Barter and Exchange Leads to Trucks

Interesting article. The reason that humans started to outpace Neanderthals is... exchange, and division of labor.


Nod to Angry Alex

P-Krug Gets Schooled

Tyler comes up really, really big here.

I particularly like point #3, both parts A and B. To paraphrase:

A. Offshore drilling WAS regulated. Why isn't the failure an indictment of regulation?

B. The standard public choice critique is certainly not that markets are perfect. It is that government agencies are subject to problems of information acquisition, capture by industry, and desire for increased revenue. I have almost never heard a libertarian say that markets perform perfectly. The core of the free market position is that government agencies can be counted on to perform less well than P-Krug imagines.

In short, you can't criticize the model of perfect competition unless you are also willing to abandon the model of perfect government.

As usual, and as has been argued here before, LvM said it best:

Scarcely anyone interests himself in social problems without being led to do so by the desire to see reforms enacted. In almost all cases, before anyone begins to study the science, he has already decided on definite reforms that he wants to put through. Only a few have the strength to accept the knowledge that these reforms are impracticable and to draw all the inferences from it. Most men endure the sacrifice of the intellect more easily than the sacrifice of their daydreams. They cannot bear that their utopias should run aground on the unalterable necessities of human existence. What they yearn for is another reality different from the one given in this world...They wish to be free of a universe of whose order they do not approve.
(Ludwig von Mises, Epistemological Problems of Economics)

P-Krug is a smart guy. But he has been whoring his intellect in service of his daydreams for a decade now.

UPDATE: I have to add this, from a comment by David--

Krugman's first foray into this was to argue that the oil spill was proof that liability didn't work. In other words, we have a disaster in a heavily-regulated industry with liability caps, and we conclude from that that liability doesn't work.

Nice!

UPDATE: Related post.... Nicely done, sir. Thanks for the tip in comments.

Underwear, and Rowing

Went to the regatta in Tampa, for the YYM's rowing team.

I should note that the Mungowi have a custom. When we travel, the LMM brings three large suitcases, but forgets something, something important. Famously, when we were travelling to Fundman's wedding, with Neanderbill she forgot (wait for it) HER DRESS. So we were flopping about like fish, searching malls. That story has been told, before.

This time? Underwear. She didn't bring any underwear. (I'm playing this straight, not going to any of the obvious places I might go.)

(And I should note that the lovely Ms. Angus likewise once arrived in NC without undies (except the ones she was WEARING, I hasten to add.) So the Angii and I went to a Kohl's or something, and there in the ladies underwear aisle, a place I had not been before, we saw a very heavily veiled and robed Muslim woman, completely covered, shopping. She was shopping for some amazingly racy thongs and lacy little nothings. Holding up those little g-string looking undies to the light, while she was totally hooded in heavy black cloth. Strange. Anyway, Ms. Angus got some sensible American made-in-Mexico underwear, and we were off.)

So I had to find a Tar-shay, or something like that, and buy the LMM some undergarments. I did find a Target, and this time in the ladies undies aisle there were two elderly women, Brits from their accents, arguing fiercely about whether the double panels in the enormous granny style, come-up-to-your-neck, panties would "control spotting." EEEEWWWWWW! They were loud, and pulling back and forth and holding up the crotch panels to the light. (This, ladies, is why men don't like to buy that sort of stuff. One elderly Brit-women-arguing-about-spotting wipes out at least five Muslim-woman-holding-up-thongs experiences.)

Anyway, all is well, and the LMM no longer has to travel commando. (Or "true Scotsman"). But as soon as we get to the regatta site, we see ....this! Nice!

The regatta site is huge, and crowded. It looked like this, for more than a mile, solid.

Hard to see the actual races, out on the lake. But the YYM rows in a 4-boat, like this one:

Back at the airport, spirits were high. The YYM was dressed all in black, with sunglasses. He's in the middle.

One of our boats, the lightweight 2 men, made it to Nationals, by coming in 2nd in the finals and winning a silver medal. (Our team is Triangle Rowing Club, btw). Yay! Very exciting.

YYM at the beach....

If you haven't seen the YYM for a while, that's him on the right.

NC Beaches.... nice.

Turn out the lights, the party's over

In my younger days, I tried to publish a paper entitled "How Dead is the Solow Model?"

Let me reproduce in full the abstract to that paper below:

"Stone dead."

Needless to say, I got nowhere, and it wasn't until Mrs. Angus came on board that a much revised, improved and toned down version got published in the Journal of Development Economics.

Undaunted, I rise this lovely morning to proclaim that Keynesian economics, despite recent wide spread reports of its revival, is indeed, "Stone dead".

People, we have seen a literal mountain of government spending around the globe. And what do we have to show for it? An avalanche of unsustainable deficits and sovereign debt levels.

In the long run, it is true that we are all dead. But meanwhile, until that blessed day arrives, we are all broke!

The smartest thing many countries could do right now is the old double D; Default and Devalue. However, the likely result will be a "lost decade" of immiserizing policies undertaken at the behest of Keynes' most horrible creation, the IMF.

Tell us how you really feel

Jazz guitarist Pat Metheny really doesn't like Kenny G and really really likes the late Louis Armstrong. So when Kenny overdubbed his music on top of Pops, Pat went mental:

"But when Kenny G decided that it was appropriate for him to defile the music of the man who is probably the greatest jazz musician that has ever lived by spewing his lame-ass, jive, pseudo bluesy, out-of-tune, noodling, wimped out, f***ed up playing all over one of the great Louis's tracks (even one of his lesser ones), he did something that I would not have imagined possible. He, in one move, through his unbelievably pretentious and calloused musical decision to embark on this most cynical of musical paths, shit all over the graves of all the musicians past and present who have risked their lives by going out there on the road for years and years developing their own music inspired by the standards of grace that Louis Armstrong brought to every single note he played over an amazing lifetime as a musician. "

The whole essay is well worth reading (find it here).

Hey Mungo, I like Pat's style. Can we get him to guest blog some this summer?

Amazing, But Not Surprising

This is a problem for every state in the U.S.

Can you explain to me again how excessive compensation in private employment requires people like this to regulate us?

2008 Election Analysis

Insiders, Outsiders, and Voters in the 2008 U.S. Presidential Election

Melvin Hinich, Daron Shaw & Taofang Huang
Presidential Studies Quarterly, June 2010, Pages 264-285

Abstract: In 2008, both Barack Obama and John McCain repeatedly talked about "reform" and "change" on the campaign trail, presumably believing that voters would respond to a president who could challenge the established way of doing business. The authors gauge the significance of "reform" politics in 2008 through two analyses. First, they estimate a two-dimensional issue space, paying particular attention to the possibility of a reform /establishment dimension. Second, they consider whether voters (1) preferred reform candidates, and (2) saw Obama or McCain as credible reform candidates. The data indicate the existence of a reform-establishment dimension. However, neither Obama nor McCain effectively convinced voters that they were reformers.

----------------------

Did Bush Voters Cause Obama's Victory?
Arthur Lupia, PS: Political Science & Politics, April 2010, Pages 239-241

Abstract: In the 2008 election, Barack Obama's campaign brought many new voters to the polls. Were these new voters necessary for Obama's victory? In this study, I find that they were not. The basis of this finding is an examination of decisions made by people who voted for George W. Bush in 2004. I show that Bush voters' decisions not to vote or to support Obama were a sufficient condition for Obama's victory.

