/document/5373/ssoar-1995-1-gellner-the_price_of_velvet_thomas.pdf: 'Masaryk’s 1925 book was in due course translated into English as The Making of a State, whereas the Czech title means World Revolution. The English version can be justified on the grounds that it gives the reader a far more accurate account of the actual contents of the book, which is a fascinating description of Masaryk’s activities and thoughts during the First World War period, and which eventually led to the establishment of the Republic. A subsidiary reason for the English title is that the Western publishers did not like the Bolshevik-sounding stress on revolution in the title. But in a deeper sense, the English title is an appalling mistranslation: the Czechs weren’t creating their own state out of some capricious wilfulness or opportunism; they were, on Masaryk’s account, doing it because this was part of an overall trend which was both global and deeply moral. Masaryk wanted it clearly understood that he would not be seen indulging in state-creation, unless it was manifest that it was morally right to do so and history had decreed that it should be done–and these two conditions were linked to each other, for history did not do things lightly or without good cause. Like the men who drafted the American Declaration of Independence, he was not going to indulge in state-creation lightly, without due cause and deep philosophic reflection. No State Formation without Philosophic Justification! The victory of their nationalism was the victory of democracy, reason, sobriety, scepticism, individualism. It was not something to be undertaken lightly. But, and this is the second theme in Masaryk’s interpretation of the great transformation, the Czechs weren’t merely jumping onto a bandwagon, belatedly and without having made much of a contribution to it. They had once, in the late Middle Ages and early modern times, been at the very heart and forefront of that movement which they were now re-joining: that was the deep meaning of Czech history...

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Heather Boushey: In Conversation with Leemore Dafny https://equitablegrowth.org/in-conversation-with-leemore-dafny/: 'Leemore Dafny: 'How can it possibly be a bad thing for consumers if insurers use some of their bargaining power to bring down the prices of the inputs into the health insurance product? The answer to that question is that it depends on how they are bringing down those prices.... From an antitrust enforcement perspective, savings passed through would be considered a benefit to consumers... a change in the division of existing surplus. But now, suppose something different—suppose that the only way the insurers get lower prices is not by taking away the margin, holding quantity constant, but by exercising their market power vis-à-vis these healthcare providers such as purchasing less, as well as paying less.... Lower prices in this setting can have an impact on the quantity and/or the quality of services, and that’s called monopsony, and it’s the flipside of monopoly. And just as monopoly benefits the seller of a good, monopsony benefits the buyer, in this case, the insurer, but at the expense not only of the healthcare providers but also of consumers in general...

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It is very hard, given China's growth over the past two generations plus its outstripping those economies that were its peers in the 1980s, to criticize Chinese macroeconomic and industrial policy. Nevertheless, we economists keep trying—and thus, implicitly at least, reinforcing our reputation for arrogance by hinting that we could have done it better: Panle Jia Barwick, Myrto Kalouptsidi, and Nahim Bin Zahur: China's Industrial Policy: an Empirical Evaluation https://www.nber.org/papers/w26075: 'Despite the historic prevalence of industrial policy and its current popularity, few empirical studies directly evaluate its welfare consequences. This paper examines an important industrial policy in China in the 2000s, aiming to propel the country's shipbuilding industry to the largest globally. Using comprehensive data on shipyards worldwide and a dynamic model of firm entry, exit, investment, and production, we find that the scale of the policy was massive and boosted China's domestic investment, entry, and world market share dramatically. On the other hand, it created sizable distortions and led to increased industry fragmentation and idleness. The effectiveness of different policy instruments is mixed: production and investment subsidies can be justified by market share considerations, but entry subsidies are wasteful. Finally, the distortions could have been significantly reduced by implementing counter-cyclical policies and by targeting subsidies towards more productive firms...

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Urban Dictionary: Tankie: 'A hardline Stalinist. A tankie is a member of a communist group or a "fellow traveller" (sympathiser) who believes fully in the political system of the Soviet Union and defends/defended the actions of the Soviet Union and other accredited states (China, Serbia, etc.) to the hilt, even in cases where other communists criticise their policies or actions. For instance, such a person favours overseas interventions by Soviet-style states, defends these regimes when they engage in human rights violations, and wishes to establish a similar system in other countries such as Britain and America. The term is used to distinguish the rare individuals with these kinds of beliefs from communists more broadly (including Communist Party members), whose adherence to Soviet doctrine and attachment to existing "socialist" states is somewhat weaker. It is always more-or-less abusive in the sense that those termed tankies do not use the term themselves, but it doesn't have any particular bite (unlike, say, Trot). The term derives from the fact that the divisions within the communist movement first arose when the Soviet Union sent tanks into communist Hungary in 1956, to crush an attempt to establish an alternative version of communism which was not embraced by the Russians. Most communists outside the eastern bloc opposed this action and criticised the Soviet Union. The "tankies" were those who said "send the tanks in". The epithet has stuck because tankies also supported "sending the tanks in" in cases such as Czechoslovakia 1968, Afghanistan 1979, Bosnia and Kosovo/a (in the case of the Serbian state), and so on (whereas the rest of the communist movement has gravitated towards anti-militarism)...

