In which I try to explain the logic of discontent

by on December 28, 2016 at 2:49 am in Current Affairs, Economics, Political Science, Uncategorized | Permalink

Or at least part of it:

Consistent with those points, I would say the road widening is wonderful for boosting throughput — that is, it gets more people and cars onto the road. Yet it’s mediocre or worse for improving the quality of life of the typical resident. An economist, engineer or technocrat typically believes that boosting throughput is important, but voters usually are less impressed.

Western democracies are encountering more problems that have this logical structure and bring an analogous clash of values…

It’s no accident that so many of the gains available today involve throughput. If you widen a road, more people will drive on it. If you open up a border, more foreigners will come. If you build more in a well-to-do city, new residents will pour in and make it more crowded. These days there is always someone knocking at the gates because of all of the global talent that has been mobilized.

And that is part of the logic that elected Donald Trump and drove Britons to vote to leave the European Union. It’s well known in economics that when prices and opportunities change, it is the elastic factors of production (those that can change their plans readily) that gain the most, and the inelastic factors that are most likely to bear losses. Insiders and long-term residents are so often the inelastic ones while outsiders and newcomers have the greater willingness or ability to adjust.

That is from my Bloomberg column, there is much more at the link.

1 Yancey Ward December 28, 2016 at 2:58 am

So, it was the newcomers and the outsiders who were the largest blocs for Bremain and Clinton electorally?

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2 too hot for MR December 28, 2016 at 6:54 am

Set aside the aristocrat insiders, is there really any question?

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3 Boonton December 28, 2016 at 7:25 am

The US must be a Lake Wobegone type of country. Clinton won a majority of the vote, I guess 52% of the people in America are “aristocrat insiders’.

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4 Lurker December 28, 2016 at 8:02 am

They just wanna be like Hilary, the ultimate aristocratic insider.

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5 Boonton December 28, 2016 at 8:10 am

Yes, drenching your house in gold is the way to signal you are not an aristocratic wannabe.

6 Rich Berger December 28, 2016 at 9:03 am

Losers make a lot of different excuses, but “if the rules were different, I would have won” is a bit unusual. Per PE Trump: “I’d rather do the popular vote,” he confessed, but that would have required a separate strategy. “It’s like, if you’re a golfer, it’s like match play versus stroke play. It’s a whole different game.”

Interestingly, if you took out the votes of LA county and the five counties of NYC, Trump would have won the popular vote by about 500,000. For that, see http://uselectionatlas.org/RESULTS/ for details (HT to a caller on Rush last week).

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7 louis December 28, 2016 at 9:25 am

Combined population of LA County and NYC exceeds that of 46 whole states.

8 derek December 28, 2016 at 9:32 am

It was obvious on election night that California would turn out in large numbers. Usually everything is decided by supper time.

9 CM December 28, 2016 at 9:47 am

Really? You mean if you we arbitrarily ignore places where 18.5 million people live? More than the combined populations of Wyoming, Vermont, Alaska, Montana, Idaho, North Dakota, South Dakota, Delaware, Rhode Island, Maine, New Mexico, Hawaii, West Virginia, Kansas and Nebraska?

Anyway, it’s not an excuse. Its a complaint about the system. Nothing about HRC’s popular vote victory excuses her inability to close Michigan, Wisconsin and Pennsylvania. But it sucks that our system permits a candidate to win even though he received 2.8 million votes than his opponent.

10 8 December 28, 2016 at 9:49 am

I’ve had Chinese tell me they didn’t like going to NYC because they didn’t see any Americans. They didn’t consider it an American city anymore. Said the same of London.

11 Rich Berger December 28, 2016 at 9:57 am

Here’s Trumpland and the Clinton Archipelago – http://www.vividmaps.com/2016/12/trumpland-and-clinton-archipelago.html

I remember when the Electoral College was popular with the “progressives”. Who can forget all the firm predictions that “Trump has no path to 270”? Now they’re just a bunch of sore losers.

12 (Not That) Bill O'Reilly December 28, 2016 at 10:08 am

Really? You mean if you we arbitrarily ignore places where 18.5 million people live?

It’s not arbitrary though–it’s illustrative. While Clinton was busy piling on in NYC, Chicago, and California (which didn’t have a single republican on the statewide ballot), Trump was focused on winning votes that actually mattered. Clinton’s ability to rack up meaningless, uncontested votes tells us only so much about whether she would have won under a popular vote system in which Trump was contesting those votes or offsetting them in places like Dallas and Nassau.

13 Boonton December 28, 2016 at 10:14 am

It has nothing to do with the rules. Yes in a universe where the popular vote was the only thing that counted Trump might have worked harder on expanding his votes in easy to win states for him like Texas. But then Hillary would have done the same in states like NY and CA. We have no idea where that might have went except for the fact that the general national polling right before the election said Hillary was slightly ahead by about 2% and the popular vote confirmed that. Was Trump’s offputting debate performance a highly controlled strategy to win critical electoral states while sacrificing the national election or was it simply the best he could do given his poor ability to handle criticism and think on his feet? You could try to make the case for the former but no one will believe you.

More importantly the game is to win both the popular vote and the electoral votes. By failing that Trump failed to unite the country around his Presidency. He comes into office with a handicap he wouldn’t have had he won both in a landslide.

“Interestingly, if you took out the votes of LA county and the five counties of NYC, Trump would have won the popular vote by about 500,000. For that, see http://uselectionatlas.org/RESULTS/ for details (HT to a caller on Rush last week).”

Or another way of putting it, “look at all these areas that failed to be attractive enough for most people to want to live in, if only those areas count, Trump won the national vote.”

Likewise we could say Moana won the box office gross for movies Dec23-25 (http://www.boxofficemojo.com/weekend/chart/)….if we just don’t count Star Wars, Sing, Passengers, Why Him and Assassins Creed.

14 MOFO. December 28, 2016 at 10:24 am

“By failing that Trump failed to unite the country around his Presidency”

This is a meaningless sentence.

