Fascinating Graph

As KPC pal Tim Worstall puts it, "Fascinating graph!"

He is quite right.

When The State Leaks, We All Get Force on Our Faces

Again, the state = violent force.

Not "the state uses force to keep us all safe." The state is force. Sure there is force that is not the state, but there is no part of the state that is not force.

(click for a more forceful image)

Statists have a conception that a "monopoly on the legitimate use of force" (THEIR definition of the state! Even they admit state=force) means that state will expand to fill the entire "force" part of the Venn diagram.

Problem is, the state leaks; force gets spilled everywhere. Force metastasizes outside of the original limits of force and displaces perfectly effective voluntary action. There is essentially no check on this expansion, unless voters choose voluntarism over coercion.

Which is why this HuffPo piece is so disturbing. The use of force, of sickening excessive force, is expanding rapidly. But you people all keep voting for it, and then saying, "Oh, we didn't mean THAT much force! Oh, no, no, no." And then you vote for it again.

Let's make this simple.
The state is force.
If you vote to expand the state, you are expanding force.
If you want less force, you have to want less state.

It's just physics.

Bridge to Euro

Some years ago a small rural town in Italy twinned with a similar town in Greece.

The Mayor of the Greek town visited the Italian town. When he saw the palatial mansion belonging to the Italian mayor he wondered how he could afford such a house. The Italian said; "You see that bridge over there? The EU gave us a grant to build a two-lane bridge, but by building a single lane bridge with traffic lights at either end this house could be built".

The following year the Italian visited the Greek town. He was simply amazed at the Greek Mayor's house, gold taps, marble floors, it was marvelous. When he asked how this could be afforded the Greek said; "You see that bridge over there?"

The Italian replied; "What bridge? There's no bridge." That's how it happens, folks.

Thanks to John-O for sending this!

All Politics is Local

From my NC State colleague Steven Green:

The Politics of Parenthood: Parenthood Effects on Issue Attitudes and Candidate Evaluations in 2008
Laurel Elder & Steven Greene, American Politics Research, forthcoming
Abstract: This project employs 2008 National Election Study (NES) data to explore whether parents are different than nonparents in terms of their political attitudes and candidate evaluations. We find that parenthood does have political consequences although often not in ways suggested by conventional wisdom. Rather than finding parents to be a conservative group, our results support the idea that raising children has liberalizing effects on the attitudes of women. Fatherhood shapes attitudes less than motherhood, but these fewer effects are in a conservative direction. We argue that the distinctive politics of mothers and fathers reflects the impact of parenting as a gendered socialization experience combined with the contrasting parenthood themes articulated by the Republican and Democratic parties. Finally, despite media coverage suggesting Sarah Palin’s “Hockey Mom” image would attract parents, especially mothers, to her candidacy and the Republican ticket we find no support for this idea.

LeBron on the EU

Podcast: LeBron on the EU.

Contra the NY Times, Vector Autoregressions are NOT magic

In an interesting human interest story on the newest Econ laureates, the NY Times tosses this into the mix:

Mr. Sims developed a statistical approach called vector autoregression, or V.A.R. It enables the testing of cause and effect — whether, for example, the money supply is affecting interest rates, or vice versa. That is a crucial determination if economic models are to have any accuracy, as the Nobel committee has noted.

So many things wrong here. Lets try to unpack it.

First of all, causality requires identification. VARs do not provide any automatic or free identification. To do policy analysis with a VAR (as opposed to agnostic forecasting) one has to make the same type of untestable identifying assumptions here as one does in the older, explicitly simultaneous equation, Cowles commission approach.

The most common way of identifying a VAR (ordering the variables and performing a Cholesky decomposition) is EXACTLY the same as using exclusion restrictions to identify a system of equations. Other structural VARS do NOT remove the need for identifying assumptions. VARS are not a free lunch.

Second, if the article is referring to Granger causality, then Granger's 1969 Econometrica article predates the VAR.

Third, is causality (i.e. identification) crucial for economic models to have any accuracy? Well that depends on what you mean by accuracy. If you mean on target forecasts of specific aggregates, then no, identification is not really needed (VARS are great for agnostic forecasting of specific variables). If you mean being able to perform convincing counterfactual policy simulations, then yes, identification is vital (but the VAR doesn't give a free lunch here).

Don't get me wrong, I think Sims is *awesome* and well deserving of the Prize (Sargent too!!!), but VARS are not magic.

Rice Student Breaks Window

A student at Rice, participating in the old Rice tradition of running around "wearing" a little shaving cream, broke a window with his butt. Now he owes $15,000.

If you want to donate to help the kid's butt, or just want some background (sorry), by all means go here.

(Nod to Tommy the Promoted Brit)

Man, I Hate Republicans

So, check this out:

How is it that a Republican House that claims to be pro-jobs can't pass a regulatory reform so modest that even President Obama's jobs council endorses it? Part of the answer is that the accounting cartel fighting reform has one of its own in the Republican ranks. A GOP presidential candidate also can't be bothered to show up for a critical vote.

In September we told you about Tennessee Representative Stephen Fincher's plan to relieve small public companies from Sarbanes-Oxley's most burdensome and duplicative accounting rules. "Useless" might be a better description for these rules, after MF Global became the latest company in the Sarbox era to hide catastrophic transactions outside its balance sheet—exactly what the law was supposed to prevent.

On Tuesday night, the House Financial Services Committee had to yank the Fincher reforms from a scheduled Wednesday vote. With all committee Democrats expected to vote against reducing paperwork, the Republicans would need almost all hands to send the measure to the House floor.

But House sources say Michele Bachmann wouldn't return from the campaign trail to vote. Meanwhile, California Republican John Campbell has been leading an effort to water down or kill the Fincher reforms. Mr. Campbell is an accountant carrying water for his former industry colleagues. New Mexico Republican Steve Pearce, who styles himself an opponent of federal regulation, is also blocking reform.

Sarbox was supposed to punish accountants, but like much regulation in practice it guarantees a lucrative business to a cartel dominated by four big firms. The mandate for an external audit on top of the traditional financial audits has helped accounting fees rise as fast as the bureaucratic burden.

That editorial was not from the WaPo or the HuffPo. That's the Wall Street Journal. Could the idiot Republican possibly be any more worthless? Every chance they get they vote for anti-competitive regulation increases and bailouts for their campaign contributors. They vote against millions for widows and orphans, but support billions in tax money for corporations. Man, I hate Republicans.

(If you are thinking of offering a "yeah, but Dems are bad, too!" defense....just shut up. The Dems are honest. They say they are going to take money from people who earned it and use it to buy votes. Despicable, but honest. The Republicans are LIARS on top of being thieves.)

(Nod to Kevin Lewis)

Fun Talk with Rick Martinez

Got to do an interview on many subjects with my pal Rick Martinez.

It's long, with commercials. But we had a good time. Plagiarism, North Carolina politics, and the economy.

Angus!

Angus visited, and the Mungowitz dogs were worshipful. Tanzi would not leave him be, and Hobo...well, we always say that dog put the "ho" back in Hobo.

Oh, and his talk was terrific, too!

Heh. WRK strikes back

On being forced to volunteer, and then being interrogated on why he "wants to be around other people's children.

Nicely played, sir. Nicely played.

Basic Logic Fail

Okay, let's review.

This guy, Dr. D.M. Berwick, was appointed to head the US gov't office of Medicaid/Medicare.

He had a history of saying that we needed a health care system more like the Brit system, run by the government, and with rationing decisions made by bureaucrats. (Note: At KPC we understand health care has to be rationed. I just don't want it done by some person who got fired at the DMV).

