Libertarianism 101: a remedial course

Republicans are not necessarily Libertarians.

In particular, Bush was not a Libertarian.

He spent recklessly, engaged in chicanery to promote useless and costly wars, trampled all over civil liberties, cut protectionist deals with the steel industry and others, and screwed up big time on immigration.

As far as I know, Libertarianism is not primarily defined as a dogmatic belief in total deregulation (at least I hope it is not).

Libertarians tend to believe that victimless crimes are not actually crimes, that national borders should be much more open than they currently are, that foreign military operations are rarely justified, and that people have a right to privacy.

The idea that government screws things up is more an idea from Public Choice than from Libertarianism. Even if the government was awesome at fighting wars, Libertarians would oppose it. I think most Libertarians are *happy* that the government is not particularly good at what it does.

To me, Libertarianism is a philosophical argument against a lot of government interventions, and Public Choice is an instrumental argument against a lot of government interventions.

In case you are wondering what set me off, check here.

te estan buscando, Matador

"The bull charged and matador Christian Hernandez took off — across the ring, over the wall and into controversy.

The admittedly terrified torero was arrested after Sunday's botched bullfight at the Plaza Mexico, apparently for breach of contract, local media reported Monday. He was released after paying a fine.

"There are some things you must be aware of about yourself," the 22-year-old Mexican matador said in a television interview. "I didn't have the ability, I didn't have the balls, this is not my thing."
In a sight rarely seen in the bravado world of bullfighting, Hernandez made a spin with his red cape at the charging bull, then ran across the ring and leapt headlong over the wall to safety, dropping his cape in the process. The crowd hooted in derision.

Several months ago, another bull grievously gored Hernandez in the leg.

Officials did briefly convince Hernandez to return to the ring on Sunday, where he put his hands over his head and pointed upward before he made a second exit, shaking his head.

He later said he would retire from bullfighting."

If Only....

If only they had listened to me. Means-tested school vouchers had the #1 place on my education platform. And they WORK, and they don't cost much.

Competitive Effects of Means-Tested School Vouchers

David Figlio & Cassandra Hart
NBER Working Paper, June 2010

Abstract: We study the effects of private school competition on public school students’ test scores in the wake of Florida’s Corporate Tax Credit Scholarship program, now known as the Florida Tax Credit Scholarship Program, which offered scholarships to eligible low-income students to attend private schools. Specifically, we examine whether students in schools that were exposed to a more competitive private school landscape saw greater improvements in their test scores after the introduction of the scholarship program, than did students in schools that faced less competition. The degree of competition is characterized by several geocoded variables that capture students’ ease of access to private schools, and the variety of nearby private school options open to students. We find that greater degrees of competition are associated with greater improvements in students’ test scores following the introduction of the program; these findings are robust to the different variables we use to define competition. These findings are not an artifact of pre-policy trends; the degree of competition from nearby private schools matters only after the announcement of the new program, which makes nearby private competitors more affordable for eligible students. We also test for several moderating factors, and find that schools that we would expect to be most sensitive to competitive pressure see larger improvements in their test scores as a result of increased competition.

(Nod to Kevin L)

Now they finally have something to fight about

From today's NYT:

The United States has discovered nearly $1 trillion in untapped mineral deposits in Afghanistan, far beyond any previously known reserves and enough to fundamentally alter the Afghan economy and perhaps the Afghan war itself, according to senior American government officials.The previously unknown deposits — including huge veins of iron, copper, cobalt, gold and critical industrial metals like lithium — are so big and include so many minerals that are essential to modern industry that Afghanistan could eventually be transformed into one of the most important mining centers in the world, the United States officials believe.

People, this could make the Dutch disease and blood diamonds look like kid's stuff, no? We have already seen all the years of violence, all the corruption and now there is actually something valuable in play. Kudos to the NYT reporter for recognizing this:

Instead of bringing peace, the newfound mineral wealth could lead the Taliban to battle even more fiercely to regain control of the country.

The corruption that is already rampant in the Karzai government could also be amplified by the new wealth, particularly if a handful of well-connected oligarchs, some with personal ties to the president, gain control of the resources. Just last year, Afghanistan’s minister of mines was accused by American officials of accepting a $30 million bribe to award China the rights to develop its copper mine. The minister has since been replaced.

Endless fights could erupt between the central government in Kabul and provincial and tribal leaders in mineral-rich districts.

Not to mention how it will affect the US and our willingness to keep soldiers fighting and dying there.

Goat Spears Weiner

Anonyman just liked the headline. So I'll post the story.

Anthony Weiner has been very busy lately.

Here's Mr. Weiner in a "point your finger and open your mouth contest" (he came in second, because his finger pointing was limp).

So wrong in so many ways

People, what's the creepiest part of this photo?

The pic is from here and the site is highly recommended.

Hat tip to Andy Roddick!

Misallocation and Productivity

I just read two interesting papers that highlight how market distortions like labor market regulations or capital subsidies can affect both actual productivity in a country and also our attempts to measure productivity in a country.

First is Hseih & Klenow's MISALLOCATION AND MANUFACTURING TFP
IN CHINA AND INDIA (QJE 2009, ungated version here). They use firm level data and estimate that if resources were allocated across sectors in China and India the same way they are in the USA, that manufacturing productivity could rise 40% or more!

No word on how eliminating distortions in the USA would raise our productivity though.

Second is a new NBER paper (ungated version here) by Fernald & Neiman entitled Growth Accounting with Misallocation: Or, Doing Less with More in Singapore. They set up a model which shows how having a sector of the economy that has preferential access to resources and earns a pure profit can cause different techniques for measuring productivity growth (i.e. using quantities vs. prices) can produced answers that disagree with each other and fail to capture actual productivty growth.

Interestingly, their case study of Singapore shows that the subsidized sector of the economy their had negative productivity growth even more severe than that estimated by Young in his classic piece.

When life gives you lemons....

Flash vs. Superman

Mungo and I have been friends for a long time. We even competed against each other in Track & Field in high school. Here's a shot of one of our photo finishes:

by the way, I still have those shorts!

Onions

President O sure has 'em!

Consider this. His administration is now demanding that BP pay the salaries of oil workers who are not working because of the Administration's moratorium on deep water drilling!