15 Ricardo December 28, 2016 at 11:32 am

“While Clinton was busy piling on in NYC, Chicago, and California”

Of course, candidates go to these places to raise money but it is incredibly unlikely that either Clinton or her campaign strategists thought their efforts should be focused on getting more votes in these places. Even marginally informed people understand what swing states are. Clinton made a real mistake in overlooking Wisconsin but her campaign did indeed concentrate heavily on Michigan, Pennsylvania and Florida. She lost the combination of Wisconsin, Michigan and Pennsylvania by about 107,000 votes — that hardly suggests a campaign that failed to pay attention to basic electoral math.

16 (Not That) Bill O'Reilly December 28, 2016 at 11:46 am

Of course, candidates go to these places to raise money but it is incredibly unlikely that either Clinton or her campaign strategists thought their efforts should be focused on getting more votes in these places

Ricardo – at least one outlet (Politico) has reported that the Clinton campaign did basically just that. http://www.politico.com/story/2016/12/michigan-hillary-clinton-trump-232547

Additionally, in California specifically, the Senate race featured two Ds and no R on the statewide ballot, so even without specific focus to run up the score Clinton’s margin was inflated relative to what we would expect in a contested popular vote election.

17 Floccina December 28, 2016 at 12:27 pm

There is some truth to that, if Trump need the big city votes he would have said different things. He seems very much confidence man to me. He said what he thought would win the election.

18 Floccina December 28, 2016 at 12:37 pm

Hillary Clinton and Donald Trump are both such liars, that if the contest was for the popular vote their positions, not only the place that campaigned would be quite different.

19 Boonton December 28, 2016 at 3:33 pm

“This is a meaningless sentence.”

Yet Trump felt the need to lie about it (see the tweet about winning the popular vote if you get rid of mythical ‘illegal’ votes).

“While Clinton was busy piling on in NYC, Chicago, and California”

Clinton was not busy in NYC, Chicago or CA nor was Trump busy in Texas. These areas were already heavy in favor of one or the other candidate and except for fund raising there’s little need for candidates to concentrate there.

It does illustrate a problem with the system, non-swing states essentially lose their votes. Imagine Trump had won Texas with 90% of the vote, he would have had a popular vote landslide but it wouldn’t have changed the outcome one bit. Every Trump voter in Texas beyond the 50% one is a vote that doesn’t count as are Clinton voters in NY, CA, NJ, and other states.

The electoral college was meant to be geographic affirmative action in a nation with a lot of geographic diversity. It’s downfall, though, is that it subverts the popular democratic vote.

20 A Black Man December 28, 2016 at 9:55 am

I suggest you move to a country where mob rule is the form of government. See how that works out for you.

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21 Boonton December 28, 2016 at 10:17 am

So saying the person who wins should also win the popular vote is ‘mob rule’, but at the same time Trump winning is a triumph against ‘insiders’? By definition if you set it up so the winner doesn’t get the popular vote, it is rule by insiders.

22 CM December 28, 2016 at 10:26 am

RB – You should resize the map for population. It will look a lot different. Land doesn’t matter, people do.

NTBO – It’s not arbitrary only in that those are the places you need to “take out” to make your argument. But it is arbitrary in that does not follow any neutral democratic principle (i.e., what is the justification for treating voters in LA or NY differently from voters in Ohio or Indiana other than that you consistently disagree with them?). I could also swing the election to HRC by “taking out” the voters in the Florida Panhandle and the Upper Peninsula of Michigan. My choice is not arbitrary in that it is an efficient way of shifting the outcome but it is arbitrary in that there is no neutral principle that would justify doing so.

8 – Chinese visitors are no authority on what it means to be American or British. Their disappointment in not having their uninformed priors confirmed shouldn’t affect your views.

23 (Not That) Bill O'Reilly December 28, 2016 at 11:30 am

CM – You misunderstand the argument. It’s not about “neutral principles” (although the Electoral College provides one) or democratic legitimacy; it is about the fallacy of the popular vote counterfactual. Clinton’s popular vote margin is meaningless, and certainly does not prove she is the “rightful” President-Elect, because that margin was a product of the fact she was able to run up the score in places like California where Trump (and the GOP, to a larger extent) had absolutely no stake in pursuing votes (there was not a single statewide race featuring an R on the ballot in California). If the rules were different, the results would have been different, and looking at the vote counts outside of where Clinton ran up the score illustrates that point.

24 A Black Man December 28, 2016 at 11:59 am

@Boonton,

So, constantly yapping about counter factuals is all you got? OK. Thanks for eliminating yourself from the conversation.

We live in a republic and select our presidents through the electoral college system. If you don’t like it and prefer mob rule, go find a country with mob rule.

25 TMC December 28, 2016 at 12:49 pm

Bill won with 43% of the vote, so what? Trump won the vote that mattered.

26 CM December 28, 2016 at 1:29 pm

NTBO – I think we may be talking past each other. Even though I think the electoral college is a bad system because it values some votes more than others and permits a candidate with less overall votes to prevail, I don’t think Trump’s election is illegitimate. As you mention, the electoral college is the system set forth in the Constitution. Call it legitimate and undemocratic.

The election would have been different if victory went to the popular vote winner but I don’t share your confidence that Trump would have won. A nationwide popular vote would bring out more Democratic voters as well as more Republicans (not just in Californian but everywhere there wasn’t active campaigns or heavily contested local races). Since Republican turnout is generally higher and less elastic than Democratic turnout, my guess is that a national popular vote system would turn out more Democratic voters than Republican voters.

27 (Not That) Bill O'Reilly December 28, 2016 at 1:40 pm

CM – I don’t mean to offer any strong opinion on which candidate would win in a national popular vote system, only to reject the proposition that Clinton’s popular vote margin is meaningful evidence that she would have won under such a system.

28 Boonton December 28, 2016 at 1:54 pm

There is no counterfactual, Trump lost the popular vote and lost it by a record setting margin. The only counterfactual being presented here is by his defenders who would like us to imagine that Trump could have won the popular vote if the rules were different from the start.

This requires us to believe Trump ditched the popular vote in favor of strategically winning the ground with electoral votes. This would be a very risky strategy as history demonstrates the winner in the college almost always has won the popular vote and the few times that didn’t happen the margin was razor thin. In other words, for a candidate to opt to lose the popular vote would be like a football team opting to not even try for a touchdown and winning the game on field goals alone. Perhaps a team with exceptional control and skill could do that but more likely a team that won that way is probably just not very strong in the end zone.

