J. Bradford DeLong's Blog, page 98

I wish to once again flag this: Recession Ready. We are n...

I wish to once again flag this: Recession Ready. We are not yet out of time to take steps to keep the next recession from turning into a depression. But the clock is ticking. Here is an issue are in which the sooner we take action, the better. And here we at Equitable Growth and the Hamilton Project have, I think, done a very good job: Equitable Growth: Recession Ready https://equitablegrowth.org/recession-ready-2/: "Economic recessions are inevitable and they are painful, with harsh short-term effects on families and businesses and potentially deep long-term impacts on the economy and society. But we can ameliorate some of the next recession���s worst effects and minimize its long-term costs if we adopt smart policies now that will be triggered when its first warning signs appear. Equitable Growth has joined forces with The Hamilton Project to advance a set of specific, evidence-based policy ideas for shortening and easing the impacts of the next recession...

#noted #2017-10-27

Looking forward to this. Still, Heather, $26.55 for an eb...

Looking forward to this. Still, Heather, $26.55 for an ebook?: Hooks Book Events: "Please join us Oct. 30th, for Programs w/ a Purpose with @HBoushey, Pres./CEO of @equitablegrowth. She will discuss her book, Unbound: Heather Boushey Unbound: How Inequality Constricts Our Economy and What We Can Do about It: 'Many fear that efforts to address inequality will undermine the economy as a whole. But the opposite is true: rising inequality has become a drag on growth and an impediment to market competition. Heather Boushey breaks down the problem and argues that we can preserve our nation���s economic traditions while promoting shared economic growth...

#books #noted #2019-10-27

Matthew Martin: "It doesn't usually get spelled out this ...

Matthew Martin: "It doesn't usually get spelled out this way https://twitter.com/hyperplanes/status/1125383936258052097, but the father of Clovis���the first french king���seems to have been a kind of Roman governor https://t.co/xfhgPnx3V0

#noted #history #2019-10-27

Let me highlight this once again: The very sharp Martin W...

Let me highlight this once again: The very sharp Martin Wolf reacts to the Business Roundtable's recognition that it and the corporations of which it consists need to take on a much broader system-stabilization role. In my view, the first thing the Business Roundtable and its fellow travelers need to do is for them to recover control of the political right from the armies of political and media grifters. They need to weigh on on what right-wing politicians ought to stand for. So far they have not:

Martin Wolf: Why Rigged Capitalism Is Damaging Liberal Democracy https://www.ft.com/content/5a8ab27e-d470-11e9-8367-807ebd53ab77: "Economies are not delivering for most citizens because of weak competition, feeble productivity growth and tax loopholes.... The��US Business Roundtable, which represents the chief executives of 181 of the world���s largest companies, abandoned their longstanding view that 'corporations exist principally to serve their shareholders'.... What does���and should���[this] moment mean? The answer needs to start with acknowledgment of the fact that something has gone very wrong. Over the past four decades, and especially in the US, the most important country of all, we have observed an unholy trinity of slowing productivity growth, soaring inequality and huge financial shocks.... The economy [is] not delivering... in large part... [because of] the rise of��rentier capitalism.... Market and political power allows privileged individuals and businesses to extract a great deal of such rent from everybody else.... If one listens to the political debates in many countries, notably the US and UK, one would conclude that the disappointment is mainly the fault of imports from China or low-wage immigrants, or both. Foreigners are ideal scapegoats. But the notion that rising inequality and slow productivity growth are due to foreigners is simply false.... Members of the Business Roundtable and their peers have tough questions to ask themselves. They are right: seeking to maximise shareholder value has proved a doubtful guide to managing corporations. But that realisation is the beginning, not the end.... We need a dynamic capitalist economy that gives everybody a justified belief that they can share in the benefits. What we increasingly seem to have instead is an unstable rentier capitalism, weakened competition, feeble productivity growth, high inequality and, not coincidentally, an increasingly degraded democracy. Fixing this is a challenge for us all, but especially for those who run the world���s most important businesses...

#noted #2019-10-27

Comment of the Day: Maynard Handley https://www.bradford-...