Really.

You guys remember that classic, close the barn door after the cows are all gone moratorium, right? The one that was "peer reviewed" by a panel of experts?

Ooops. Turns out the moratorium was added to what the experts reviewed ex-post and the experts do not agree with even having a moratorium.

So I guess this all works out, at least on the "two wrongs make a right" theory of justice.

Tyler Cowen is a jelly doughnut

KPC friend Tyler Cowen informs us that he is now somehow living in Berlin with "only five CDs, a Kindle, and a few paperbacks"

5 CDs for Berlin, eh? That's tough. Here is what I hope he has:

Can: Tago Mago

Cluster: Cluster 71

The Notwist: Shrink

Velvet Underground: White Heat / White Light

Lounge Lizards: Voice of Chunk

Now I have to say that I've never been to Berlin, but if I did go, and didn't bring my iPod or anything, I'd be very, very happy to have these 5 CDs. They just fit my image of the place.

Regulation Competition

Trust and technology: The social foundations of aviation regulation

John Downer
British Journal of Sociology, March 2010, Pages 83-106

Abstract: This paper looks at the dilemmas posed by 'expertise' in high-technology regulation by examining the US Federal Aviation Administration's (FAA) 'type-certification' process, through which they evaluate new designs of civil aircraft. It observes that the FAA delegates a large amount of this work to the manufacturers themselves, and discusses why they do this by invoking arguments from the sociology of science and technology. It suggests that – contrary to popular portrayal – regulators of high technologies face an inevitable epistemic barrier when making technological assessments, which forces them to delegate technical questions to people with more tacit knowledge, and hence to 'regulate' at a distance by evaluating 'trust' rather than 'technology'. It then unravels some of the implications of this and its relation to our theories of regulation and 'regulatory capture'.

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Valuing Incremental Highway Capacity in a Network

Allen Klaiber & Kerry Smith
NBER Working Paper, May 2010

Abstract: The importance of increments to an existing highway system depends upon their contributions to the accessibility provided by the existing network. Nearly 40 years ago, Mohring [1965] suggested this logic for planning optimal highway investment programs. He argued it could be implemented by measuring the quasi-rents generated by specific additions to an existing roadway system. This paper uses a unique set of additions to a loop roadway in metropolitan Phoenix, together with detailed records of housing sales over the past decade, to meet this need. We find that estimated increases in capitalized housing values due to four segments added during this period range from 73 to over 273 million dollars per mile of the roadway addition.

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Consumption tax competition among governments: Evidence from the United
States

Jan Jacobs, Jenny Ligthart & Hendrik Vrijburg
International Tax and Public Finance, June 2010, Pages 271-294

Abstract: The paper contributes to a small but growing literature that estimates tax reaction functions of governments competing with other governments. We analyze consumption tax competition between US states, employing a panel of state-level data for 1977–2003. More specifically, we study the impact of a state’s spatial characteristics (i.e., its size, geographic position, and border length) on the strategic interaction with its neighbors. For this purpose, we calculate for each state an average effective consumption tax rate, which covers both sales and excise taxes. In addition, we pay attention to dynamics by including lagged dependent variables in the tax reaction function. We find overwhelming evidence for strategic interaction among state governments, but only partial support for the effect of spatial characteristics on tax setting. Tax competition seems to have lessened in
the 1990s compared to the early 1980s.

(Nod to Kevin L)

Dirty Pool

Smart pup doesn't want to go into dirty pool

Call Dan Klein!

This is an easy problem to fix, actually.

Just ask Dan Klein.

Soon, I'll be back in Santiago,riding them buses. July 10 - July 28.

College Silliness: Report from the Front

RL writes:

Pre-midterm, an ESL student came to me this morning with some questions about some terms she was unsure about.

One was filibuster. She was confused about the definition she found on the internet.

She showed it to me: noun, a male candidate that completely overwhelmes [sic] and defeats his female opponent in the political areana [sic]

I was (understandably, I hope) confused. Then I noticed above the text she had written fillybuster. A harmless typo? Not if you type that into Google. First hit is from "addictionary.com"

Sure enough, according to that website, the definition of fillybuster is
"noun, a male candidate that completely overwhelms and defeats his female opponent in the political arena."

I think I set her straight and showed her what turns up if she spells the word correctly. Perhaps it would have been better if she used wikipedia! On Wikipedia, the definition is clear and correct!

Inflation targeters: yer doing it wrong!

Recent experience has led some people to argue that central bank inflation targets should be raised above their 2% levels in order to better accommodate the problems of monetary policy at the zero interest bound.

Not so fast, say Uribe and Schmitt-Grohe in their new NBER Working Paper, "The Optimal Rate of Inflation" (ungated version available here)

The central goal of this chapter is to investigate the extent to which the observed magnitudes of inflation targets are consistent with the optimal rate of inflation predicted by leading theories of monetary nonneutrality. We find that consistently those theories imply that the optimal rate of inflation ranges from minus the real rate of interest to numbers insignificantly above zero. Our findings suggest that the empirical regularity regarding the size of inflation targets cannot be reconciled with the optimal long-run inflation rates predicted by existing theories. In this sense, the observed inflation objectives of central banks pose a puzzle for monetary theory.

And then there's this:

Furthermore, we argue that the zero bound on nominal interest rates does not represent an impediment for setting inflation targets near or below zero.

A paper on this topic by these authors would obviously be self recommending except that I have read it and am actively recommending it.

Winning ugly

People, is Brad Gilbert somehow coaching both teams in the NBA finals? Aside from the Lakers' performance in game 1, this has been an ugly, tedious series so far.

Last night, Kobe notched 29 points on 29 shots (Can you say "Allan Iverson"? I knew that you could)! The interior passing and moving without the ball that the Lakers showed so well in game 1 continued to be completely absent in game 3. LA had a total of 13 assists for the entire game.

The Cs main scorers, Ray Allen and Paul Pierce were a combined 5-25!

From the three point line the two teams collectively shot 6-33!

The foul parade slowed down slightly with "only" 47 personals assessed.

I can't believe I am saying this, as I am a HUGE NBA fan, but I am probably going to boycott the rest of this series.

Wake me up when the Nets sign Phil Jackson and LeBron!