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Arindrajit Dube on our going long-time mentor and friend Marty Weitzman, who committed suicide last summer. His "price and quantities" article is at https://scholar.harvard.edu/weitzman/files/prices_vs_quantities.pdf. His memory is a blessing: Arindrajit Dube: Mary Weitzman: "Marty's book on share economy was something I read, thought, and argued a lot about in my undergrad and grad years. Ultimately, I don't think I agree with the argument, but I am so thankful to him for helping me think about the relevant issues https://hup.harvard.edu/catalog.php?isbn=9780674805835#.XXBiuT0dujQ.twitter.... Needless to say, Marty's work on catastrophic climate change was monumental. This is what he is best known for today, and rightfully so https://scholar.harvard.edu/files/weitzman/files/review_of_stern_review_jel.45.3.pdf... He has a QJE 1976 paper that has become THE basis for an enormous literature on “green accounting”, which only got picked up after Solow referred to it a decade later, prompting a boom in work in that area, which is still ongoing.... Weitzman's paper on the 'ratchet principle' https://scholar.harvard.edu/files/weitzman/files/rachetprincipleperformanceincentives.pdf—so simple, and by modern standards no doubt only a toy model, but for me a lasting insight into allocation under a hierarchy. Two... Weitzman also contributed on production-function accounting for Soviet growth https://scholar.harvard.edu/weitzman/files/sovietpostwareconomicgrowth.pdf.... I have to add his work on prices versus quantities, which was so insightful...

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Great conversation between Heather Boushey and Emmanuel Saez. My favorite highlight: Heather Boushey: In Conversation with Emmanuel Saez: "Kansas... illustrates beautifully from a research perspective even though it’s a disaster in terms of public policy... tax avoidance... pass-through businesses... huge incentives for high-income earners to reclassify... a big erosion of the wage income tax base in the state... a much bigger negative impact on tax revenue than would have been predicted mechanically.... When governments have actually to balance their budgets, they realize that taxes are useful, and that brings the two pieces of the debate together.... Certainly Kansas didn’t experience an economic boom...

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Ben Casselman: "The prime-age (25-54) employment and participation rates both held at their post-recession highs https://twitter.com/bencasselman/status/1202958816163303425. Adjusting for demographic shifts, the participation rate is now back to its prerecession level. And the employment rate is getting close to its 2000-era peak, which is something many of us doubted we'd ever see. The gender split in participation is really striking, though. Participation among prime-age women is well above its prerecession level. For men, the rate has barely rebounded...

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Noah Smith: Economics Will Never Be the Same https://www.bloomberg.com/opinion/articles/2019-12-09/economics-will-never-be-the-same: 'The Shift to the Left: In the 1970s and 1980s, libertarian economists such as Milton Friedman commanded the limelight and dominated the policy conversation, while conservative supply-siders filled  Washington's think tanks. But in the 2010s... left-leaning economists became the public face of the discipline... Paul Krugman... Thomas Piketty... Emmanuel Saez and Gabriel Zucman... Economists for Inclusive Prosperity.... The Fight Against Sexism: The pervasive sexism in the economics profession has long been an open secret. But in the 2010s the problem began to get the attention it deserved.... Warming to Minimum Wage.... Research is also suggesting that concentrated corporate market power is a reason the real world doesn’t work like the simple theories in introductory textbooks.... Warning About Monopolies: As megamergers become more common, gigantic companies are taking over industry after industry. Economists are warning that this could be leading to low productivity growth, higher consumer prices and greater inequality.... Heresy on Trade.... A growing literature suggests that China’s entry into the World Trade Organization had dire consequences for a large swath of the American workforce.... The Diminished Clout of Economics: It’s a sad coincidence that just as economics is improving in so many ways, its public influence is on the wane. But the financial crisis and the devastating recession that followed discredited the discipline in the eyes of much of the public. Meanwhile, decades of rising inequality and stagnating mobility has made economists the targets of leftist ire and scorn just as the field has become substantially more progressive...

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Josiah Ober: Agamemnon's Cluelessness https://delong.typepad.com/files/ober-agamemnon-selections.pdf: 'For Aristotle, ethics and politics must take into account “merely living” (zên) as the foundation for the end of living well (eu zên)... in a way... cognizant of the kinds of expertise necessary for living, without losing sight of the ultimate goal of living well. The domain of expertise... concerned with natural material conditions and forms of authority (especially master-slave) required by the end of self-sufficiency is designated oikonomia. But the definition of oikonomia and especially its relationship to money-making (chrêmatistikê) is, Aristotle says, contested.... Among the many goals of Politics book 1 is to put chrêmatistikê–as expert knowledge of a particular relationship among production (poiêsis), exchange (allangê/metablêtikê), and consumption/possession (ktêsis), all characteristically involving coined money—into the normatively correct place in his naturalized hierarchy of value. The critical conclusion is that chrêmatistikê (or one specific type of chrêmatistikê) is a subordinate part of oikonomia. It is not “according to nature” (kata phusin) but rather a technê arising from practical experience (empeiria). It aims the possession and increase of wealth, at accumulation of money, as an end. That accumulation is by its internal logic unbounded and unconstrained, insofar as wealth denominated in monetary terms has no natural limit. Chrêmatistikê thus is a matter of maximizing a single resource (one thought to give access to all other resources), rather than optimizing or satisficing in respect to other values. It is at once contrary to the true end of human existence, a prevalent approach to the management of material goods, and (at least potentially) an essential instrument for both the oikonomos and the politikos. Among the delicate tasks of book 1 of the Politics is, then, to demonstrate that Aristotle knows enough about this dangerous and vulgar (phortikon) instrument to specify its proper uses, while avoiding appearing to honor it as a science worthy of a detailed treatment. Much of Politics book 1.8-11 is devoted to sorting out the contested relationship between chrêmatistikê and oikonomia...

