J. Bradford DeLong's Blog, page 310
September 4, 2018
Brad Setser: Can Anyone Other than the U.S. Fund a Curren...
Brad Setser: Can Anyone Other than the U.S. Fund a Current Account Deficit These Days?: "To exaggerate a bit, the world may soon only have one borrower...
...In some sense that���s a safe equilibrium: the United States��borrows in dollars, so it is less exposed to the risks created by the Fed���s monetary tightening and a rising dollar��than��others. Exorbitant privilege and all. In another sense though it is a disappointment: the United States already has a lot of external debt, it doesn���t really need any more.�� And it would be globally healthier if the savings of aging Europe and aging Japan and aging Korea and slow growing Taiwan flowed to the world���s young and potentially rapid growing emerging economies, not to fund inequality increasing tax cuts in the United States���
#shouldread
September 3, 2018
American Politics Has Always Been Partisan; American Policy Not so Much...
Note to Self: My take was always that American politics was partisan but that American policy was not: that they were always enough people in the middle open to technocrat arguments to make the Hamiltonian Madisonian machine broadly work.
But when that vital center disappears.... When party discipline becomes strong because the people in the center believe they have to mobilize their base by toeing the party line....
Well, then you are reduced to a vain Downsian hope that people can assess and remember whose policies worked and whose policies failed...
Sean Carroll: The Wrong Objections to the Many-Worlds Int...
Sean Carroll: The Wrong Objections to the Many-Worlds Interpretation of Quantum Mechanics | Why Probability in Quantum Mechanics is Given by the Wave Function Squared | Quantum Mechanics and Decision Theory | Does This Ontological Commitment Make Me Look Fat? | Sean Carroll
David Deutsch: Quantum Theory of Probability and Decisions
David Wallace: Quantum Probability from Subjective Likelihood | Three Kinds of Bf=ranching Universe | Epistemology Quantized
Ilyana Kuziemko: Excerpts from McCain funeral are both ge...
Ilyana Kuziemko: Excerpts from McCain funeral are both genuinely touching and yet painfully out of touch. Wonder if we will think of it as Edward VII's 1911 funeral: huge gathering of monarchs, many from soon-to-be-deposed royal families and most unaware of how the world was about to convulse.
Henry: Tropism Toward Powerful Electoral Bases: "A key thing now is the politicians have a tropism toward their powerful electoral bases, who are driving them to extreme positions and cowardice toward Trump...
...It's different from 1911. This is the people's turpitude and blaming elite failure is a half-dodge. Elite failure set a backdrop for the people's turpitude but we the people need to own our fair share of responsibility. We value money/importance/self-aggrandizement over character/group achievement/kindness. We see the result in many weakened communities and broken families.
Appendum: To focus only one elite failings (which are real) but not the benefits elites have brought is misleading, just as is extolling the people wo pointing to our flaws as a people . Numerous advances in technology/processes have led to better quality of life and lower prices...
#shouldread
Just Do It: Colin Kaepernick
I'm gonna have to start buying me some Nikes...
#justdoit
#nike
#publicsphere
Monday Smackdown/Hoisted: William Saletan Claims That the Real Thing Wrong with the Cheney-Bush-Rice-Rumsfeld Iraq War Was That It Prevented the Much Larger Cheney-Bush-Rice-Rumsfeld rIan War
Duncan Black: The Stupidest People In The World: "I was going to let this go, but I just can't. Will 'Too Stupid to Tie Shoes' Saletan wrote his little 'How a supergenius like me helped cause the deaths of hundreds of thousands of people' piece for Slate as a list of 'lessons learned'. All relatively innocuous until you get to the last one...
...8. Consider the opportunity cost. The problem with dumb war isn't that it's war. The problem is that it costs you the military, economic, and political resources to fight a smart war. Everything Bush wrongly attributed to Iraq turns out to be true of Iran. But we can't confront Iran with the force it probably requires, because we wasted our resources in Iraq. Americans, having been suckered in Iraq, won't accept evidence of Iran's nuclear program. Countries that might have supported us in a strike on Iran won't do so now, since we led them astray. Our coffers have been emptied to pay for the Iraq occupation. Our troops are physically and spiritually exhausted. In the name of strength, Bush has made us weak.