Seatbelt Ad: Persuasion, not coercion

Sweet, and pretty. Also, advocating persuasion rather than coercion in using seatbelts.

Self-Identified Leftists Don't HAVE to be Dumb

Economic illiteracy is not destiny, it's a choice. KPC friend D-Klein has some data.

Me, I'm reminded of LvM:

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 long for the "leap of humanity out of the realm of necessity and into the realm of freedom." They wish to be free of a universe of whose order they do not approve.

So, it's a conscious choice to decide that the basic laws of economics should be amended. Lefties want to feel good about regulating housing prices. The fact that rent control actually HURTS the poor...well, that's inconvenient, and they just prefer to put their fingers in their ears and sing folk songs from the 1960s, and congratulate themselves on their INTENTIONS, not the actual impacts of the laws they advocate.

If you want to help the poor, but know that your dumb laws actually hurt the poor, you just pretend that the laws aren't really dumb.

Papers to Read

How to reduce unemployment: A new policy proposal

Roger Farmer
Journal of Monetary Economics, forthcoming

Abstract: This paper uses a model with a continuum of equilibrium steady state unemployment rates to explore the effectiveness of fiscal policy. The existence of multiple steady state equilibria is explained by the presence of search and recruiting costs. I use the model to explain the current financial crisis as a shift to a high unemployment equilibrium, induced by the self-fulfilling beliefs of market participants about asset prices. I ask two questions. 1) Can fiscal policy help us out of the crisis? 2) Is there an alternative to fiscal policy that is less costly and more effective? The answer to both questions is yes.

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Estimating the Firm’s Labor Supply Curve in a “New Monopsony” Framework:
Schoolteachers in Missouri

Michael Ransom & David Sims
Journal of Labor Economics, April 2010, Pages 331-355

Abstract: In the context of certain dynamic models, it is possible to infer the elasticity of labor supply to the firm from the elasticity of the quit rate with respect to the wage. Using this property, we estimate the average labor supply elasticity to public school districts in Missouri. We leverage the plausibly exogenous variation in prenegotiated district salary schedules to instrument for actual salary. These estimates imply a labor supply elasticity of about 3.7, suggesting that school districts possess significant market power. The presence of monopsony power in this teacher labor market may be partially explained by its institutional features.

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The Micro-geography of Tax Avoidance: Evidence from Littered Cigarette Packs
in Chicago

David Merriman
American Economic Journal: Economic Policy, May 2010, Pages 61–84

Abstract: The large tax differentials between Chicago and neighboring jurisdictions provide an incentive for cigarette tax avoidance. Data from a random sample of cigarette packs littered in Chicago reveals a startling degree of tax avoidance: three-quarters did not display a Chicago tax stamp. Also, the $2.68 difference between the tax in Chicago and surrounding counties decreases the probability of a local stamp by almost 60 percent, and a one mile increase in distance to the lower-tax state border increases the probability a pack of a local stamp by about one percent. These results are consistent with the predictions of economic theory.

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Build America Bonds

Andrew Ang, Vineer Bhansali & Yuhang Xing
NBER Working Paper, May 2010

Abstract: Build America Bonds (BABs) are a new form of municipal financing introduced in 2009. Investors in BAB municipal bonds receive interest payments that are taxable, but issuers receive a subsidy from the U.S. Treasury. The BAB
program has succeeded in lowering the cost of funding for state and local governments with BAB issuers obtaining finance 54 basis points lower, on average, compared to issuing regular municipal bonds. For institutional investors, BAB issue yields are 116 basis points higher than comparable Treasuries and 88 basis points higher than comparable highly rated corporate bonds. For individual investors, BABs represent poor deals compared to regular municipal bonds. Thus, on average the Federal government subsidy disadvantages individual U.S. taxpayers, who are the main holders of municipal bonds, and benefits new entrants in the municipal bond market.

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Public Provision of Private Goods and Nondistortionary Marginal Tax Rates

Sören Blomquist, Vidar Christiansen & Luca Micheletto
American Economic Journal: Economic Policy, May 2010, Pages 1–27

Abstract: Using an optimal taxation model combined with a previously neglected scheme of public provision of private goods, we show that there is an efficiency
gain if public provision of selected goods replaces market purchases and that efficiency requires marginal income tax rates to be higher than if the goods were purchased in the market. Part of the marginal tax serves the same role as a market price and conveys information about a real social cost of working more hours. It might be that economies with higher marginal tax rates have less severe distortions than economies with lower marginal tax rates.

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Will Governments Fix What Markets Cannot? Overconfidence and the Demand for
Regulation

Patrick Warren & Daniel Wood
Clemson University Working Paper, May 2010

Abstract: Market forces will sometimes "fix" consumer biases through competition that improves the welfare of biased consumers, and sometimes will not. Likewise, government regulation will sometimes fix consumer biases by making exploitative transactions difficult, and sometimes will not. We show that in the case of markets for goods with add-ons (Gabaix and Laibson, 2006) the instances where markets or government will fix biases (in our model, consumer overconfidence about add-on services such as overdraft fees) are correlated. In the same cases where markets are inefficient due to the prevalence of biased consumers, voters will not demand efficiency-enhancing regulations. This is because consumer biases have two effects: they produce deadweight losses, and they redistribute from biased consumers to
less-biased consumers. These distributional consequences can both prevent equilibrium competition by firms from enhancing efficiency and prevent equilibrium policy choices by citizens from regulating away inefficient trade.

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”Unfunded liabilities” and uncertain fiscal financing

Troy Davig, Eric Leeper & Todd Walker
Journal of Monetary Economics, forthcoming

Abstract: A rational expectations framework is developed to study the consequences of alternative means to resolve the “unfunded liabilities” problem — unsustainable exponential growth in federal Social Security, Medicare, and Medicaid spending with no plan to finance it. Resolution requires specifying a probability distribution for how and when monetary and fiscal policies will change as the economy evolves through the 21st century. Beliefs based on that distribution determine the existence of and the nature of equilibrium. We consider policies that in expectation combine reaching a fiscal limit, some distorting taxation, modest inflation, and some reneging
on the government's promised transfers. In the equilibrium, inflation-targeting monetary policy cannot successfully anchor expected inflation. Expectational effects are always present, but need not have large impacts on inflation and interest rates in the short and medium runs.

