J. Bradford DeLong's Blog, page 316

Paul Krugman: The Slippery Slope of Complicity: "When was...

Paul Krugman: The Slippery Slope of Complicity: "When was the last time centrist talking heads declared, ���Donald Trump just became president��� (because he bombed someone, or something like that)? I think it���s been more than a year...

...At this point, you have to be a truly fanatical practitioner of bothsidesism not to see that Trump is every bit as terrible a human being, and every bit as much a menace to the republic, as some of us warned when all the cool kids were busy snarking about Clinton���s emails. The real news of the past few weeks isn���t that Trump is a wannabe Mussolini who can���t even make the trains run on time. It���s the absence of any meaningful pushback from Congressional Republicans. Indeed, not only are they acquiescing in Trump���s corruption, his incitements to violence, and his abuse of power, up to and including using the power of office to punish critics, they���re increasingly vocal in cheering him on. Make no mistake: if Republicans hold both houses of Congress this November, Trump will go full authoritarian, abusing institutions like the I.R.S., trying to jail opponents and journalists on, er, trumped-up charges, and more ��� and he���ll do it with full support from his party.

But why? Is Trumpocracy what Republicans always wanted? Well, it���s probably what some of them always wanted. And some of them are making a coldblooded calculation that the demise of democracy is worth it if it means lower taxes on the rich and freedom to pollute. But my guess is that most Republican politicians are spineless rather than sinister���or, more accurately, sinister in their spinelessness. They���re not really ideologues so much as careerists, whose instinct is always to go along with the party line. And this instinct has drawn them ever deeper into complicity. The point is that once you���ve made excuses for and come to the aid of a bad leader, it gets ever harder to say no to the next outrage.... the path of least resistance is always to sign on for the next stage of degradation. ���No evidence of collusion��� becomes ���collusion is no big deal��� becomes ���collusion is awesome���and let���s send John Brennan to jail.���... There are some special aspects of the modern GOP that make it especially vulnerable to this kind of slide into leader-worship. The party has long been in the habit of rejecting awkward facts and attributing them to conspiracies: it���s not a big jump from claiming that climate change is a giant hoax perpetrated by the entire scientific community to asserting that Trump is the blameless target of a vast deep state conspiracy....

Modern Republican politicians are, with few exceptions, apparatchiks: they are creatures of a monolithic movement that doesn���t allow dissent but protects the loyal from risk. Even if they should happen to lose a race in their gerrymandered districts, as long as they toed the line they can count on ���wing nut welfare������commentator slots on Fox News, appointments at think tanks, and so on. Even now, I don���t think most political commentators have grasped how deep the rot goes...

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The view that all government should do in the economic re...

The view that all government should do in the economic realm was to establish property rights and enforce contracts was never true. Smart governments always did much, much more. (Dumb governments did much, much more too.) Indeed, it is only with proper regulation that a market can fulfill its appropriate social role as a consumer surplus-generating mechanism: Diane Coyle: Three Cheers for Regulation: "One of the striking changes any rich-world traveler to low-income countries cannot fail to have missed during the past decade or so is the rapid spread of mobile phone use...

...followed now by expanding mobile Internet access. Mobile communications are playing the same role in social and economic development in Africa, Asia, and Latin America that the spread of fixed-line communications did in countries like France and the United Kingdom in the 1970s. Family and social connections, as well as business and educational opportunities, are being transformed. A key contributor to this technological transformation was a mandatory EU technical standard enforced in 1987. The regulation created a continent-wide market for hardware and services, one large enough that the standard���called GSM, after the Groupe Sp��cial Mobile committee that had codified it���was adopted globally.... There are in fact three important channels through which regulation can benefit an economy. One is the market-creating and market-growing role illustrated by the GSM standard.... This is a powerful dynamic. It explains why British businesses are increasingly appalled by the prospect that the UK government will not deliver continuing post-Brexit regulatory alignment with the EU.... Regulation can also benefit an economy by enabling competition.... The third way in which regulation is good for an economy is precisely in its protection of consumers...

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The more interesting question, I think, is: Should we use...

The more interesting question, I think, is: Should we use the natural rate hypothesis in forecasting and expect it to materially affect our forecasts over the next three years? And the answer, I think, is: no. The gearing of inflation on its past is low, and there is little impact of unemployment on inflation in the short run. Plus there is no good reason to think anything like the natural rate hypothesis holds near zero inflation: Olivier Blanchard: Should We Reject the Natural Rate Hypothesis?: "Fifty years ago, Milton Friedman articulated the natural rate hypothesis... the natural rate of unemployment is independent of monetary policy.... there is no long-run trade-off between the deviation of unemployment from the natural rate and inflation...

