J. Bradford DeLong's Blog, page 419

Should-Read: But is this���global���productivity slump re...

Should-Read: But is this���global���productivity slump really like any of the previous���much more local���productivity slumps? A very promising intellectual exercise to do in prospect, but I am going to find Barry and ask him what we really learn from it: Barry Eichengreen, Donghyun Park, and Kwanho Shin: The Global Productivity Slump:��� Common and Country-Specific Factors: "Productivity growth is slowing around the world...

...In 2015, the growth of total factor productivity (TFP) hovered around zero for the fourth straight year, down from 1 percent in 1996���2006 and 0.5 percent in 2007���12. In this paper we identify previous episodes of sharp and sustained decelerations in TFP growth using data for a large sample of countries and years. TFP slumps are ubiquitous:��� We find as many as 77 such episodes, depending on definition, in low-, middle- and high-income countries. Low levels of educational attainment and unusually high investment rates are among the significant country-specific correlates of TFP slumps, and energy-price shocks are among the significant global factors...

Barry Eichengreen: I
remain a techno-optimist. I see no evidence that the progress
of science and technology is slowing down. What I
see is the need to further reorganize how enterprises interact
with their customers and organize their workforce
to better exploit the productivity-enhancing potential of
new technologies. My own favorite example is electronic
medical records. At the moment, with the transition from
handwritten charts and transcriptions, doctors are being
forced to grapple with unfamiliar software and awkward
laptops, and to re-input old information along with new.
Different electronic recordkeeping systems are incompatible,
and it remains impossible to transmit information
across platforms. New technology is therefore a drag on
productivity rather than a boost. With more time to adjust
and more work on systems compatibility, we can be confident
that this will change. We just can���t say when.

Must-Read: Few people���and next to zero of today's Repub...

Must-Read: Few people���and next to zero of today's Republicans���seem to me to understand exactly how dangerous the current situation is���not just Trump's erratic moves, but the responses of all the people who somehow hope that riding his coattails will be to their long-term advantage. "But it could not happen here: this is the country of Goethe and Schiller!": Nouriel Roubini: Populist Plutocracy and the Future of America: "Donald Trump has consistently sold out the blue-collar, socially conservative whites who brought him to power...

...while pursuing policies to enrich his fellow plutocrats. Sooner or later, Trump's core supporters will wake up to this fact, so it is worth asking how far he might go to keep them on his side.... Trump has governed like a,,, pluto-populist. But why has his base let him get away with pursuing policies that mostly hurt them?... How long can anyone be expected to support ���God and guns��� at the expense of ���bread and butter���?...

Trump is probably hoping that tax cuts and deregulation will spur enough growth and create enough jobs that he will have something to brag about.... Whatever happens, Trump will continue to tweet maniacally, promote fake-news stories, and boast about the ���biggest and best��� economy ever. In doing so, he may even create a circus worthy of a Roman emperor. But if gassy rhetoric alone does not suffice, he may decide to go on the offensive.... That could mean truly withdrawing from NAFTA, taking trade action against China and other trading partners, or doubling down on harsh immigration policies... ���wag the dog,��� by fabricating an external threat or embarking on foreign military adventures... start a war with North Korea or Iran.... And if things got bad enough, Trump and his generals could declare a state of emergency, suspend civil liberties, and transform America into a true pluto-populist authoritarian state.... Consider the recent history of Russia or Turkey; or the history of the Roman Empire under Caligula or Nero. Pluto-populists have been turning democracies into autocracies with the same playbook for thousands of years. There���s no reason to think they would stop now...

Should-Read: So it turns out that "Brexit means Brexit" m...

Should-Read: So it turns out that "Brexit means Brexit" means: The United Kingdom loses its voice in Brussels, but for all other intents and purposes remains part of the EU. Who knew that this was the hill Boris Johnson and Teresa May wanted to die on? It may still be a political winner: May and Johnson and company will use "we are no longer part of the EU" to get their constituencies to look down on continental Europeans. But the U.S. southern Democratic Party got its constituency to look down on Negroes so that the constituency's pockets could be picked���it made cruel, sadistic, and pragmatic sense. There is no pragmatic sense here: Simon Wren-Lewis: First Stage Reality and Brexiters... see... the important facts... and... apply them relentlessly despite what politicians say...

...A Single Market and Customs Union needs a border.... to comply with all the tariffs, standards and regulations of the Single Market. The UK has now agreed, as I thought��it would, that this must also apply to the UK as a whole.... After Brexit, the UK will to the first approximation continue to obey all the rules of the Single Market and Customs Union... as if we are still in the EU... [but] we no longer have any say on what those rules are....

But, you may respond, all the UK have signed up to is that this is a default position, if they fail to find a technological fix for the border, or if they fail to conclude a trade agreement with the EU in stage 2, and what does "alignment"��mean anyway?... We also know... the UK desperately want a trade agreement with the EU and the EU will not allow any agreement that implies a hard border in Ireland....

Why then are the Brexiters not up in arms?... Partly because the agreement plays on their lack of realism.... Why is it important that this deceit continues? Because if everyone was honest, and respected the reality of the border issue, people would rightly ask whether our final destination (obeying the rules but with no say on the rules) is worth having. They would note that being to all intents and purposes part of the Customs Union means Mr. Fox cannot make new trade agreements. People might start asking MPs why are we doing this, and the line that we have to do this because the people voted for it would sound increasingly dumb....