(Nod to Kevin L)

Travel is Educational

More goodness here.

Mark McGwire: Great American

From Angry Alex:

Elicited a chuckle from Mark McGwire today. I thanked him for all the heat he took regarding steroids. When Congress is focusing on steroids in baseball they aren't trying to pass things like Obamacare. I thanked him for taking one for the average American.

For immediate release: OU gets a new supercomputer

Now my Matlab programs will fly!

Papers to Read

Global effects of fiscal stimulus during the crisis

Charles Freedman, Michael Kumhof, Douglas Laxton, Dirk Muir & Susanna Mursula
Journal of Monetary Economics, forthcoming

Abstract: The IMF's Global Integrated Monetary and Fiscal Model is used to compute short-run multipliers of fiscal stimulus measures and long-run crowding-out effects of higher debt. Multipliers of two-year stimulus range from 0.2 to 2.2 depending on the fiscal instrument, the extent of monetary accommodation and the presence of a financial accelerator mechanism. A permanent 10 percentage point increase in the U.S. debt to GDP ratio raises the U.S. tax burden and world real interest rates in the long run, thereby reducing U.S. and rest of the world output by 0.3 to 0.6 percent and 0.2 to 0.3 percent, respectively.

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Social Welfare Expenditures in the United States and the Nordic Countries: 1900-2003

Price Fishback
NBER Working Paper, May 2010

Abstract: The extent of social expenditures in the U.S. and the Nordic Countries is compared in the early 1900s and again in the early 2000s. The common view that America spends much less on social welfare than the Nordic countries does not survive closer inspection when we consider the differences in the structures of social expenditures. The standard comparison examines gross social expenditures. After adjustments for direct and indirect taxes paid, the net social expenditures in the Nordic countries are much closer to American levels. Inclusion of mandatory and private social expenditures raises the American share of GDP devoted to social expenditures to rank among the middle of the Nordic countries. Per capita net public social expenditures in the U.S. rank behind only Sweden. Add in the private spending, and per capita spending in the U.S. is higher than in all of the Nordic countries. Finally, I document the enormous diversity across time and place in public social expenditures in the U.S. in the early 1900s and circa 1990.

(Tyler has already discussed this one a bit...)

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Capitalism and freedom?

Frederic Pryor
Economic Systems, March 2010, Pages 91-104

Abstract: This essay tests Milton Friedman's conjecture that capitalism is a necessary condition for political freedom. For the decade around 2000 indices of the degree of capitalism and the degree of political freedom are highly correlated and provide plausibility for Friedman's conjecture. In looking at changes over time in the nineteenth century, however, the analysis refutes Friedman's conjecture. These apparently contradictory results are reconciled by showing that both capitalism and freedom are related to such variables as the educational level of the population so that, although not causally tied, they are correlated in a cross-national comparison.

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Is H.A. Simon a theoretician of decentralized planning? A comparison with
F.A. Hayek on planning, market, and organizations

Stefano Fiori
Constitutional Political Economy, June 2010, Pages 145-170

Abstract: Herbert A. Simon acknowledged Friedrich A. Hayek as a founder of the notion of bounded rationality; yet Simon considered Hayek’s perspective incomplete, and, more in general, their views on market mechanisms, planning, and organization exhibit considerable differences. The comparison between these authors sheds light on Simon’s interpretation of planning, which emerges within his theory of organization (and not in traditional debates on socialism). Contrary to Hayek, he maintained that planning, in specific circumstances, is more advantageous than the market; and in both administration and organization, it involves a decentralized structure based on near independent sub-units. Decentralization of decisions also appears in social planning, which evolves through continuous interactions among
planners (i.e., agents and institutions), and it is a process connoted by the absence of “fixed goals”. Finally, Simon defined modern economies more in terms of “organizational economies” than in those of “market economies” and this highlights a further difference with respect to the Austrian economist. This leads to analysis of the nature of organizations as hierarchical and “near-decomposable” structures, which refers to Simon’s theory of complexity and gives an epistemological explanation to the relation between centralization and decentralization.

In the closet, with a candlestick

C'mon Jackie Chan

Only one more week!

Copa Mundial

In honor of the looming World Cup, KPC is proud to present the greatest soccer kick of all time:

here be monsters

It is really freakin' hot here in Angusland. Dry too. Luckily for us, our local newpaper has decided to publish water conservation tips.

Like this one:

"When you give your pet fresh water, don't throw the old water down the drain. Use it to water your trees or shrubs."

People, can I get a WTF?

What kind of pet does the Norman Transcript think I have, a full grown African elephant? A camel?

Would my shrubs really notice the remnants of my dog's quart sized water bowl getting dumped on them at night?

With Cochlear Implants, Little Jonathan hears his mama

It's pretty easy to make me cry. This did it. (Nod to the NCM)

Who's on first?

The "heard on the street" section of today's WSJ reports that Greek tourism workers had scheduled a press conference to announce a strike, but realized at the last minute that the Greek journalists were already on strike and thus unlikely to attend the conference, prompting its postponement until such time that the journalists might be available.

Whatever the over/under is on Greek default, I'll take the under.

These aren't the droids you're looking for...

Observatory as R2-D2. Story.

Here is a video. Odd that it is 90 degrees rotated. Still, not bad.

Bill Lumaye Show

Did Bill Lumaye show, 4-5 pm on Thursdays as always.

Talked about LLRW decision (which I used to work on, with Dennis Coates...especially these papers from long ago...

Coates, D., and M. Munger, Strategizing in Small Group Decision Making: Host State Identification in the Southeast Compact, Public Choice, vol. 82 (1995), pp. 1-16.

Coates, D., V. Heid, and M. Munger, Not Equitable, Not Efficient: U.S. Policy on Low-Level Radioactive Waste Disposal, Journal of Policy Analysis and Management, vol. 13 (1994), pp. 526-541.

Interesting that the Sup Ct finally decided that the NC could keep the $80 million they stole.

But then we talked about....of course, Armond Galaraga. Callers leaned toward "leave it be," and Dutch Boy wrote an email to the same effect. Dutch Boy said:

For the record: keep the bad call from last night, painful as it is. I hate even the instant replay on the homers.