29 Post-Truth Politics December 28, 2016 at 6:23 pm

Trump’s supporters think he is Magic, so they believe that he always wins, no matter what– and that if presidents were elected by popular vote then he would have won that too. And that if Comey and Assange and the fake news outlets hadn’t handed the election to Trump on a silver platter that he still would have won anyway.

Because that’s what Magic is all about.

Their Magic bubble is about to burst soon.

30 byomtov December 28, 2016 at 7:19 pm

NTBO,

There is a difference between “meaningful evidence” and “absolute proof.” The actual margin is not proof, but it is certainly meaningful evidence. It would have taken a big change to alter the popular vote outcome. Maybe the changes in strategy – by both candidates, remember – would have done it, but it’s long odds.

By the way, the Electoral College is indefensible, and no, “progressives” never loved it.

31 Art Deco December 28, 2016 at 12:59 pm

Clinton won a majority of the vote,

Another time, another place Boonton may learn the distinction between ‘majority’ and ‘plurality’.

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32 John de Rivaz December 28, 2016 at 3:04 am

I have noticed that authorities like to get people moving about as much as possible — two or more appointments where one would do, or a demand to attend personally somewhere to show your “papers”. Yet they also claim to worry about congestion.

So little wonder that they want to widen roads.

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33 wallace December 28, 2016 at 10:13 am

yes — the “authorities” are the real problem with this supposed “logic of discontent”, not “throughput”.

“Collective” decision making is impossible. In a large group or society, decisions for that group are always ultimately made by a small minority. Therefore, the diverse wants & needs of the many can not be met by the few decision-makers… who act according to their own personal outlook. Result is many unsatisfied/unhappy group members.

Solution is to de-centralize group decision-making as much as practical.

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34 JC December 28, 2016 at 4:26 am

“It’s well known in economics that when prices and opportunities change, it is the elastic factors of production (those that can change their plans readily) that gain the most, and the inelastic factors that are most likely to bear losses. Insiders and long-term residents are so often the inelastic ones while outsiders and newcomers have the greater willingness or ability to adjust.”

Well said.

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35 John de Rivaz December 28, 2016 at 5:01 am

This will drive more and more people to rent accommodation rather than buy houses. It will join with the unsustainable rise in house prices and growing stress and delays in buying or selling houses. Mortgage lenders can even quash a sale because of certain plants growing in a garden. Against this is the recent demand by government that landlords check the Identity Purity of new tenants, with the penalty of prison if they don’t do it properly. No wonder people are voting “against the establishment” regardless of any deleterious consequences of their vote.

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36 Joan December 28, 2016 at 4:40 am

This argument is also why getting rid of zoning will have little effect on the cost of housing in our expensive cities.

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37 Brian December 28, 2016 at 8:45 am

Unless you have aggressive compounding effects those that move into this new supply will almost certainly have a lower utility, which will mean they will pay less… which means prices would go down. Unless you actually increase the supply of people who can live in the city (increased immigration, large businesses move in, etc.) it’s pretty hard to see how this doesn’t result in lower prices.

Regardless, even if decreased zoning results in a huge increase in people living/working in the city, increasing the supply of useful housing, stores, restaurants, and businesses while keeping prices the same doesn’t strike me as the worst outcome.

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38 carlospln December 28, 2016 at 6:06 am

Another excellent exercise in obfuscation & artful framing.

The reason people feel disenfranchised by ‘increases in capacity’ of infrastructure is that the gains from growth flow to the owners of capital-the 2 or 3 oligopolies in almost every industry vertical in the USA, the UK & Australia [& of course to their executives].

These companies can’t grow anymore by acquisition-its the end of the line [as determined by their anti trust regulators].

So, dialling up immigration kills multiple oiseaux d’une pierre – the most important of which is juicing growth for corporations.

Oh, yeah, & the externalities of the above? That’s for citizens to deal with.

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39 Brian December 28, 2016 at 8:57 am

I’m sure this feels right when you are laid off from your job and are forced to move somewhere else. Sadly the 22 year old out of college who gets a good job out of college and can rent a nice little place to live doesn’t realize how much she has inclusive policy to thank for her situation.

I certainly appreciate that I can hire highly skilled immigrants to work with me, not because they work cheaper, but because there aren’t enough Americans with the skills that I and my competitors need. I’m sure some small employers take that for granted.

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40 carlospln December 28, 2016 at 2:23 pm

Brian, nice non sequitur.

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41 chuck martel December 28, 2016 at 6:44 am

In the case of a freeway expansion, there’s no reason to do it (except for politicians buying votes and gifting to contractors) until the city begins to lose population due to the congestion, which would, if it ever happened , solve the problem. But cities with serious traffic problems, LA, Houston, Seattle, etc. still continue to grow, which causes more traffic gridlock. The solution to the perceived problem makes the problem worse while at the same time raising taxes.

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42 Post-Truth Politics December 28, 2016 at 6:29 pm

Seattle is a real pain to drive in. I guess the traffic problem might be solved by building more and taller residential skyscrapers. That way, people could live downtown and work downtown, and never have to even get into a car.

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43 Axa December 28, 2016 at 6:51 am

“inelastic” is a bit weird adjective to describe people but it may work. People needs to move where the jobs are. Not so long ago, Tyler or Alex wrote about people being trapped by mortgages and not being able to get out of a depressed region.

A couple days ago I visited a town that once had a paper mill and a cement plant. Economies of scale killed the relatively small industries. Today, the trees have covered the abandoned limestone quarry. All that’s left from the paper mill is some ruins of canals. Population went down by 80% since the industrial peak and the village today is a commuter town.

Factories disappear and people needs to move. The sooner the better.

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44 Boonton December 28, 2016 at 8:14 am

How long did that process take? The population could go down 80% overnight or it could take several generations (with the last people left old retirees).