In other words, the real problem with the Iraq war is that it's made it impossible to... repeat the mistake with Iran. Our discourse is ruled by monstrous fools. Why can't Saletan just go back to telling women how they're supposed to feel when they have abortions?
#shouldread
The Two-Step of Terrific Triviality: Monday Smackdown/Hoisted from the Archives
John Holbo: When I hear the word culture��� aw, hell with it: "Jonah Goldberg is now grumbling that people are calling him stupid. But... the upshot of Goldberg���s indignant response... would seem to be that Henry was actually too charitable to Goldberg...
...oldberg complains: ���Any fair reader of my post (hint, that excludes Henry) would see that... ���My point was not that culture is everything, but that government isn���t everything.��� That is, Goldberg is claiming that the assignment of a non-zero significance to culture is bold contrarianism that places him at odds with both left and right. Of course, far from being a bold position, the claim that culture is not nothing is something everyone would grant freely, if it seemed to anyone worth mentioning. To put it another way, Goldberg is making a standard rhetorical move which has no accepted name, but which really needs one:
I call it ���the two-step of terrific triviality���.
Say something that is ambiguous between something so strong it is absurd and so weak that it would be absurd even to mention it. When attacked, hop from foot to foot as necessary, keeping a serious expression on your face. With luck, you will be able to generate the mistaken impression that you haven���t been knocked flat, by rights. As a result, the thing that you said which was absurdly strong will appear to have some obscure grain of truth in it. Even though you have provided no reason to think so...
Indeed:
Henry Farrell: When I hear the word culture I reach for my textbook on institutional theory: "Via Ezra Klein, I see that Jonah Goldberg has lapsed into what Ezra describes as a 'weird revery over how the rugged individualism of Americans makes them totally unsuitable for social welfare programs'. In Goldberg���s own words...
...The liberal defense of European welfare states... leave[s] culture out of the equation almost entirely.... Maybe, just maybe, France and Denmark can handle the systems they have because they have long traditions of sucking-up to the state and throne? Marty Lipset wrote stacks of books on how Canadians and Americans have different forms of government because the Royalist, throne-kissing, swine left America for Canada during the Revolutionary War and that���s why they don���t mind big government, switched to the metric system when ordered and will wait on line like good little subjects...
Now it���s a bit rich for a National Review hack to be talking smack about ���long traditions of sucking-up to to the state and throne.��� But even if we were to pretend for a moment that Goldberg���s argument is serious, it���s terrible.... It gets Lipset���s thesis badly wrong.... Lipset was keen on enduring American values, he didn���t pretend... they were the only force.... He explicitly documented how American values became more ���European��� as a result of the institutional innovations of the New Deal.... But more generally, sweeping claims about the all-determining-power of fixed national cultures have a godawful reputation in the social sciences these days.... Sweeping, half-assed claims that Culture is Destiny simply don���t feature in serious argument any more. Instead, they enjoy a sort of zombie-like half-life in some corners of the rightwing punditocracy, where their explanatory deficiencies are outweighed by their political usefulness in providing a higher justification for selfishness. Which is what seems to me to be happening here...
Also:
Dan Davies: Rules for Contrarians: 1. Don���t whine. That is all: "I like to think that I know a little bit about contrarianism. So I���m disturbed to see that people who are making roughly infinity more money than me out of the practice aren���t sticking to the unwritten rules of the game...
