Friday, August 13, 2004

All's Fair in Politics

All’s Fair in Politics

Economist Ray Fair’s very simple model on presidential elections has some interesting things to say about the upcoming election. Given the macro-economic and macro-political factors that have mattered in the past, George W. Bush should win between 57% and 58% of the popular vote, according to the model. Any way that this happens implies a large Electoral College victory for Bush.

Here is the main estimation equation:
VOTE = 55.57 + .691*GROWTH - .775*INFLATION + .837*GOODNEWS
You can simulate results by playing with your own assumed values here.

A note on the past: Fair’s model predicted that Gore would win the 2000 election….and since “win” is defined in terms of popular vote, he was right! The prediction was that the Dem candidate takes 50.8% of the two party vote. The actual number received by Gore was 50.3%; pretty impressive. (This factored in “no personality” for Gore, which usually means “not an incumbent” but since Gore actually had no personality was even more correct than usual)

I Wish Tiebout Could See This

Tiebout sorting”, named after Charles Tiebout (1924-1968) is one of the ways that public economists have described the effects of differences in levels of public expenditure and variations in policy in a federal system. The essence of the model is the claim that people will move to find their optimal mix of goods and amenities.

But who would have expected this?

South Carolina is becoming a magnet for conservative Christian religious groups.

New Hampshire may be the Tiebout equilibrium destination for Libertarians.

Does this mean that Bill Clinton is going to move to the Virgin Islands?

(thanks to KLH for the tip...)

"UN Resolution" is an oxymoron

For those who thought sanctions on Iraq were "working," more confirmation in the NYTimes today that the UN bureaucrats supposed to be in charge were just running around giggling and giving each other wedgies.

I have a picture, a K. Grease exclusive, of the UN meeting to discuss making the sanctions on Iraq more defective:

Seriously, here is an actual quote from the article in the Times:

"Everybody said it was a terrible shame and against international law, but there was really no enthusiasm to tackle it," said Peter van Walsum, a Dutch diplomat who headed the Iraq sanctions committee in 1999 and 2000, recalling the discussions of illegal oil surcharges. "We never had clear decisions on anything. So we just in effect condoned things."

This is a general description of the UN procedure, on everything: (1) That's a shame. (2) No enthusiasm to tackle it. (3) No clear decisions. (4) Condone. (5) Blame, after the fact, anyone who does do anything. (To be fair, they often skip steps (1) and (2)).

(Extra credit if you remember what Senator Binks was saying in the scene above....No? "Dis is nutsen!" You go, Jar-Jar!) (Photo Credit)

Thursday, August 12, 2004

A Very Private Affair


Governor McGreevey, of NJ, admitted to having "had an extramarital homosexual affair."

Sign of the times? Was the problem really that it was "extramarital?"

Gay marriage is not legal in NJ; it HAD to have been extramarital.

Holy City of Najaf

One reason for the war in Iraq (one that I found plausible enough to remain agnostic about the whole thing) was the argument that we needed to get out of Saudi Arabia, which is the traditional guardian of the two holiest sites in Islam. Osama bin Laden specifically invoked the "crusader infidels occupying the holy land argument" a couple of times in explaining why he organized al Queada and attacked the U.S. in the first place.

And, since much of the reason we had so many troops in Saudi-land was the aggression of Iraq in 1990-1, the war served two important real politik purposes: we gained a strategic foothold for troop bases that were NOT in Saudi Arabia, and we ended the largest demonstrated strategic threat to stability by destroying Saddam's large and powerful army.

Suppose for a moment that argument convinced you (it is a decent argument, not a slam dunk, but not obviously absurd). THEN WHAT THE HELL ARE WE DOING NOW?

UPDATE: al-Sadr wounded?

The Shia were supposed to be the ones who would welcome us into Iraq with open arms, because they had been brutally oppressed by Saddam. (They had been brutally betrayed by the U.S. after the Gulf War, though, so it was always a little hard to believe that). But, okay, they gave us some trouble.

One possibility is that there are so many "holy cities of Islam" that you can't swing a cat without defiling a holy site, and to some extent that's true. Furthermore, one could argue that "holy sites of Islam" spring up like mushrooms, for strategic reasons (Jerusalem became a lot more holy to Islam after the Jews took it).

But...c'mon. That's quibbling. The big plan for us to pacify southern Iraq is now this:


And this is supposed to make happy the Islamic "extremists" who were angry we were occupying holy sites?