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45 rayward December 28, 2016 at 6:51 am

Metaphors work better than the well-worn plan for economic growth being offered by the usual suspects such as Mr. Hubbard. http://www.nytimes.com/2016/12/27/business/dealbook/how-donald-j-trump-could-promote-long-term-economic-growth.html?ref=business At least with metaphors, unpopular specifics can be avoided. Alas, two specifics offered by Cowen, deregulation of building in NYC and SF and increased enrollment at elite colleges such as Yale and Harvard, would magnify our problems not solve them. The best and brightest should be encouraged to live and work in places other than NYC and SF, which is to say break from the lure of riches in finance and advertising that dominate NYC and SF, respectively. And the best and brightest should be encouraged to study at places other than Yale and Harvard, the suppliers of the legions already in NYC and SF (i.e., finance and advertising). Cowen’s metaphor, road widening, hits the mark. I grew up in the South before the interstate highway system was built. Nothing, not even integration, was as world-changing to the South than was the interstate highway system, for it connected the South to places and opportunities never imagined before. What is today’s interstate highway system? I don’t know, but if you build it, they will come.

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46 Wonks Anonymous December 28, 2016 at 10:24 am

I thought SF’s economy was centered more on the tech sector.

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47 Anonymous December 28, 2016 at 11:06 am

It would not be inaccurate to describe the SF “tech sector” as advertising. Silicon Valley isn’t about chip manufacturing these days. Look at where Google or Facebook actually make their money.

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48 Zeitgeisty December 28, 2016 at 7:32 am

So Trump’s first major foreign policy is challenge is going to come directly from the outgoing administration!!

That’s sick

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49 Art Deco December 28, 2016 at 7:33 am

Whoooaaa I’m such a Cuck!

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50 msgkings December 28, 2016 at 1:02 pm

I stalk people on the internet because everyone I encounter personally is irked, bored, or impatient with me.

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51 Rich Berger December 28, 2016 at 8:17 am

This is a fairly standard argument on the left: Trump won, the voters are stupid/angry, explain why. Just rear view mirror stuff, the real action has moved far beyond toward the actual Trump administration. Of course, people may be forgiven for thinking that he has already replaced our “semi-retired” president, who took a vacation with less than a month left. Gotta take advantage of one last big government freebie!

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52 Troll me December 28, 2016 at 8:15 pm

Imagine if Christian America were to criticize its president for not working 24/7 over Christmas …

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53 TMC December 29, 2016 at 11:46 am

I wish he wouldn’t bother with the 4 hrs a day he puts in.

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54 Troll me December 29, 2016 at 8:40 pm

A far more consistent position if you don’t like his policies.

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55 Meets December 28, 2016 at 8:31 am

The only thing I’d add is that Trump is actually going to deregulate and boost growth, which will actually increase the prospects of outsiders (or increase throughput in the words of the column).

Like Tyler asked in a previous column, “What If Trump Wanted More Illegal Immigration? Wait, He’s On It!”

https://www.bloomberg.com/view/articles/2016-11-22/what-if-trump-wanted-more-illegal-immigration-wait-he-s-on-it?cmpid%3D=socialflow-twitter-view&utm_campaign=socialflow-organic&utm_content=view&utm_medium=social&utm_source=twitter

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56 M December 28, 2016 at 8:39 am

Insiders / outsiders seems a weird way to phrase talking about people who have no community attachments or sentimental attachments that would inhibit mobility. Rootless / rooted might work better.

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57 Brian December 28, 2016 at 8:49 am

Rootless/rooted, flexible/inflexible, static/dynamic, living in the past/moving forward. Today’s lesson in framing is upon us!

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58 AlanG December 28, 2016 at 9:01 am

The only way to get affordable housing in either Manhattan or SF (or for that matter in any other area) is for a government mandate and strict enforcement. Builders and the municipalities want to maximize the ROI and this is best done with high end building. We are seeing the same thing in my home area of Bethesda MD where large houses and expensive condos/apartment buildings are the only things being built. The County Council gets a maximum ROI from this in terms of the revenue from construction and the increased property taxes once the dwellings are complete and inhabited. To think that a builder such as our President-Elect would construct a moderately cost rental unit in Manhattan is sheer folly. there is too much high end money (foreign and domestic) chasing real estate in NYC. Economics is sometimes like Occam’s Razor, the simplest solution is usually the best one.

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59 Borjigid December 28, 2016 at 9:51 am

Maybe, but economics is always like supply and demand, which your comment somehow misses.

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60 A Definite Beta Guy December 28, 2016 at 10:13 am

Economics is not like Occam’s Razor, it’s a Willy Wonka adventure where every seemingly easy free lunch is actually a trap.
Manhattan and San Fran are so crazy expensive that it’s unlikely they will ever become anything other than playgrounds for the wealthy. However, they are so insanely expensive that what could fetch a luxury apartment in most locations will fetch a bombed out husk, and only if you have rent control. So even “high-end” condo development is still a net positive: it’s that expensive.

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61 (Not That) Bill O'Reilly December 28, 2016 at 10:17 am

The reason developers in cities like DC, NYC, and SF are focused exclusively on the high end of the market is that they are severely constrained in how much they are allowed to build. For as long as the supply is constrained by land use policies to a level below demand, developers have to target margin rather than volume, which means going after the highest ends of the market they can.

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62 collin December 28, 2016 at 11:39 am

Living near LA, even without LOCAL government regulation, there is really not a lot of room to build. So even some ‘deregulation’ in these areas won’t have major impacts here.

Anyway, using Tyler’ logic here against Immigration, I would suggest that these local communities have a very feeling. People in Orange County, CA don’t like increases in housing stock because of ‘MORE TRAFFIC!’ than anything else.

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63 (Not That) Bill O'Reilly December 28, 2016 at 12:49 pm

There’s always “up” when “out” isn’t available. I’m not terribly familiar with land use policy in LA or the Bay Area, but I know here in DC the height restrictions make density quite difficult.

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64 Art Deco December 28, 2016 at 1:11 pm

About 85% of the population of greater Washington lives outside DC. DC has a density of 11,000 people per square mile. That’s as dense as Philadelphia, just shy of Miami’s density, and denser than Seattle.