Comment of the Day: Maynard Handley https://www.bradford-delong.com/2019/10/very-briefly-noted-2019-10-07-1-clearkimura-_how-to-convert-document-from-google-docs-to-text-file_-no-need-to.html?cid=6a00e551f0800388340240a4b711d1200d#comment-6a00e551f0800388340240a4b711d1200d in "How to Convert Document from Google Docs to Text File"Even more useful is that Google Docs provides access to what has been (in my experience) by far the best OCR system available. Upload a JPG (and I'm guessing probably other image formats like PDF scans, but I haven't yet tried that) to your Google Drive, and then in your browser in the Google Drive window, right/ctrl-click on the image and choose "Open in Google Docs". You'll get a document opened with the text of the image. I've found that this works not just for the easy cases, but even the tough stuff -- small low quality images, multiple columns, things like that. A little more hassle than the various OCR+scanner apps I've paid for but vastly higher quality. (Supposedly MS Live can do the same thing, but I tried getting to MS' OCR from a dozen different angles, on iOS and Mac, through the web and through OneNote, and gave it up. MS may have the greatest OCR scheme on earth, but they've hidden access to it so well it's useless to me.) (Apple have adopted a strange tactic WRT to OCR. Many things on an iOS13 system are automatically text OCR'd, like any scans or images you dump into Notes or Messages. And this text is indexed, so that the relevant scans/images appear in searches. But you can't get at the underlying text for other purposes, whether to edit it or just to read it. It's unclear if this was just not enough time to ship by iOS13, or if it's an attempt to warn other OCR vendors to find some other app category soon, so that there's less grumbling and the usual anti-competitive complaints when Apple does ship. Either way, this particular design choice means that, at least right now, I can't yet compare the quality of Apple's work to that of Google.)...

#commentoftheday #2019-10-27

Fifteen Worthy Reads from October 25, 2018

Worthy Reads at Equitable Growth

Alix Gould-Werth: What upticks in U.S. economic inequality and incarceration mean for marriage - Equitable Growth : "...

...The work of these three researchers indicates that increasing inequality in the United States has consequences beyond the material circumstances of those at the bottom of the income distribution. Lower bank account balances, for example, affect people���s romantic lives and family composition. What does this mean for policy? Because other research shows that married people have higher rates of economic security, some experts call for the promotion of marriage. Schneider and his co-authors��� work suggests that these policy proposals may be putting the cart before the horse. If policymakers instead start by improving economic circumstances, rates of marriage are likely to increase. This could lead to a virtuous circle, in which people have the resources they need to form the families they desire, which, in many cases, may further bolster their economic circumstances or insulate them from economic hardship.
Schneider and his co-authors also show that incarceration has effects that ripple beyond the immediate impact on the confinement of and concomitant declines in well-being among incarcerated people. Incarceration affects not only the family relationships of African American and low-educated men who are most likely to be incarcerated but also the family formation of low-educated women. While much literature investigates whether marriage is a protective factor against justice involvement, policymakers may again wish to move the proverbial cart and focus on the long-reaching benefits that reducing incarceration may have for families....

Elisabeth Jacobs: Paid Family and Medical Leave in the United States - Equitable Growth: "... >...Caregiving needs span the life cycle, and changes in women���s labor force participation in the United States mean that the majority of families no longer have a stay-at-home spouse to provide unpaid care. Yet too many workers who need time off to care for a new baby, a sick loved one, an aging family member, or their own health may do so only at the expense of their own financial well-being���and the cumulative cost of this failure takes a broader toll on the health of the U.S. economy. A growing number of states are experimenting with policies designed to provide widespread access to paid family and medical leave, which creates a window of opportunity for expanding the knowledge base about the demand for paid caregiving leave across the life cycle, as well as the costs and benefits of paid leave policies for individuals, families, businesses, and the economy as a whole. This paper explores the evidence from the United States on the need for and impact of paid family and medical leave, considering parental, caregiving, and medical leave separately, and surveys a wide range of literature that spans labor market outcomes, health outcomes, and broader macroeconomic outcomes, including policy spillovers. In doing so, it lays out a research agenda designed to accelerate the evidence base for future state and federal policymakers....