Now, he says 30% of the US health care expenditures on Medicare/aid are pure waste, and doctors all know it.

He continues (I quote the NYTimes reporter's set-up)

If his estimate is right, Medicare and Medicaid could save $150 billion to $250 billion a year by eliminating waste, which he defines as “activities that don’t have any value.”

Dr. Berwick sounded like a professor of political science or a visitor from a foreign country when he recounted his efforts to fathom Washington’s ways.

“Government is more complex than I had realized,” he said in an understatement. “Government decisions result from the interactions of many internal stakeholders — different agencies and parts of government that, in many cases, have their own world views.”

Um.... so, I have a question. This guy was a big fan of government-run health care. He took a government job, and now he thinks 30% of the money we spend is wasted. He thinks government is "more complex" than he realized, and...well, the article continues:

Before coming here, Dr. Berwick was president of the Institute for Healthcare Improvement, a nonprofit group in Cambridge, Mass., that trains medical professionals. “I was used to moving very, very fast,” he said. “We could decide on Monday to start a program and have it in existence on Wednesday.”

As a federal official, Dr. Berwick was sometimes impatient with colleagues in the government and with the health care industry.

So, in this gentleman's OWN EXPERIENCE, private nonprofits are relatively fast and much more efficient and government sucks. Medicare/aid in particular is a disaster, as he knows from trying to fix it.

His solution: Let's expand Medicare until it's the entire health care system! He continues to love Obama-care like it's a religious pilgrimage.

Asked why Americans were still deeply divided over the new health care law, signed 20 months ago, Dr. Berwick said: “It’s a complex, complicated law. To explain it takes a while. To understand it takes an investment that I’m not sure the man or woman in the street wants to make or ought to make.”

But, Dr. Berwick said, just as Americans supported manned missions to the moon without knowing the details of rocket science, they ought to support the new law because of its ultimate destination.

A religious belief is one that you cling to in spite of all empirical evidence to the contrary. This guy saw, with his own expert eyes, the gigantic waste of time and money that is government-run, government-provided health care. He gave specifics, showed that he is actually a smart and honest guy.

And then reverts to his religious belief: worship the state, and the state will do the right thing. These little glitches....just aberrations. Eventually, he says:

“We are a nation headed for justice, for fairness and justice in access to care,” Dr. Berwick said. “We are a nation headed for much more healing and much safer care. There is a moon shot here. But somehow we have not put together that story in a way that’s compelling.”

No, doctor, there is a big difference between going to moon, and going to justice. When you get to the moon, you can come back. When you get to "justice," which you appear to be believe to be the absence of any private enterprise, you turn into Cuba. There is no coming back from that.

I don't Fault the Police....TSA Edition

So, the girl could not get on the plane, because her purse had a little plastic gun glued onto it. TSA said it was a "replica gun," which is illegal. The girl missed her plane, because of the hassle. (May I point out that the "girl" is unmarried, pregnant, and arrived at the security checkpoint less than 30 minutes before her flight left...?)

Everybody, as usual, is all mad at the police. They should use their discretion better! Surely this was a mistake!

Had a talked with La Skarbek yesterday at a reception, on just this question. It is WRONG to criticize the police. If you want a police state, with a bunch of intrusive laws, this is what you get. It is not an abuse of power, it is just the fact of power. Saying "that's not what we meant!" after the fact is idiotic. If you don't want to go to Chicago, don't get on that train.

Here is what the law says (the relevant parts, anyway):

Items prohibited from aircraft cabins:

The following items will not be allowed through the security checkpoint. Please note that this list is not all-inclusive. In addition to items specifically listed here other items that may be deemed to present a potential threat may also be prohibited.
...
Replica weapons
...
Toy transformer robots (this toy forms a toy gun)
Toy weapons

That thing, on her purse: that is a three dimensional gun. It is not a design. It is a glued on plastic piece. Is the TSA stupid for preventing it?

No, the law is stupid for outlawing it. I believe that TSA actually promulgated this regulation, but I could not easily find the underlying statute.

Here is an actual video, used at Glacier International Airport in Montana. Imagine if you had to work all day in security, and heard this several hundred times. You would be WISHING you had a gun so you could kill yourself.
I like when the guy cuddles the metal detector.

There is no great stagnation!

Sinvergüenzas!

So proud to be an American. Appalling links from around the nation.

1. San Fernando turns....your stomach.

2. Cook County prosecutors pursue case of man without FOID permit who had a gun. Even though he could not possibly have had an FOID permit.

3. Wrap rage: We need regulation of holiday packaging, because "Today's packages force consumers to fight tooth and nail to get them open."

4. Maxine Waters is going to make you miss Barney Frank. Really.

5. Robert Reich: The grease is gone, baby.

On the other hand, there is still some hope. Chris Coyne responds to OWS, in a brief and effective way.

And Mark Perry explains why Chinese "currency manipulators" are actually our friends.

The Takeaway

In which I try to get happy about the increased employment in the 16-24 age group.

I tried, I really did. It was on The Takeaway.

4 happy women Cain't be wrong

there is a real, official website called "Women for Herman Cain" and here is its masthead:





Job well done, Herman.

Not the Onion?

Try to guess....

1. Kidnapper claims kidnapped couple agreed to hide him from police. When police later shot him, he sues for breach of contract.

2. Guelph professor accidentally named Italy's junior agriculture minister

3. Financial professional seeks "holiday girlfriend."

Infra-marginal garbage

People, I have no real dog in the fight about taxing incomes over $1,000,000 at a higher rate. In fact, if I could keep my current marginal tax rate, I'd say hack away at those 1% cads.

But, I am incredibly tired of tax increase apologists making the elementary economic mistake of conducting infra-marginal analysis.

You know, by saying things like since the tax surcharge only applies to the income ABOVE $1,000,000, all the income BELOW $1,000,000 is not affected and so incentives for these people won't change much.

The argument about tax rates and incentives is a MARGINAL argument. We presumably want the economy to expand, so the question is how does increasing taxes on the marginal earnings of these "most fortunate Americans" affect their future behavior?

At the margin, for people already making $1,000,000 changes in the tax rate on incomes higher than $1,000,000 have a full effect on the incentives of these people. The effect on their incentives to undertake further economic activity (expand their business, work more themselves) is NOT mitigated by the fact that the tax rate has not risen on the income they are already making!!

If you make $999,999 the tax increase would not affect your current liabilities under your current business plan. That is clearly true. But it does fully affect any decisions by such a person about future actions.

If we want to sock it to these "most fortunate Americans", by all means let's do. But let's not think that the fact that it's a marginal tax rate increase means that it will have an attenuated effect on their future economic activity.

PS: another bogus argument is to refer to the proposed increase as a "modest 3.25 percent surcharge". It's a 3.25 percentage point increase. If the current top rate is 35%, then the proposal is actually a 9.3% surcharge.

Hey Treasury department: Do what you want to do. Just stop lying about what it is you are doing!

Kenneth Arrow on Occupy Movement

I find that reading Kenneth Arrow's articles takes me a while. They are usually very dense and closely reasoned. But once I have read them I feel like I have learned something.

This "article" is something else entirely. A truly remarkable claim:

The notion of a well-running market is applicable to manufactured goods; different items are produced to be alike and can be evaluated by consumers. But the products of the finance and health industries are individualized and complex. The consumer cannot seriously evaluate them—a situation that economists call “asymmetric information.”

This casts light on the claim that the problem is one of personal ethics, of greed. After all, the search for improvement in technology, and consequently in the general standards of living, is motivated by greed. When the market system works properly, greed is tempered by competition. Hence, most of the gains from innovation and good service cannot be retained by the providers.