65 Pshrnk December 28, 2016 at 12:08 pm

“The only way to get affordable housing in either Manhattan or SF (or for that matter in any other area) is for a government mandate and strict enforcement”

Do you mean like zoning laws? Meh

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66 Art Deco December 28, 2016 at 1:06 pm

Look at your take home pay and divide by four. Anything under that per pay period is affordable housing. If you cannot find it in Manhattan, the Bronx, Brooklyn, and Hudson County, NJ beckon. Works for anyone sensible.

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67 Art Deco December 28, 2016 at 1:15 pm

We are seeing the same thing in my home area of Bethesda MD where large houses and expensive condos/apartment buildings are the only things being built.

Move farther out.

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68 robert December 28, 2016 at 5:55 pm
69 Boonton December 28, 2016 at 9:03 am

“Consistent with those points, I would say the road widening is wonderful for boosting throughput — that is, it gets more people and cars onto the road. Yet it’s mediocre or worse for improving the quality of life of the typical resident.”

How does this follow? Let’s map it through. Say before the widening there was 1,000,000 people using the road and they are unhappy because their commute takes 50 minutes. After the road widening, the commute time initially goes down to 30 minutes. So that’s an increase in quality of life. But then 300,000 additional people get jobs (or better jobs) and the commute goes back up to 50 minutes.

So the quality of life of the typical resident still seems better, it’s just that the improvement from the widening is spread out over old and new commuters. Previously 300,000 residents didn’t have a job or had a job they would have opted to change but for the inability of the roads to facilitate the work transactions. (think of roads in this case like money, a medium of exchange….too few roads is sort of like a world where you can only use your credit/debit card once a day or you have to lug around gold bricks rather than have an option for paper or digital money….if transaction costs are higher then some transactions that would be mutually beneficial won’t happen).

You only get quality of life going down if you make the original 1,000,000 commuters the only people that count. Even then it seems the worse that happens is their life stays more or less the same. This seems less like an economic principal than a share of voice problem.

In the media some narratives have a larger share of voice than others. For example, consider the mental picture of “white working class guy who is a coal miner”. Maybe that’s part of the reason Trump won. But is it? Consider in 1979 there was maybe 200K coal miners and by 1990 that number had dropped to 100K. The Reagan years were the years of the coal miner genocide. Today the number is about 97K, so maybe we have 3K fewer coal miners. Pretty stable actually considering the price of coal has dropped and competition from fracking is higher. In contrast though dog groomers number about 100K. Dog grooming is def. ‘working class’, you have to get your hands dirty. But it’s safer than coal mining, there’s more opportunity to start your own business in it than there is in coal mining, more flexibility to work only the hours that make sense for you, you are much less geographically tied to a single large employer as well (people have dogs everywhere, coal miners can only work where there are active coal mines). Yet the media will not talk about the state of the economy as seen from the eyes of dog groomers. There will be no call for elaborate plans to bail out dog groomers, increase employment, offer them low interest business loans, offer classes on starting your own dog grooming business. Yet we will destroy our environment least the number of coal mining jobs goes from 97,000 to 96,500?

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70 Jeff R December 28, 2016 at 9:33 am

How does this follow?

1. Side roads, which were not widened, become more congested.

2. Noise and air pollution become worse for area residents.

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71 Boonton December 28, 2016 at 10:21 am

That might work assuming the 300,000 additional road users were not previously using any roads at all. If they were you have to net decreased noise and air pollution on the road use they cut back against the added use of the expanded highway.

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72 Jeff R December 28, 2016 at 10:33 am

When you build highways, commutes tend to lengthen.

Come on, man. This isn’t a complicated point Tyler is making here.

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73 Boonton December 28, 2016 at 1:58 pm

Why? Because choices that were previously not practical now become practical. How does this support the contention that the average person is worse off?

74 Anon December 28, 2016 at 9:51 am

“You only get quality of life going down if you make the original 1,000,000 commuters the only people that count.”

Most communities act that way: those who have been around longer are more tightly networked, more influential, and use their power to sustain their power against newcomers. In typical reified discourse, the old-timers count while the newcomers are invisible.

I think external competition is the main thing that opposes the seniority dynamic. If you need to win, you need newcomers to improve your team. Business owners compete to recruit and promote newcomers, while employees often oppose that for the usual reasons. In modern times, governments are permanent and isolated from competition (especially ones like NY and SF that have a goose laying golden eggs), which I think is the ultimate cause of a large part of their characteristic dysfunction.

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75 Boonton December 28, 2016 at 10:24 am

True but this is special interest politics, not the ‘typical resident’. The farmer lobby convinces everyone that it is essential to save 1000 farmers and raising the price of food for 5 million families is worth that. Reality is in that case the ‘typical person’ is made worse off

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76 Borjigid December 28, 2016 at 12:55 pm

Agreed, but I think that Tyler’s point is political rather than economic. That is, he’s arguing that increasing throughput is disadvantageous politically, even if it is economically efficient.

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77 Mc December 28, 2016 at 9:07 am

A best seller from a few years back proves out to be BS. A Nobel Prize and MaCarthur genius award not withstanding:

http://www.slate.com/articles/health_and_science/science/2016/12/kahneman_and_tversky_researched_the_science_of_error_and_still_made_errors.html

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78 Post-Truth Politics December 28, 2016 at 6:37 pm

Thanks, MC. Interesting article.

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79 byomtov December 29, 2016 at 12:23 pm

Did you read the article?

It’s not “BS.” Some of the studies cited in the book turn out to be questionable. Kahnemann’s own research has been replicated often.

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80 Alain December 28, 2016 at 9:11 am

a) widening roadways increases throughout. However, there is a large queue of dissatisfied motorists who were previously staying at home who are now driving. This is why congestion remains the same, but yet throughput increases. This is welfare enhancing.

b) the i405 widening project was a *HOV* expansion. That this liberal attempt at behavior modification failed is a complete shock. They are the worst.

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81 The Anti-Gnostic December 28, 2016 at 9:27 am

On the topic of roads, my observation from a lifetime in Atlanta GA is more roadway just leads to more cars. In town, a visiting traffic engineer friend told me the existing (and largely unexpandable) roadways will not be able to handle the residences currently being constructed. Apartment complexes are going up anywhere and everywhere, and they’re all wood framing, up to four stories.