Greg Lieserson: Slide presentation: How should Treasury and the IRS conduct cost-benefit analysis of tax regulations? - Equitable Growth: "... >...Equitable Growth���s Director of Tax Policy and Senior Economist Greg Leiserson participated today in the Tax Policy Center���s event ���Costs and Benefits of Tax Regulations: Exploring Treasury���s and OMB���s New Responsibilities.��� In his presentation, Leiserson argues that the traditional tools of tax analysis are the appropriate tools for the cost-benefit analysis of tax regulations, and that cost-benefit analysis should report estimates of the revenue, distribution, and compliance-cost impacts of a proposed regulation. Social benefits and social costs are not quantified in this approach���and should not be quantified���because doing so would require assumptions about the value of revenues and the appropriate distribution of the tax burden. Treasury and the IRS should not claim to have definitive answers to these questions in a regulatory impact analysis...

Delaney Crampton: Gerrymandered school districts perpetuate segregation by keeping low-income students out, which is bad for economic growth - Equitable Growth: "In 1954, Brown v. Board of Education was the unanimous U.S. Supreme Court ruling that led to the beginning of the end of blatant racial segregation of children in public schools. Actual desegregation took decades to enforce and is still incomplete in many local school districts across the United States. But what���s equally troubling is a new type of segregation in some school districts���gerrymandered school borders that fence out students from economically stressed families, which often means new segregation along racial and ethnic lines. With economic inequality on the rise sharply over the past four decades, families are increasingly segregated into communities based on income status, resulting in public schools becoming increasingly segregated by income. Research from 2014 Equitable Growth grant recipient Sean Reardon of Stanford University, Christopher Jencks of Harvard University, and Ann Owens of the University of Southern California found that between 1990 and 2010, the segregation of public-school families by income between school districts had increased by more than 15 percent....

Elisabeth Jacobs and Liz Hipple: Are today���s inequalities limiting tomorrow���s opportunities? - Equitable Growth: "Comparing the relationship between inequality and intergenerational mobility across developed economies, City University of New York economist Miles Corak found that in countries where inequality is high such as the United Kingdom and United States, there is a strong relationship between a parent and a child���s economic outcomes. Conversely, in countries where inequality is lower such as Norway and Denmark, the relationship between a parent and child���s economic outcomes was not as strong.1
Comparing the relationship between inequality and intergenerational mobility across different parts of the United States, Harvard University economist Raj Chetty found that mobility varied dramatically across the United States and that high inequality was one of the factors correlated with low mobility. Some cities such as Salt Lake City have rates of mobility similar to countries with high rates of mobility such as Denmark. Other cities such as Atlanta and Milwaukee have rates of mobility lower than other developed countries.2
Metrics matter for making sense of the relationship between inequality and mobility. Relative (or rank) mobility compares a child���s rank in the economic distribution to the child���s parents��� place in the distribution at a similar point in the life cycle. Imagine a child born into a family with a total household income in the bottom 20th percentile of the distribution of all household incomes. As a young adult, that now-adult-child���s household income at a comparable point in life is in the 75th percentile of the distribution of all household incomes. This is relative upward mobility. Relative mobility is, by definition, a zero-sum proposition: If a particular child moves up in rank from childhood to adulthood, then someone else, by definition, must move down.

 

Worthy Reads Elsewhere

The Federal Reserve's public view of the likely path of the economy now lacks coherence. This is a bad thing. It may mean that the Federal Reserve's private view of the likely path of the economy now lacks coherence, in which case policy will lack coherence. It certainly means that market participants can no longer plan on the Federal Reserve having a known coherent view of the economy: Joe Gagnon: Tension Remains at the Heart of the Fed���s Forecast: "The Federal Open Market Committee (FOMC, or Fed) surprised no one at its September meeting by raising the target for the federal funds rate a quarter of a percentage point to a range of 2.00 to 2.25 percent. The FOMC has been tightening monetary conditions very slowly since late 2015...