[If] we... end up with the softest of soft Brexits...] there is a huge irony.... The Brexiters��� dream was to rid the UK of the shackles of the EU so it could become great again, but it is a legacy of empire that has brought this dream to an end.... Instead we will still be acting under the rules of the EU, but because we are not part of it the UK will be largely ignored...

Weekend Reading: Judge Kozinski: More Stories

Weekend Reading: Nancy Rapoport: There are likely several more stories to come: Courtney Milan���s post about Alex Kozinski is a harrowing read, but an important one...

...���After the story posted online, the judge told the Los Angeles Times, ���I don���t remember ever showing pornographic material to my clerks��� and, ���If this is all they are able to dredge up after 35 years, I am not too worried.�������� Well, ���this��� is not all they are able to dredge up.�� I don���t know how many other stories there are out there, but here���s mine.

I clerked for the Hon. Joseph T. Sneed in 1985-86.�� It was one of the best jobs that I have ever had.�� Judge Sneed taught me about tight editing, critical thinking, and fair decision-making.�� He was a wonderful mentor to me and to countless other former law clerks.

Judge Kozinski sat up north from time to time, and at one point during my clerkship, he asked me to go for drinks with him and his clerks after work.�� I���m sociable (though not much of a drinker), so I agreed.�� When I showed up, none of his clerks were there.�� Just him.

Two things stand out in my memory.�� One was that he asked me, ���What do single girls in San Francisco do for sex?����� Another was, after I said I needed to head home because I had to absorb the news that my mother had just been diagnosed with breast cancer, he offered to ���comfort��� me.�� There was no reporting relationship between him and me, and I certainly never believed that my job with Judge Sneed was ever in jeopardy because of my interactions with Judge Kozinski.�� I just thought that the judge exhibited extremely poor taste.

But I have told countless female law students that I would never write them a letter of recommendation for a clerkship with him, and I have told them why.�� I didn���t want them ever to be at risk of being sexually harassed by him.�� I have told some of my female colleagues not to be alone with him, and for the same reason.

I doubt that he remembers our interaction that night.�� I do, and I view his statement to the Los Angeles Times as a challenge; hence, this post to add to the other voices.

R.I.P. Joseph N. Froomkin, 1927 Harbin, China - 2017 Chevy Chase, MD

From the perspective of a child growing up in D.C.'s upper northwest in the 1960s and 1970s, Joe Froomkin seemed to have a very different kind of job then did other dads:

There were lobbyists, whose jobs seemed to be some variant on: ���What do you want to hear?���

There were lawyers, whose jobs seemed to be some variant on: ���What is the best argument that could be made for this position?���

And there were economists, of which Mr. Froomkin was always the one I saw most closely, whose jobs seemed to be: ���This is what is going on, and I know you do not like to hear me say this now, but in the future you will be glad you heard this������always backed up by arguments that were counterintuitive but seemed powerful when you thought about them.

Mr. Froomkin���s existence raised the possibility that an economist was something one might become, and made it an attractive possibility.

Anyone knowledgeable in the history of economic thought knows that a great deal of the time economics does not seem to progress in any normal way. Instead, the solution to this decade���s urgent economic problem leads to changes that induce another urgent economic problem, which is then solved by policies that produce yet a third... and by around five we are back to our original problem, although hopefully we understand it at a deeper level this time through the cycle. Thus it is at least as much intellectual and policy firefighting as standing on the shoulders of giants and seeing further.

Back in 1968 Joe Froomkin wrote a book with A.J. Jaffe: Technology and Jobs: Automation in Perspective. It could have been written today. Indeed, I am going to draw upon it in some parts of my contribution to Berkeley���s research project on ���working, earning, and learning in the age of intelligent tools���.

What Froomkin and Jaffe recommended in 1968 would have been good policy to adopt then and would be good policy to adopt now:

They were right to say that we did not and do not need to fear large scale technological unemployment.
They were right to say that we do need to fear profound problems of adjustment.
It would be good to have a large Job Corps to assist the transition into the labor force and the acquisition of useful skills by those 16 to 21.
Their proposal for more generous permanent 39 week unemployment insurance benefits with automatic extensions when unemployment is high would have gotten and would get us better matches between workers and jobs.

And there are two passages toward the end of the book that ring out loud and clear:

Our investigation... has led us time and again to the same conclusion: the proper management of demand could obviate many of the problems of adjustment...

The major part of this volume was devoted to what may be called the short-run view of technological change and its relationship to the working force.... These short-run problems... are recurring ones. They have appeared many times in the past and will appear even more frequently in the future. Every time the unemployment rate moves up, ���cures��� will be advanced and a ���great debate��� will ensue. That most of the discussion will be regurgitation will not stop the proliferation of polemics. Indeed, it is probable that between the time a speech in this ���debate��� is delivered and the time it appears in print, the unemployment rate will have changed... and the talk will appear outdated. But let the speaker wait a while, and then he can reuse his talk, barely introducing the most recent statistics...

Comment of the Day: But, alas, I think Robert Waldmann ha...

Comment of the Day: But, alas, I think Robert Waldmann has the completely wrong. Draw the graph, Robert! What areas on what graphs does Greg's calculation correspond to? Please tell me!: Robert Waldmann: DeLong & Krugman vs Mankiw and Mulligan III: "Just click the links...

...I finally understand that Brad too is asking a very similarly odd question. The only difference is that Brad considers a tax on capital (tau)k not on capital income (t)f'(k)k. This makes the difference...

No, I do not think that it does.