MARTA is hurting again, so we just approved an increase in the sales tax to 8.9 cents on the dollar, up from 8.0. In other words, as the population increases, unit costs are going up, not down. Cities past a certain point seem to be diseconomies of scale.

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82 Art Deco December 28, 2016 at 4:09 pm

is more roadway just leads to more cars.

No, more affluence means more driving and more vehicles per adult. More roadway means a reduction in time costs. For now. If you slapped tolls on limited access highways and financed your ordinary roads entirely through excises on gasoline, the pecuniary costs of motor transport would be borne by people in their capacity as motorists (rather than in their capacity as property owners or consumers or income recipients), and you’d have less congestion on roads. The excise necessary to accomplish that (given the trade elasticity of demand for it) would be north of $3, however. You might also quit adopting land use plans which strictly segregate residential and commercial uses.

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83 The Anti-Gnostic December 28, 2016 at 7:43 pm

I think we agree more than we disagree. The cost of driving is artificially cheap because it’s spread beyond drivers. Thus, more roads just means more cars, not less congestion. Also, metro areas have another dynamic in play: people moving out, out and out chasing white/Asian school districts.

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84 Boonton December 28, 2016 at 9:29 am

HOV lanes probably came at the wrong time. In an earlier age of very large employers HOV lanes might have made better sense. Everyone going to the same place for the same hours.

Today we have a lot more fragmentation in employment…even people working at the same company find it difficult to coordinate hours for the sake of commuting.

Tomorrow I suspect we’ll have a lot more Uber style time shares with self driving cars. HOV lanes will then make sense again as the coordination of people to ride with will be done by the app or company rather than the individual.

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85 chuck martel December 28, 2016 at 9:39 am
86 Boonton December 28, 2016 at 10:18 am

Of course they do. Roads that don’t have intersections don’t need traffic lights. How often do you see traffic lights at a point in the road where there is no intersection, no reason for a light?

How much more space would roads take up though if you tried to avoid all intersections and made every road continuous by doing over/under ramps and used merging on/off ramps for people to change streets rather than simply turning at intersections.

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87 Art Deco December 28, 2016 at 1:16 pm

Slap on tolls.

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88 Boonton December 28, 2016 at 3:23 pm

Old school, cameras + license plates + congestion pricing mean you can eliminate the stops to pay tolls while also improving road quality and reducing traffic jams.

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89 Progressive December 28, 2016 at 7:40 pm

Of course tolls would have to be progressive with an exemption for government workers, single mothers, and illegal immigrants.

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90 Boonton December 29, 2016 at 8:32 am

Don’t forget Chris Christee is entitled to block traffic whenever someone makes fun of him.

91 collin December 28, 2016 at 9:33 am

I believe this is the key reason for local residents being against housing regulation. Irvine, CA is a great city to live in but the main reason I hear against ‘deregulation’ is “More Traffic!!!” Not housing values, not opinions against those people or anything like that. It is simply more people means more traffic and don’t want to add lanes to the 5 or 405 Freeway (Which are already 4 – 5 lanes).

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92 Brian Donohue December 28, 2016 at 9:37 am

Very thought-provoking. Excellent use of examples that cut across the political spectrum.

I think ‘pace of change’ is an important issue here. People like stability- that’s why we have wage earners rather than just independent contractors. This creates a kind of rigidity, but also protective moats around which people can make long-term plans.

Government jobs are the extreme version of this. (Related- government jobs as a % of total are at lowest level in US since 1960, which is great news for fans of flexibility, apart from any other considerations.)

We used to be mostly agricultural workers, and the transition away from agriculture was surely wrenching for lots of people, but the transition took place over generations, so individuals still had more of a sense of stability than the long-term trends suggest.

The same goes for prime-age male labor force participation. It’s been trending down for 60 years, for a variety of reasons. But the pace of change feels faster than the agricultural transition. In retrospect, China joining the WTO was a real accelerant here. Pile on remorseless technological improvement and mass immigration (foreign-born % approaching a record in USA) and the disruption is just too much for a lot of people.

I don’t think economic models account for pace of change and its ability to destabilize lives very well. Talking about ‘elasticity’ is cold and technocratic.

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93 Brian Donohue December 28, 2016 at 9:44 am

As to your examples, it’s not surprising that the powerful (e.g. NYC and SF NIMBYs) are more effective at preserving their moats than others are.

I also think this suggests that government workers really have no understanding of what life is like outside that bubble.

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94 derek December 28, 2016 at 10:21 am

Indeed. Throw on top of this policies that exacerbate the problems. Almost free money drives up housing prices. Regulatory costs driving out of business all but the largest and connected, driving even more production offshore.

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95 chuck martel December 28, 2016 at 12:14 pm

“the transition away from agriculture was surely wrenching for lots of people”

They were overjoyed not to milk cows by hand at 5 am, shovel manure out of barns and pitch hay down from the loft while clad in brogans and dashboard overalls. They couldn’t get off the farm fast enough.

“the transition took place over generations”

It was done in one generation, that of the soldiers returning from WWII Europe, few of whom had any intention of going back to the farm.

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96 Art Deco December 28, 2016 at 4:57 pm

It was done in one generation, that of the soldiers returning from WWII Europe, few of whom had any intention of going back to the farm.

No it wasn’t that generation. Heads of households listing an agricultural occupation went from 41% of the total in the 1880 census to 30% of the total in the 1920 Census to 15% of the total in the 1940 Census. There was a further decline to about 5% in 1969.

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97 Jeff R December 28, 2016 at 9:39 am

Tyler, that’s a nice analogy you’ve constructed, but did the part where you suggest some sort of Coasian bargaining solution, such as auctioning off rights of citizenship, get cut by an editor?

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98 Archibald Meatpants December 28, 2016 at 9:43 am

Well, that’s a depressing column.

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99 A Black Man December 28, 2016 at 10:03 am

If there is any doubt that open borders has become a religion, just read the two proprietors of this site. There’s a drought in California? More immigration! Your car won’t start on cold mornings? More immigration!

You see the same thing with the climate nuts. Crime spree in Chicago? Climate change! America blows up the Arab world with pointless wars of choice? Climate change!

