Matthew Yglesias's Blog, page 2453

Assess Risk Like a Woman!

Kay Steiger on the problem with why women should do x "like a man" articles:

Women are frequently told to ask for a raise like a man, Date Like a Man, and even pee like a man. But the problem here is that "like a man" is often synonymous with "do it better." When women are given advice on asking for raises "like a man" it's because women are often paid less than men, and it's often thought that the solution is to simply mimic men's behaviors to receive the best results. Same goes for dating and peeing — the idea is that men somehow do it better. The way to fix that seems to be to tell women how to be more like men.

There's a reason there isn't a genre of "like a woman" articles for men. (Except for this Daily Fail Mail article on a man who spent a week "living like a woman.") See, the idea is that men would never want to be "like a woman" because women are generally considered inferior, even though if you replace "like a woman" with "better," you could write articles on how men should drive like a woman, how to multitask like a woman, or how to fly a fighter jet like a woman.

This reminds me, naturally, of the pathological nature of finance in the United States. If you look at the fields of endeavor where doing it "like a man" is better, they're basically areas (like negotiating a salary) where a more aggressive approach is rewarded. Usually because the downside risks are smaller than they may seem, but sometimes (soldiering, firefighting) it's because you're specifically looking for someone who's willing to endanger himself. Now by contrast if the concern is that people may be irrationally underweighting small probability events with disastrous consequences—driving, for example—women tend to perform better.

Banking, on any reasonable account, is much more like driving in this regard than it is like soldiering. So in a well-functioning system, you'd expect to see more women bankers than male bankers. You might even expect "statistical discrimination" that causes women to be more overrepresented than the underlying difference in behavior would warrant.

Adapting The Great Gatsby

The idea of Baz Luhrmann doing The Great Gastsby in 3D is pretty groan inducing, but Ta-Nehisi Coates is right that the adapting the story to film is inherently a bit of a mess:

As in so many of the books I love, I found the plot in Gatsby to almost be beside the point. Whenever I see it translated to cinema, the film-maker inevitably crafts a story of doomed romance between Daisy and Gatsby. It's obviously true that Gatsby holds some sort of flame for Daisy, but what makes the book run (for me) is the ambiguity of that flame. Does he really love her? Or is she just another possession signaling the climb up? I always felt that last point—the climb up—was much more important than the romance. What I remember about Gatsby is the unread books. His alleged love for Daisy barely registers for me.

I think it might be interesting to see a movie very loosely inspired by Gatsby, much like it's interesting to see poems inspired by paintings. But every poem shouldn't be made a painting. Art is not necessarily made better by literalization. I'm not convinced that The Great Gatsby works without those pockets of imagination which make the written word, still, a unique experience.

Indeed. So much of the joy exists in the layers of unreliable narration, and the details of the prose. You can put the eyes of Doctor T.J. Eckelburg on the big screen, but you can't capture the detail of Nick invariably referring to him with is formal title. Or consider: "some wild wag of an oculist set them there to fatten his practice in the borough of Queens, and then sank down himself into eternal blindness or forgot them and moved away." How is it that Nick know for certain that Eckelburg isn't practicing in Queens any longer but is unsure as to whether he's moved or died?

Anyways, there's no point complaining about hypothetical adaptations, but my New Year's Resolution is to read more books so I've got the books I've loved on the mind and this is definitely on the list.

Japan-Korea Defense Cooperation

Japanese Defense Minister Toshimi Kitazawa

If you look at the region in very abstract terms, close defense cooperation between South Korea and Japan seems like a no-brainer. In practice, however, the relationship between the two countries is actually quite chilly, as detailed in Chico Harlan's article about efforts to increase defense and intelligence cooperation between Tokyo and Seoul.

The difficulties are attributed largely to the fact that Koreans, especially older ones, feel "intense bitterness over the 35-year Japanese occupation of Korea that ended in 1945." That's quite understandable. It's also the case, however, that if you look at 20th century Europe, the practical imperative to move forward with defense cooperation served as an important driver of reconciliation between Germany and its neighbors.

The danger here for the United States is that while it's obviously good for our two main allies in the region to cooperate, especially vis-à-vis the DPRK, I don't think we really want to become the offshore sponsors of an anti-Chinese military alliance. One can easily imagine some future state of the world in which it does make sense for the US to be the patron of a grouping like that, but one can also easily imagine steps in that direction becoming self-fulfilling. Our main concrete interest in the area is simply that war and destruction in Northeast Asia would be very economically disruptive. We want to be preventing trouble, not starting it.