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Katherine Policelli and Alix Gould-Werth: California Paid Family Leave Reduces Poverty: "Between 2004 and 2013, the California paid leave program increased household income levels and lowered poverty rates for mothers of 1-year-olds... an average 3,407 increase in income.... Also... good news specific to the bottom end of the income distribution: The introduction of paid leave in California is tied to a 10.2 percent decrease in risk of new mothers dropping below the poverty threshold and disproportionately helps women with lower levels of education and who are unmarried: Alexandra Boyle Stanczyk: Does Paid Family Leave Improve Household Economic Security Following a Birth? Evidence from California...

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I have not yet seen a good estimate of the impact of Trump's trade war on supply-side growth. Half a percentage point per year is what my own back-of-the-envelope guesses are suggesting to me now, but I have no confidence in them. I would really love to see a comprehensive assessment that I could trust: Jayant Menon: The Knock-On Consequences Of The Us-China Trade Tariffs on Global Value Chains https://voxeu.org/article/knock-consequences-us-china-trade-tariffs-global-value-chains: "The impact of a simple 25% trade tariff can go far beyond the costs of directly impacted goods. This column shows that seemingly small tariffs can substantially disrupt global value chains, both through the difference between nominal and effective tariff rates and the relative costs of relocation and transhipment, and also because of how the trade dispute is being perceived. If it is seen as a symptom of an enduring geopolitical struggle for global economic dominance, then it could recur.... Effective rather than the nominal tariff rate, and the perception that the dispute will not end with the trade war... explain how a relatively small tariff has permanently fractured GVCs. The recent escalation in the trade war, both in terms of increases in tariffs and its greater coverage of products, suggests that the disruption will be even higher.... A similar dispute took place just over 30 years ago, also triggered by a large bilateral trade imbalance, but between the US and Japan.... Japan responded by moving labour-intensive segments of manufacturing production to lower wage destinations in Southeast Asia, giving birth to ‘Factory Asia’ (Baldwin 2006). In the process, Japan was able to retain its export competitiveness... shift a part of its export surplus to the balance of payments accounts of the countries it had invested in, thereby appearing to shrink its bilateral surplus.... The creation of Factory Asia benefitted consumers around the world and raised world incomes. This trade war is having the opposite effect. And the fallout could continue for a long time yet...

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Looking forward to the next recession, and to the unwillingness of politicians to reserve fiscal space for fighting it, makes Keynes message more urgent than ever: Paul Krugman: Introduction to Keynes's General Theory https://delong.typepad.com/sdj/2006/03/krugmans_intro_.html: 'In the spring of 2005 a panel of “conservative scholars and policy leaders” was asked to identify the most dangerous books of the 19th and 20th centuries.... Charles Darwin and Betty Friedan ranked high on the list. But The General Theory of Employment, Interest, and Money did very well, too. In fact, John Maynard Keynes beat out V.I. Lenin and Frantz Fanon. Keynes, who declared in the book’s oft-quoted conclusion that “soon or late, it is ideas, not vested interests, which are dangerous for good or evil,” would probably have been pleased.... It’s probably safe to assume that the “conservative scholars and policy leaders” who pronounced The General Theory one of the most dangerous books of the past two centuries haven’t read it. But they’re sure it’s a leftist tract, a call for big government and high taxes.... The arrival of Keynesian economics in American classrooms was delayed by a nasty case of academic McCarthyism. The first introductory textbook to present Keynesian thinking, written by the Canadian economist Lorie Tarshis, was targeted by a right-wing pressure campaign aimed at university trustees. As a result of this campaign, many universities that had planned to adopt the book for their courses cancelled their orders, and sales of the book, which was initially very successful, collapsed. Professors at Yale University, to their credit, continued to assign the book; their reward was to be attacked by the young William F. Buckley for propounding “evil ideas.” But Keynes was no socialist—he came to save capitalism, not to bury it. And there’s a sense in which The General Theory was... a conservative book.... Keynes wrote during a time of mass unemployment, of waste and suffering on an incredible scale. A reasonable man might well have concluded that capitalism had failed, and that only... nationalization... could restore economic sanity.... Keynes argued that these failures had surprisingly narrow, technical causes... because Keynes saw the causes of mass unemployment as narrow and technical, he argued that the problem’s solution could also be narrow and technical: the system needed a new alternator, but there was no need to replace the whole car...

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