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100 anon December 28, 2016 at 11:08 am

“In counties for Trump, prices have been flat for 15 yrs. In counties for Clinton, homes are worth $147K more than in counties for Trump.” – WSJ today?

That seems to say it works.

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101 A Black Man December 28, 2016 at 11:57 am

The only native North American marsupial is the Virginia opossum.

Your turn.

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102 anon December 28, 2016 at 12:10 pm

Was that supposed to be a clever “non sequitur?”

Those are problematic because they mean you can’t follow.

High immigrant cities are richer. Correlation or causation. Discuss.

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103 The Anti-Gnostic December 28, 2016 at 1:27 pm

In non-immigrant enclaves, the property values are quite high. Property values in Little Haiti, Little Tijuana, Little Mogadishu, not so much.

104 Thomas December 28, 2016 at 7:46 pm

When you never took a course in pure mathematics because calculus was a prerequisite: Nigerian immigrants to the US have about 17 years of education on average -> immigration increases average educational attainment.

105 anon December 28, 2016 at 12:12 pm

I am sure a couple commentators can pop in to say data is never data, only opinion.

http://www.citylab.com/politics/2013/04/how-immigration-helps-cities/5323/

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106 chuck martel December 28, 2016 at 12:18 pm

High home prices means what works? There’s something “good” about high home prices? What would that be? Do high prices for gasoline, pancakes, cigarettes, electricity and beer work?

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107 anon December 28, 2016 at 12:22 pm

Do you “just want” high wages and low prices, not to mention fast commutes?

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108 chuck martel December 28, 2016 at 4:07 pm

So you’re saying that counties that voted for Clinton have fast commutes? That workers with easy access to their place of employment are Democrats? Who’d a thunk it?

109 Chris s December 28, 2016 at 9:43 pm

Cmon chuck, keep it together. You grabbed the bait on the commutes thing..

Economics. High prices = high demand. Where there are also substitutes (living somewhere else) price is usd as a proxy for desirability. “Nobody goes there any or, it’s too crowded.”

Disagree with that premise? Let’s hear it.

110 Chris s December 28, 2016 at 9:45 pm

“Nobody goes there anymore, it’s too crowded.” Stupid typo.

111 Troll me December 28, 2016 at 8:26 pm

Droughts and cold morning will not go away if you keep brown people out.

Weather and climate are kind of like that.

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112 8 December 28, 2016 at 10:19 am

Expand the roads = get more traffic jams and longer commutes
Create cheap renewable energy = get faster economic growth and more environmental destruction
The Internet was supposed to allow telecommuting, but Silicon Valley wants 10 million Indians on H1-B visas.
Push for open borders= deliver political power to nationalists
Push for multiculturalism = spawn White nationalism, Black separatism, La Raza

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113 anon December 28, 2016 at 10:30 am

I drive the Sepulveda Pass a couple times a week. I always marvel at it. It is a huge engineering effort, but it has rich-country written in the smallest, least seen corners.

Perhaps some of you have seen concrete, and some of you have seen concrete textured and colored to look like natural rock, then imagine maybe 10 miles total of 100 foot high concrete walls textured to pseudo natural relief. (I was wondering yesterday why they diverge the cliff around the streetlamps, rather than mount the streetlamps on the cliffs, but I guess that this keeps the streetlamps and poles standard, replaceable, from one inventory?)

From a logistics and throughput point of view, it isn’t really the freeway, it’s the mountains (Holloywood Hills continuing to the Santa Monica Mountains) getting in the way. The Sepulveda brothers found a pass that still serves, and it is the only wide pass for many miles around. It is a pinch point, and always will be. Some talk about a tunnel now, which seems ridiculous but who knows.

So if I were to interpret this in Tyler’s framework, maybe it is that we want what we want, and realities like geology be damned? A house in Calabasas is nice, and a job in Westwood is nice, so damn it, the drive should be fast .. never mind the people and the mountains in the way.

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114 anon December 28, 2016 at 10:36 am

Here is a Google Route that illustrates the problem. It’s either the pass, or two-lane canyons down into the city. For … a million people?

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115 Post-Truth Politics December 28, 2016 at 6:42 pm

Someone needs to invent little helicopters people can fly to work, like cars are now. Surely someone can invent something like this.

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116 Hwite December 28, 2016 at 11:20 am

“It’s no accident that so many of the gains available today involve throughput. If you widen a road, more people will drive on it. If you open up a border, more foreigners will come. If you build more in a well-to-do city, new residents will pour in and make it more crowded. These days there is always someone knocking at the gates because of all of the global talent that has been mobilized.

And that is part of the logic that elected Donald Trump and drove Britons to vote to leave the European Union.”

In Europe, the problem isn’t with foreign “talent” or even foreign unskilled laborers. The problem is this:

http://www.express.co.uk/news/world/745147/million-immigrants-Germany-few-find-jobs-migrant-crisis

About high-skilled immigration, I have mixed feelings about it, but I will note that the countries with the least popular opposition to immigration, which have a significant amount of immigration(it’s easy to be pro-immigration if you don’t have any) are those which have immigration policies biased toward the high-skilled, Canada and Australia. America, where the immigrants are low-skilled but work hard, and aren’t any more criminal on average, is intermediate. The strongest opposition has historically been based in Europe, where the immigrants work a lot less than the natives and commit a lot more crime.

But I get that you couldn’t go and advocate an Australian-type system, Bloomberg would fire you. I like that you mentioned the example of Ivy League universities, the elites won’t practice what they preach!

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117 Thomas December 28, 2016 at 7:51 pm

Open membership increases the average income of country club members, right? No, sorry Cowen. If that was true then it would also be true that we could attract Harvard professors to George Mason by “increasing throughput” of outsiders to tenure track. It’s obviously false. Hard to believe TC actually believes this.

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118 Troll me December 28, 2016 at 8:31 pm

It is true. It is not guaranteed that the end result of helping people who flee war will be more money in the pocket. It could go either way. One way that it will result in losing money is if first money is spent to help them, followed by second, barriers to their contribution to the economy. However, even if that happens, in balance, it might still be the right thing to give someone a place to stay when they free one of the largest and most deadly conflicts in recent time.