Amy Chua on Parenting

Amy Chua writing in The Wall Street Journal makes the case that just because you've written a good book doesn't mean you're not history's greatest monster:

A lot of people wonder how Chinese parents raise such stereotypically successful kids. They wonder what these parents do to produce so many math whizzes and music prodigies, what it's like inside the family, and whether they could do it too. Well, I can tell them, because I've done it. Here are some things my daughters, Sophia and Louisa, were never allowed to do:

— attend a sleepover

— have a playdate

— be in a school play

— complain about not being in a school play

— watch TV or play computer games

— choose their own extracurricular activities

— get any grade less than an A

— not be the No. 1 student in every subject except gym and drama

— play any instrument other than the piano or violin

— not play the piano or violin.

I'm using the term "Chinese mother" loosely. I know some Korean, Indian, Jamaican, Irish and Ghanaian parents who qualify too. Conversely, I know some mothers of Chinese heritage, almost always born in the West, who are not Chinese mothers, by choice or otherwise. I'm also using the term "Western parents" loosely. Western parents come in all varieties.

Be all that as it may, I feel that many less extreme parents subscribe to some version of this "video games bad, classical music good" view of the world. Personally, I feel like I turned out fine despite a completely inability to play piano, violin, or any other instrument. When I was a kid I spent a lot of time playing SimCity and some might be so bold as to trace my present-day interest in urban planning back to efforts to try to understand this game better. I also had a less well-known game dating from approximately the same time called L'Empereur, a turn-based strategy game set during the French Revolution and the Napoleonic Wars. As I recall, my dad cleverly deployed my interest in this game to get me to read some Napoleon biographies, and thence over the years to some other material about the French Revolution and even War and Peace by high school—I was already familiar with Marshall Kutuzov and several other relevant figures from the game.

The larger issue about Chua's piece is that it just seems very strange for her to be so worried about this. On the list of problems typically experienced by the children of Yale Law School faculty "not successful enough" comes way below "has dysfunctional relationship with mother."

Have Blog, Will Travel

My very favorite request from the requests thread:

I would like to see The Great Matthew Yglesias American Road Trip of 2011. Spend at least a month driving around the country, seeing the sights but also talking with journalists, policy-makers, ordinary people, and anybody else of interest who might deliver some insight into their local situation. I think this would be a nice way to get some more perspective on the country, and also we the readers would benefit from you sharing the insights and new perspectives you get.

I love to travel, so I love this idea. Obviously the real limiting factors are the views of my boss (and, I suppose, my girlfriend) on the merits of taking this kind of time. For the record, here's one of those "states I've visited" maps:

Not so bad, I think. Plus though I would never count an airport stopover as having "been to" a place, I do think it's worth observing that the best airport lunch I ever had was in Memphis. Though of course looking at this state-by-state can be misleading. Norfolk and Clarendon may both be "in Virginia" but they're very different and even tiny states like Connecticut conceal very diverse experiences. Arizona is huge and I've only bit to a tiny part of it. So there's always more to be learned by going places, even places you've already "been to" in some sense.

Part of which is to say that I typically travel because someone's invited me to speak somewhere, and when invited I typically say "yes." Once early in my career I think I turned down a junket to Bentonville, which in retrospect was a mistake. Oftentimes student groups do this, and I'm always excited to do it. But for whatever reason, a very high proportion of the lifetime domestic speaking invitations I've received have been in Southern California and nobody's ever asked me to come to Oregon or Kentucky. But I'd love to go.

Strategy and Defense Spending

Thomas Donnelly, Mackenzie Eaglen, and Jamie Fly of the "Defending Defense Project" took to the virtual pages of National Review on Friday to complain that Barack Obama isn't spending enough on the military. Paul McLeary has a helpful response in detail and lands it with a good take on the big picture:

Defense budgets, like all budgets, should reflect a larger strategy for what the allocation of funds hopes to accomplish. Pentagon planners need to understand what kind of world—and what kind of threat—they expect to operate in so they can plan, spend and field the appropriate systems accordingly. F-22s, Ground Combat Vehicles, self-healing ad hoc communications networks and unmanned systems all have limited utility if there isn't a valid strategy in place to direct where and when they should be employed, and under what circumstances. The last decade stands as a warning of what happens when tactical proficiency and creativity masquerades as strategy. The last 10 years also shows us that we don't always get to choose where and how the next war will be fought, and when we do choose, we sometimes choose poorly. While it most surely isn't the job of the authors of this NRO article to come up with a workable national security strategy—especially since the Pentagon and White House haven't been able to do so since the end of the Cold War in the early 1990s—they also don't offer any compelling reasons for keeping all of the problematic programs they complain have been cut.

But to go stronger here, there is a kind of implicit strategy in conservative calls for ever-higher defense budgets and it's not a good one.

The fact of the matter is that there's a lot of uncertainty about what kind of "hard" security problems we'll face 25 years from now. The conservative approach to hedging against that uncertainty is to look at the hard security realm and basically say we should do everything. Keep our nuclear arsenal in place and spend more on modernization. And build missile defense. Invest more in counterinsurgency capabilities. Use the present-day military more aggressively. Build every weapons system the engineers can think up. It's an uncertain world and a lot can go wrong, so let's do more more more more.