But in situations of asymmetric information, the forces of competition are weakened. The individual patient or financial client does not have access to all the relevant information. Indeed, when the information is sufficiently complex, it may be impossible to provide adequate information.

If Prof. Arrow is correct, and he may be, then we are left with two choices. We can recognize that information is asymmetric, scarce, and difficult to obtain, and warn consumers to be careful. Or we can assume, as Prof. Arrow does, that the government can solve this problem completely and insulate people from all risk.

That is what happened in 2007, in a nutshell. Everyone thought that regulation had solved the asymmetric information problem, and they were free to invest without risk.

Regulation makes the problem worse, not better. Government has no special ability to obtain information, and has no particular incentive to provide the information it does have, since Wall Street firms use campaign contributions dominate the oversight committees. If anything, the oversight committees in Congress are simply wholly owned subsidiaries of Goldman-Sachs et al.

What makes this so upsetting is that the poor buyers were duped into believing that since the system was regulated it must be safe. All the people I know who lost heavily in the market in 2007 were lefties, secure in the knowledge that their government was there to help them. People like me saw that the risk was unsupportable, and pulled out.

Had to Stop; Could Feel Myself Getting Dumber

I tried to watch this, and I tried to read the transcript. But I could feel myself getting dumber so rapidly that I had to look away. Be careful.

David Harvey at Occupy London / November 12, 2011 / International Day of Solidarity from Elaine Castillo on Vimeo.

Public Relations Firm Fires Railroad

How bad is it when a public relations firm quits, because they can't stand all the lying, deceit, and soul-sucking distortion?

Answer: Pretty bad.



(Nod to Jason S.)

Political Economy Lecture Series Podcasts: Economics for Non-majors

So, here are the four podcasts from the PE lecture series from this fall. I put the name of the speaker, linked to his web page, and then a link to the podcast (in every case, an MP3). The sound quality is not always very good, because I was both the person in charge of recording and also the editor of final product.

Remember, the course that these podcasts come from is "Economics for Non-majors," a new but now permanent course being taught at Duke. (Syllabus for Fall 2011). Let me acknowledge the extremely helpful assistance of the Charles G. Koch Foundation and the Thomas W. Smith Foundation in getting this off the ground. We could not have done it without you, folks! There was nothing like this, and now there is a new permanent course, right here at Duke University. It will be offered at least twice a year from now on.

November 30, 2011: Professor Kevin B. Grier, University Professor and Professor of Economics, University of Oklahoma. (email him if you have questions!)

"MONETARY POLICY: PAST, PRESENT, AND FUTURE" (Link to mp3 file file)

November 2, 2011: Professor Timur Kuran, Professor of Economics and Political Science & Gorter Family Professor of Islamic Studies, Duke University. (email him if you have questions!)

"THE GREAT DIVERGENCE: WHY DO ISLAMIC COUNTRIES LAG ECONOMICALLY?" (Link to mp3 file)

October 12, 2011: Honorable William Gradison, US House of Representatives and PCAOB

"FINANCIAL REGULATION: CAUSES AND EFFECTS" (Link to mp3 file)

September 7, 2011: Professor John D. Lewis, Visiting Professor, PPE Program, Duke University. (email him if you have questions!)

"MORALITY OF EXCHANGE IN GREECE AND ROME" (Link to mp3 file)

Let's put the future behind us

Every day that the Eurozone continues to exist, things just get worse. We hear a lot about how terrible the breakup of the common currency will be for everyone, and I agree it will be bad. But people, there are only bad options left. There is no happy way out of here.

The PIGS need, above all, economic growth. Due to the public choice problems that LeBron has recently enumerated, I believe the fastest route to increased growth for them is default and devalue. Let Argentina be your guide.

What "reforms" is Germany going to dictate to the PIGS that will raise growth over the next 3-5 years?

Run free little PIGS, and let the ECB or the individual central banks of France and Germany worry about being LOLR to their crazy banks who believed that Greece had turned into Germany.

Nando's Chicken Commercial

I think this commercial is pretty funny....

Which almost certainly means it is inappropriate.  Does it make you HUNGRY?

If Your College Major Contains the Word "Studies," You are Part of the Problem!

"Far more than in Europe, most Americans remain instinctively loyal to the killer applications of Western ascendancy, from competition all the way through to the work ethic. They know the country has the right software. They just can’t understand why it’s running so damn slowly. What we need to do is to delete the viruses that have crept into our system: the anticompetitive quasi monopolies that blight everything from banking to public education; the politically correct pseudosciences and soft subjects that deflect good students away from hard science; the lobbyists who subvert the rule of law for the sake of the special interests they represent — to say nothing of our crazily dysfunctional system of health care, our overleveraged personal finances, and our newfound unemployment ethic. Then we need to download the updates that are running more successfully in other countries, from Finland to New Zealand, from Denmark to Hong Kong, from Singapore to Sweden. And finally we need to reboot our whole system. I refuse to accept that Western civilization is like some hopeless old version of Microsoft DOS, doomed to freeze, then crash. I still cling to the hope that the United States is the Mac to Europe’s PC, and that if one part of the West can successfully update and reboot itself, it’s America." [Niall Ferguson, Newsweek]

(Nod to Kevin Lewis)

KPC Summit: Angus on Monetary Policy

Last outside speaker for my "Econ for Non-Majors" course tomorrow (syllabus here):  Angus himself!

The course has been very fun to teach.  Just started it up (this is the second time around), and it has  80 students in the second semester.  (That's a pretty big class for Duke....)  The "real" sciences all have courses for non-majors, and I have noticed that a lot of students duck Econ because it has too much math.  But it's REALLY important (or so Angus insists).

I'll post the four podcasts (John Lewis, Classics; William Gradison, US House and PCAOB; Timur Kuran, Economics; and Kevin Grier, Economics) next week.  They were all REALLY good, and I'm sure Angus will be the cherry on top of my sundae of life, as always.

(Angus is flying in tonight.  A little trouble, though, because Ms. Angus screwed up his reservations.  Okay, no she didn't:  Angus got a little confused about the admittedly complex concepts of "before" and "after."  But it's all good.  The LMM has made a lovely gluten-free chocolate cake in anticipation of arrival d'Angus)

Smart or Stoopid

The Smart or Stoopid Test.

I got a 27.  Apropos of absolutely nothing, since the test is not deep or difficult.  But it is fun.

Nod to the LMM, who thought Elvis died in 1957.

They keep burying these deeper and deeper

but I keep finding them! Bob Shiller continues his relentless march deeper and deeper into the NY Times Sunday Business Section, but I ferreted his column out on page 8!

Lets take a quick sample:

THE failure of the Congressional supercommittee to come up with any agreement on the budget deficit makes it even less likely that Congress will rise above its partisan divisions and act on behalf of the millions of out-of-work Americans.Yet without government intervention, we may well have high unemployment and social discord for years to come. How did this disaster happen?

Let's blow right by the supercommittee non-sequitor and focus on the second sentence: without government intervention.

YIKES.

He doesn't say "without FURTHER intervention"; he acts like nothing has been done!

Hey Bob, lets take a peek at the Fed's balance sheet:

No government intervention? Dude!

How about on the fiscal side?

Since 2007, We've more than tripled the Fed's balance sheet and more than tripled the Federal deficit. I think that qualifies as a fair amount of "government intervention" (am I weird to think that when automatic fiscal stabilizers kick in that counts as government intervention?).

Yes, long term unemployment is a big problem in this country. Will another $400 billion "jobs" program solve it or even noticeably reduce it? Will another round of quantitative easing solve it?