What does Mankiw think the pretax rate of profit is in the short run after you cut the tax rate from t0 by ��t? The pretax rate of profit was initially:

$ \frac{r}{(1-t_{0})} $

and total pretax income from capital was initally:

$ \frac{k_{0}r}{(1-t_{0})} $

and total government revenue was initially:

$ T_{0} = \frac{t_{0}k_{0}r}{(1-t_{0})} $

As I see it, Mankiw maintains, when calculating the tax revenue loss, that, after the tax cut, the pretax rate of profit is still:

$ \frac{r}{(1-t_{0})} $

So that the amount of revenue collected is:

$ T - ��T = \frac{(t_{0}-��t)k_{0}r}{(1-t_{0})} $

and the change in revenue is:

$ ��T = \frac{��t(k_{0})r}{(1-t_{0})} $

But, as I see it, Mankiw also maintains, when calculating the wage gain, that, after the tax cut, the pretax rate of profit is:

$ \frac{r}{(1-t_{0}+��t)} $

so that there is an extra cash flow ��C per unit of capital arising from the reduced pretax cost of renting capital equal to:

$ ��C = \frac{r}{(1-t_{0})} - \frac{r}{(1-t_{0}+��t)} $

$ ��C = \frac{1-t_{0}+��t - 1+t_{0}}{(1-t_{0})(1-t_{0}+��t)} $

$ ��C = \frac{��t}{(1-t_{0})(1-t_{0}+��t)} $

The total extra cash flow available to pay higher wage is then that times the initial capital stock:

$ ��w = \frac{k_{0}��t}{(1-t_{0})(1-t_{0}+��t)} $

��w is not equal to ��T: there is the extra factor in ��w of:

$ \frac{1}{1-t_{0} (+��t)} $

But this factor does not arise because of the difference between a tax on capital and capital income. It, rather, arises because Mankiw has calculated:

the tax loss assuming that the pretax rate of profit is not immediately impacted by the tax cut,

the cash flow available to pay wages assuming that the pretax rate of profit is immediately impacted by the tax cut.

What if he assumed in making both calculations that the pretax rate of profit did not fall? Then the calculation of the tax revenue loss would be correct. But with no decline in the pretax rate of profit, there is no extra cash flow to pay wages, and so the ratio of wage gain to tax revenue loss is zero.

What if he assumed in making both calculations that the pretax rate of profit did fall to:

$ \frac{r}{(1-t_{0}+��t)} $

?

Then the calculation of the wage gain is correct, but your calculation of the tax revenue loss is in error. Tax revenue falls both because the government is levying a lower rate on pretax profits, and because pretax profits are now lower.

In the long run, as k expands to k(0)+��k, the ratio is greater than one of course���but production function parameters do not drop out...

Weekend Reading: "Nor Trust in Wodan / Walhall's High Drighten..."

Nor Trust in Wodan Walhall's High Drighten... http://www.bradford-delong.com/2002/12/nor_trust_in_wo.html: The raw ingredients out of which J.R.R. Tolkien fashioned The Lord of the Rings are equal parts Norse-Anglo-Saxon-Germanic myth, chivalric romance, and Christian apocalyptics (evil personified and mighty, but also powerful guardian spirits, and over all a God who arranges things so that the highest prizes fall to those who suffer).

The mix is extraordinarily powerful. But if you want the Norse-Anglo-Saxon-Germanic myth itself, akratos���unmixed, undiluted���you have to go elsewhere: to a place like: Stefan Grundy (1994): Amazon.com: Rhinegold (9780553095456): Stephen Grundy: Books:

The dwarf scuttled away between the rocks, slithering into them until Loki could no longer see where dwarf ended and stone began. Only the red sparks of his eyes glowed out of the darkness as his voice hissed:

My curse on the ring I made, on all who wear it!

Gold fired in blood, ruby blood-red, be you bathed in your holders' blood again and again, the death of athelings and the sorrow of women.

Death to every man who takes you, make each woman who keeps you the bringer of death to her kind.

Be strife of kinsmen, be breaker of bonds, let no gift and no oath hold where the river's fire burns, let no love bear lasting fruit, but cut all kin of your keepers down.

My curse on the hoard I kept, held by the ring! Let no craft work its might to weal, let no need turn round nithing's might, but smith-craft's torch and need-fire's glow burn but to funeral pyres. Brother's bane and drighten's doom: thus Andward names the hoard! Norns, lay this orlog from the Rhine's depths. Write this wyrd���so shall it be!...

[...]

"Then what hope is there for us?" asked Alfarik quietly.

"To die like Walsungs," Wynberht answered, then started to chant softly:

If our wyrd is crueler,    ��  let our courage be keener

harder be hearts    ��  and higher be souls

unweakened by fear    ��  though with horror fraught

then shall Wals's sons    ��  all worthy be named...

[...]

Now I shall sing a song for you which is seldom heard on the Rhine these days... of the Rhine's gold: how it was drawn forth... how the children of Hraithamar fought over it till at last it was won by Sigifrith the son of Sigimund and Herwodis:

Wodan and Hoenir    ��  wandered with Loki

to Middle-Garth    ��  as men by the Rhine.

There an otter    ��  eating saw they

a goodly fish    ��  the flood beside...

[...]

No hero, say men,    ��  higher has lived

Than Sigifrith Fadhmir's Bane    ��  slaying the wyrm

to get for himself    ��  the gold's red-bright fire,

glittering by    ��  the banks of the Rhine.

Wyrd love no fosterling    ��  more long than a moment,

and no man may breathe    ��  for more than his days,

Nor trust long in Wodan    ��  Walhall's high drighten,

for raven and wolf    ��  wait for his thanes aye.

Now lies the weregild    ��  all lost by the Rhine,

and no man may say    ��  nor see where it's hid.