I don't know. I agree about the bad call being uncorrectable. But the home runs thing is easy to fix, and doesn't take long.

Euvoluntary II

I presented the Euvoluntary Exchange paper (informally) today at the IHS Liberty and Society Conference.

Anyone who wants a copy of the paper can find it here...

Heartwarming

Gene Simmons...wow.

Joe!!!

My man, Joe Ramiro Garcia has taken things up a notch with his latest exhibition. He is going all Edward Hopper on me! Mrs. A and I have 4 of his earlier paintings. This is perhaps my favorite of those four:

Here are a couple from his new exhibit, which is opening this weekend in one of my favorite galleries:

See what I mean?

Duke 2, Indiana 0

NCAA title games....

Duke 2

State of Indiana 0

I'm just sayin'.

Lean on your Staff

A little piece on working with staff, in the CHE.

I was NOT good at this, at the beginning. And I'm still not, let's be honest. It's hard to do well.

This cartoon is all too accurate, I'm afraid...


But I wrote down the things I now know would make me, or anyone, a little better at figuring out how to work with a staff in an academic department.

Not the Onion: MILFs get pounded

Okay, yes, the fact that I find this funny means that I am a bad person.

But I find it funny: "Air Force pounds MILF lairs with rockets." (And including "MILF" several times in a post will improve our hits dramatically....)

(Nod to Angry Alex)

When enough is enough

I am not a big fan of the "must get 50% of the vote to avoid a runoff" electoral system in Presidential Democracies.

Consider the current case of Colombia:

Santos got 46.5% and his nearest challenger, Mockus, got around 21.5%.

Where I come from, people, that's an ass-whoopin'.

There's no need for the time and expense of another round of voting.

Couldn't you make the runoff conditional?

Like if one candidate gets 40% or more and more than twice as many votes as the second place finisher, then no second round will be held?

Shouldn't Mockus just back down now and accept that, in the words of Mo Udall, "the voters have spoken, those bastards!"

Whats wrong with just letting the highest vote getter win, regardless of their absolute percentage, like the USA and Mexico?

Lib Nat Conv: Back Now

Whoa. The LP National Convention was pretty darned tiring. Didn't help that we had to drive Raleigh to St Louis to Raleigh. That's 1,700 miles for the round trip.


But we got to see some great stuff. I enjoyed giving the main banquet speech (Neil Boortz out, Munger in! Strange...), and Dr. Mary Ruwart did a terrific job raising big $$ for ballot access.

We elected a new LNC.

And, of course, Starchild was in the house. This outfit, I thought was a tour de force. (Picture from Mike S., who is the one wearing the blue sirt, and no top hat).

I feel I have to explain about Starchild. He is beloved, and rightly so. Sure, the way he dresses is a bit over top / under the bottom / whatever you want to say. But he is amazingly charismatic, gentle, and serious. His message is of real brother / sisterhood, and that you have to look past the outside, whether it's skin color or feather boas (or, as in the picture above, a big black bow tied like a present over a black silk thong) to see the real person. If that is not the core of libertarianism I don't know what is. Starchild is the best, seriously. (And the ladies in our delegation were pretty vocal in their admiration of Starchild's hard work at the gym, and were glad that he was willing to share it publicly. Some things are complex, and some are simple. Starchild is mostly pretty simple, in the best possible way...)

Elderly prof ISO a sexy E-reader

People, I need help. usually when I travel I pack a boatload of books that brutally weigh me down. For example, on our trip to Brazil last summer, Mrs. Angus and I brought 12 books.

So I guess that makes me a candidate for an e-reader.

But, the marketplace is pretty confusing to me. Kindle? Kindle DX? iPad? Kindle for iPad? Nook?

Can you guys break it down for me and help me out?

Are there extra costs beyond the machine and the book downloads, like data transfer costs / contracts? How much worse is the iPad screen for reading than the Kindle's? What is battery life like? How rugged are these products?

TIA,

Angus

Half a loaf

Been listening to the debut album by Surfer Blood called "Astro Coast".

It is basically half of a stellar album. The first six songs are all good with three that are really excellent (Floating Vibes, Swim, & Twin Peaks).

They sound a lot like the Shins circa "Oh Inverted World" (one of the great indie albums of all time by the way).

Then they go and spoil it all with track 7, a weird rip-off of "I'll stop the world and melt with you" by Modern English. It is really atrocious, people.

The rest of the record never recovers.

At the least, I can wholeheartedly recommend getting the three awesome songs. I am putting the first six tracks onto my Iphone.

The rest is pretty bad.

Here's the video for "Swim"

Catch me at the border, I got visas in my name

Extensive profile of M.I.A. in the NY Times Sunday Magazine. This one is a bit better than the ridiculous puff piece on the National a couple weeks ago. Word is that Maya A. didn't like this piece one little bit.

She doesn't come across as an overall genius, but she certainly is a pop genius. "Galang" and "Paper Planes" are two of the best songs of this century.

What the Hex?

Why in the world would Josh Brolin do this?

More Jonah Hex Videos

He has been in some tremendous movies. Why this?

A diet that works: Stop eating and run 15 miles a day

I was going to make fun of Fitty Cent.

But what he did was actually really cool, and impressive. Psychotic, but for a fat man like me, who is always "trying" to lose weight...generally by eating bagels and imagining that I am excercising....well, major props to Fitty.

Libertarian National Convention

Neanderbill and I joined the NC state delegation to the Libertarian National Convention.

Here is a brief video of our arrival at the bar last night, greeting our fellow Libertarian Party members.

[Ponda Baba gives Neanderbill a rough shove and starts yelling at NB in an alien language which NB doesn't understand]
Dr. Evazan: [explaining] He doesn't like you.
NB: Sorry.
Dr. Evazan: [grabbing NB] *I* don't like you either. You just watch yourself. We're wanted men. I have petitioned for ballot access in twelve states.
NB: I'll be careful.
Dr. Evazan: You'll be de-credentialed!
Obi-Wan: [intervening] This gigantic one's not worth the effort. Now, let me get you something.
[Dr. Evazan shoves NB across the room and pulls out a quorum call]
Bartender: No quorum calls! No quorum calls!
[Obi-Wan pulls out his microphone, severing Ponda Baba's eardrum with a point of parliamentary inquiry]

Okay, no, seriously, here are some pix. Here is the view from the floor of the big screens up front. And here is David Nolan (yes, the chart guy, and founder of the LP) making a point. Oh, and don't forget StarChild. StarChild is the best.