(Nod to Kevin L)

Self-fulfilling prophecies or How to make it in America

"THIBODAUX, La. – A man who told police that God told him to walk the streets naked to save his soul has been arrested. Thibodaux police responded to an obscenity complaint around 2 a.m. Thursday and found Shafiq Mohamed walking nude down the street. When approached, Mohamed reportedly told officers that "America raped him" and added God told him to walk the streets naked to save his soul.

Mohamed was taken into custody and charged with obscenity. He was booked into the Lafourche Parish Detention Center where he awaited bail.

It was not immediately known whether Mohamed has an attorney."

Link is here. I believe I'll just let this one speak for its ownself.

Distribution Channels

Nice post on Libertarian views of income distribution from my friend Will W, with some riffs from D. Friedman and R. Frank.

The Catholic Church in Latin America

Great essay by one of my favorites, Alma Guillermoprieto.

Here's her take on the late, unlamented Father Maciel:

"A great achiever and close associate of John Paul II, Maciel was also a bigamist, pederast, dope fiend, and plagiarist."

Highly recommended (it would be "self recommending" but I already read it and liked it).

Thank you Jebus!

People, Doug "master of the obvious" Collins is going to coach the 76ers. While that in and of itself is neither here nor there, it does however mean that HE WILL NO LONGER BE BROADCASTING GAMES ON TNT.

All across America, you can hear the sounds of hoops fans' sphincters unclenching in relief.

Doug, baby, do I ever have an assistant coach for you! He will show your young men how to go to the front of the rim.

Not From the Onion

Though it ought to be from the Onion only.

Check this video. As far as I can tell, the two giant, big brotherish EYES are the symbol of British nanny-state intrusiveness. They got cameras in their bloody RUBBISH TIPS, after all.

(Nod to Mike G)

Adjective-free

Big ups to Mrs. Angus, whose promotion to full professor was finalized yesterday and commemorated today with a new sign on the old office door!

Way to go, sweetheart!

GM Lies, Fiscal Sanity Dies

John P. has a nice post on GM, and George Will. GoodONya, John! The best part is the YouTube on the GM "loan repayment." But I don't want to steal; you have to go to JP's page to see it.

But when are you going to send me that clip with my ACTUAL LINE, so I can post it?
"Where to, Lord Keynes?" You keep promising, you big tease, and then NOTH! ING!

I now believe in re-incarnation....

Because James Brown has come back to earth in the body of a young woman:

Hot Links!

This just in: Water is wet. Who knew?

You can now add driving to the list of things Diego Maradona is not good at.

The world's greatest sausage factory is in full swing.

3 Yikes and I'm out!

Just when you think it's safe to come out of the closet

Holy Crap, people.

More hail, more tornadoes, the Norman tornado sirens are blowing and the Angii are back in the bedroom closet, hunkered down and tuned in to the national weather service.

you know we belong to the land, and the land we belong to is....grand?

Just another band from San Jose

Costa Rica, that is!

Ladies and gentlemen, I give you Las Robertas. They are women, they are from Costa Rica, they are very very good.

More info here and here and here and here.

I'm a fan.

Photos of Five Worst Airline Meals

From Craig, who linked to photos of the five worst airline meals.

I rushed to look, because I was sure I had seen worse.

But.... nope. Those are awful.

If only I lived in Bridgeport Nebraska....

....then my non-voting might matter!

BRIDGEPORT, Neb. – A deck of cards and a bit of luck helped decide who will likely be the next sheriff of Morrill County.

The nine of hearts Milo Cardenas drew Monday beat Travis Petersen's six of spades, giving Cardenas the Republican nomination for sheriff. Since no Democrats ran for sheriff, Cardenas, the police chief in Bridgeport, is likely to win in November's election.

"I knew it was going to be close, but I didn't expect to be this close," Cardenas said.

The two men agreed to cut a deck of cards after Monday's re-count confirmed that both finished at the top of a four-man race with 379 votes after balloting ended last Tuesday. State law requires tied elections to be settled by a game of chance.

Cardenas said deciding the race with a card game seemed a little crazy but also seemed like the best option.

"I felt more comfortable with the deck of cards. That way you pick your own destiny," Cardenas said.

Brandt shuffled the cards seven times and spread them out on a table before the candidates drew cards simultaneously.

"People wanted to revote and do a lot of things, but unfortunately, Nebraska law is very clear," Morrill County Clerk Kathy Brandt said.

Brandt said none of the candidates who lost in the primary are allowed to run in the general election.

"For all those people that didn't vote, they should realize that one vote does make a difference," Brandt said.

Two points about the Morrill County Clerk, people.

(1) "unfortunately, Nebraska law is very clear"?? WTF? given that people wanted to "do a lot of things", I think it's very fortunate that the law was clear.

(2) Ms. Brandt also seems to have a very low bar for defining "making a difference"! Were these two Republican candidates for Morrill County Sheriff really so different from each other?

New Colombian Presidente Mockus, Mock You, Too

An interesting guy. Excerpt:

Perhaps Mockus is best known for his stunts. Attempting to crackdown on traffic law violations, he hired an army of mimes to stand on street corners and publicly humiliate bad drivers. It worked brilliantly. He also created his super hero alter-ego, "Super Citizen" (complete with spandex and cape), to talk to citizens about civic responsibility. This definitely drew more listeners than a mayoral speech. And then there was his most infamous move of all: In an attempt to get the attention of a tuned-out college age audience, he pulled down his trousers and mooned them. Needles to say -- the ploy worked.

Needles, indeed. Some questions:

1. What's with all the mooning, all of a sudden? Sheesh.
2. When I hear "broken window," I think of Bastiat. But most people apparently think of Giuliani. Which is the dominant metaphor?

England Lets 3rd Party Debate; Why Don't We?

I wrote an op-ed about sunshine and open debate for the Durham Herald today.

What do you think?

Squirrel Kerfuffle

The LMM and I disagree about something.

She loves hummingbirds. We have several little hummingbird drinking stations set up, hanging from metal hooks.

There is this one squirrel who has mastered the technology of hanging onto the feeder, tipping it, and then furiously drinking the contents, emptying the container onto himself, his mouth, and the ground, in about two minutes.

The LMM keeps letting the dogs out, and going out herself, to "scare off" the squirrel. But the squirrel comes right back, of course.

My solution: Squirrel dies of a gunshot wound.

Look: (1) There is only one (now fat) squirrel who is doing this. The others try, but the thing tips if they try to drink from the top. No other squirrel has mastered the "hang, tip, and quaff" technique.
(2) we have a .22 with a scope. I can fire those little tiny 20 grain "Colibri"** shells, which have a range of about 100 meters. (The standard .22 LR shell is 40 grains, and these Colibri actually have NO powder, other than the primer)
(3) I can fire downward, with grass as the background, so there is no danger of ricochet, not that these little bullets would go anywhere.

Yes, one should be very careful firing Colibris from a long gun. Not enough power to eject the casing, and in fact the bullet may not leave the barrel, so you really, really have to check after every shot. But they are quite accurate. And at a range of 10 meters, they will kill a squirrel.

All right readers: Who is right?

**Plus, "Colibri" means "Hummingbird" in French (also Spanish, and, oddly, Rumanian). How perfect is that? The fat squirrel gets taken out by a little lead hummingbird!

The Grand Game! Physician Salary Edition

Can we play The Grand Game? Can we? This is just a short version, because all we have is the abstract of the paper. (Yes, you are welcome to use a library subscription to get the actual paper. I am sure there are other delights there, also).