...Both propositions have been challenged.... Evidence is suggestive, but not conclusive. Policymakers should keep the natural rate hypothesis as their null hypothesis, but keep an open mind and put some weight on the alternatives....

The basic implications of deviations from either the independence hypothesis or the accelerationist hypothesis, or both, can be shown simply.... Assume that (the log of) potential output, y* follows: y*(+1) = ay* + b(y ��� y*), where a ��� 1. Potential output next period, y*(+1), depends on potential output today and on the deviation of actual output from potential output today.... The parameter b captures the effect of the output gap on potential output, and the parameter a captures the persistence of the effect.... In most models (and in reality), b is likely to be positive and a to be less than one.... Assume that the relation between inflation and output is given by:

�� = c(y ��� y*) + E��,

where:

E�� = 0 for ��� x ��� �� ��� x, ��(���1) otherwise,

where ��(���1) is the rate of inflation last period....

The general conclusion.... Failure of either of the hypotheses leads to a more attractive trade-off between output and inflation, and, in the presence of shocks, suggests a stronger role for stabilization policy. If the independence hypothesis fails, adverse shocks are more costly, and stabilization policy more powerful. If the accelerationist hypothesis fails, there is more room for stabilization policy to be used at little inflation cost....

Where does this leave us? It would be good to have a sense of the values of a, b, c, and x, or more generally, a sense of the specific channels at work. The empirical part of this paper has shown that we are still far from such an understanding. Thus, the general advice must be that central banks should keep the natural rate hypothesis (extended to mean positive but low values of b and a) as their baseline, but keep an open mind and put some weight on the alternatives. For example, given the evidence on labor force participation and on the stickiness of inflation expectations presented earlier, I believe that there is a strong case, although not an overwhelming case, to allow US output to exceed potential for some time, so as to reintegrate some of the workers who left the labor force during the last ten years.

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As we try to figure out how to create a functional rather...

As we try to figure out how to create a functional rather than a dysfunctional Habermasian public sphere to support at least semi-sane policies, I find it useful to look back at how previous functional and dysfunctional public spheres emerged and maintained themselves. The general view���which may be false���is that the Eighteenth Century Enlightenment did pretty well. And it had one of its wellsprings in the development of new genres, all of which she argues were in some way created as echoes and transformations of the personal letter. Well worth reading: Rachael Scarborough King: Writing to the World: Letters and the Origins of Modern Print Genres: "Rachael Scarborough King examines the shift from manuscript to print media culture in the long eighteenth century...

...She introduces the concept of the "bridge genre," which enables such change by transferring existing textual conventions to emerging modes of composition and circulation. She draws on this concept to reveal how four crucial genres that emerged during this time���the newspaper, the periodical, the novel, and the biography���were united by their reliance on letters to accustom readers to these new forms of print media.

King explains that as newspapers, scientific journals, book reviews, and other new genres began to circulate widely, much of their form and content was borrowed from letters, allowing for easier access to these unfamiliar modes of printing and reading texts. Arguing that bridge genres encouraged people to see themselves as connected by networks of communication���as members of what they called "the world" of writing���King combines techniques of genre theory with archival research and literary interpretation, analyzing canonical works such as Addison and Steele���s Spectator, Samuel Johnson���s Lives of the Poets, and Jane Austen���s Northanger Abbey alongside anonymous periodicals and the letters of middle-class housewives.

This original and groundbreaking work in media and literary history offers a model for the process of genre formation. Ultimately, Writing to the World is a sophisticated look at the intersection of print and the public sphere...

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Quentin Taylor: The Mask of Publius: Alexander Hamilton a...

Quentin Taylor: The Mask of Publius: Alexander Hamilton and the Politics of Expediency: "Madison���s and Hamilton���s private views... in places the authors defended positions to which they did not fully adhere...

...In Hamilton���s case, this is a major understatement. And yet a careful reading of his Federalist essays points to something far more complex and nuanced than a simple act of concealing his actual views or putting the best face on a plan he discountenanced. Undoubtedly, there are instances where he did both, but it is far more characteristic of him to engage in something quite different and admittedly ingenious: the creative act of construing the document in such a way as to stretch its meaning to accord more closely with the high-toned plan of government he outlined in the Federal Convention....