Eric Levitz: Tribalism Isn���t Our Democracy���s Problem. The GOP Is: "Ordinary Republican and Democratic voters don���t disagree about public policy much more than they used to, but they still fear and loathe each other more than at any point in our nation���s modern history.... electoral politics has always been 'identity' politics. What is new is how cleanly the two-party system currently divides Americans along lines of racial, religious, and regional identity.... Few rural white Evangelical Christians can vote for a Democrat in 2018 without betraying all of their definitions of who 'their people' are...

Sarita Gupta, Stephen Lerner, and Joseph A. McCartin: It���s Not the 'Future of Work,' It���s the Future of Workers That���s in Doubt: "Nearly every discussion of labor���s future in mainstream media quickly becomes mired in a group of elite-defined concerns called 'The Future of Work'.... Rarely has a phrase been so ubiquitous in discussions of the economy or social policy.... [But] it is the concentration of wealth and power in this new economy, not computerization or artificial intelligence, that represents the gravest threat to our future...

THE MUST-READ OF MUST-READS on the links between behavioral finance and macro: John Maynard Keynes (1936): The State of Long-Term Expectation: The General Theory of Employment, Interest and Money: Chapter 12: "If I may be allowed to appropriate the term _speculation for the activity of forecasting the psychology of the market, and the term enterprise for the activity of forecasting the prospective yield of assets over their whole life, it is by no means always the case that speculation predominates over enterprise. As the organisation of investment markets improves, the risk of the predominance of speculation does, however, increase...

Antonio Fat��s: Europe's fiscal policy doom loop: "The damage done by procyclical fiscal policy in the euro area between 2010 and 2014 is likely to be even larger.... Fiscal policymakers... created a 'doom loop', with unfounded pessimism feeding into policy... the consequences of those policies increasing pessimism... hysteresis, permanently reducing GDP...

Stewart Brand: The Whole Earth Catalog���s Long Legacy over 50 years: "Stewart lays out out how the Whole Earth Catalog 'conferred agency' and spawned many subsequent efforts.... The special role of San Francisco and California to the rest of America-and especially to the East Coast.... Stewart ponders whether the Whole Earth Catalog marked the beginning of a shift to a new kind of 21st-century civilization.... Stewart on why he is optimistic about the next 50 years...

Jiahua Che and Yingyi Qian: Insecure Property Rights and Government Ownership of Firms>: "The ownership of firms in an environment without secure property rights against state encroachment. 'Private ownership' leads to excessive revenue hiding, and 'state ownership' (i.e., national government ownership) fails to provide incentives for managers and local governments in a credible way.... 'Local government ownership'... may better serve the interests of the national government...

A very interesting study of what appears to be highly successful job search assistance in Nevada: Day Manoli, Marios Michaelides, and Ankur Patel: Long-Term Effects of Job-Search Assistance: Experimental Evidence Using Administrative Tax Data: "Administrative tax data... examine the long-term effects of an experimental job-search assistance program operating in Nevada in 2009...

Seth Godin: Throat : "Begin in the middle. The first paragraph, where you lay out what's about to happen. The half-apology you use to preface your comments at the meeting. The email that takes a paragraph or two to get to the point���. You can skip those. Throat clearing is a good way to make sure that people are looking at you. And an even better way to give yourself time to collect your thoughts, to indulge your fears or to get yourself warmed up. But we're already looking at you. We've clicked through to your link, given you the microphone, read your note���

Cosma Shalizi: Alien Failure Modes of Machine Learning: "They have such alien failure-modes, and... don't have the sort of flexibility we're used to from humans or other animals. They generalize to more data from their training environment, but not to new environments.... If you take a person who's learned to play chess and give them a 9-by-9 board with an extra rook on each side, they'll struggle but they won't go back to square one; AlphaZero will need to relearn the game from scratch...

Milton Friedman (1982): Free Markets and the Generals: Weekend Reading

Milton Friedman* (1982): Free Markets and the Generals: "The adoption of free-market policies by Chile with the blessing and support of the military junta headed by General Pinochet has given rise to the myth that only an authoritarian regime can successful ly implement a free-market policy. The facts are very different. Chile is an exception, not the rule. The military is hierarchical, and its personnel are imbued with the tradition that some give and some obey orders: it is organized from top down. A free market is the reverse. It is voluntaristic, authority is dispersed; bargaining, not submission to orders, is its watchword; it is organized from the bottom up...