I think the problem goes far beyond a failure of "demand management"

Speaking of "cute boots"

Picked up these bad boys in Santa Fe for Mrs. Angus' christmas present. Not on Black Friday though.

(clic the pic for an even more glorious image)

NB: I followed the full set of Mark Perry boot rules; no half boots, no zipper boots.

I don't Fault the Police....

This Thursday, in a parish hall not far from the New Jersey town green where George Washington once made his winter headquarters, as many as 300 people will gather for their Thanksgiving meal. Some will be homeless, some will be mentally ill, some will be old, and some will be folks and families who have just hit a hard patch. For all of them, Morristown's Community Soup Kitchen and Outreach Center is one of the few blessings they can count on...This the men and women of the Community Soup Kitchen have provided for 26 years, not once missing a day. Now comes a challenge greater than any snowstorm or power outage. Earlier this year, the Morristown Division of Health ruled that henceforth the soup kitchen would be considered a 'retail' food establishment under New Jersey law...Most obvious is the higher cost: at least $150,000 more a year...Much of this cost results from a new prohibition on people donating food they've prepared at home. For those on the giving end, often this was the only way they could participate, so eliminating their contributions means eliminating volunteers. For those on the receiving end, it means no more homemade meat loaf, lasagna, cakes and so forth. All, of course, in the name of food safety. Still, one suspects that when a co-worker brings a tin of Christmas cookies to a friend inside Morristown's Division of Health, those cookies are not forbidden because they do not come wrapped from a supermarket or approved restaurant...In the 26 years this kitchen has been open, there seems to be no case of food poisoning. [William McGurn, WSJ op-ed]

The passage in yellow is the one I think is interesting. Presumably the Morristown Health Gestapo has potlucks, or during the "holiday season" someone brings in some homemade goodies. And I bet the folks at the MHG do NOT throw the stuff out.

One could say that the food brought to the office is informal, and is not for sale. Right. That's the correct distinction: since the food at the Soup Kitchen and Outreach Center is NOT FOR SALE, it should have a separate category. Not exempt, perhaps (though, why not? The Morristown Health Stasi is exempt, apparently!), but a different category. If you don't sell food, or anything else, you can accept donations of cooked food.

If it turns out there are health problems, ex post, the shut them down. But the idea that you are going to protect poor people by denying them something to eat is pretty strange.

As Mr. McGurn notes in closing (since the piece is gated, you may not have read it): Hillary Clinton visited an orphanage run by Mother Teresa's nuns. She came away impressed by the great love and care she found there. With no small irony, she noted it was a place that "would not have passed inspection in the U.S."

Look, folks, we can't blame the food police. It's the LAW. Get rid of the law. I don't fault the police, cause the people that run 'em got 'em on a short leash.

Al Sharpton and "THE PIE" video

Okay, I enjoy the video and all. But why the "MSNBC" label at the end? Are they making campaign videos now? Turns out that yes, that is exactly what "Lean Forward" is all about.

Fine with me if they are. But the bald abandonment of any pretense of objectivity (MSNBC long ago abandoned objectivity, but they have maintained the pretense) is impressive. As the NYTimes (a pretender of great talent!) says that MSNBC has "embraced a political identity" I guess they know what they are talking about.

Have to wonder about the title they picked. "Lean Forward, America!" sounds a lot like "Bend Over, America!" And that's pretty much what the MSNBC campaign to reelect the President sounds like: bend over, America, and yes you CAN have another.

That's Old, and Authentic! I'll buy it and put it in my bathroom...

Drugs, Arms, and Arrowheads: Theft From Archaeological Sites and the Dangers of Fieldwork

Blythe Bowman Proulx
Journal of Contemporary Criminal Justice, November 2011, Pages 500-522

Abstract:
This article presents findings from a recent worldwide study of archaeological site looting, which largely fuels the international trade in illicitly obtained antiquities. Focused on practicing archaeologists’ opinions about and personal experiences with site looting, the study surveyed 2,358 archaeologists excavating throughout the world in 118 countries. Key findings presented here include archaeologists’ reports of connections between archaeological site looting and the production of and trade in methamphetamine across the United States. American archaeologists report run-ins with “meth heads” on their sites with increasing frequency. Other archaeologists working throughout the world report violent encounters with looters on site, some of whom even report being shot at and assaulted by looters. Overall findings suggest that archaeological fieldwork has become an increasingly dangerous occupation around the world.

NBA thoughts

It looks like a 66 game season starting Christmas day. I'll be happy to see my Thunder hooping again.

Everyone likes to talk about winners and losers, so here goes.

Stern and Hunter aren't winners. This deal went down very badly and they repeatedly looked bad in the process.

The players aren't really losers. They will still be making a lot of money and earning a fair amount of economic rents.

Jeffrey Kessler is a big loser. His way (lawsuits) got pushed aside, another voice (Jim Quinn) was brought in, and the deal accepted appears to be very similar to the one that caused the players to dissolve the union and file lawsuits.

Big time agents are losers. Smaller and shorter contracts mean less in commissions. Less movement of players, no more sign and trades, all will hit them in the wallet. They were strongly against the deal that basically has now been agreed to.

The hardline owners are big winners. If they can't make money now, then contraction would be richly deserved.

Me and LeBron are winners. We nailed the lockout for Grantland, and will be writing more columns for them in the future.

The biggest thing I'm anticipating before Christmas is the amnesty debacle, if it is in the new CBA. That's where teams can pick a player to dump (while having to pay the contract) off their team and get the savings on the new salary cap.

Reihan Salam on Majors and Pay

Reihan Salam is one of my favorite bloggers.

He comes up big, again, discussing the correlation between majors and incomes.

To be fair, Mr. Salam makes use of KPC friend Code and Culture, which is always a good idea. Code and Culture is one of the most consistently interesting and yet serious blogs out there.

Fair Trade Kerfuffle

I am on record as being a Fair Trade Skeptic. (I admit that Fair Trade is human- caused, but I am not sure that is melting the polar ice caps).

Interesting article from NYTimes, normally a big Fair Trade cheerleader ("If you want to get laid, support Free Trade! Yay, team!")

Excerpt:

Critics accuse Fair Trade USA of watering down standards, perhaps motivated by the bigger fees to be earned from certifying a higher volume of products. Some sellers of fair trade products fear that small coffee farmers will lose market share to the big plantations and that companies will have an incentive to include only the minimum amount of fair trade ingredients in their products.

“It’s a betrayal,” said Rink Dickinson, president of Equal Exchange, a pioneer importer of fair trade coffee, chocolate, tea and bananas, based in Massachusetts. “They’ve lost their integrity.”

Paul Rice, chief executive of Fair Trade USA, said the fair trade movement was dominated by hard-liners who resisted needed changes. “We’re all debating what do we want fair trade to be as it grows up,” Mr. Rice said. “Do we want it to be small and pure or do we want it to be fair trade for all?”

He dismissed criticism that his group was seeking to increase revenue for its own sake. “The more we grow volume, the more we can increase the impact” of fair trade, he said. In 2010, companies that sell fair trade products paid the group $6.7 million in licensing fees, which are meant to pay the cost of auditing a company’s production to make sure its fair trade claims are accurate.

As part of his efforts to expand the fair trade designation, Mr. Rice is cutting ties between his group and an umbrella organization, Fairtrade International, which coordinates fair trade marketing activities in close to two dozen countries. He said his group paid outsize fees to Fairtrade International — about $1.5 million last year — and received little in return. The international group has also rejected the changes put forth by Mr. Rice.

“The best thing we can do is make sure we’re staying true to the principles that got us to where we are,” said Rob S. Cameron, the chief executive of Fairtrade International. “I’m not going to water those principles down.”