But for now....what is the most amazingly nonsensical claim? That's the Grand Game, folks....

Can We Close The Income And Wealth Gap Between Specialists And Primary Care Physicians?

Bryan Vaughn, Steven DeVrieze, Shelby Reed & Kevin Schulman
Health Affairs, May 2010, Pages 933-940

Abstract: Over their lifetimes, primary care physicians earn lower incomes-and accumulate considerably less wealth-than their specialist counterparts. This gap influences medical students, who are choosing careers in primary care in declining numbers. We estimated career wealth accumulation across specialists, primary care physicians, physician assistants, business school graduates, and college graduates. We then compared specialists, represented by cardiologists, to primary care physicians in four scenarios. The wealth gap is substantial; narrowing it would require substantial reductions in specialists' practice income or increases in primary care physicians' practice income, or both, of more than $100,000 a year. Current proposals for increasing primary care physician supply would do little to lessen these differences.

I'll go first!

1. Why would you WANT to have equal salaries across primary care and all specialties? Why in the world would that be any kind of important policy goal, given all the other problems we have in health care?

2. Given that one might one might have such a goal (I don't, but...), why in the name of Hippocrates would you consider reducing the income of specialists? Yes, you might encourage competition, for its many benefits, one of which might be a reduction in monopoly rents for specialists. But just going in and messing with prices, as a stand-alone goal... amazing.

(Nod to Kevin L, for the article)

Munger Sign on Private Property!

An email I received this morning:

I have an unauthorized sign advertising Mr Munger posted on private property. It is a vacant parcel #500-04-371 in Yavapai County. I appreciate the immediate removal of the sign and an explanation why it was placed without permission.
Signed,
[PERSON]

My response, in the form of a letter--
Dear PERSON: I'm pretty sure you are writing from Arizona. At least, there is a Yavapai County in AZ, but there is not one in North Carolina.

Yet you have contacted the MIKE Munger for Governor campaign, in North Carolina.

May I propose that you contact instead the JOHN Munger for Governor campaign, in Arizona.

I thought about saying that I would appreciate an explanation on why would you would send unsolicited spam to a professor in North Carolina, but people make mistakes. That may be the reason that there is a sign on your property, also.

In any case, it's not my sign.

Rally Driver Crashes After Being Mooned

Ah, the memories. Driving home from baseball games in high school.

Remember, Dutch Boy?

A Bizarre Paper, But With An Important Point

Private-Payer Profits Can Induce Negative Medicare Margins

Jeffrey Stensland, Zachary Gaumer & Mark Miller
Health Affairs, May 2010, Pages 1045-1051

Abstract: A common assumption is that hospitals have little control over their costs and must charge high rates to private health insurers when Medicare rates are lower than hospital costs. We present evidence that contradicts that common assumption. Hospitals with strong market power and higher private-payer and other revenues appear to have less pressure to constrain their costs. Thus, these hospitals have higher costs per unit of service, which can lead to losses on Medicare patients. Hospitals under more financial pressure-with less market share and less ability to charge higher private rates-often constrain costs and can generate profits on Medicare patients.

Good lord. The problem is not "profits," but rather that costs are increasing without bound. The point is that in the absence of any kind of competition, the very idea of "cost" is poorly defined. Every step along the line can charge higher prices, because the costs are passed on. You can call that profit if you want, but it's really just a transfer based on the monopoly protections afforded to health care by government restrictions on advertising, and the creation of insuperable entry barriers.

Two things you should read, if you think the article above makes sense (hint: it doesn't)

1. My little piece on insurance, at REASON
2. Nick G's cool piece on eye surgery, at ReasonTV

Cost can come down in a hurry, with competition. But the Obamacare program will, if anything, make the problem worse by focusing on insurance and bureaucratic price-fixing. In any case, blaming "profits" is the sort of idiocy you learn in public health schools, where as far as I can tell they would save time if they could just lobotomizing students. A lobotomy and an MPH are only distinguished by the size of the scar they leave; the effects are identical.

(Nod to KL for the article)

Funny sentences about the Euro Crisis

One is funny on purpose and one is funny - yikes!

"Beware of Greeks burning thrifts"

--Mary Anastasia O'Grady in today's WSJ.

“The situation was already starting to get worse on Thursday afternoon and throughout Friday of the week before last, a number of markets were no longer functioning correctly."

--Feckless ECB president J. C. Trichet as quoted by Tyler this morning.

Mary O's is astoundingly clever. I apparently have underrated her.

J.C.'s is funnier but scarier. He sees not lending to broke-ass governments = not functioning correctly.

They Probably Can't Jump, EIther

What is a "Sentence"?

I don't understand this. It may well make sense, but there are no details yet.

The Supreme Court ruled Monday the federal government has the power to indefinitely keep some sex offenders behind bars after they have served their sentences, if officials determine those inmates may prove "sexually dangerous" in the future.

"The federal government, as custodian of its prisoners, has the constitutional power to act in order to protect nearby (and other) communities from the danger such prisoners may pose," Justice Stephen Breyer wrote for the 7-2 majority

UPDATE: If this means that there is a normal hearing, going toward a criminal insanity commitment, then okay. But....if the guy is certifiably insane, how could it be that he could be tried, and sentenced in the first place? I still don't understand.

UPDATE II: Roger Pilon clarifies....

Monday Flashback: 2004 White Sox Game

Our regular Monday feature: one of my favorite posts from the distant past, on Monday. This week, the description of a visit to U.S. Cellular Field, home of those beloved Pale Hose.

The best part really was where the guy ran out on the field, and took his beer with him. When the fat security guys finally caught him, they just straight up beat the hell out of him; don't need no stinkin taser!

What's in a name?

The social science that studies the production, distribution, and consumption of goods and services.

--wikipedia

The dismal science

--Thomas Carlyle

The mechanics of utility and self interest.

--W.S. Jevons

A study of mankind in the ordinary business of life

--Alfred Marshall

Economics is a science which studies human behavior as a relationship between ends and scarce means which have alternative uses.

--Lionel Robbins


The study of how the forces of supply and demand allocate scarce resources

--investorwords.com


The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.

--F.A. Hayek

Chairity: Thursday at 7 a.m.

Thursday at 7 am: The "Countdown for Chairity" clock will go under 1,000 hours. Baby, oh baby, oh baby.

This just in: the 22nd amendment does NOT apply to Haiti

Leave it to Slick Willie to find a loophole and get back in the saddle:

"On April 15, the Haitian Parliament ratified a law extending by 18 months the state of emergency that President René Préval declared after the earthquake of January 12. The Parliament also formally ceded its powers over finances and reconstruction, during the state of emergency, to a foreign-led Interim Commission for the Reconstruction of Haiti (CIRH). The CIRH's mandate is to direct the post-earthquake reconstruction of Haiti through the $9.9 billion in pledges of international aid, including approving policies, projects, and budgeting. The World Bank will manage the money.

The majority of members on the CIRH are foreign. The criterion for becoming a foreign voting member is that the institution has contributed at least $100 million during two consecutive years, or has cancelled at least $200 million in debt. Others who have given less may share a seat. The Organization of American States and non-governmental organizations working in Haiti do not have a vote.

The CIRH is headed by U.N. Special Envoy Bill Clinton and Prime Minister Jean-Max Bellerive. The only accountability or oversight measure is veto power by Préval. Few expect him to employ his veto option, both because his record is not one of challenging the international aid apparatus, and because of possible repercussions, in terms of the dollar flow, by the CIRH."