For only two living    ��  owned Fadhmir's secret,

now that secret's kept    ��  in cairn with the dead.

Stephan Grundy is not to everybody's taste���I'm not even sure that he is to my taste: I have never picked up Rhinegold again since I read it for the first (and only) time. But the memory of reading it still haunts me, and it is not an experience that I would have foregone.

Should-Read: Ann Marie Marciarille: Hey, Hey, New York Ti...

Should-Read: Ann Marie Marciarille: Hey, Hey, New York Times: Just What Are the "Increasingly Blurred Lines" in Health Care?: "I don't get it...

...Does anyone who really understands pharmaceutical pricing or compensation systems in commercial health insurance really think that health care hasn't had plenty of "blurred lines" for quite some time���try decades?... Like Austin Frakt, I do not lament the apparent beginning of the end for the stand-alone pharmacy benefit manager (PBM) industry but, unlike Austin Frakt, I am not optimistic that�� migrating all that stand-alone PBM power into the hyper-concentrated drug store and health insurance industries is necessarily going to benefit consumers. If the data on concentration in complementary industries in health care teaches us anything, concentration in ownership has not produced efficiencies�� that have trickled down to the health care consuming public.��If the problems are little choice, no transparency, and conflicts of interest, how will this re-arrangement of the deck chairs change anything?...

Weekend Reading: Courtney Milan: Judge Kozinski

Weekend Reading: Courtney Milan: Judge Kozinski: "Judge Kozinski had a way of summoning his clerks...

...He could make our phones beep by pressing the intercom button. Two beeps meant, ���drop everything, grab pen and paper, and run to his office.��� Sometimes he���d summon us all, or he���d summon some of us and not the others, or he���d just want one of us.

���Heidi, honey,��� the Judge said one day, when he���d beeped me into his office alone, ���you���re the computer clerk. I need your opinion on something.���[1]

I was the computer clerk because I���d worked in a computer store, built several computers, run my research group���s computer cluster in graduate school before I went to law school. Once, being the ���computer clerk��� meant a software consult. Once, he���d shown me his own self-built computer that he���d brought into the office for emergency surgery.

This time, the thing he needed an opinion on was a set of pictures. He pulled them up from where he had saved them���a private server, run by his son, that he used as a massive external hard drive. Those pictures showed a handful of naked college-age people supposedly at a party where other people were clothed and drinking beer. In one of those photos, a man and a woman were sitting naked on a couch.

���I don���t think your co-clerks would be interested in this,��� he said. ���Do you think this is photoshopped?���

At the time, I didn���t know what to say. I remember thinking that I didn���t want to be there, not without my co-clerks. It would have felt entirely different if my co-clerks���both male���were present; it would have felt like I was being treated as one of the guys. Kozinski was not known for being terribly appropriate, but I could handle that. Inappropriateness directed solely at me felt very different than chambers-wide jokes.

His office in Pasadena overlooks the Colorado Street Bridge, more colloquially known as Suicide Bridge. I remember feeling like the sounds of the cars passing were very loud. I remember wanting to be so small I could disappear.

���Yes,��� I said. ���It���s photoshopped.���

I remember pointing out how the couch didn���t compress where the naked people were supposedly sitting, how the shadows weren���t right compared to the clothed party-goers. I tried to stay as factual as possible.

���Does this kind of thing turn you on?��� he asked.

���No.��� I remember feeling that I needed to not move, either physically or emotionally, that if I just treated this like this was normal it would stay normal and not get worse.

���Why not?���

���They don���t look like they���re having fun.���

���It doesn���t do anything for me either,��� he replied. ���People just send me these things. I don���t know why. But I like to keep them as a curiosity. I don���t understand why people find this sort of thing arousing.���

It happened at least three times. I can���t remember exactly how many times it happened.

I was also alone the day he showed me what he called his knock chart. It was a typed piece of paper listing all the girls that he and his friends had banged while they were in college, tracking their conquests.

���Don���t tell your co-clerks about this,��� he said. ���It���s not something I want them to know about.���

I don���t remember everything he told me. I do remember him talking about how terrible the focus on STDs today was, because nobody was willing to just fuck anymore.

When this happened, I felt like a prey animal���as if I had to make myself small. If I did, if I never admitted to having any emotions at all, I would get through it.

Despite my best efforts, I continued to have emotions. Why was I alone? What was the purpose of not having the other clerks around? Most prevalent of all was this worry: Was it going to escalate? What could I do if it did?

The worry took its toll. I began waking from sleep, heart racing, hearing imaginary double beeps summoning me to his office. I started not being able to sleep at all. By the time I left the clerkship, there were nights I would lie in bed and watch the darkened ceiling until I had to get up and go back to work.

I stopped being able to complete even basic tasks���I left the clerkship as one of the most incompetent clerks ever to grace Kozinski���s chambers, and I���m fairly certain that when I started I was not one of his most incompetent clerks. I gained something like forty pounds over the last six months of the clerkship.

There are questions I ask myself, questions like, ���If you were so uncomfortable, did you tell him to stop?��� or ���Why didn���t you tell him that you didn���t want to have these discussions alone?���

I���m not sure I will ever be satisfied with my own answers, but by the time this happened, I was not in the best place to say no to anything.

The day I started as a clerk in Judge Alex Kozinski���s chambers, he swore me in. After I read the words, he grabbed my arm and smiled. ���It���s too late now!��� he said. ���She can���t escape any longer. She���s my slave.���

I knew (I thought I knew) all about the Kozinski clerkship���long hours, impossible expectations, in which you were pushed to become the best he could make of you.