In the meantime, it might be worth considering that some people will remember these humane acts at some future date. I would attribute additional positive value to that.

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119 M December 29, 2016 at 5:27 am

But not as right, for everyone involved, as it would be for them to stay in Islamic, safe Turkey, then return to Syria. And for that small fraction that might be over what Turkey can take, only for women, old men and children, the opposite demographics of who actually arrives in Germany.

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120 M December 29, 2016 at 5:23 am

Interestingly, if you go by PISA scores for children of migrants, the UK performs way better than Germany, etc. with migrant children much closer to the English they live among (not as good as them, not nearly as bad as migrant children in Germany).

But popular opposition to migration is still high.

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121 Troll me December 29, 2016 at 8:42 pm

Maybe it helps that there is a much larger body of experience in teaching English as a second language compared to German?

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122 Peldrigal December 30, 2016 at 10:42 am

The countries that have the less problems with immigration are the ones that are isolated.

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123 Stormy Dragon December 28, 2016 at 12:00 pm

“Restlessness is discontent — and discontent is the first necessity of progress. Show me a thoroughly satisfied man — and I will show you a failure.” ― Thomas A. Edison

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124 Post-Truth Politics December 28, 2016 at 6:43 pm

Yes, someone needs to invent ways to solve this discontent without causing more traffic or other new problems.

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125 Floccina December 28, 2016 at 12:23 pm

Still, as in Houston TX supply can increase enough that prices are reduced and people are better off, especially low income earners.

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126 anon December 28, 2016 at 1:46 pm

My sister had to switch sides of Houston though, as the commute had become untenable.

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127 Dude Man December 29, 2016 at 11:52 am

Houston doesn’t have the same geographic barriers as San Francisco and New York.

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128 Jack December 28, 2016 at 3:21 pm

Thank you for this very insightful article. In NYC you have a lot of vitality from new arrivals from elsewhere in the US and overseas and a lot of entrenched interests, price controls in housing for example, that benefit primarily those who have been here for a long time but limit supply and raise prices for new arrivals — and probably on average lower the present quality of life and future opportunities.

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129 GoneWithTheWind December 28, 2016 at 4:02 pm

Hillary lost because she didn’t have the energy to get out there day after day. There is something wrong with her, she is sick and has been for quite awhile. It could simply be old age related problems but clearly she was on her last leg every time she made an appearance.

If we learn anything from this election we should have learned that our elections are being subverted by illegal aliens and poltical special interest mobs. There should be a full scale investigation into the illegal vote and the obvious election cheating in Detroit and a dozen other cities. Investigate and prosecute.

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130 Post-Truth Politics December 28, 2016 at 6:45 pm

Looks like someone has been reading fake news lies about HRC’s health, and about illegal immigrants voting in large numbers.

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131 Thomas December 28, 2016 at 7:54 pm

Hillary didn’t pass out and have to be thrown into a van, there wasn’t voter fraud in Detroit, and Hillary didn’t leave the campaign trail for weeks at a time – if you live in a post truth bubble.

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132 Post-Truth Politics December 28, 2016 at 8:36 pm

Lots of people pass out once or twice in their life time from the heat or the flu or something. There is no evidence of significant voter fraud in the U.S. And a few weeks off of the campaign trail doesn’t mean anything. I am very aware of the truth. I do not ever consume Faux News, Breitbart, Drudge, Limbaugh etc.

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133 AlanW December 29, 2016 at 6:16 am

Tinfoil hats, get them while they’re hot.

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134 Ricardo December 29, 2016 at 12:15 am

Thanks for your expert diagnosis, Doc

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135 Russian Agent Tokarev December 28, 2016 at 7:03 pm

And that is part of the logic that elected Donald Trump and drove Britons to vote to leave the European Union. It’s well known in economics that when prices and opportunities change, it is the elastic factors of production (those that can change their plans readily) that gain the most, and the inelastic factors that are most likely to bear losses. Insiders and long-term residents are so often the inelastic ones while outsiders and newcomers have the greater willingness or ability to adjust.

In other words, globalism benefits gypsy-like individuals who contribute nothing to the generations-long process of building up social capital and institutions but do expect to benefit fully from those things. Since they remain unrooted wherever they are, after the host society has been sucked dry, they can simply move on to the next easy mark.

Specialized ecosystems get wiped out when invasive generalist species are introduced. Specialized local societies also are being wiped out by globalism–replaced by the boring gray hellworld of corporate monoculture.

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136 Troll me December 28, 2016 at 8:34 pm

The fact of coming and going does not necessarily mean that institutions, culture and society in general are not improved as a result of the interaction. Very often, au contraire (they are improved), although birthing pains may be associated with the process.

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137 byomtov December 28, 2016 at 7:13 pm

I would say the road widening is wonderful for boosting throughput

That depends, doesn’t it, on the definition of “throughput?” Suppose we define it as “Number of workers who get to their jobs per time unit (or per something else, like energy used).”

Are we sure the widening improves that? Let’s say it’s true current users don’t get to work faster. What about the newcomers? Maybe not. Maybe the widening encourages people to move further away from their jobs, or to take jobs that involve longer commutes. That’s not to say there might not be an improvement from a broader perspective. It take someone longer to get to theor new job, but th ehigher pay more than makes up for it.

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138 Shane M December 29, 2016 at 3:00 am

Are there examples of cities that have grown not by increasing throughput (by funneling more and more people to the city center), but who have solved the people/jobs problem by moving the jobs closer to where people live – reducing the traffic load and congestion in the process? Is there a successful model?

I could see the latter model working well when you have longer-lived jobs, but in an economy with high turnover people really can’t be expected to move close to a new job every time they change jobs, and with dual income households it becomes increasingly more difficult because someone will likely have to drive. My general sense is that much development seems to try to limit the mixing of residential/commercial space making short commutes more difficult than if different zoning decisions were made initially.

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139 AlanW December 29, 2016 at 6:21 am

I think Vancouver, B.C., and, to a lesser extent, Portland, Ore., are examples of that. Those cities also show that you can’t stop sprawl, though.

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