The brouhaha has surprised many companies that sell fair trade products and will soon be forced to take sides. For consumers who pay attention to where their food comes from and how it is produced, the result could be confusion as they try to sort through a proliferation of competing fair trade labels with differing claims.

Heh, heh heh. He said "brew-ha-ah." About Fair Trade coffee. That's funny.

Things I'm thankful for: Belated edition

Australian Rock!!

I've finally expanded beyond the Birthday Party and Rowland S. Howard to Eddy Current Suppression Ring and the Twerps!

This is incredible music:

Black Friday

LeBron on Black Friday. He doesn't say it, so I will: Robert Frank is a clown.

The LMM just came home with three pairs of "cute boots." I like it very much when the LMM feels attractive (which she always is, objectively), and happy (which she is sometimes not). I love Black Friday.

Airline Travel: If the person beside you is fat, you have to stand?

A discussion over at EE, on who should bear the costs of jumboness.

Thanks to Mark Steckbeck, for the tip.

Happy T-Giving From Seattle!

Raoul sends this from Seattle. I think he actually lives in coffee shops, though he does have a nice place to stay, with a deck. Problem is that the weather.... well, check his glasses.

(That's not his real smile, btw. Two reasons to do this: 1. I want to protect Raoul's identity. He is the source for the name the "the savage Raouli" in Hinich-Munger 1994. 2. His nickname was (and is, as far as I'm concerned) "Mr Joy." The sight of that smile on Mr. Joy makes me giggle.

Sure, They Voted for Buchanan, But They Meant "Gore"!

Typo leads to wrong candidates election...

DERBY, Conn. (CBS Connecticut/AP) — A typo has led to the election of the wrong man to a finance board in Derby.

James J. Butler was the highest vote-getter, winning 1,526 votes for the 10-member Board of Apportionment and Taxation, which oversees the town’s finances.

However, his father, 72-year-old James R. Butler, was nominated by the Democratic Town Committee for a second, two-year term.

The News Times of Danbury and New Haven Register report that James R. Butler says his 46-year-old son is not interested in politics or serving in public office.

A reader asks: "Key, Converse, or Downs? Is this evidence in favor of any one of the above theorists? It probably speaks best of Downs considering the line, "'The error was made in the caucus back in July and nobody picked up on it,' she said." I wonder how elite ignorance fits into Downs' theory? Game theoretic irrationality?!"

What I wonder is why Democrats can't come up with a way to proofread ballots. The "butterfly ballot" that cost Algore the 2000 election: Democrats.

(Nod to RWP)

Happy Thanksgiving from Angus & Mungowitz!

(clic the pic for a more glorious image)

Renewable Energy is cheaper than coal (?)

Mr. Overwater sends this link (without, I should note, making any claims it is right or wrong. Just thought KPC would be interested, and KPC is interested. KPC is clearly trying to be like Herman Cain, and refer to KPC in the third person. Or maybe Herman Cain wants to achieve the deserved obscurity that KPC achieved long ago? Either way, here is an excerpt from the Google site):

In 2007 we launched our Renewable Energy Cheaper than Coal (RE lt C) initiative through Google.org as an effort to drive down the cost of renewable energy. We’ve retired this initiative and continue to support renewable energy in a variety of other ways.

Our approach to RE cheaper than C
Through RE lt C, we made several investments in companies working on potentially breakthrough technologies. For instance, we invested in companies like Brightsource Energy and eSolar to help expand their work on concentrating solar power technology, and in Potter Drilling to advance its innovative geothermal drilling technology. We also sponsored research to develop the first Geothermal Map of the US, helping better understand the potential for geothermal energy to provide renewable power that’s always available. And we’ve had an engineering team working to improve a type of concentrating solar power technology called the solar power tower.

Being a broken record is repetitive, by definition. But the fact is that facts have shown over and over that it is a fact that RE gt C, in fact. Wishing it weren't so is just a giant waste of resources.

As proved by the fact that all of the enormous amount money wasted on wind power has gotten us nothing but a bunch of big towers, sort of an exercise machine for giants to hang dirty clothes on.

Overall, there is one simple truth: if it requires a subsidy to compete, it's NOT CHEAPER! Conversely if it IS cheaper, then it does not require a subsidy to compete.

And the wind cries.....wasteful! Here is some background, for you nuke-haters. In the US, perhaps 100 workers, and more than 30 citizen/bystanders, have been KILLED by wind turbines breaking or malfunctioning.

At Chappaquidick, one innocent person died.

At Three Mile Island, and in fact the total for all US nuclear power operations, cumulatively? That would be zero.

So, a lot more people are killed every year by wind turbines than have died, total, from nuclear power.

Boston Globe Article

Did a fun interview with Donovan Slack (yes, a woman named Donovan) for the B-Globe. Here is the article...

Excerpt:

Today’s visit is the latest in a string of presidential trips to battleground states since he introduced his jobs bill in September. The White House has said the forays are designed to take the president’s case for passage of the legislation directly to the public with hopes of pressuring Congress to pass it.

Congress has so far passed only one small piece of his bill, a measure signed by Obama yesterday that will provide tax credits to businesses that hire veterans. The rest appears mired in partisan gridlock on Capitol Hill, a logjam the president hopes to loosen by pushing his case directly to the public.

“We’re hopeful that the pressure from the American people is ultimately going to prevail,’’ one of the president’s top economic advisers, Brian Deese, said in an interview yesterday.

But some analysts say the destinations the White House has chosen for the trips appear to target electoral votes in the 2012 election rather than congressional votes to pass the jobs bill.

Shortly after unveiling the legislation, Obama held an event on a bridge that connects Ohio and Kentucky, the home turfs of House Speaker John Boehner and Senate minority leader Mitch McConnell, both Republicans. But his itinerary since then has included Colorado, Michigan, North Carolina, and Pennsylvania, which do not have similar connections to GOP leadership on Capitol Hill but are all critical battleground states in next year’s presidential election.

It appears that he has “completely abandoned the idea of legislative accomplishments and switched to electoral accomplishments,’’ said Michael Munger, a Duke University political science professor who was a Libertarian candidate for governor of North Carolina in 2008.

Some analysts say it is a necessary tactic for the president.

“Taking his case to the folks in swing states makes obvious sense looking forward to 2012,’’ said Christopher Parker, a political science professor at the University of Washington.

Parker and others believe the logjam in Washington will not ease until the 2012 election is decided and the public gives a mandate to one side or the other to take action. Right now Republicans will not approve large amounts of new spending without an equal amount of cuts, and they are vehemently opposed to tax hikes. Democrats want new spending to accelerate economic recovery, including what is in the president’s jobs bill, but will not make deep spending cuts without new tax revenue.

"Makes obvious sense looking forward to 2012"? Prof. Parker, it's 2011. He is Prez NOW. There has never been a President, in my memory, so utterly indifferent to legislative accomplishment, or to the state of the nation. He does not enjoy working on legislation, doesn't care about policy, and doesn't like having people disagree with him. Much more fun giving campaign speeches to hand-picked audiences, 'cause they will stay say "Yay! You are the MAN!" Even though Prez O is NOT the man. Even Chris Matthews recognizes that Prez O is a nebbish.

Tiger Attack!

The OKC zoo has four month old tiger cub quadruplets! Here are two of them having fun:

(clic the pic for a more ferocious image)

Shatners Frying Club

This has everything: explosions, turkeys, and William Shatner.