I tried to make a joke of it. ���I think you mean indentured servant,��� I replied.

���No,��� he said with a smile. ���I meant slave.���

I want to be clear: There is absolutely no comparison between a job that pays reasonably well, that no law prevented me from walking away from, and that opened up career opportunities that most people will never have and slavery.

But over the course of the clerkship I learned very swiftly how impossible it was to say no to the judge.

As an example, one day, my judge found out I had been reading romance novels over my dinner break. He called me (he was in San Francisco for hearings; I had stayed in the office in Pasadena) when one of my co-clerks idly mentioned it to him as an amusing aside. Romance novels, he said, were a terrible addiction, like drugs, and something like porn for women, and he didn���t want me to read them any more. He told me he wanted me to promise to never read them again.

���But it���s on my dinner break,��� I protested.

He laid down the law���I was not to read them anymore. ���I control what you read,��� he said, ���what you write, when you eat. You don���t sleep if I say so. You don���t shit unless I say so. Do you understand?���

There was nothing to say but this: ���Yes, Judge.���

This sort of diatribe was a regular occurrence. The judge had incredibly high standards, and when we failed to meet them, we were raked over the coals. I do not think a week passed without at least one such outburst; during bad times, they were a daily occurrence.

He also had an innate sense of when he���d gone too far. A few hours after a bad encounter, he���d call me into his office and tell a joke or a funny story or he���d show us Weird Al videos���anything to lighten the mood and show that he was still our friend. It was as close as he ever came to apologizing.

After he���d demonstrated that he had forgiven me for the misplaced comma or misspelled word that gave rise to his outburst, he would go up to me.

���Heidi, honey,��� he would ask. ���Do you still love me?��� [2]

There was only one answer. To say ���no��� would be to invite the tempest a second time.

���Yes, Judge,��� I would say. ���Of course I still love you.���

He���d kiss my cheek, and I would kiss his.

If someone controls when you eat, when you sleep, what you dream, they control who you love, too. I said it and I told myself it was true, because it is easier to feel love than to tell yourself that you must lie for your own protection. It took me years afterward to understand that the relief I felt at the absence of pain was not love. It was not anything like love.

I thought about quitting during the clerkship. I calculated the fastest route between Pasadena and the city where my fianc�� was living. I checked plane ticket prices and read my lease to see if I could afford to break it. I would look at my savings (meager) and calculate how long it would take me to get a job, a paycheck.

I wondered if I anyone would hire me if I said, ���well, yes, I quit my clerkship, and I can���t talk about it for judicial confidentiality reasons, and��� no, the Judge won���t give me a recommendation, and��� yes, you have it right, I got through six months of this but I just couldn���t manage the last six.���

I had over a hundred thousand dollars in student loans. I couldn���t risk it.

I came close enough to quitting that I told Judge Kozinski that I didn���t want to clerk at the Supreme Court. The Judge prided himself on placing a majority of his clerks with Supreme Court Justices, and my opting out was a warning signal. He got me an interview with Justice O���Connor anyway.

I told him I didn���t want to go on the interview, and I meant it. At that point, the thought of spending another year with someone who could wield ultimate power over me sounded like a nightmare.[3] I didn���t care about the career benefits; I didn���t care about anything except that I was going to be trapped once more. He told me that if I didn���t go, and do my best, I would have to leave his chambers.

I calculated how long it would take me to run out of money. I wondered if it would destroy my career to not have a reference from my Judge. I felt utterly powerless; I went on the interview.

When Justice O���Connor called and told me she wanted me to clerk for her, I realized that saying yes to her meant saying yes to finishing the clerkship with Kozinski, no matter what would happen.

So I stayed. There were no physical advances���just occasional porn, occasionally asking about my opinion on it, occasionally asking whether it turned me on. There were no physical advances, just endless worrying on my part about whether there would be one, and if there was, if I would be able to say no.

I remember almost nothing about my last two months there.

I do remember my last day.

Throughout the clerkship, the judge had instilled his view of judicial confidentiality in us. His views on the duties that law clerks owe their judge are public; eight years before I started my clerkship, he wrote an article discussing those views. While that article was in the context of Supreme Court clerks, he applied the same standards to his own clerks.

This is what he had to say in that article: ���A Supreme Court clerkship is not simply a job, a great honor, or a stepping stone to plum jobs in the legal profession���it is membership in a family, with correlative rights and responsibilities���. The clerk has a duty of diligence, loyalty, and confidentiality, both to the Justice who appoints him and to the other Justices. He also has a duty of loyalty to his fellow clerks and to other Court employees. In exchange, the clerk gets to work in the headiest environment to which any young lawyer could aspire and enjoy the luxury of open, robust, and unbridled debate about our nation���s most pressing legal issues���.��� [4]

While the article was written as a book review of Edward Lazarus���s Closed Chambers, and thus refers to Supreme Court clerks, Judge Kozinski believes the same principles applied to the operation of his chambers in the Ninth Circuit as well. He repeatedly instilled these views in me.

While some judges take the view that law clerks only owe their judges confidentiality on the question of deliberations, Kozinski���s view is far more expansive: Clerks owe a bond of loyalty to their judges, and that means ���that, under normal circumstances, whatever one learned inside the Court���whether or not it was covered by the duty of confidentiality���would not be repeated on the outside, especially if it tended to demean the Court, the Justices, or fellow clerks.��� [5]

On the last day of my clerkship, he told me that the beauty of judicial confidentiality was that it went two ways. As long as I never, ever told anyone what had happened in chambers with him, he would never tell anyone what had happened with me.