Obituary for Neo-Conservativism

C. Bradley Thompson has an interesting new book.

Wow! News and Observer comes through...

Quite an editorial, in the News and Observer.

Check it out.

Inappropriate Anger Pays Dividends

If inappropriate anger explains success, that may be a big part of why Angus and I rule the world.

Cultural Variance in the Interpersonal Effects of Anger in Negotiations

Hajo Adam, Aiwa Shirako & William Maddux
Psychological Science, forthcoming

Abstract: The current research is the first investigation of how the effects of expressing discrete emotions in negotiations vary across cultures. In a hypothetical negotiation scenario (Study 1) and a computer-mediated negotiation simulation (Study 2), expressing anger (relative to not expressing anger) elicited larger concessions from European American negotiators, but smaller concessions from Asian and Asian American negotiators. A third study provided evidence that this effect is due to different cultural norms about the appropriateness of anger expressions in negotiations: When we explicitly manipulated anger expressions to be appropriate, Asian and Asian American negotiators made larger concessions to the angry opponent, and their concessions were as large as was typical for European American negotiators; when we explicitly manipulated anger expressions to be inappropriate, European American negotiators made smaller concessions to the angry opponent, and their concessions were as small as was typical for Asian and Asian American negotiators. Implications for current understanding of culture, emotions, and negotiations are discussed.

(nod to Kevin L)

Media Surprise

The Causal Impact of Media in Financial Markets

Joseph Engelberg & Christopher Parsons
University of North Carolina Working Paper, October 2009

Abstract:
It is challenging to disentangle the causal impact of media reporting from the impact of the information being reported. We solve this problem by comparing the behaviors of investors with access to different media coverage of the same information event. First, we use zip codes to identify 19 mutually exclusive trading regions, corresponding to 19 large U.S. cities and local newspapers (e.g., the Houston Chronicle). For all earnings announcements of S&P 500 Index firms, we find that local media coverage strongly predicts local trading, after controlling for characteristics of the earnings surprise, firm, local investors, and reporting newspaper(s). Reverse causation does not explain our findings. The local coverage-local trading effect: 1) holds for firms unlikely to be of local interest (e.g., remotely located, sparsely held by local investors) and 2) disappears entirely during extreme weather events, which leaves media content unchanged, but disrupts transmission to investors. The evidence supports the idea that media -- apart from the information they transmit -- affect investor behavior.

This is a little surprising to me. Though people watch shows about investing, so they must USE that stuff, even though it has no (and can't possibly have) any useful information.

(nod to Kevin L)

Darwin and the current account?

Sexual competition is a wonderful thing. Just ask any bird of paradise you happen to meet.

Now, in a new NBER working paper (gated version here), Du and Wei argue that it can have aggregate macro consequences as well:

"Large savings and current account surpluses by China and other countries are said to be a contributor to the global current account imbalances and possibly to the recent global financial crisis. This paper proposes a theory of excess savings based on a major, albeit insufficiently recognized by macroeconomists, transformation in many of these societies, namely, a steady increase in the surplus of men relative to women. We construct an OLG model with two sexes and a desire to marry. We show conditions under which an intensified competition in the marriage market can induce men to raise their savings rate, and produce a rise in the aggregate savings and current account surplus. This effect is economically significant if the biological desire to have a partner of the opposite sex is strong. A calibration of the model suggests that this factor could generate economically significant current account responses, or more than 1/2 of the actual current account imbalances observed in the data"

So there you have it people, rampant heterosexuality helped cause the crisis.

Yikes!

This paper certainly has some interesting policy implications, no?

Oh Noes!

I got a Mac in the office now. It's a bit too much fun....

Tony, I promise I'll get that paper written up real soon!

How not to be a professional athlete

Here is a great "your doin' it wrong" from alleged American tennis pro Sam Querry:

Q. So do you feel like going in you're not in the frame of mind, or does it happen right in the middle of the fight?

SAM QUERREY: I think it happens in the middle. I think if you ask my coach, David, he might say otherwise. When I lost that second set tiebreaker and got broken in the first game, I was done. I wanted to be off the court.
I started thinking about leaving and pulling out of the doubles and how much I wanted to go home, how much I wasn't enjoying.
You're never gonna win a match if you're just being negative. I'm only hurting myself.

Q. Isn't that the definition of a professional, that you don't despair so fully as the match progresses, that you somehow control your feelings?

SAM QUERREY: Yeah, I need to work on that. I've not been a professional the last, you know, on and off for the last few months. You know, you're out there facing one opponent. I don't want to face the opponent and myself.
You know, I just need to be better than today, in this case, it was Robby. It's someone different every week. But I don't want to be fighting myself out there and also fighting the opponent.

Q. Yet, Sam, you've had some good results on clay. You won Belgrade, won Houston. Are you fighting sort of a Jeckyll/Hyde part of yourself here?

SAM QUERREY: A little bit. Those are 250s, and they're great. I love you know, a tournament win is a tournament win. A final is great. It builds my confidence, but I won Belgrade and my ranking didn't move. I'm kind of past that point right now. Those 250s do nothing for me ranking wise. It's all about the Masters Series and the Grand Slams.
That's where I just have not been playing well. You know, I just need to mentally get it together in my head. I need to enjoy myself out there. I need to enjoy playing. You know, if a guy has a breakpoint against me, I should know, Hey, I've got one of the biggest serves out there. Let's see you win this point off me.
But like I said, I just tank some points.

YIKES!!!

Full interview is here.

Machine Trading Good?

At a minimum, not bad.

The problem is that many people think stuff they don't understand must be bad. Of course, they still watch their plasma tv. Somehow, not understanding THAT must be okay.

Does Algorithmic Trading Improve Liquidity?