This just gets worse and worse

Abolish Inflation Tax

John T. Plecnik writes an interesting piece on the "Inflation Tax"

Abstract:
Inflation erodes the purchasing power of money and distorts some income tax liabilities upward, which in turn discourages savings and investment. When inflation is caused by the central bank “printing” money to fund deficit spending, it results in a transfer of real wealth from the holders of dollars or assets denominated in dollars to the government and, in normative terms, may be conceptualized as a tax. The effect of the so-called inflation tax is regressive, because low-income taxpayers often lack the sophistication or liquidity to invest in hedges against inflation.

Following the double-digit inflation of the late 1970s and early 1980s, the U.S. Treasury Department and a host of legal scholars proposed sweeping reforms to comprehensively index the Internal Revenue Code for inflation. However, their proposals were never enacted into law. Instead, Congress chose to respond to inflation on a case-by-case basis. Many of those responses, such as the preferential rate for capital gains, afford relief to the wealthy, but do little to help the poor and middle class. To counter the pernicious effects of inflation and make the Code more equitable, this article proposes an inflation tax credit. Under the proposal, low-income taxpayers may elect between (i) substantiating the average balance of their bank deposits and treasury bills to receive a credit based on that balance, and (ii) taking a standard credit based on their gross income.

Daughter of Cuddles Wins Rhodes!

News article:   SC student studying at Stanford is Rhodes Scholar

The Associated Press  Posted: 11/20/2011 11:16:21 AM PST   Updated: 11/20/2011 11:16:22 AM PST

COLUMBIA, S.C.—A student from Columbia studying at Stanford University in California has been chosen as a Rhodes Scholar.   Katherine Niehaus is one of 32 American students who were awarded scholarships to study at Oxford University. Niehaus will have all her expenses paid to the prestigious university in England.   Niehaus' work focuses on biomechanics and she wants to apply her research to high technology entrepreneurship. She also is a mentor and tutor for students in low income families. Niehaus was star student and track athlete at Spring Valley High School, where she won 14 state championships. She was the captain of Stanford's track and cross country teams.

Congrats to Kate!  That is very cool.  I met Kate when dad Dr. Greg Niehaus and she came to visit Duke.  She "settled" for Stanford, I guess...

Anyway, Kate should know that Angus had an important role in her past.  Because Angus used to sing this song, loudly, when "House" was around.  I should note, we called Dr. Niehaus "Cuddles," because he was captain of the 1979 Kenyon football team in college.  (His teammates called him "House."  He's still tied for the Kenyon record for most interceptions in a single game:  3 against Grove City College in 1979) .  Just LOOK at the guy:  clearly he should be called "Cuddles."
The song:

Cuh-cuh-cuh-Cuddles!
Beautiful Cuddles!
He's the only math-uh-matt-ish-uhn we adore!
By the luh-light of
A silvery slide rule
He'll be differentiating on the floor!

I am 100% serious, by the way.  We really did sing this.  And Angus really did make it up.  Congrats to Greg and Liz, and of course to Kate.

Nod to Chateau

Food Stamps

Work incentives and the food stamp program, Hilary Williamson Hoynes & Diane Whitmore Schanzenbach
Journal of Public Economics, February 2012, Pages 151-162

Abstract: Labor supply theory makes strong predictions about how the introduction or expansion of a social welfare program impacts work effort. Although there is a large literature on the work incentive effects of AFDC and the EITC, relatively little is known about the work incentive effects of the Food Stamp Program and none of the existing literature is based on quasi-experimental methods. We use the cross-county introduction of the program in the 1960s and 1970s to estimate the impact of the program on the extensive and intensive margins of labor supply, earnings, and family cash income. Consistent with theory, we find reductions in employment and hours worked when food stamps are introduced. The reductions are concentrated among families headed by single women.

Nod to Kevin Lewis

This IS What Democracy Looks Like!

Dan D'Amico: The "Occupy" movement is what democracy looks like. Interesting.

On the Road: Excerpt

How times have changed. Jack Kerouac's description of a hip NY party in the late 1940s in On the Road:

The party was enormous; there was something going on in every corner...There was even a Chinese girl.

Apparently some guy went upstairs with her. But then he was horny again in three hours.

(Nod to Raoul)

Adam Carolla--Uncensored

NSFW!!!!



(Nod to Douglas Coate)

Lefties: Ron Paul should be your man

Lefties should vote for Ron Paul.

I agree, but.... Al Jazeera gets this right, and the New York Times doesn't get it? We are through the looking glass here.

(Nod to Erik C)

The Thrill is GONE, Baby

Chris Matthews breathlessly comes to the conclusion most of us came to two years ago.

Still, let's be fair: Mr. Matthews gets it right. Our President has zero interest in policy, or change, or addressing any serious problem. He likes to play golf, and he likes to speak to cheering crowds. Obama makes Carter look like Lyndon Johnson, when it comes to effectiveness. As Mr. Matthews put it, and he put it well: "When was the last time a member of Congress heard from him? ...He does not enjoy their COMPANY."

It was not always thus. Mr. Matthews, at one point not so long ago, had a good feeling in his tingly parts, and all the way down his leg, at the mere THOUGHT of putting the words "President" and "Obama" in the same sentence.

There was NEVER any reason to expect BHO to be an effective, or even engaged President. I admit, given the choice between Obama and McCain, again, I'd pick Obama, still. But it would be nice to have some better choices.

(Nod to the Blonde; BHO never sent a thrill up HER leg, either)

Inequality, take II

So what I was saying yesterday is that graphs like this don't intrinsically bother me:

What is worrying to me is how we got to this graph, as described here:

CBO finds that, between 1979 and 2007, income grew by:

275 percent for the top 1 percent of households,
65 percent for the next 19 percent,
Just under 40 percent for the next 60 percent, and
18 percent for the bottom 20 percent.

If we had gotten to the graph via say 75% growth in the bottom quintile with correspondingly faster growth in the other groups, I'd see no no problem at all.

But we didn't.

Incomes in the lower part of the distribution are not really growing. 18% growth in 29 years stinks. 40% growth in 29 years is really not much better either.

To me, it's the lack of absolute improvement in incomes at the bottom of the distribution that we need to address, not the big growth at the top.

And I just don't see how hammering the 1 percent is going to sustainably raise income growth for the bottom 20-40 percent.

We need to fix public education, and the problem there is not really a lack of overall expenditures.

We need to not put so many young people in prison and the problem there is not a lack of expenditure.

We need stronger and more stable family lives for more children. I am not sure if greater expenditure would help here. Maybe.

Inequality

To me, whether inequality is a problem/evil/worthy target of policy depends on how we reached that inequality.

For example, if the real incomes of bottom 20% were growing at 4% per year while the real incomes of the top 20% were growing at 6% per year, we would eventually arrive at a very unequal society. However, to my mind, it would not be a problem or a legitimate target of policy because the bottom quintile would be doing pretty well in an absolute sense.

Another way to say this is that I don't think policy in our current situation should be addressed at reducing inequality, I think it should be addressed at increasing opportunities for the group of people that are not doing well.

Another way to say this is that I'm not troubled by the super-rich, I'm troubled by the persistently high unemployment rates for people with limited education levels.

I could probably sign on to celebrate income inequality; but at the same time, I am very worried about the absolutely poor income trends for the bottom quintile.

It's just not obvious to me that taxing millionaires will help the job and earnings prospect of low skilled workers.

Room Assignment Puzzle

Question: Should Duke allow side payments in room assignment process?

Answer: why not?

Real answer: Nope, they do not allow it. And they are threateing "referrals." I don't know what that means, but it frightens me.

Big Day Tomorrow!

People, tomorrow is World Toilet Day (for realz)!

From the WTO (world toilet organization) website we are encouraged to:

"Join in the celebrations! Click around and find out how you can be part of World Toilet Day celebrations!"