Both were disappointed in the document they signed. On the day he did so, Hamilton proclaimed that ���no man���s ideas were more remote from the plan than his own were known to be���.... Madison confided to Thomas Jefferson that the plan ���will neither effectually answer its national object nor prevent... local mischiefs���.... Yet both would vigorously champion the Constitution in the guise of Publius. Jefferson detected this incongruity when he observed that ���in some parts [of The Federalist], it is discoverable that the author means only to say what may best be said in defense of opinions in which he did not concur...���

Hamilton-cum-Publius engaged in a systematic effort to interpret the Constitution in a manner that would (1) give the national government (and particularly the executive) maximum power, flexibility, and ���energy���; (2) minimize the power and prestige of the state governments; and (3) vindicate monarchic and centralizing principles within a projected federal republic.... The likelihood that the federal government would be better administered might in time wean them away from such parochialism and help forestall state encroachments on the national authority. This much, at least, he said as Publius (Federalist 27; Hamilton et al. 1961, 172���74). Privately he added that a government headed by Washington (himself a nationalist) and administered by a ���wise choice of men��� (including himself) would not merely strengthen the central government but allow it to ���triumph altogether over the state governments and reduce them to an intire subordination, dividing the larger states into smaller districts���....

Madison was at the peak of his nationalism during the Convention, supporting a plenary grant of power to the central government, a national veto over state laws, and long terms of office for senators and the executive. Jay, who did not attend the Convention, was a prominent nationalist who shared a number of Hamilton���s views, including the desirability of reducing the states to appendages.... This is not to say that Madison and Jay shared Hamilton���s private aims or were part of a coordinated effort to propound the Constitution in a ���high-toned��� vein. Given their respective views, such a ���conspiracy��� was hardly necessary.... In carefully demonstrating to readers that the government embodied in the proposed Constitution was both federal and republican in the best sense, Madison provided considerable cover for Hamilton���s more aggressive campaign to instill that government with ���energy,��� ���efficiency,��� and ���vigor���....

For Hamilton republicanism was not a civic ideology based on popular participation and classical virtue, but simply representation, the rule of law, the protection of property, and freedom from arbitrary government. Nearly everything else was discretionary based on his highly flexible reading of the central government���s powers and the president���s prerogatives. It is notable that in his rejection of a bill of rights, Hamilton identifies the writ of habeas corpus, a ban on ex post facto laws, and a pro- hibition on titles of nobility as ���perhaps greater securities to liberty and re- publicanism than any��� in the New York Constitution. And of these three provisions, he singles out the prohibition on titles of nobility as ���truly . . . the cornerstone of republican government��� (Federalist 84; Hamilton et al. 1961, 577). As long as there were no milords in America, it would seem, the United States was a republic...

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The downside to the fact that we are cognitive animals th...

The downside to the fact that we are cognitive animals that reason via analogous narratives: Andrew Pollack: A Brilliant Concept���Compulsive Narrative Syndrome: "I first came across this brilliant concept in Joel Shepherd���s 23 Years on Fire.... Here are Shepherd's characters explaining CNS���tell me this doesn't ring a bell...

...The human brain is trained to look for and identify patterns, but in abstract concepts, fixed and unarguable facts are hard to find. So the brain looks for narratives instead, stories that can tie together various ideas and facts in a way that seems to make sense, to make a pattern. And the human brain, always seeking a pattern as a basic cognitive function, will latch onto a narrative pattern compulsively, and use that pattern as a framework within which to store new information, like a tradesman honing his skill, or someone learning a new language.

That���s why religions tell such great stories, the story makes a pattern within which everything makes sense. A synchronicity of apparent facts. Political ideologies, too. Humans are suckers for a great story because we can���t resist the logical pattern it contains."

���When you���re learning a new skill, discarding irrelevant information and organizing the relevant stuff within that framework is good. But in ideologies, it means any information that doesn���t fit the ideological narrative is literally discarded, and won���t be remembered... which is why you can argue facts with ideologues and they���ll just ignore you. They���re not just being stubborn, their brains are literally structurally incapable of processing what they perceive as pattern-anomalous data. That���s why some ideologues get so upset when you offer facts that don���t match their pattern, it���s like you���re assaulting them.

So what Compulsive Narrative Syndrome really says is that being a one-eyed partisan isn���t just a matter of taste or values, it���s actually a cognitive, neurological condition that we all suffer from to some degree. And it explains why some people���s ideologies can change, because sometimes a new pattern is identified that overrides the old one. And it explains why the most intelligent people are often the most partisan and least objective, because pattern recognition is a function of higher intelligence. If you want an objective opinion, ask a stupid person...

#shouldread
#books

The utility of history for rational self-government: Davi...

The utility of history for rational self-government: David Walsh: "That Twitter is the major forum for this says a lot about the pitiful state of our institutional capacity...

....However, that so many people are interested in what we have to say despite the decades of attacks on our profession and higher education generally speaks volumes....