Terrence Hendershott, Charles Jones & Albert Menkveld
Journal of Finance, forthcoming

Abstract: Algorithmic trading has sharply increased over the past decade. Does it improve market quality, and should it be encouraged? We provide the first analysis of this question. The NYSE automated quote dissemination in 2003, and we use this change in market structure that increases algorithmic trading as an exogenous instrument to measure the causal effect of algorithmic trading on liquidity. For large stocks in particular, algorithmic trading narrows spreads, reduces adverse selection, and reduces trade-related price discovery. The findings indicate that algorithmic trading improves liquidity and enhances the informativeness of quotes.

(Nod to Kevin L)

When did Diego Maradona join Van Halen?

Is he the new new lead singer or something?

I can only assume that he is now in the group after looking at his demands for hotel services at the upcoming football World Cup in South Africa.

My favorite items are:

(A) 2 "e-bidet" toilets for his personal use, with heated seats, a blow dryer, and double fountains.

(B) 24 hour ice cream.

Nothing about M&Ms though.

Argentina have the best player in the world (Messi), but I don't think they will get out of the first round with this gentleman leading them.

I was carried to Ohio in a swarm of bees

Whenever a favorite band of mine makes a move to a more "upscale" record label, I get scared.

However, the National have more than survived their move to 4AD. "High Violet" is a great record.

As always, the drumming and vocals are the most distinctive parts of the record, and while there is a little bit of 4AD-ish "fussiness" to the record, it is really fantastic. This is a highly skilled band, I guess at their peak.

When I first put the CD on, it brought Mrs. Angus right into the music room where she plopped herself down beside me and didn't leave until the album ended (she usually "listens" to music on the move).

For my part, I kept updating which song was my favorite and the music went by. High Violet hangs together really well as a cohesive album.

Highly recommended.

Don't Say "Bless You!" in Chapel Hill

Whoops! Forgot the "favorite past posts" this week.

So here it is, from November 2004. In which a Chapel Hillian is offended by my car.

TeeJaw conjures Joe Friday and Colonel Potter to discuss Obamacare.

Heh.

You have to enforce the law

Even if you agree with the protesters, you have to enforce the law.

This is a bit scary...

(Nod and thanks to Wayne Rogers, for the tip)

Idiot Conservatives on Parade

The last two weeks has brought an avalanche, a deluge, a... well, a lot, of embarrassment for conservatives in terms of public relations. IF they were capable of embarrassment, or self-reflection, or introspection.

One bozo stole large sections of BHO's 2004 convention speech.

Another "family values" candidate, who values families so much that he has TWO of them, was selected by the GOP to run for the House.

The biggest idiot of all, IMHO, a pretty extreme family values guy, who actually hired his long-time mistress to (I'm not making this up) help film a video about the importance of family values. Don't want her to feel left out, right?

Earlier in the month, this fool was caught with a "RentBoy." Now, it's certainly all right with me if somebody wants to pay for sex. And it's true that the RentBoy looks quite hot. But you can't persecute gays with a Torquemada-like fervor, and THEN get caught with "Lucien". As Jon Stewart pointed out, RentBoy didn't even help with the luggage! It's hard to shock the Miami papers, but...

Jon Stewart does some fine television. Rekers story just after 7:30...

Anyway, the most important "family value" ought to be to respect other peoples' choices about their family, and to stop trying to RUN EVERYONE ELSE'S LIVES.

You right wing family values people: shut up, if you can't even keep your OWN families according to your own (admittedly puritanical) standards.

(Nod to Anonyman, who amazingly sent me every one of the above stories)

UPDATE: Another snippet (again from Anonyman) on the GOP right here in NC. The GOP is actually trying to repudiate this candidate, even if it means they lose the seat. Here is the guy's web site....Here's a picture, from Salon. It may have been photoshopped, but I think he may be looking at us... or not.

I'm Feeling Moody

Nice. Very nice. From Blue Matter:

Markets play a simple yet crucial role: they price (or 'rate') assets, so as to ensure societal resources are allocated efficiently.

Markets do this better than any other institution yet devised because people need to put their money where their mouth is; it is not enough to say 'I think Greece will default' - if you are going to have an influence on the price, you have to be willing to take the risk of losing money if your opinion turns out to be wrong, and you would only do that if you have confidence in your information and analysis. That way, the price of different assets, including sovereign debt, is determined by the people with the best information (or, as is the case when it comes to extremely deep and liquid markets such as sovereign debt, the best ability to process the information that is freely available to all).

So, it is a serious perversion of this basic principle when the credit ratings agencies spend 60,000 dollars a year (that's the annual wage of a junior analyst) on analyzing Greek debt while investing exactly $0 on it, yet the effect they have on the price of that debt is equivalent to their controlling billions in funds. What the hell does it mean to 'rate debt'? Isn't this what the market is supposed to be doing by setting the price?

I think there IS an answer to the question: the "skin" a ratings agency has in the game is its repuation. Underwriters' Laboratories, or Consumer Reports, can only survive if their ratings carry information. Information is a complex good, but if one person has information it is hard to sell without revealing the information. Imagine:

A: Is your advice on which blender to buy good?

B: Yes, I have excellent private information about blenders. I have tested hundreds of them.

A: Okay, prove it, before I buy.

B: All right, buy XXX and YYY, because of [reveals private information about blenders]

A: That's stupid! I'm not paying! [OR} Great info, thanks! I'm not paying!

Either way, not paying for a straight up transfer of information. So you get specialized firms, which can (a) charge subscriptions and (b) develop a reputation as a depreciable capital asset, a hostage against lying.

This only works because information about a blender, a car, or a movie, is not really very valuable. So a ratings agency can make sense by obtaining the information and selling it for a small price, like a subscription to CONSUMER REPORTS magazine, where they could never sell it piece rate.

But information on a bond? Or on the likelihood of default on Greek sovereign debt? Why would we think that a rating agency would tell us more than the price of the asset, in elite level financial markets? Good one, datacharmer!

Crime Rates Fall

Violent crime fell significantly last year in cities across the U.S., according to preliminary federal statistics, challenging the widely held belief that recessions drive up crime rates. The incidence of violent crimes such as murder, rape and aggravated assault was down 5.5% from 2008, and 6.9% in big cities. It fell 2.4% in long-troubled Detroit and plunged 16.6% in Phoenix, despite a perception of rising crime that has fueled an immigration backlash. The early figures, from the Federal Bureau of Investigation, indicate a third straight year of decreases, along with a sharply accelerating rate of decline. WSJ, Evan Perez.

bu...bu...but that can't be right? We all KNOW that crime rates are rising sharply, because of all those dirty immigrants.