Yikes!!!!

Hat tip to LeBron.

Tim G is Gone, But Not Forgotten

My friend Tim G, from Erlangen, is now back in Erlangen after a year at Duke.

On his last day in the U.S., I took this photo. You see Tim there in all his facets: a guitar tattoo that would be cheesy on anyone less sincere about rock music, the Buddy Holly glasses (see above), the books (he xeroxed much of the Duke library in his time here). And the earphones, so that he can play Altar or Lacuna Coil at a volume that would hurt the ears of someone at the same table if he were using ear buds. The full headphones keep all that death metal inside, where it belongs. Tim is a POLITE metal freak.

And he is sitting in the sun, in NC. Since he is now back in Germany, he will never see the sun again.

So, Tim: Alles Gute! Herzlichen Glückwunsch!

Graduation Station

My job, as chair of Poli Sci, is to read out the names of the 132 first majors (we had 200 total majors, out of a class of 1,400, meaning of course that 1 of every 7 Duke students finish with a Poli Sci major. Amazing!).

I get a lot of the names wrong. Hard to pronounce.

But this year I yelled at the kids who blow right past the podium and get their diploma w/o giving the parents a chance to take pictures. I actually made one kid come BACK, and pose again so that dad could take the picture.

We got through 12 awards, and then 132 names, complete with ample ops for pix, in 45 minutes. I made the kiddos line up, and made sure the moms / dads / uncles knew where to stand to take pictures.

Got a big hand from the parents. It's their day. Enjoy, parents! Your kid is done.

Fortunately, not too hot today, and there was a breeze. Another year over....

no fold-em hold-em, Euro style

In the gaming establishment I occasionally frequent, low-stakes poker games are referred to as "no fold-em hold-em" meaning that the tables are filled with calling stations who will pay to see every available card.

I mention this because Barry Eichengreen has chosen a poker metaphor to describe the $1 trillion Euro rescue fund:

"rather than folding their cards, European leaders doubled down. They understand that their gamble will be immensely costly if it proves wrong. They understand that their political careers now ride on their massive bet. But they also understand that they already have too many chips in the pot to fold."

"They already have too many chips in the pot to fold"?

This is a common belief. I can't tell you how many times I have heard someone justify a bad call at the poker table by saying "I was pot committed".

But people, the logic of the irrelevance of sunk costs applies in poker too.

While it is true that the size of the pot in relation to the size of the required bet to stay in can encourage someone to stay in with a weaker hand (if you are getting 8 to 1 on your money, you only have to win 12% of the time to make the call mathematically correct), that is pretty much NOT the case for the Eurozone leaders.

In poker terms, they are making a bluff raise in the hopes of getting the bond markets to fold. It's got nothing to do with chips in the pot.

Look, at least some of the PIIGS are insolvent and will eventually default. Delaying default will make things worse for the debtor countries (though it has the potential to make things better for the lending banks, which (as usual) is the real purposes of the rescue fund).

He also seems to think that the Eurozone has already won the hand:

"Europe’s fortnight mirabilis was also marked by amazing – and erroneous – predictions. Greece would be booted out of the monetary union. The eurozone would be divided into a Northern European union and a Southern European union. Or the euro – and even the European Union – would disintegrate as Germany turned its back on the project....Those forecasting the demise of the euro were wrong because they misunderstood the politics."

I admit I am more comfortable forecasting some sovereign defaults than I am the demise of the Euro, but I am pretty sure that fight is far from over. I'd say there is easily still a 1 in 3 chance that the current Euro-zone system will not survive the next 5 years unchanged. In fact, you could already say it's been dramatically changed by the "unprecedented purchases of Spanish, Portuguese, Greek, and Irish bonds by the European Central Bank."

Two final thoughts.

(1) I just don't see the rescue fund as a slam dunk game changer.

(2) I'd like to play Barry heads up in Texas hold-em

Cute Things Falling Asleep

That's all. Cute things falling asleep.

Gotta love the interwebs.

How Cool Is This?

Electoral reform? You mean it is not impossible?

Wow.

Consider the sequence of events.

1. Third party candidate allowed to participate in debates. Does well. Polls show third party might matter, might have good ideas.

2. Election takes place, where third party gets hammered, because of crooked election laws.

3. But because neither of major state-sponsored parties has a majority, third party is able to extract promise to make election law more open and less crooked.

If it happened in England, could it happen in the US? Answer: Probably not, because in the US we can't even get to step 1. Voters can't like what they can't see.

(Nod to Anonyman)

Darned Profits! They must DIE!

Heh. Heh heh. Heh.

He said "Sackodonuts."

Why loopholes are good things, segun yo.

#2 with a WTF

Here is yet another list of the top 10 most profitable college majors.

Economics is #2 (so appropriate,no?). But oh my Lord, the description!

"A pretty ubiquitous myth is that economics is all statistics and math. The fact is, while economics majors do a lot of statistics and math, they also study a wide range of topics, including social science, psychology, political science and history. Alan Metzer, even said: "economics is a social science." There are plenty of humanitarian efforts you can make in this line of work, as economists are needed to create public policy -- domestically and internationally.

Average first year salary: $50,200. Average mid-career salary: $101,000."

I am pretty sure it was NOT Alan Metzer they are trying to quote, more likely it's Alan Meltzer. However I am also pretty sure neither one of those gentlemen were the first to label economics as a social science.

But the best is the equation of "creating public policy" with "humanitarian efforts". Sweet Fancy Moses, people.

Look, econ is a good major and the pay is not bad. But we are not known for our "humanitarian efforts", and, as a rule, we don't study much history or political science.

Globalization Kills Local Culture

Pop Internationalism: Has A Half Century of World Music Trade Displaced
Local Culture?

Fernando Ferreira & Joel Waldfogel, NBER Working Paper, May 2010

Abstract: Advances in communication technologies over the past half century have made the cultural goods of one country more readily available to consumers in another, raising concerns that cultural products from large economies – in particular the US – will displace the indigenous cultural products of smaller economies. In this paper we provide stylized facts about the global music consumption and trade since 1960, using a unique data on popular music charts from 22 countries, corresponding to over 98% of the global music market. We find that trade volumes are higher between countries that are geographically closer and between those that share a language. Contrary to growing fears about large- country dominance, trade shares are roughly proportional to country GDP shares; and relative to GDP, the US music share is substantially below the shares of other smaller countries. We find a substantial bias toward domestic music which has, perhaps surprisingly, increased sharply in the past decade. We find no evidence that new communications channels – such as the growth of country-specific MTV channels and Internet penetration – reduce the consumption of domestic music. National policies aimed at preventing the death of local culture, such as radio airplay quotas, may explain part of the increasing consumption of local music.

Wow, Canada: How much BNLs, Shania, Alanis, and Neil Young can you play in a day?

(Nod to Kevin L)

give us Barabbas

for we will not have this man rule over us!

And here's why:

by the way, Bryan Caplan is totally wrong, at least about the Japanese electorate. Dude wore that shirt in public and his approval rating dropped 9 points. That, people, is what we call hyper-rational politics.

note: more fun photos at the first link!

That Darned Media

So, South Carolina's budget is in the toidy, the Gov of SC is trying to rekindle his affair with his Argentine "soul mate," and the House of Reps in SC has already given the largest sanctioning fine in its history to Gov. "Gotta get my boy wet" Sanford.

And the villain? The MEDIA. Because they got the name of the hotel wrong. Really.