At that point, aware of just how painfully bad I had been at stumbling through the clerkship those last months, I was grateful to think that I could forget the year entirely. It felt like he was telling me that all that incompetence belonged to someone else, not me.

I closed my fist on everything I couldn���t let myself feel and drove away as fast as I could. On the day I finished my clerkship, I left the office at seven or eight; I collapsed into bed just across the border in Nevada some time after one that morning, because I had promised myself I wouldn���t sleep in the same state as him that night. I got two speeding tickets the next day, trying to get away���one in Utah, one in Colorado.

I didn���t care. I was free, and I just wanted to not remember.

I told one person a little bit less than a year later. I didn���t think I should tell her; I felt I was violating my duty of loyalty. I told her because I didn���t know what my heart was doing anymore and I needed someone to help me find it again. I felt guilty about telling her what I did for years.

In 2015, at a friend���s wedding, I went on a hike with two other former Kozinski clerks. I told them in very barebones terms what had happened.

I did not tell anyone else, not for nine years.

I���m painfully aware that some people will find reason not to believe me. I deal with occasional depressive episodes that almost certainly exacerbated my emotional reactions. When I think back, parts of my clerkship are cloaked in a depressive fog. Details from that time can be elusive. But my depression has allowed me to (gratefully) forget portions of the clerkship; it has never added memories that did not exist.

In the first years afterward, I wished that I had been louder, more in control. I wished I hadn���t completely fallen apart.

My wishes changed gradually. I began to wish that a sitting federal judge���one who became the Chief Judge of the Ninth Circuit a few months after I left his chambers���had realized that bringing his sole female clerk into his office on her own, showing her porn, and asking if it turned her on, was beyond inappropriate. I wished that I had not had to wonder at night how far he really intended to take his slave metaphor; I wished he had never called me one. I wished that he had never told me that he controlled when I slept, when I ate, that I had never been given reason to worry about whether my bodily autonomy was at stake in other ways, too.

I spent almost a decade closing my fist on that clerkship, wishing that none of it had happened.

If you did not know about Kozinski, it would be impossible to understand my career choices. I applied for jobs as a law professor, but I pulled out of the UCLA interview a month before I was scheduled to visit���I couldn���t bear to be anywhere I might see him on a regular basis. I withdrew from the hiring process at the University of Michigan, my alma mater���when I did the campus visit, it reminded me too much of who I had been before the clerkship, and I couldn���t handle the memory.

I got job offers and warm congratulations, and they hurt so much I could barely acknowledge them. I could not escape the notion that my career success was built entirely on my silence, and it poisoned any joy I could have found in the job I did take.

In a private act of defiance, I didn���t just read romance novels���I began to write them. I wrote dozens of books where my characters had secrets that they could not tell. The secret varied���sometimes a heroine kept it; sometimes it was the hero.

I wrote books where women won, again and again.

I grappled with my own secret in fictional, changed form. Book after book, I wrote the happy ending I couldn���t quite reach myself. That the stories I wrote resonated with readers, I think, speaks to the fact that #metoo has been building for centuries.

I wrote about secrets for nine years, while I held onto my own.

What changed after nine years?

On June 5, 2016, I got this email from Alex Kozinski asking me to speak to a reporter about my experience as a clerk at the Supreme Court:

Heidi: Hope you're doing well.

A good friend of mine, David Kaplan, is writing a book about the Supreme Court. Here's his latest prior book

http://goo.gl/buOSg0

And this is his description of what he plans to write:

My book is an ideas book, asking the question whether Alexander Bickel might have been wrong in "The Least Dangerous Branch." But my book is not aiming to be a scholarly tome, but rather an accessible narrative of recent developments at the court against a larger historical backdrop. That's where talking to clerks can be vital. I've already talked to one justice. Again, I can't emphasize enough: nobody gets quoted or in any other way sourced.

Think you might talk to him? I've known him for 25 years
and he's 100 percent trustworthy.

Ciao. AK

There are no words that can describe how it felt to receive that email. For years, I���d been hiding a secret because I had been told that judicial confidentiality protected the Judge���that it applied not just to chambers deliberations, but to his showing me porn in his office.

But here Kozinski was, asking me to breach my duty of loyalty to Justice Kennedy as if it were no big deal���as if I hadn���t upended my life trying to escape the memories Kozinski had given me.

I wish I had taken a little more time to think about my reply. This is how I initially responded:

Hi Judge,

I'm not sure what, if anything, I could say that would be useful in such a project without violating the code of judicial ethics. I'm happy to talk to him as long as he understands I might not be able to answer many of his questions.

I thought, at the time, this was a way to give a soft ���no��� that we would both understand. He had drilled it into me that confidentiality meant you don���t say anything. I was invoking the very thing that he���d used as a shield for years. I never forgot why I was keeping quiet.

He, apparently, had.

The judge���s response to my soft ���no��� was to treat it as a yes:

David, meet Heidi Bond.

I've explained to Heidi the nature of your project, and she's willing to talk, though she may not be able to answer many questions.

I'll leave the two of you to communicate. Please leave me out of the loop.

I felt both sick and angry. How dare he casually sell out the principle I���d been choking on for years? (For the record, I did not, in fact, talk to the reporter.)

After the anger passed, I started to wonder: I���d assumed that what he said about judicial confidentiality was correct, that I had no choice but to hold onto my silence���that I needed to feel guilt about the few instances when I���d slipped before.

Was he wrong? Could I tell people?