...Military juntas in other South American countries have been as authoritarian in the economic sphere as they have been in politics. So were General Franco and the Greek colonels. Some have introduced free-market elements to meet an economic crisis���but so did Russia in the 1920s with its new economic policy and so has China in recent years. However, to the best of my knowledge, none, with the exception of Chile, has supported a fully free market economy as a matter of principle.

Chile is an economic miracle. Inflation has been cut from 700% a year in mid-1974 to less than 10% a year. After a difficult transition, the economy boomed, growing an aver age of about 8% a year from 1976 to 1980. Real wages and employment rose rapidly and unemployment fell. Imports and exports surged after export subsidies were eliminated and tariffs were slashed to a flat 10% (except for temporarily higher rates for most automobiles). Many state enterprises have been denationalized and motor transport and other areas deregulated. A voucher system has been put into effect in elementary and secondary education. Most remarkable of all, a social-security reform has been adopted that permits individuals to choose between participating in the government system or providing for their own retirement privately.

Chile is an even more amazing political miracle. A military regime has supported reforms that reduce sharply the role of the state and replace control from the top with control from the bottom. This political miracle is the product of an unusual set of circumstances. The chaos produced by the Allende regime that precipitated the military takeover in 1973 discredited central economic control. In an attempt to rectify the situation, the military drew on a comprehensive plan for a free-market economy that had been prepared by a group of young Chilean economists, most, though not all, of whom had studied at the University of Chicago. For the first two years, the so-called ���Chicago boys' participated in implementing the plan but only in subordinate positions, and there was little progress in reducing inflation. Somewhat in desperation, the junta turned major responsibility over to the Chicago boys. Fortunately, several of them combined outstanding intellectual and executive ability with the courage of their convictions and a sense of dedication to implementing them���and the economic miracle was on its way.

Chile is currently having serious difficulties���along with much of the rest of the world. And the opposition to the free-market policies that had been largely silenced by success is being given full voice���from both inside and outside the military.

This temporary setback will likely be surmounted. But I predict that the free-market policy will not last unless the military government is replaced by a civilian government dedicated to political liberty���as the junta has announced is its intention. Otherwise, sooner or later���and probably sooner rather than later��� economic freedom will succumb to the authoritarian character of the military. A civilian government, too, might destroy the free-market���after all, Allende was doing so in Chile when he was overthrown by the military.

A civilians government, too, might destroy the military���after all, Allende was doing so in Chile when he was overthrown by the military. Yet it is no accident that the spread of the free market in the nineteenth century was accompanied by the widening of political liberty and that although politically free societies have moved in the direction of collectivism, none has gone all the way except through the force of arms.

I have long argued that economic freedom is a necessary but not sufficient condition for political freedom. I have become persuaded that this generalization, while true, is misleading unless accompanied by the proposition that political freedom in turn is a necessary condition for the long-term maintenance of economic freedom.

#economicgrowth #politicaleconomy #weekendreading #2019-10-27

Very Briefly Noted 2019-10-27:Mark Graham: The Wayback...

Very Briefly Noted 2019-10-27:

Mark Graham: The Wayback Machine���s Save Page Now is New and Improved https://blog.archive.org/2019/10/23/the-wayback-machines-save-page-now-is-new-and-improved/: 'You can now save all the ���outlinks��� of a web page with a single click.... When users are logged in with their free Archive.org account, SPN-generated archives can be saved to that user���s ���My web archive��� public gallery of archived pages.... In addition to capturing more high-quality archives of web page elements (HTML, JavaScript, Image files, etc.), SPN can now also produce a screenshot...

Roderick Long: Old Philosopher Yells at Clouds https://aaeblog.com/2019/10/21/old-philosopher-yells-at-clouds/: 'I���m sure I can���t be the first to notice the ways in which Plato���s Protagoras is framed as a response to Aristophanes��� Clouds, but I���m not aware of any previous discussion of the connections I have in mind.... I have in mind a more specific set of dramatic parallels...