(Nod to Anonyman, whose soul mate likes Loco Pops)

The 4 chord song....s

Axis of Awesome? Yes, they are pretty awesome. The 4 chord song.
Nod to Angry Alex

you wouldn't even know a diamond if you held it in your hand

I know that I am treading on thin ice here, after all, the US of A re-elected George F. Bush!

Nonetheless, I am amazed at how political pariahs can somehow rehabilitate themselves.

Consider Alan Garcia in Peru. From hyper inflation (7,649% in 1990), rampant terrorism and disgrace to, less than 20 years later being again elected President.

Of course that was perhaps a bit of an Edwards v. Dukes (vote for the crook, it's important) situation.

I was amazed to see today that Imelda Marcos and two of her children won elections in the Philippines. Imelda in the House, a Governorship for the daughter and Senator for the son.

After winning, Imelda had this to say:

"The Filipino people can be assured of our selfless and endless service and love to all."


YIKES!!

Leadership Deficit

As Dr. Newmark notes, t'ain't often that REASON and NEW REPUBLIC agree. But they do.

Yikes (NBA edition)

“I spoil a lot of people with my play. When you have three bad games in seven years, it’s easy to point them out.”

--LeBron James


Wow, people. As Wojo points out, that is not exactly what you want to hear from the league MVP after he's thrown away home court advantage and possibly his team's season in the second round of the playoffs.

Hey Moneybags!

This website shows your own personalized place in the world income distribution.

It's simultaneously fun and unsettling.

Immigration Truths

I keep thinking I'm going to write about immigration.

But I have nothing to add to what Don B. says, and links, here.

KPC Classics

I have been trying to repost what I though were some of the best of the past of KPC, on Mondays. But didn't make it in time yesterday. So, a day late, here is another classic from the Jurassic.... blogging from St Louis the day after the 2004 prez debate. I found the whole experience to be surreal, and it still seems that way, reading it nearly six years later.

Your KPC classic....

Truth in Advertising

I often make my lefty friends angry, when I say that force and coercion are the distinguishing features of government. Ultimately, both good laws bad laws are enforced by men with guns, and we are forced to obey. The men, and the guns, don't care whether the laws are good or not.

My friends deny this, and say that in fact obedience is something we all WANT to do, because it makes us happy. And all laws must be good, because government wants what is good for us.

The state of Pennsylvania has abandoned the pretense. Well done, PA.


(Nod to my man John P, at BWtHDIK)

and a mighty slow line it is....

(click on image to enlarge, hat tip to Art C.)

God hates Oklahoma

Wow people, that was a close one! Mrs. Angus, Mr. Tooty, and myself spent late yesterday afternoon and early evening hanging out in our bedroom closet listening to the tornado sirens (which was ok til the power went out), while all hell broke loose outside.

One of my favorite quotes from the National Weather Service yesterday was: "This storm likely to contain damaging hail of baseball size or greater"

I wondered if there was a such thing as baseball sized hail that was UN-damaging, and also doubted that hail could get that big.

Regarding my doubt, here is a photo posted by a local Facebook friend (thanks JPP!)

Yikes!

Article by the McCubbi!

Proposition 13 and the California Fiscal Shell Game

Colin McCubbins & Mathew McCubbins
Stanford Working Paper, December 2009

Abstract: We study the effects of California's Tax and Expenditure Limitations, especially Proposition 13. We find that Proposition 13 was indeed effective at reducing both ad valorem property taxes per capita and total state and local taxes per capita, at least in the short run. We further argue that there have been unintended secondary effects that have resulted in an increased tax burden, undermining the aims of Proposition 13. To circumvent the limits imposed by Proposition 13, the state has drastically increased nonguaranteed debt, has privatized the public fisc, and has devolved the authority to lay and collect taxes and to spend the proceeds so gained. The devolution of authority has been among the swiftest growing aspects of government finance in California, to a far greater extent than in other states. Lastly, we argue that the new tax and spending authorities that have been created to circumvent Proposition 13 have led to a reduction in government transparency and accountability and pose an increasing threat to our democracy.

(Nod to Kevin L)

Germany Blinks

Wow.

I admit I am shocked (but not awed). The Euro Nations have put together a large ($1 trillion or so) contingency fund to defend their common currency and stock markets are so far rejoicing.

But what shocks me is the fact that the ECB (European Central Bank) is now going to be directly buying government debt.

In other words, goodbye Central Bank Independence, hello Weimar 2.0???

I would call this Wow and Yikes, not Shock and Awe.

Judging Gender

Since we are likely soon to have a new female associate Justice on the SC....

Untangling the Causal Effects of Sex on Judging

Christina Boyd, Lee Epstein & Andrew Martin
American Journal of Political Science, April 2010, Pages 389-411

Abstract:
We explore the role of sex in judging by addressing two questions of long-standing interest to political scientists: whether and in what ways male and female judges decide cases distinctly — "individual effects" — and whether and in what ways serving with a female judge causes males to behave differently — "panel effects." While we attend to the dominant theoretical accounts of why we might expect to observe either or both effects, we do not use the predominant statistical tools to assess them. Instead, we deploy a more appropriate methodology: semiparametric matching, which follows from a formal framework for causal inference. Applying matching methods to 13 areas of law, we observe consistent gender effects in only one — sex discrimination. For these disputes, the probability of a judge deciding in favor of the party alleging discrimination decreases by about 10 percentage points when the judge is a male. Likewise, when a woman serves on a panel with men, the men are significantly more likely to rule in favor of the rights litigant. These results are consistent with an informational account of gendered judging and are inconsistent with several others.

Several questions occur.

1. "Panel effects"? That is not the way I would have talked about panel effects. What is meant here is the presence or absence of at least one woman on the "panel" deciding. Makes sense, but panel data is an established term.

2. The rap on SDO'C on the court was that she was erratic. (She wrote McConnell v. FEC, which was bizarre, for example). So the difference (and there may not be one) between men and women may be in the variance, not the means. And in spite of the anecdote about Sandra D., it may well be men who have higher variance. I have no idea. Just saying that the difference in the second moment would be an interesting thing to measure...

The wisdom of Tyler Cowen

He tweets:

"Some people hate me for this view, but TARP is looking better all the time."

I agree. Maybe it worsened moral hazard issues down the road, maybe some of the money has been spent beyond the intent of the program (GM anyone?), maybe it was bigger than it needed to be, but TARP and quantitative easing by the FED pretty clearly worked and worked well.

As a lagniappe, most of the money is actually getting paid back.

What do you think I am, a cuttlefish?

I am very late to this party, and for that I apologize, but have y'all seen the "green porn" and "seduce me" videos by Isabella F. Rossellini on the Sundance Channel?

Freaky-deaky to say the least.

Here is the homepage, where you can learn about the genitalia of ducks and the lack of genitalia of female bedbugs courtesy of a deranged Italio-Swede actress.

As Tyler would say, it's self-recommending!

QOTD

"People never lie so much as after a hunt, during a war or before an election." Otto von Bismarck

hat tip to Keith Gaddie

Markets in everything: Pork-o-meter edition

Sadly this isn't for the kind of pork we really need protected from (which I should have realized right away given that it was invented in Kazakhstan), but it's still awesome nonetheless:

ALMATY (Reuters) – Scientists in mainly Muslim Kazakhstan have come up with an instant test for the presence of pork in food, a popular newspaper reported on Monday.