After weeks of turmoil, I decided to seek advice from the judiciary: What were the limits of judicial confidentiality? Were there any?

On the advice of two friends, I spoke to several people in the federal judiciary���first, Jeffrey Minear, Counselor to Chief Justice Roberts, then, at his referral, to Judge Scirica of the Third Circuit, in his capacity as the chair of the Committee on Judicial Conduct and Disability.

I wanted to know if I could tell some of those details to my husband, a therapist, or some close friends.

I want to be clear that Judge Scirica was warm, understanding, and kind. He also insisted that I not tell him any facts of the situation. I believe the reason he gave was that since the question was whether judicial confidentiality applied, there was no way to give specifics without potentially breaching confidentiality.

Initially, he told me that if what had happened was a matter of personal misconduct on the part of the judge, that I was not bound by the code of chambers confidentiality, and that whatever I needed to do for my own closure and healing was fine, so long as it wasn���t about a judicial matter.

That���s where I paused. ���What,��� I said, ���if it���s not about a matter that my judge decided, but if there���s a nexus of facts that are relevant to another judicial matter? What if there���s a nexus of facts between what I want to talk about and the matter that arose from US v. Isaacs?���

Here I must digress. The porn the judge showed me was stored on his personal server, a computer in his house that he left entirely unsecured. A year after I left, a disgruntled litigant discovered the existence of this server, and, in light of the images on it, Kozinski asked that an official ethics investigation be made into his conduct.

A pause. ���I know something about that matter,��� Judge Scirica finally said. I knew he did. He���d written the opinion that ultimately exonerated Kozinski in that investigation. I had done my best to pay as little attention to the matter as possible.

���What then?��� I asked.

It took him a while to think this through. Because of that investigation, the only way that he could tell me if the matter was covered by judicial confidentiality was if I told him the facts of the matter, but there was a possibility that the matter was covered by confidentiality, in which case I could not tell him.

I wrote down his next sentence, and so this is a direct quotation: ���I cannot think of any person, persons, or institution that can give you an answer on this,��� he said.

On the advice of another friend, I directed the same question to the chair of the Committee on Codes of Conduct, and was given the same answer.

I have decided that the events that I have described here cannot be considered by any reasonable person to be part of a judge���s official duties, and that attempting to shield those events from scrutiny by invoking the principle of judicial confidentiality is an abuse of judicial privilege.

There is, I am sure, some arrogance in my deciding this on my own, but I was told that no person, persons, or institution could help me answer this question.

The inevitable question I will be asked, I am sure, is this: What do you want?

I do not want to have to think about Judge Kozinski in any public capacity beyond what I have said here. Despite what I have related here, I also believe that the Judge is one of the most brilliant, capable legal minds sitting on the federal bench. I am sure that this revelation will spark a debate about Kozinski���s future; I do not want to have anything to do with it. Please exclude me from these discussions.

I want the law clerk handbook distributed by the judiciary to explicitly state that judges may not compel clerk silence on matters like the ones I have described here. I also believe that there should be a person, or persons, or an institution that clerks can turn to in order to find answers. I understand that there are reasons why no such institution exists now���judicial independence and confidentiality must be fiercely protected. I also believe that the judiciary is capable of coming up with a solution to this problem.

I want greater honesty regarding judicial clerkships. Law students are often told in glowing terms that a clerkship will be the best year in their career. They are never told that it might, in fact, be their worst���and that if it is their worst, they may be compelled to lie to others in the name of loyalty to their judge.

I also want law schools to start giving our best and brightest students accurate advice about clerkships. Students are often told that if they receive a clerkship offer from a judge, they must say ���yes��� without hesitation. I cannot imagine a situation more rife for abuse. Students should feel free to say no to any judge who triggers their discomfort for any reason.

Most of all, I want to break my own silence. I have held onto it for too long. So, you know���#metoo.

Heidi Bond

For the purpose of narrative flow, I���ve chosen to use quotation marks. I have only chosen to do this when my recall of the events is close enough that I am certain I am capturing the sentiment expressed. Except where noted, I do not recall exact phrasing.

This is a direct quote���one that I heard multiple times.

Nothing of the sort happened. I worked with both Justice O���Connor and Justice Kennedy during my year at the Supreme Court, and they both treated me with respect and dignity.

Alex Kozinski, Conduct Unbecoming, 108 Yale L.J 835, 875 (1999).

Id. at 846.

Watching Bitcoin, Dogecoin, Etc...: Hoisted from 2014-01-05, Plus Update Graph

2017-12-08 16:02:15 PST Market Capitalization: 278 billion dollars.

Brad DeLong (2014): Watching Bitcoin, Dogecoin, Etc...: Underpinning the value of gold is that if all else fails you can use it to make pretty things. Underpinning the value of the dollar is a combination of (a) the fact that you can use them to pay your taxes to the U.S. government, and (b) that the Federal Reserve is a potential dollar sink and has promised to buy them back and extinguish them if their real value starts to sink at (much) more than 2%/year (yes, I know).

Placing a ceiling on the value of gold is mining technology, and the prospect that if its price gets out of whack for long on the upside a great deal more of it will be created. Placing a ceiling on the value of the dollar is the Federal Reserve's role as actual dollar source, and its commitment not to allow deflation to happen.

Placing a ceiling on the value of bitcoins is computer technology and the form of the hash function... until the limit of 21 million bitcoins is reached. Placing a floor on the value of bitcoins is... what, exactly?

At the moment, it's only a $10 billion bubble--or, if you are going to convince me that it is not a bubble, you are going to have to find me a market player willing to become a bitcoin sink...