Alison Flood: Susan Sontag was true author of ex-husband's book, biography claims https://www.theguardian.com/books/2019/may/13/susan-sontag-her-life-benjamin-moser-freud-the-mind-of-the-moralist-philip-rieff: 'Sontag: Her Life says she wrote Freud: The Mind of the Moralist by Philip Rieff, whom she married at 17...

Allison Martell: Canada's Trudeau Clings to Power, but Loses Some of His Luster https://www.reuters.com/article/us-canada-election-trudeau-newsmaker/canadas-trudeau-clings-to-power-but-loses-some-of-his-luster-idUSKBN1X1065: 'Canadian Prime Minister Justin Trudeau held on to his job in Monday���s election, securing his spot as one of the world���s few high-profile progressive leaders, but tarnished by scandal and with his power diminished...

Kevin Jones: Downtown Berkeley's Logan Park Wins Zoning Board Approval Thursday Night https://www.berkeleyside.com/2019/10/25/downtown-berkeleys-logan-park-wins-zoning-board-approval-thursday-night: 'Logan Park is... what owner William Schrader Jr. described as ���the largest project possible allowed under the downtown plan and the density bonus���... two buildings that will occupy much of the block on Shattuck Avenue between Channing Way and Durant... hundreds of units for residents���most likely students���and many retail spaces as well...

Apple: Record Video and Audio in a Keynote Presentation https://support.apple.com/kb/PH28041?locale=en_US...

Apple: Edit Video and Audio in Keynote Presentations https://support.apple.com/kb/PH28037?locale=en_US&viewlocale=en_US...

Wikipedia: List of Marshals of France https://en.wikipedia.org/wiki/List_of_Marshals_of_France#Vincent_Auriol,_1947%E21954...

#noted #verybrieflynoted #2019-10-27

That your grandfather Governor John Buchanan campaigned a...

That your grandfather Governor John Buchanan campaigned against federal voting rights acts, raised the poll tax, and established pensions for Confederate veterans���that all that goes unmentioned in the context of "I have shared in the emotional damage imposed by discrimination...", "From that day forward I have shared in the emotional damage imposed by discrimination..." and "'fairness' assumed for me a central normative position..." demonstrates either an absolutely stunning lack of self-awareness or a conscious intellectual judo move to distract attention from the racial politics of the white southern establishment: James Buchanan (2009): Karen Ilse Horn, ed, "Roads to Wisdom: Conversations with Ten Nobel Laureates in Economics" https://delong.typepad.com/document.pdf: "What did the Navy teach you?... I experienced overt discrimination for being a non-Easterner, a nonestablishmentarian. In the whole group of 600 boys, there were only about twenty who were graduates of Yale, Harvard, Princeton���all Ivy League. By the end of this first boot camp period, they had to select midshipman officers. Out of the 20 boys from the establishment universities, 12 or 13 were picked, against a background of a total of 600. It was overtly discriminatory towards those of us who were not members of the establishment... James Buchanan (2009): Better than Plowing: "From that day forward I have shared in the emotional damage imposed by discrimination, in any form, and 'fairness' assumed for me a central normative position decades before I came to discuss principles of justice professionally and philosophically...

#noted #2019-10-27

MXCity: Mexico City���s Mountains: Every Possible Elevati...

MXCity: Mexico City���s Mountains: Every Possible Elevation:

...Mexico City occupies the grand base of a massive bowl formed by the meeting of two mountain ranges... [that] easily reach 5,000 meters.... The Sierra Madre Occidental and... the Sierra Madre Oriental. Mexico City rests at the confluence of the two... [and] the Trans-Mexican Volcanic Belt... accounts for... a string of volcanoes... across the central part of Mexico.... Mexico City���s mountains aren���t always obvious.... But one day, a friend will invite you to the rooftop patio. Perhaps in the east of the city you���ll discover that Popocatepetl is right there.... In the south, you may see Ajusco. To the north, friendly Cerro del Chiquihuite has been waving to the exodus leaving the city via Indios Verdes for decades. On a clear day, they can be witnessed from almost any area of Mexico City...

#noted #2019-10-31