The problem the administration has is that they have now resoundingly contradicted by their own actions every rationale for the war that they gave in their own words. Today and tomorrow, if this battle continues, the blood of more than 1,000 more martyrs (in Shia eyes) will stain the very sands that soaked up the blood of Ali. If you are a terrorist recruiter, you just can't write a better script than that.

Wednesday, August 11, 2004

I think I'll go for a walk

It's hard to know what to say about this.

But it happened near where I grew up.

Go outside, now, all of you, and turn off the computer.

If Wishes were Batteries...or Ice

States have some ridiculous laws on the books, but some of the most interesting, popular, and ridiculous are those on price regulation.

At bottom, they come down to this: Wouldn’t it be better if there were no scarcity? (Maybe; I’m not convinced), but why stop there? Gravity and friction both bug me, too.

Today Florida opened a “report your neighbor” hot line, for price gougers. But Anti-gouging laws reduce quantities available in emergencies, such as hurricanes or other natural disasters.

(K. Grease's own state, NC, has an egregious version). If there is not enough ice or batteries at high prices, how will there be enough at artificially low prices? (Walter Williams, John Hood, and Arnold Kling, on same) (see, for a little different view, Tyler Cowen)

Anti-scalping laws have created an entire industry focused on the secondary black market.

Why can’t we just all get along…with markets?

Tuesday, August 10, 2004

"I did NOT have sex with that stockbroker!"

Did my occasional radio appearance with the witty, over-caffeinated Winnipeg radio CJOB host Charles Adler, who has had his own problems with Canada's increasingly aggressive and self-righteous thought police and university nannies.

He asked a great question: why was Martha Stewart jailed on a rather vague stock fraud charge, when Sven Robinson, liberal MP, skated out the courthouse door after "pocketing" a $47,000 ring at an auction, right in front of security cameras?

Charles had started thinking of this after seeing David Frum's story, "Canada's Culture of Impunity," in the subscription-only National Post.

I think that the answer is this: Sven did the "full Swaggart" (like the full Monte, but baring your soul rather than your willie), mea-culpa-ing and abasing himself. "Yes, I did it, it was wrong, I am lower than a snake's belly, it was a cry for help."

Martha, on the other hand, said "Bite me, all of you! I didn't do it, and the people who came after me were all cowards and haters!"

Which leads me to think that only Bill Clinton can look us all right in the eye, and say (nearly in tears): "I did not have sex with ___FILL IN LIE HERE___", and have us still respect him in the morning. For anyone else, better to apologize and get it over with.

Sunday, August 08, 2004

The Economics of Wage Labor


An amazing study was released August 2 by the UCal-Berkeley Labor Center. The conclusion? Wal-mart costs California $86 million a year. The nefarious company does this by cruelly (wait for it) employing 44,000 Californians as workers. Worse, the study points out ominously, Wal-mart actually has plans to hire even more Californians soon. Egads! They must be stopped.

Here’s an excerpt from the report: "When workers do not earn enough to support themselves and their families through their own jobs, they rely on public safety net programs to make ends meet."

Sounds right. One could quibble with the idea of “make ends meet,” of course. It seems to be based on a Marxian idea of subsistence (to “make ends meet,” I need new $150 sneakers, a plasma TV, and a nice car), and has all the problems of a labor theory of value

But let that go. The amazing part of the study is the conclusion drawn by the study’s authors from the sentence I first quoted: Employment policies at Wal-mart, the nation's largest employer, cost California taxpayers approximately $86 million a year in public assistance to company workers. Huh?

The study authors treat the entire amount of public assistance to Wal-mart workers as a cost to the state. But since Wal-mart workers are at the bottom of the economic ladder, why doesn’t it make at least as much sense to add up all the wage payments by Wal-mart to the workers, and count those as a saving to the state?

The question is: what would these workers be doing without their Wal-mart jobs? I would confidently assert a lot of them would be unemployed. Then, the full cost of their subsistence would be borne by the state, whereas now most is offset by Wal-mart wages. The study assumes, bizarrely, that if Wal-Mart would just fire these workers they would be employed in high wage jobs paying full subsistence wages, and the state would pay them nothing. (To be fair to them, the authors say they don’t assume this. To be fair to logic, no other assumption generates the study’s supposed “results”).

Those study authors could be right. Maybe, since knowledge of basic economics is not required, all the Wal-Mart workers could get hired at Berkeley.

UPDATE: See The Liberal Order