Timothy B. Lee has smart things to say:

Timothy B. Lee: Dogecoins and Litecoins and Peercoins oh my: What you need to know about Bitcoin alternatives: "Dogecoin is a joke. Though weirdly it's a joke that, at least on paper, is worth millions of dollars...

...The founders of Dogecoin took the source code of another Bitcoin variant called Litecoin, made some further tweaks, and rebranded it as 'Dogecoin'. That's a reference to the canine variant of lolcats, an Internet meme where a grammatically challenged dog makes excited statements. Dogecoin has been around for less than a month. In that time, the value of all dogecoins in existence has skyrockted from zero to more than $8 million.... Bitcoin's pseudonymous creator, Satoshi Nakamoto, did an amazing job of building a payment network that is secure, scalable and useful. But he wasn't perfect; he made some design decisions that might not look so great in retrospect. The problem is that thanks to Bitcoin's decentralized design, it's not easy to change the core Bitcoin protocol. Hence, if you have an idea for an improved version of Bitcoin, it's easier to start your own virtual currency....

Most of the altcoins have focused on improving mining, the process the Bitcoin network uses to process transactions. In the Bitcoin mining process, hundreds of computers race to solve a repetitive math problem. The winner of the race gets to add a 'block' to the Bitcoin network's global transaction register, and to award itself 25 bitcoins (roughly 20,000 dollars) for its trouble....

One problem is that the mathematical formula at the core of the Bitcoin mining process, called a hash function, can be performed much more efficiently by expensive, custom���designed computers than with an ordinary PC. As a result, mining has become an increasingly specialized activity, with people spending thousands of dollars on chips whose only function is to mine Bitcoins....

It���s no longer cost���efficient to mine Bitcoins with an ordinary PC���the electricity consumed is worth more than the bitcoins produced.... A Bitcoin alternative called Litecoin replaces Bitcoin���s hash���based mining process with an alternative that���s harder to accelerate with dedicated hardware.... As this is being written, the value of all Litecoins is more than. 500 million dollars....

The second Bitcoin flaw is the... mining process is a computational arms race.... The Bitcoin principle that miners with more computing power earn more Bitcoins is known as 'proof of work'. Several Bitcoin alternatives use an alternative principle called 'proof of stake', where miners with the most virtual cash earn the most. That approach eliminates the incentive to spend ever-larger sums of money on mining hardware, which is good for the environment....

All bitcoins in circulation are worth around 10 billion dollars. Its nearest rival, Litecoin, has a total market value of around 500 million dollars. The other virtual currencies are worth much less...

UPDATE (2014):

Okay. Suppose that you're on the island of Yap and it is the late 18th century...

You want to get richer. You can either work on Yap doing something useful, or catamaran over to Palau where the limestone is, carve a big piece of limestone into a disk, catamaran it back, and use it as money. If the value of stone money is too low, it won't be worth anyone's while to catamaran over to Palau. Thus the stone money supply will stop growing if the price dips. As long as the relative desire to use stone money does not shrink faster than per-capita income on Yap plus the population of Yap grows, the value of stone money on Yap will be determined by its cost of production--that is, the cost of catamaraning it over to Palau, carving the limestone disk, and bringing it back...

We can see this at work come the late 19th century. Europeans show up with steel tools that make it a lot easier to carve limestone disks on Palau. Thus there is a huge boom in the limestone disk-carving stone money-mining industry. And the value of stone money on Yap Falls as the money supply grows...

Now suppose that you were on the Internet and it is the early 21st century...

You want to get richer. You can either work doing something useful, or you can set up a botnet to mine BitCoins, or you can fork the code behind BitCoin and set up your own slightly-tweaked virtual cryptographic money network. Setting up a new, alternative network is really cheap. Thus unless BitCoin going can somehow successfully differentiate itself from the latecomers who are about to emerge, the money supply of BitCoin-like things is infinite because the cost of production of them is infinitesimal.

How can BitCoin successfully keep itself differentiated from the latecomer copiers?

By asserting, over and over again, simply that it was first. And this might work. But I am skeptical.

By stressing that it has a trustworthy track record of being a safe store of value--and thus appealing to a history that the latecomers do not have. This works until someday, for some reason, demand for BitCoins falls. Then supply and demand drives the value down. BitCoin is then no longer differentiated as a safe store of value. Then the people who were holding BitCoin because they thought it was a safe store of value dump it, its price falls even more, and so it becomes even more questionable as safe store of value. And the downward spiral continues.

Note that in these respects--unless it can successfully and permanently differentiate itself from other virtual cryptographic money networks--BitCoin is like fiat money, and unlike 18th and 19th century Yap stone money, in that its cost of production is zero.

So how do actual fiat moneys maintain their value? Well, they don't always do so--cough Zimbabwe, cough Weimar Germany. When they do so, it is because a government (a) accepts its money in payment of taxes, thus giving people a reason to hold it, (b) doesn't want the financial chaos that hyperinflation would generate, and so (c) sets its central bank the mission of being a currency sink--of maintaining the value of the currency by buying it back and burning it up if necessary. Thus I tend to be a "chartalist": commodity moneys can maintain their value via their cost of production, but fiat moneys maintain their value when some very large too-big-to-fail entity backs them.

In my view, BitCoin's chances would be a lot better if there were some large and durable entity that promised to be a BitCoin sink if necessary. If, say, Google Cayman Islands were to start GoogleCoin, and announce that it would always stand ready to buy back GoogleCoins at a fixed real value, it could make a (small) fortune and, I think, eliminate BitCoin's business in a month...