Right? Wait, "Evan PEREZ." He's one of them eel-eagle immy-grants, right? So the story is made up.

Whoops. Guess not. Even an Anglo like "Charlie Savage" is writing this story, for the Times.

Darn it. That whole "immigrants are dirty criminals" was such a good story, too. Until the inconvenient facts got in the way.

Some facts: Markets like predictability, Politicians like chaos

Interesting and useful article, on world investment climate.

Two truths:

1. Markets like predictability. What tax system is best? Whatever one we have, if we keep it and are sure it won't change. What exchange rate is best? The current one, whatever it is. And so on.

2. Politicians crave chaos. What tax system is best? The one I am "reforming" to achieve. What exchange rate is best? I can't tell you, because central bank data are secret, but you'll see. What new policies will help the economy, save the poor, and improve health care? Just TRY to guess what I'm thinking now! Uncertainty is the preferred habitat of politicians and speculators. The politicians are the predators, and the speculators are carrion birds and hyenas that follow the predators around. Amazingly, after investment is destroyed, the politicians actually have the eggs to blame the speculators. Impressive, that the lion would blame the hyena, just because the hyena happens to be seen chewing on the deer the lion killed.

In a stable system, politicians are almost irrelevant. No one is afraid, things are getting better, and there is lots of investment. In an unstable system, we all hang on every word from our "leaders."

The Great Depression was caused by bad monetary policy, and an over activist response by Hoover. (Yep, I said Hoover. Look it up. He pressured the Fed to cut money supply, and worked behind the scenes to raise prices and force financial enterprises to "capitalize" losses. The "do nothing" description is a myth.)

Then Roosevelt, a political genius, realized that the chaos Hoover had created could be used to the advantage of the Democrats and their crony capitalist allies. So Roosevelt consciously choose taxes, pricing regulations, and make-work projects that would create a continuing crisis. (Read Amity Shlaes' fantastic book, THE FORGOTTEN MAN, for a detailed historical account).

The only reason we got out of the Great Depression was that anticipation of WWII made Roosevelt realize that chaos was bad for production and investment. And in a war, everybody listens to politicians anyway, so he was able to end the artificial domestic crisis in favor of a real international crisis. Roosevelt clearly called off the dogs in 1939 and 1940, as you can see from memos telling investors and manufacturers in plain language that they were now free to invest and make things without fear of government attacks.

Like Roosevelt, President Obama is a man of excellent political instincts and zero understanding of markets and the causes of prosperity. We are entering another stage of artificial continuing crisis, and it could last for years. Higher business taxes, a transactions tax, new regulations of finance, new federal ownership of manufacturing in automobiles, steel, and other industries. Anything to make investment returns less predictable, and preserve the power of the government.

You can pay me now, AND you can pay me later

States borrowing off the books? It appears so.

Most states have to run a balanced budget, by state constitution or by statute. But these "emergency" loans from Uncle Barack never have to appear on the state budget. Here is the list of states and borrowings:

Alabama $ 283 million
Arkansas 330 million
California 6.9 billion
Colorado 253 million
Connecticut 498 million
Delaware 12 million
Florida 1.6 billion
Georgia 416 million
Idaho 202 million
Illinois 2.2 billion
Indiana 1.7 billion
Kansas 88 million
Kentucky 795 million
Maryland 133 million
Mass. 387 million
Michigan 3.9 billion
Minnesota 477 million
Missouri 722 million
Nevada 397 million
New Jersey 1.7 billion
New York 3.2 billion
N.C. 2.1 billion
Ohio 2.3 billion
Penn. 3.0 billion
R.I. 225 million
S.C. 886 million
S.D. 24 million
Tennessee 21 million
Texas 1.0 billion
Vermont 33 million
Virginia 346 million
Virgin Islands 13 million
Wisconsin 1.4 billion
Total $37.8 billion

For North Carolina, that's about $210 per person in borrowing. Not very much, perhaps. But that's an additional $400 per person who is actually working and paying federal income taxes. And this is DEBT, not new taxes. How in the world can anyone think that borrowing on the credit of the US, and giving the money to the states, is a good idea? You hear this a lot: "Our state taxpayers can't afford this, so we are going to seek Federal money." IT'S ALL THE SAME MONEY. If you take money from my federal taxes, and give it back to me as a state benefit, there is no net benefit, and nothing of value is created.

But if you BORROW on Federal credit, and give the money to the states, it appears to be free money. Politicians can claim credit for it, and it won't have to be repaid until later. This is exactly the strategy that has worked so well in Greece, for example.

To be fair, this new off-the-books state borrowing appears to be something else: In the long run, this debt will take money from some people, in some states, who are dumb enough still to have jobs. And give that money to other people, in other states, who have figured out that it's cheaper to get free money than to try to earn a living by having a job.

(nod to Doug C, and the Economic Policy Journal)

Get a Job!

Get a job and keep it! High school employment and adult wealth accumulation

Matthew Painter, Research in Social Stratification and Mobility, June 2010, Pages 233-249

Abstract: Wealth inequality receives substantial scholarly attention, but mounting evidence suggests that childhood and adolescent traits and experiences contribute to financial disparities in the United States. This study examines the relationship between adolescent labor force participation and adult wealth accumulation. I argue that employed high school students gain practical life skills, abilities, and knowledge from work experience and business exposure that shape investment decisions and affect overall net worth. I use the National Longitudinal Survey of Youth, 1979 cohort, to empirically explore this idea. This study extends the wealth literature by
identifying adolescent employment as an important mechanism that improves adult net worth and financial well-being.

Plausible, but it may confuse cause and effect. If you get a job in high school, you are likely a bit more ambitious. Those jobs are NOT fun (not even if you are "Welder / Union Steward Angus"), and anyone who sticks it out is pretty tough, and willing to work hard.

Still, it is likely to staying with a job teaches you to be more hard-working, also.

(Nod to Kevin L)

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!