...The whole idea of contrarianism is that you���re ���attacking the conventional wisdom���, you���re ���telling people that their most cherished beliefs are wrong���, you���re ���turning the world upside down���. In other words, you���re setting out to annoy people.... If annoying people is what you���re trying to do, then you can hardly complain when annoying people is what you actually do. If you start a fight, you can hardly be surprised that you���re in a fight. It���s the definition of passive-aggression and really quite unseemly, to set out to provoke people, and then when they react passionately and defensively, to criticise them for not holding to your standards of a calm and rational debate. If Superfreakonomics wanted a calm and rational debate, this chapter would have been called something like: ���Geoengineering: Issues in Relative Cost Estimation of SO2 Shielding���, and the book would have sold about five copies....
The other point of contrarianism is that, if it���s well done, you assemble a whole load of points which are individually uncontroversial (or at least, solidly substantiated) and put them together to support a conclusion which is surprising and counterintuitive. In other words, the aim of the thing is the overall impression you give. Because of this, if you���re writing a contrarian piece properly, you ought to be well aware of what point it looks like you���re making, because the entire point is to make a defensible argument which strongly resembles a controversial one. So having done this intentionally, you don���t get to complain that people have ���misinterpreted��� your piece by taking you to be saying exactly what you carefully constructed the argument to look like you were saying. Fair enough, you might not care to defend the controversial point it looked like you were making, but a degree of diffidence is appropriate here, because the confusion is entirely and intentionally your fault... Contrarians ought to have thick skins, because their entire raison d���etre is the giving of intellectual offence to others. So don���t whine, for heaven���s sake. Own your bullshit...
#shouldread
#hoistedfromthearchives
#mondaysmackdown
September 1, 2018
Yes, Europe may well be facing another crisis: Olivier Bl...
Yes, Europe may well be facing another crisis: Olivier Blanchard, Silvia Merler, and Jeromin Zettelmeyer: How Worried Should We Be about an Italian Debt Crisis?: "Two conditions... that rising interest rates reflected economic recovery; and... that the Italian government would be prepared to cooperate with European authorities... no longer hold...
...Political backlash to slow growth and immigration has produced the least cooperative government imaginable, a coalition between the left-populist Five Star Movement (M5S) and the right-populist Lega. And borrowing costs have started to rise in reaction. Does this mean that a crisis is imminent? If so, how bad would it be? The second question is easier to answer.... A crisis could be horrific.... None of the powerful stabilization instruments that the euro area has developed over the years could be deployed to rescue Italy.... With the ECB using all available tools to limit contagion, the euro might survive Italexit. But an exit would nonetheless put Italy, the euro area economy, and the European Union in deep distress. With credit, investment, and consumer confidence collapsing, Italy would enter a deep recession. Redenominating assets and liabilities of Italian corporates and banking would trigger bankruptcies and legal conflict....
How likely is such a scenario?... To succeed in the next election, the two parties will want to deliver on their major promises. Are the promises featured in the M5S-League contract compatible with a scenario in which Italy (and Europe) do not end up facing a debt crisis?... M5S promised the introduction of a minimum guaranteed income.... The League party promised a flat tax.... Both parties advocated the repeal of a controversial pension reform.... The total would reach a whopping... 6 to 7 percent of GDP.... Difficult to imagine a course of policy that would not put it on collision course with financial markets and the European Union....
But... the government may eventually blink. A full-fledged crisis would hurt Italy at least as much as the rest of Europe.... Most of the policies that could bring Italy to the brink of crisis will be manifested in the revision of the 2018 or 2019 budget... [which] need[s] to be approved by both chambers.... The governing coalition���s majority in the upper one���the Senate���is slim: 6 votes.... Third, Article 81 of the Italian constitution introduces a balanced budget principle, and Article 97 states that general government entities, in accordance with EU law, shall ensure balanced budgets and the sustainability of public debt. A budget that too bluntly contravenes these rules could be deemed unconstitutional by the president of the Republic, who could refuse to sign it.... One can imagine several scenarios in which escalating crisis conditions���rising borrowing costs, accelerating outflows���eventually induce a correction.... Italy���s membership in the euro area may live to see another day. A European catastrophe may be avoided. But the costs of doing so could still be high, both for the political and social cohesion in Italy and for the future of Europe...
#shouldread
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