The plastic-stick test detects food molecules that are found only in pork, which is forbidden by Islam but is easily found in the Central Asian state, Megapolis weekly said.

"It's no secret that some chefs cheat and add pork to beef to make the dish cheaper," the newspaper wrote on Monday, saying the practice was widespread in Kazakhstan.

"When you get your beef patty, cut off a couple of small pieces and drop them in a glass of water. Stir, shake, put the test stick in ... In a minute or two you will see the result."

Megapolis said it was unclear when the test, in which the stick changes color as in a pregnancy test, would become widely available.

I have to say that I think it IS pretty clear when this product will actually become widely available: Never!

Plus, I really admire the onions of a newspaper in Kazakhstan calling itself "Megapolis".

Kudos!

Laptop Dance: How Could This Go Wrong?

If you are going to steal laptops, you might not want to give full descriptions of same on Craigslist, within a week, and try to sell them in the same city.

Or, maybe you would.

Bass Ackwards Redux

I have been claiming that Greece is not ruining the Euro, but that the Euro ruined Greece. Now, compulsive tweeter Felix Salmon provides a provocative tidbit in support of this thesis:

"Greece had a primary budget surplus for every year from 1992 to 2000"

In other words, joining the Euro somehow got lenders to believe that Greece was no longer Greece.

People, they (the lenders) deserve whatever haircut they end up getting.

A good jobs report

+290,000 in April (231,000 in the private sector (yes we still have one)), and March's number was revised upward from 162,000 to 230,000.

More details:

More confident employers stepped up job creation in April, expanding payrolls by 290,000, the most in four years. The jobless rate rose to 9.9 percent as people streamed back into the market looking for work.

The hiring of 66,000 temporary government workers to conduct the census helped overall payroll growth last month. However, private employers -- the backbone of the economy -- boosted jobs, too. They added a surprisingly strong 231,000 positions last month, also the most since March 2006, the Labor Department reported Friday.

The unemployment rate rose from 9.7 percent in March to 9.9 percent in April, mainly because 805,000 jobseekers -- perhaps feeling better about their prospects -- resumed their searches for work....

Also encouraging: The employment picture in both March and April turned out to be stronger than previously thought. Payrolls grew by 230,000 in March, better than the 162,000 first reported. And, 39,000 jobs were actually added in February, an improvement from the previous estimate of 14,000 losses.

QOTD: British election edition

"The country has spoken — but we don't know what they've said,"

--former Liberal Democrat leader Paddy Ashdown

Well Hung Parliament

Brit Labour Gov Goes Up in Flames, Down in Seats!

Actually, Labour lost, and should have lost power, but the districts are so distorted in terms of seats/votes ratio that I don't see how the Brits even call these things elections. Also, the LD surge turned out to be just puff, no real blow.

And so the pound gets pounded.

This just in: A = A

From the comparable Scott Sumner:

"I think the Great Depression was caused by NGDP falling from $106.7 billion in 1929:3 to $49.8 billion in 1933:3. "

In other words, the Great Depression was caused by..... THE GREAT DEPRESSION.

Yikes!

What part of non sequitur do you not understand?

In reference to immigration, I keep seeing and hearing the phrase "what part of illegal do you (insert derogatory epithet here) not understand?" given as the beginning and ending of any debate.

I guess this is supposed to mean that fact that something is illegal means we should have zero tolerance for it?

Well,

Speeding is illegal but.....
Driving while texting is illegal but....
Not reporting all tips or gifts on your income tax is illegal but.....
Making sales in cash and not reporting the income is illegal but....
Smoking marijuana is illegal but......

We could literally list scores of things that are clearly illegal but cause most people little or no consternation. There are also tons of things that are illegal but carry inconsequential penalties.

Hey, that is immigration reform I could really get behind.

Fine all illegals $5.

There, two problems solved.

Pickin' & Grinnin'

Speech Unrecognition

This is one of the coolest things I have read in a long time. Worth reading the whole (very long) thing.

It is very interesting that there is a huge difference between speech to text, and text to speech. I often use Adobe's listen-to-text feature to be able to hear a dissertation or a paper read aloud to me on a long drive. Just plug my laptop into the auxilliary jack on the BMW (it's supposed to be for your iPod or MP3 player, but it works on anything that has an audio jack). Start up the PDF reader by clicking on "Read out loud" (which, bizarrely, is in the "View" menu on Adobe).

Wouldn't work well on a diss with a lot of tables and equations, but works fine for lots of theses in poli sci.

It is rather amazing that the reverse process, speaking and having the computer record the words, basically doesn't work at all. Optical scanning works quite well, with error rates below 5%. But audio speech-to-text... 80%, tops, and even then you are better off typing it straight from voice, for most purposes.

Reform Bites

Betsy has a good story on election reform in Arizona.

I am not a fan of taxpayer financing of elections. If you want to get money out of politics, get government's hands off our money. The reason that election outcomes are so crucial right now is that government has metastisized into nearly every aspect of our lives.

To make elections less expensive, make them less important.

Ph(UNNIES)d

The Ward Boss supplies some excellent comic material, here.

I would add, to the list of things you will never see in a published paper:

"The reason that some of the indep vars are logged and some are squared and some are linear is that none of the results come out right otherwise."

Cinco de What?

Here are my favorite Cinco de Mayo songs.

First, the incomparable Liz Phair:

Next, the comparable Lil Rob:



Finally, it turns out that Obama's Spanish is even worse than Mungowitz's!

Zombie Joseph Beuys?

FYI, Mungowitz, here are the top 5 reasons why I don't vote:

5. So Bryan Caplan can't make fun of me

4. No tax deduction given for voting

3. It only encourages them

2. I work in a university, so I already interact with plenty of officious bureaucrats

1. No jury duty

(context for title is here)

Libertarians Dissed, and I Commit Election Fraud

Very interesting. I went to vote today, of course. (Angus does not vote, which mystifies me. Of COURSE he is right that voting because you affect the outcome is silly. But voting because it makes normal people nervous....THAT is really fun. Of course, at this point Angus has 34 years of virginal non-voting streak at risk, so perhaps I don't blame him after all).

Anyway, I went to vote. I was #306, and I went to the poll 10 minutes before closing time. ("You.... you are number #306! Get in line!" I love being an arbitrary number chosen by the state. Perhaps I should get used to it, if laws like the Arizona "Extra Real ID" rules spread to other states).

Except there was no line. I was the only one there. Four poll workers, and me. Yes, they are volunteers. But they are volunteers working for the state. And... well, let me tell you.

I give the front line lady my name. She finds my entry in the "Giant Special Book of People Who Have the State's Permission to be Citizens, and Other Secret Things." And says, "Please state your name." Since that is what I had just done, and that is how she found my listing, I was giggling. (Angus, see what you are missing, man?) Then, "State your address."

I said, "10020 Bushveld." She looks up, suspicious. "Bushveld WHAT?"

"Lane," I said, amazed. "10020 Bushveld LANE." She nods, still suspicious. Now, I was #306 for the day, in a place where the polls had been open since 6:30 am. They are only getting a little less than 4 people every 10 minutes, or 24 people per hour, voting. There couldn't have been much demand for vote fraud. She just didn't like the look of me, I think. (Yes, I was wearing dirty shorts, a ripped t-shirt with a spaghetti sauce stain, and flip-flops. Again, Angus, man, so many chances to enjoy this).

She starts to explain to me which ballot I can vote. North Carolina's D and R parties have chosen to have semi-open primaries, where D registered voters vote D, R registered voters vote R, and unaffiliated voters can vote either.