How will you celebrate WTD?

Here is my fondest memory from WTD 2010.

So enjoy tomorrow, but don't be a turd burglar!

Hard Balls Banned In Toronto

As Jackie Blue notes, "Finally, the kids are safe."

Toronto bans balls of almost all kinds (apparently really soft balls, like Nerf or Harry Reid's, are still okay).

This includes, remarkably, soccer balls. Yes it does.

State = Violence

I'm always surprised, and a little amazed, when my lefty bed-wetter friends say that there is no violence inherent in the state. People pay their taxes because they WANT to, don't you know. They keep quiet out of respect, not fear. In your mind, friends, that may be true.

In Portland, some cops just straight up pepper sprayed a girl in the face. (if this picture is real; can never know, of course).

(photo credit), click for a more burning image.

This video happened to be taken at about the same time. You can see some people trying to help the girl, on the right side of the view, as she screams and vomits.


The state IS violence. The state does not USE violence, it IS violence. Sure, maybe you think this girl had it coming. Or perhaps, to paraphrase Burke, you fall out with the abuses. The THING! The thing ITSELF is the abuses.

Thomas Hobbes had it right, and nothing has changed. It is not wisdom but authority that makes a political "law." Authority is power, backed by violence. And the reason the state exists is to be able to wield overwhelming, irresistible power, enough to "overawe" even the thought of resistance.

Now, mind you, I don't fault the police. This is dangerous work, the kids are breaking the law, and the kids are screaming vile things at the cops. The point is that all you lefties want a police state. How do you like it now?

Dems love welfare, Reps love corporations. Result?

Corporate welfare.

"The Occupy Wall Street protesters aren't good at articulating what they want, but one of their demands is 'end corporate welfare.' Well, welcome aboard... Republicans, for their part, favor handouts to the nuclear industry. Over the years the feds have provided billions of dollars in loan guarantees and cut-rate insurance to nuclear plants, though even nuclear-utility executives say new plants may not make economic sense in a world of cheap and abundant natural gas. Last month House Speaker John Boehner backed a $2 billion Energy Department loan guarantee sought by USEC Inc. for a uranium-enrichment plant in Piketon, Ohio...Yet the parade of subsidies gets longer each year, perhaps, as the old joke goes, because in Washington Republicans love corporations and Democrats love welfare. As House Budget Chairman Paul Ryan puts it: 'How can we save billions of dollars from unjustified subsidy and entitlement programs, if we can't get corporate America off the dole?'" (gated link to whole WSJ article)

(nod to Kevin Lewis)

Your Euro Death Watch update

Spanish 10 year bond yields hit 6.975% today.

YIKES!

With no growth in sight for Greece Italy and Spain, high re-financing costs like this will make their debt ratios grow even if they manage to balance their budgets. Only large surpluses will stabilize those debt ratios if their cost of funds is 7% or above and economic growth is weak.

Good news, but will it last?

Jobless claims are down, industrial production is up, inflation is down, and consumer confidence is rising.

Nice.

Now let's see what happens when the supercommittee debacle is fully revealed or one of the PIGS makes a break for it, Argentina style.

Things my Provost wants me to know

Apropos of absolutely nothing, the Provost's office emailed me this today:

"Pregnancy is not a disability under ADA unless there are medical complications. For OU employees we have to treat pregnancies in the same manner as we do other temporary ailments, i.e., broken leg or such."

1. I'm pretty sure that i.e. is not the correct pretentious concept here. I believe this is an e.g. situation.

2. pregnancy = broken leg? WTF? Does OU put body casts on all pregnant employees?

3. I need to know this today of all days exactly why?

Markets in everything: Dali Lama doody edition

yes, that is a statue of the Lama pooping! Caganers are Catalan Christmas favors. More here.

Aaron King: FInal Note

I got several "Why are you so mean to Aaron King?" emails.

Some context:

1. Aaron is one of our very best grad students. Hard-working, smart, lots of different projects started. He is going to be famous.
2. Aaron is irrepressible, one of those people who has to make a comment, start a conversation, create a controversy. I would never pick on most grad students this way. But you have to realize that Aaron needs to be the center of attention. (No, not as much as I need to be the center of attention. But NO ONE is as needy as I am.)
3. Aaron graduated from MSU years ago. Yet every day (EVERY. DAY.) he wears an MSU shirt, hoodie, and baseball cap. MSU is all he talks about (when he is not talking about work, which is what he mostly talks about).
4. Aaron does (as we say in the south) "favor" me. Except that he is better looking and more athletic, by a lot. So I think everyone understands that me comparing our looks is ridiculous. But Aaron's style of basketball play is quite similar to mine: neither of us really go around people, but rather we go through them.
5. Aaron's "rants" are famous, and about as sensitive as mine. An example. The Duke Parking office is a disgrace to pencil pushers everywhere. They are incompetent and a waste of a paycheck (that is larger than mine). I want to go to Subway for lunch, just so I can see some better service. Doesn't that sound like me?

My bottom line point is that, if you knew him, you would smack him, too.

Animal Cruelty

Angus sends this picture, outrageous on several grounds. Check it out:

First outrage: the animal cruelty. The poor dog has no idea of the humiliation it is suffering. Someone should shoot the poor dog.

And then shoot the person who did this: Aaron King. Years after leaving his undergraduate institution (MSU), he is still obsessed.

Okay, now the second outrage....Compare to THIS pic, of Angus and I watching the Cards get beat at Rangers park in Arlington.

Angus alleges that there are certain physical resemblances between Aaron and...well, me. The same stubby, thick legs, the same apologetic smile, the same bulbous head. This is outrageous because it is entirely correct.

Aaron and I have played basketball a few times, with him being "skins" and me... just being sweaty. The slapping and thwopping of wet skin, it sounded like a hippo wedding night. Oy.

To test the "look alike" thesis, Angus posed this question to Ms. Angus, showing her Aaron's picture: "Who is this?" Her answer, unequivocally: "That's Munger, when younger. But why would he humiliate that poor dog?"

Lagniappe: This all started when Aaron posted THIS on facebook: How long can I wander Duke's campus in an MSU shooting shirt without being heckled? Show some pride people! MSU would riot if a dookie was walking down Grand River....

To which I responded, in my measured, tempered way: For Aaron King: two things. No Duke student would think of making fun of an MSU fan. It's like making fun of Special Olympics kids, except that some Special Olympics kids can read. Second, good teams win. But a team need not be good to beat MSU. So, it's no offense to see an MSU logo, and no particular sense of accomplishment to beat MSU. The reverse? Where an MSU kid would be mad if he saw a Duke logo (assuming there was someone around to read it aloud to the MSU kid, so he would know what it said)? it's because Duke is something that's worth being upset about. Glad I could clear this up for you. It's the LACK of pride, and the presence of a justifiable inferiority complex, that would make it dangerous to wear Duke gear on Grand River.

lettuce spray

The only negotiations more screwed up than Hunter-Stern are those between the Dems and Reps on the (not so) Supercommittee on deficit reduction.

They are charged with producing $1.2 trillion in cuts and revenues over 10 years. That is $120 billion per year. Federal spending is running around $3.6 trillion PER YEAR. The deficit is over $1 trillion PER YEAR.

In other words, $1.2 trillion is peanuts.

We could take the full $1.2 trillion out of defense and never miss it. Defense spending is around $900 billion PER YEAR, so we'd be "crippling" the Pentagon by only giving it $780 billion PER YEAR.

The Canadians would probably pour over our border and conquer us at that point, eh? Well not really, because the cuts are not really cuts from today's levels but from a baseline of future increases. If sequester went into effect, the Pentagon budget would still grow over the next 10 years.