Another way of looking at this is that we don't really know what the world will look like in 25 years. But it's predictable that whatever military challenges we face, they'll be easier to deal with if we have a better-educated crop of twenty-somethings rather than a worse-educated one. That they'll be easier to deal with if we have a productive economy with a modern infrastructure than if we don't. And it's predictable that the more we spend on the military in the next ten years the fewer resources will be available for non-military purposes. But it's the civilian side that ultimately supplies the capacity to engage in military activities over the long run. Obviously the long run does you no good if your country can't defend itself in the short-term, but a strategy based on perpetually higher commitments to defense spending is self-defeating over time.

Polarization: Partisan and Real

Tyler Cowen observed on Twitter that "political polarization has been rising since the 70s, and the importance of assassination in U.S. politics has been going down."

I think this is mostly a reminder that partisan polarization is a very particular sort of thing. If you go back in time 45 years you'll find that Martin Luther King, Jr and George Wallace are both influential political figures. And the substantive gap between their views is much, much bigger than is the gap between the views of any comparably prominent people today. But they were both Democrats! In the intervening years I think we've mostly seen a narrowing of the range of policy options that receive serious consideration (mostly, but not entirely, by eliminating bad ideas) but we've also seen the national political parties transform into something resembling real left vs right ideological coalitions rather than patchworks based on region and ethnicity.

This is all, I think, totally fine. But to an extent our political institutions need to evolve to catch up with the new reality. And the greater coherence of the parties has led to an explosion in wild claims about the evils of the other political party that are detached from the relatively narrow range of the policy debate.

What If They Gave a Pitchfork, And Nobody Noticed

Ryan Avent marvels that "It's striking how little inchoate public rage has actually boiled to the surface in the rich world" and elaborates:

In America, the language of the angriest is very similar to that of the plutocrats themselves. Indeed, the complaint that today's elite lack the noblesse oblige of the aristocrats of old, and are therefore risking public anger, seems to badly misread American public opinion. The middle class doesn't want hand-outs from condescending rich people. They want moralistic language and complaints about deficits.

Kevin Drum endorses this, but I think it's really mistaken. The only problem here is that populist rage in America doesn't happen to line up with the policy objectives of the mainstream Democratic Party.

Every poll I've seen shows strong support for higher taxes on rich people and lower taxes on non-rich people. That's straight-up redistributive politics relative to the status quo and it's what the public wants. Democrats flirted with making this part of their agenda, but ultimately blinked. And it just wasn't the centerpiece of their agenda in 111th Congress which, instead, was focused on stabilizing the short-term economy, expanding the welfare state, trying to grapple with climate change, improving US immigration policy, and reducing the level of discrimination against gays and lesbians. Personally, I think all those things were important. But from the point of view of an insured employed middle aged middle class heterosexual legal resident of the United States its not an agenda that has a lot to do with his family. By contrast, a drive to permanently push his tax rate lower than where it was under George W Bush while pushing rich peoples taxes higher than they were under Bill Clinton would be a juicy populist agenda. And it polls well. But it wasn't on offer because leading politicians didn't—and don't—want to offer it.

But people sure seem plenty mad to me.

Repealing the Affordable Care Act Increases The Deficit

Today the CBO announced that HR 2, the "Repealing the Job-Killing Health Care Law Act" will increase the budget deficit considerably. This should come as no surprise to those of us who recall that the CBO said passing the Affordable Care Act would reduce the deficit.

The confusing part here is the conservative take. They complained that claims about the deficit-reducing powers of the ACA were disingenuous because repeal of the deficit-reducing elements was likely. Well, maybe it was and maybe it wasn't. But if that's your argument, then it follows that repealing the deficit reducing elements of the ACA will increase the deficit. What's more, repealing the entire ACA necessarily entails repealing the deficit-reducing elements of the ACA. Ergo, ACA repeal increases the deficit even according to the bizarro world math in which passing it in the first place didn't reduce the deficit.

Obviously the fact that neither conservative politicians or voters care about long-term deficit reduction isn't news. But still!

The Moral Hazard of Yore

I think Gary Gorton's done the best work on the specifics of what, exactly, the financial panic of 2007-2008 was all about and the entirety of his Q&A with the Minneapolis Fed is interesting. But for now I just wanted to highlight this aside he offers about moral hazard:

It's a similar thing with terms like "too big to fail." The banking system was too big to fail. That's why we allowed suspension of convertibility [in the 19th and early 20th centuries]. Suspension of convertibility by banks, prior to the Fed, was always illegal, but it was never enforced because nobody wanted to liquidate the banking system.

Which is to say, I think, that while moral hazard is an important phenomenon it also doesn't really explain anything in particular. It's always been there and probably always will be. What comes and goes is better and worse ways of dealing with it. The rise of the "shadow banking" sector meant we suddenly had an important slice of banking for which we didn't have a good way of dealing with it.