Except that there is a third party, the Libertarians. Actually on the ballot. Except there were no ballots. This may make some sense, because I think that no Libertarian primary is contested this time around. Still, we have a Senate candidate, Dr. Michael Beitler, and I was looking forward to voting for him. We did all that work to get on the ballot, and I was looking forward to it. If you look at the list of candidates who filed for office, and paid fees (pdf here), you'll see there are more than 20 Libertarian candidates for statewide, federal, or state assembly seats. We did all that work, and got on the ballot. And then I got more than 2% running for governor. So we are ON THE BALLOT.

The lady is flustered by my Libertarian registration, which is there plain as day on the record. She goes to ask Uber-voting-spiel-fuhrer. They argue, she gestures, he peeks at me. Then he comes over and asks, "Sir, what is it you want to do?"

Now I start to giggle again. I did not say that I was there to watch the baseball game, and have some margaritas. Instead, I said, "I want to vote. I thought this was the voting precinct for my address, and..."

He interrupts, though not rudely, and says, "Yes, but who are you going to vote for?"

I raise my eyebrows, and my voice (there were two people behind me now): "I have to tell you who I'm going to vote for? Is this some kind of profiling? I thought we had secret ballots!"

The voting-spiel-fuhrer, who was painfully earnest, actually dropped his mouth open and then turned beet red. "Da... boh... No, I meant which party do you want to vote for?"

"I want to vote in a way that doesn't violate North Carolina's election law. I am registered Libertarian. I want to vote for my party, as the law dictates. Are you telling me I can vote in another party's primary?"

He said, "We can't have a different ballot for each party. What if the Greens, or the ... the...." (he couldn't think of any other parties) "....wanted to vote? It would be too expensive to print ballots for every party."

So, I said that the Greens, the Constitution, the Socialist Workers, the Farm Union, and Moonies couldn't possibly ask for a ballot, because they are NOT recognized parties in the state of North Carolina. The Libertarians, by contrast, are fully recognized, and are on the ballot. So his example made no sense. None of those parties were authorized to field candidates, but the Libertarians are authorized, and in fact do have candidates, including Mike Beitler who is running for the Senate nomination.

The poor fellow held up pretty well. He said, with an air of finality, "You just tell us which ballot you want, Democrat or Republican, and we'll give it to you."

I said, "Republican." (I wanted to vote for my friend BJ Lawson, since there were no Lib ballots). And I voted, and I got one of those "I voted" stickers, and I went out to the car.

But I still think that the poll workers were mistaken, and that I should not have been allowed to vote in a partisan primary other than the one I am registered for.

And, I was struck by a question whose answer I don't know, at all. What is rule for the Libertarian Party? When we have primaries in 2012 (we are likely to have contested primaries for both Governor and President), will our ballot be open, semi-open, or closed? I do not know the answer to that.

what if Yakov Smirnov had been from North Korea?

I think things would have gone much like this.

Here is my favorite:

Chang Man Yong works on a collective farm in North Korea. He goes fishing, gets lucky, and brings a fish home. Happy about his catch, he tells his wife: "Look what I've got. Shall we eat fried fish today?"

The wife says: "We've got no cooking oil!"

"Shall we stew it, then?"

"We've got no pot!"

"Shall we grill it?"

"We've got no firewood!"

Chang Man Yong gets angry, goes back to the river, and throws the fish back into the water.

The fish, happy to have had such a narrow escape, sticks its head out of the water and cheerfully yells: "Long live General Kim Jong Il!"

Hat tip to LeBron!

Why Hate?

My op-ed published today in the Durham Herald.

It's primary day here in NC. Be careful out there.

Has it really come to this?

We are now going to give awards to soldiers who don't kill innocent civilians?

Really?

Really!!

NATO commanders are weighing a new way to reduce civilian casualties in Afghanistan: recognizing soldiers for "courageous restraint" if they avoid using force that could endanger innocent lives.

The concept comes as the coalition continues to struggle with the problem of civilian casualties despite repeated warnings from the top NATO commander, Gen. Stanley McChrystal, that the war effort hinges on the ability to protect the population and win support away from the Taliban.

Those who back the idea hope it will provide soldiers with another incentive to think twice before calling in an airstrike or firing at an approaching vehicle if civilians could be at risk.


People, please join me and other libertarians around the world in deploring and protesting these senseless, state-sanctioned murders.

Just So You See What I'm Dealing With....

People meet me, and my wife, and everything seems normal. You have to understand what I'm dealing with here.

The LMM has a cousin / aunt (for Italians in RI, it's hard to tell the difference) who sent us this. Thanks, Shirley!

THE DIFFERENCE IF YOU MARRY A RHODE ISLAND GIRL

The first man married a woman from North Carolina . He told her she was to do the dishes and house cleaning. It took a couple of days, but on the third day, he came home to see a clean house and dishes washed and put away.

The second man married a woman from Florida . He gave his wife orders she was to do all the cleaning, dishes and the cooking. The first day he didn't see any results, but the next day he saw it was better. By the third day, he saw his house was clean, the dishes were done and there was a huge dinner on the table.

The third man married a girl from Rhode Island . He ordered her to keep the house clean, dishes washed, lawn mowed, laundry washed, and hot food on the table for every meal. He said the first day he didn't see anything, the second day he didn't see anything, but by the third day, some of the swelling had gone down and he could see a little out of his left eye, and his arm was healed enough that he could fix himself a sandwich and load the dishwasher. He still has trouble sitting down, though. (Note: Last line revised, in response to comments)

China and the US Debt

China and the United States: The Bonds of Debt, by Donald D. Hester
Professor of Economics, Emeritus
The University of Wisconsin – Madison

Abstract
This paper explores the large and growing indebtedness of the United States to the People’s Republic of China. Beginning with the 1971 reestablishment of diplomatic relations between the two countries, international trade between them expanded but was very modest until the mid 1980s. At that point, China under Deng Xiaoping adopted a variation on the successful export strategy that had been pioneered by Japan and the smaller Asian “tigers”. The first section of the paper analyzes the distinctive features of this variation and provides tabular information about trade and foreign exchange balances and the exchange rate between the dollar and yuan. The second section proposes a crude game-theoretic discussion of what each country might gain and lose from their large growing financial entanglement in the short and long run. The third section is a discussion of the limits of the imbalance and how U.S. debts to and Chinese claims on other countries impact the relation between the P.R.C. and the U.S. The concluding section focuses on the paradox of a poor and rapidly growing authoritarian country financing an undisciplined and relatively declining democratic superpower.

Anniversary of Chille's

We are coming up on the 1-year anniversary of the single most commented, most cited, most read, and most downloaded single post in the history of KPC.

It was.... "The Worst Mexican Restaurant on Earth." Enjoy.

Financial Regulation Will Help! Not....

So, now the government is going to fix the financial industry, because markets don't work?

Look, the genesis of the financial crisis was a trap, set by federal government offiicials and regulators.

It was a trap baited with four kinds of tasty cheese:
1. Down payment subsidies, encouraging people to buy houses more expensive than they could actually afford
2. Changes in the definitions of "conforming" loans, with much looser requirements for packaging and reselling by Fannie Mae and Freddy Mac.
3. Artificially low interest rates that served to finance an asset bubble in housing and commercial real estate.
4. An implicit guarantee, made by all of the last four Treasury secretaries, that any decline in housing prices would be treated as a "market failure," prompting government action to prop up prices.