You don't become a good historian by reading Hayden White, or by going to conferences; you do it on Twitter, you do it on the streets. In all seriousness, and in response to the very legitimate ���why keep engaging with right-wing trolls?��� question, like it or not this is how most people interact with historians. I don���t get paid to be on Twitter. Frankly it���s a distraction from writing. Maybe if I���m very lucky it won���t be an obstacle to getting an academic job. Why do I keep coming back? Because clearly there���s a need for historians on here, to at least offer grounded analyses of the past in the face of so much sophistry.... I tell this to my GF whenever I���m feeling down about the state of education in America: clearly, what we���re doing matters; otherwise, why have they invested so much time and energy in trying to tear it down?...

Just think: if the New York Times had been willing to pla...

Just think: if the New York Times had been willing to play ball with Nate Silver, they could have things of this quality���rather than more of their standard politician-celebrity-gossip and "Javanka are going to save us all" that has done so much to empower the Orange-Haired Baboons of the world: Nathaniel Rakich: 538 Election Update: How Our House Forecast Compares With The Experts��� Ratings: "FiveThirtyEight���s forecast is a tad more bullish on Democrats��� chances overall than the three major handicappers...

...If you assign probabilities to their race ratings, Cook���s and Sabato���s ratings both imply a Democratic gain of 29 seats, while Inside Elections���s compute out to a Democratic gain of 23. (Our forecast, remember, currently projects an average Democratic gain of 34 seats.) The Democratic tail is also longer in our Classic forecast ��� that is, the model gives a greater chance than the experts do that a blue wave turns into a tsunami and Democrats pick up a ton of seats, like 60 or 70. That���s because the model rates fewer seats as truly safe for Republicans... than the experts do. By a small margin, our forecast also places more seats in the ���solid Democratic��� category and all the competitive categories combined (between ���likely Republican��� and ���likely Democratic���).

Who will be right? We honestly don���t know! We���re still 11 weeks out from the election, and things are still subject to a lot of change. The long tails in our forecast reflect that, but it���s worth noting that there���s no real way for the qualitative ratings to communicate uncertainty. The bottom line is that, in the big picture, and in terms of average seat gain, all the major forecasters agree: Democrats are mild favorites to take back the House...

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DeLong Fall 2018 Teaching Schedule (DRAFT)

DeLong Fall 2018 Teaching Schedule (DRAFT):

Economic History Seminar 211: M 12-4:30 Lunch/Evans 639/Yali's East
Macroeconomics 101b: T 8-9:30 Cory 277
Macroeconomics Staff 101b: T 9:30-10 ??
Development Engineering 215: T 2-5 ???
Departmental Lunch: W 12-1
Tea/Departmental Faculty Meeting: W 3-4 Evans 639
Departmental Seminar: W 4-5:30 Evans 648
Macroeconomics 101b: Th 8-9:30 Cory 277
Development Engineering: Th 2-3:30 VLSB 2050
Economic History Thesis Group 295: F 10 Evans 506
Economic History Lunch 299: F 12 Evans 579
Open Office Hours ??

Josh Marshall: We Know Trump Is Guilty. We���re Having a ...

Josh Marshall: We Know Trump Is Guilty. We���re Having a Hard Time Admitting It: "The greatest conceit in public life today is the notion that we don���t already know President Trump is guilty... of... conspiring... with a foreign power... and then continuing to cater to that foreign power either as payback for the assistance or out of fear of being exposed...

...a national betrayal that may break some statute laws but which far transcends them and isn���t in the past but is rather on-going.... These are... simply political questions, meant in the sense that the country must make decisions about President Trump���s conduct and and whether he can be trusted with the truly vast powers of the Presidency. The relevant concept is consciousness of guilt.... From the very beginning the President has used every power at his disposal to stop investigations into what happened....

In ordinary life, such flagrant and on-going efforts to prevent the truth from coming out are a clear sign of guilt. We rightly demand a higher standard before the criminal law because that is about taking away someone���s liberty. That���s not the case here. We���re only talking about taking away or restrain the power we have given him to use on our behalf....

Trump is guilty. Why there���s such resistance to this reality is an interesting question. My own best guess is that it is too disquieting a reality to grapple with. Someone who has deliberately betrayed his country and who is compromised by and under the thumb of a foreign despot clearly should not be President. But his supporters don���t accept that. And as long as they don���t there���s no path to removing him from power prior to 2020 and maybe even beyond. That means that for the present we are locked in a situation in which we must operate in a system in which the person with the most power is working for a foreign adversary, whether out of avarice or fear. That is a profoundly uncomfortable reality. Remaining agnostic on the big question is more comfortable.

That���s my theory. But my theory, the why, doesn���t really matter. The fact that the reality is real and that it���s too hard for many to accept is what matters...

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