And yet we read this in today's WSJ:

With Congress's deficit-reduction supercommittee barreling toward a deadline for striking a big budget deal, both parties are reaching for accounting gimmicks to help reach their target of $1.2 trillion in savings over 10 years.

Some tools are familiar to old Washington hands, such as massaging budget assumptions and painting rosy economic scenarios. Others include taking credit for "saving" money on wars that are ending and putting off until next year what lawmakers don't want to deal with now.

All told, none of these efforts make the fundamental policy changes needed for a long-term budget fix. "Suddenly everyone is talking not about deficit reduction but deficit-reduction gimmicks," said Stanley Collender, a budget expert and former congressional aide.

Give me that old time sequester, give me that old time sequester, give me that old time sequester, it's good enough for me. It was good enough for Gramm-Rudman, it was good enough for Gramm-Rudman, it was good enough for Gramm-Rudman and it's good enough for me.

Keynes

I am often impressed by Keynes.
"the political problem of mankind: how to combine three things: economic efficiency, social justice and individual liberty" (Keynes, "Economic Possibilities for our Grandchildren")

Much less often am I impressed by Keynesians.

(Nod to Neanderbill)

Something Wrong With Any Man Who Wants to Work with Children?

David K writes:

Over the last week, I have heard a number of talking heads and sports radio types call for parents to be wary of men who want to be around boys. They say that we should err on the side of caution and question men who come into contact with youth. One lunatic in particular said there is "Something Wrong" with any older man who desired to commit his time and energy to being around youth.

I immediately recalled your article on this, and wondered what your thoughts were...

It seems to me that this kind of behavior could drive more men away from daycare and elementary school jobs as well as volunteer and charity related positions where they are sorely needed as role models for all children.

David, I don't have much to add. You said it better than I could have.

What We Have Here....Is a Failure....to ComMUNicate.

Henry Olsen speaks a bitter truth.

I have been saying that BHO can't possibly lose in 2012, because he will be running against the idiot Republicans. Not the one chosen as Prez candidate, but the US House.

Repubs insist on making the same mistake over and over again. When the voters see what the Dems are actually like, the voters go "ewwwwww!" But that is NOT an endorsement of the bunch of whack jobs that the Repubs trot out, or the ideas they have for running our wars, our bedrooms, our borders, or our trade policies.

Anyway, I think O, Henry has this right.

The big question

Over at MR, Tyler pops it: "to what extent can a boost in nominal flow make up for a shortfall in wealth?"

The US economy suffered a severe real shock. Housing prices collapsed, equities fell. People discovered they were a lot poorer than they thought as 10s of trillions of wealth disappeared.

Individuals stopped spending and tried to start saving, cutting debt loads and re-building their balance sheets.

Meanwhile, our government has replaced the private debt binge with a public debt binge and "encouraged" saving by nailing interest rates to the floor.

These two moves are entirely incompatible with people's desires to rebuild their balance sheets.

Of course, the moves were undertaken to increase output and reduce unemployment. However, those results have been far short of overwhelming.

Many advocates of NGDP targeting argue that it works via an expectations channel. A rough version of the logic is, if real growth is low, the Fed will be creating inflation, which will erode the value of my money, so I better go spend it now!

I know I'm treading dangerously close to getting a Samuelsonian lecture on the paradox of thrift, but it's been three years now and the economy still stinks. I am not sure that this sad state of affairs is because we haven't punished savers enough.

Go Home! Beat It!

Skeptical that this is real.

But if Tommy the Brit sends it, can it be fake?

Penn State Football v. Duke Lacrosse

Okay, so I was gritting my teeth not to write this because ... well, because why make trouble, right?

But it has to be said.

In the late spring and summer of 2006, the New York Times and other media half-wits went looney tunes over the fact that the Duke administration did not do enough to punish, horsewhip, castrate, etc. the young men of the lacrosse team. Selena Roberts and Nancy Grace stand as having behaved in ways that were especially intemperate. (No really, just take a minute and watch the Nancy Grace thing. It's worth it).

But... our President said "whatever they did do, it was bad enough." Our coach was fired, and the season was ended. The team was humiliated, and subjected to a variety of threats and psychological harassment.

AND THEY HADN'T DONE ANYTHING! There is no evidence that they did anything at all, other than foster under-age drinking. (Hiring strippers is legal, no matter how much you might disapprove on hypocritical moral grounds.) (There may have been racial epithets, according to the woman who said she was raped but wasn't.)

No assault, even. More people died at Chappaquidick than at that house on Buchanan Ave. in Durham. More sexual assaults occurred in the Arkansas Gov's mansion in 1988 than at that house on Buchanan Ave. in Durham.

And now... well, now we are all hearing a little, pretty late, pretty little, outrage about Penn State. At Penn State there WAS a rape... of a child, by an adult. And the administrators did nothing. When finally Joe Pa was fired (unbelievably, his compromise was to finish out the season. nice.), the students actually rioted to protect him. No "castrate" signs.

So, if it's football, there is no race element, and the offender is a pedophile, we'll remain calm? Because it's okay to protect football coaches, because they are more important?

Okay, yes, I understand there has been no trial, no admission of guilt. But there appears to be an eyewitness, Mike McQueary. And he TOLD THE ADMINS, INCLUDING JOE PA, WHAT HE SAW! There was an obligation to go public immediately, and given what was known the coach had to be fired and turned over to the police. The defense "there has been no trial" is only true because Penn State systematically suppressed evidence and kept back information. We'd know by now, if the trial had gone forward, about guilt or innocence. I mean, even the devil was appalled.

Joe Pa, we hardly knew ye. How could you possibly have allowed this to go on? All you haters who were mad at Duke... are you proud, now? This is one hundred times worse on every dimension. Except on the guilt of the "bad guys" dimension, where it's infinitely worse, because there are actual bad guys.

Profits

We Get Letters! Euro-zone inflation...

Will C writes: I recently listened to a Russ Roberts podcast interview where you discussed inflation, among other things. I thought of your interview when I recently read that Italy was suffering from inflation. I wonder if you could answer a question - on your blog or whenever time permits - about Italy, the Euro, and inflation.

I figured that inflation would be about the same in all of the Euro countries since they have a common currency. If inflation is a monetary phenomenon how could Italy have inflation but Germany does not? Perhaps what I read is incorrect and Italy is not experiencing inflation.

The answer is not very interesting. Inflation rates do NOT differ much in the Eurozone. Maybe from a low in Germany of 1.4% to a high of 5% or 5.5% in Estonia. As for Italy? Not so much: Italian inflation is up to 3.5%, from 2.2%, but that's not really inflation.

(click for a more inflated image!)

The differences are changed in measured relative prices in the index calculated from a survey. The biggest components are housing, food, and clothing. These change at different rates (though not MUCH different) in different countries. Some of it depends on barriers to external trade, since there are no formal trade barriers within the EU.

Here is some info: In September 2011, the lowest annual rates were observed in Ireland (1.3%), Sweden (1.5%) and the Czech Republic (2.1%), and the highest in Estonia (5.4%) and Lithuania (4.7%). Compared with August 2011, annual inflation fell in seven Member States, remained stable in five and rose in fourteen.

So the "always and everwhere" bit is a matter of DEFINITION, not CAUSE. The claim is that inflation in the EU cannot be consistently greater than the rate of increase of the money supply (though as we see in the US, it can be less). But there can be changes in relative prices, which will affect measured inflation, sometimes quite sharply. Is that "real" inflation? As far as the people paying the higher prices, sure. But in terms of definition, I'd say no.