While it is clearly true that private investors behaved both greedily and in some
cases foolishly, these four factors ensured that the financial disaster would be
larger, and last longer, much longer, than would have happened if government had
just left housing markets alone.

Given the temptations to meddle, and given the inability of government officials to
obtain the accurate information that unfettered markets provide through prices,
there is no reason to believe that these new attempts at regulation will turn
out any better than the old ones.

In short, given that government had a substantial role in causing the crisis through
misguided regulation, there is no reason to believe that the new regulatory policies will help.

YYM in Erg Contest

A video of the YYM owning an erg contest. (He's the second from the front, going left to right) He had his best time ever, 6:42 mins for a 2k race. And won his heat.

Information and Portion Size

When Healthy Food Makes You Hungry

Stacey Finkelstein & Ayelet Fishbach
Journal of Consumer Research, forthcoming

Abstract: Do subtle cues for imposed healthy eating make consumers hungry? Imposed healthy eating signals that the health goal was sufficiently met, and thus it increases the strength of the conflicting motive to fulfill one's appetite. Accordingly, consumers asked to sample an item framed as healthy later reported being hungrier and consumed more food than those who sampled the same item framed as tasty or those who did not eat at all. These effects of healthy eating depend on the consumer's perception that healthy eating is mandatory; therefore, only imposed healthy eating made consumers hungrier, whereas freely choosing to eat healthy did not increase hunger.

----------------------

The largest Last Supper: Depictions of food portions and plate size
increased over the millennium

B. Wansink & C. S. Wansink
International Journal of Obesity, forthcoming

Abstract: Portion sizes of foods have been noticably increasing in recent years, but when did this trend begin? If art imitates life and if food portions have been generally increasing with time, we might expect this trend to be reflected in paintings that depict food. Perhaps the most commonly painted meal has been that of Jesus Christ's Last Supper, chronicled in the New Testament of the Bible. A CAD-CAM analysis of the relative food-to-head ratio in 52 representative paintings of the Last Supper showed that the relative sizes of the main dish (entree) (r=0.52, P=0.002), bread (r=0.30, P=0.04), and plates (r=0.46, P=0.02) have linearly increased over the past millennium.
----------------------

Promoting Healthy Choices: Information versus Convenience

Jessica Wisdom, Julie Downs & George Loewenstein
American Economic Journal: Applied Economics, April 2010, Pages 164-178

Abstract: Success in slowing obesity trends would benefit from policies aimed at reducing calorie consumption. In a field experiment at a fast-food sandwich chain, we address the effects of providing calorie information, mimicking recent legislation, and test an alternative approach that makes ordering healthier slightly more convenient. We find that calorie information reduces calorie intake. Providing a daily calorie target does as well, but only for non-overweight individuals. Making healthy choices convenient reduces intake when the intervention is strong. However, a milder implementation reduces sandwich calories, but does not reduce total calories due to compensatory effects on side orders and drinks.

(Nod to Kevin L, who always has the skinny)

The EYM Gets His Tooth Back!

A year ago, from Germany, I told the story of how the EYM, dancing on a chair, tried to break that chair with his face. An on-looker described the resulting sound of tooth fragments hitting the floor as "like someone was playing Yahtzee."

Here is the EYM recently.
Here is the EYM after the dentist performed the adatoothtome. (Three operations, total).
He looks good! Of course, being the EYM, he then promptly got a haircut, apparently from someone using a weedwhacker.

Appholes

John Stewart on Apple. Heh.

(Nod to Angry Alex)

Tyler Out Front

So, Tyler had been fussing that the hotel doesn't sell the NYTimes. And, it was raining and blowing pretty hard.

But I took a break and walked down to Starbucks, and they had the NYT. I picked him up a copy.

And then came back up here to my room to write about immigration (article in today's NYT, btw).

And THEN I notice that Tyler had already asked the right question. Now I don't have to write that post. Dude, we're even.

Will I be able to play the piano?

Two young boys walked into a pharmacy one day, picked out a box of tampons and
hurried to the checkout counter.

The man at the counter asked the older boy, "Son, how old are you?"

"Eight," the boy replied.

The man continued, "Do you know what these are used for?"

The boy replied, "not exactly, but they aren't for me. They're for him. He's my brother. He's four. We saw on TV that if you use these you can swim and ride a bike. Right now, he can't do either."

Reminds me of the 1940s era joke: GI gets his hands burned in an explosion in battle in Italy. He wakes up, and sees the doctor examining him. "Doc! DOC! Will I be able to play the piano? TELL ME that I will be able to play the piano!"

The doctor looks carefully. The burns aren't that bad, and there is no bone damage. "You will be able to play the piano beautifully, son."

GI: "Oh, you're a genius, Doc. I never could play before."

Durham Bulls

Took two of my friends from the Erlangen exchange program to a Durham Bulls game.

Here are Tim and Linus biting big ones.

Not sure they really "got" baseball, because it is a complicated game. But the bier and wurst were easily recognized.

bass ackwards

The problem with Greece and the Euro isn't that the fixed exchange rate is foiling Greece from devaluing its way back to prosperity, but rather that adopting the Euro (and the ECB rules) let Greece finance an incredible spending binge at artificially low rates.

If Greece had never joined the Eurozone, it NEVER would have been able to run up so much foreign debt.

My problem with congress in a nutshell

“Balancing the budget and reducing the debt, in my mind, are not ends in and of themselves,” said Rep. Jan Schakowsky, D-Ill. “We can't afford to skimp on our children's education, assuring access to quality, affordable health care, retirement security, achieving energy independence, investing in our infrastructure, supporting medical research, creating more jobs.”


The article containing this gem is here.

While I do partly agree with the first phrase to the extent that I don't favor balancing the budget at current spending levels, the hideous combination of arrogance, profligacy and ignorance shown here typifies, to me, how our congress operates (and has operated for quite a while now).

USA roundup

1. First quarter GDP growth estimated at 3.2%, slightly under the forecasted rate of 3.4%. Consumer spending rose 3.6%. Can you say, "the jobless recovery continues?" Thank you, I knew that you could.

2. The oil spill off the coast of Louisiana is no joke, and it may take months just to cap the well (which is below 5000 feet of water).

3. Gilbert Arenas (still in the halfway house for his "guns in the workplace" issues) is being sued for not paying for "5 custom Berettas with 5 silencers" that he ordered from a high end arms dealer.

4. Bullish on Bush? "I been down so long, it looks like up to me."

Fire Protection Services

For you schmoes who dared doubt me, about provision of fire services.....

Well, read and cheer the mighty forces of private self-interest! That's 1979, Journal of Libertarian Studies, for the reference.

(nod to B-Doog, who knows stuff)

Proof that there is a God

Right here.

Russ R on the financial crisis

Russ has a new paper. I like it.

Dissertations

Nick T gives some good advice on dissertations.

I have taken my own shot at this, along with Dave Schmidtz and others. (For the dissertation part, check page 21 and following)

Funny to think of Nick writing about writing dissertations. Seems like just yesterday when he was a newbie in grad school, and wrote this on his blog.... Four weeks later, Nick said I had "outed him." Blogging was a bit more outre and underground in 2004.

Merle Hazard

Merle Hazard. Arthur Laffer sings along, as Bretton Woods.

(Nod to Mike S)

Sad News

Angus Maddison has died.

PPT

Power corrupts, and Powerpoint corrupts absolutely.

New Laptop Design: Roll

Interesting design for "laptop."