Current Affairs

Here is the video, the podcast, and the transcript.  Kareem really opened up.  Here is the summary:

Kareem Abdul-Jabbar joins Tyler Cowen for a conversation on segregation, Islam, Harlem vs. LA, Earl Manigault, jazz, fighting Bruce Lee, Kareem’s conservatism, dancing with Thelonious Monk, and why no one today can shoot a skyhook.

Maybe you think of Kareem as a basketball player, but here is my introduction:

Kareem Abdul-Jabbar is one of America’s leading public intellectuals. I would describe him as an offshoot of the Harlem Renaissance, and what he and I share in common is a fascination with the character of Mycroft Holmes, the subject of Kareem’s latest book — and that of course, is Sherlock Holmes’s brother.

Here is Kareem:

I did know Amiri [Baraka]. I think the difference is I believe in what happened in Europe during what they call the Enlightenment. That needs to happen to black Americans, absolutely a type of enlightenment where they get a grasp of what is afflicting them and what the cures are.

I think that the American model is the best in the world but in order to get everybody involved in it we have to have it open to everyone. That hasn’t always been the case.

The most under-appreciated Miles Davis album?

For me [Kareem], the most under-appreciated one is Seven Steps to Heaven. And that shows, I think, Miles’ best group. There’s a big argument, what was Miles’ best group, the one that had Cannonball Adderley, Coltrane, Bill Evans, and Philly Joe Jones and Red Garland or Herbie Hancock, Ron Carter, Tony Williams, and Wayne Shorter?…number two is Porgy and Bess.

He cites Chester Himes as the underappreciated figure of the Harlem Renaissance.  And Kareem thinks like an economist:

It [my instruction] was going well with Andrew Bynum, but Andrew finally got to sign his contract for $50 million, and then at that point Andrew thought that I didn’t know anything and that he didn’t have to listen to me, and we don’t know where Andrew is right now.

Read or hear also his very interesting remarks on Islam, and where its next Enlightenment is likely to come from, not to mention Kareem on the resource curse and of course his new book (and my Straussian read of it).  And Kareem on his favorite movies, starting with The Maltese Falcon.  Self-recommending!

Kareem

No, I’m not in Iowa, but I’ve never covered it before, and today seems like as good a day as any.  Here goes:

1. Painter: Grant Wood.  Here is an interpretative take on American Gothic.  It’s not by the way man and wife in the picture, but rather Wood’s sister standing next to the local dentist.

2. Novelist: I draw a blank, sorry people…Does it count that Joe Haldeman (The Forever War) was a product of the Iowa Writer’s Workshop?  There must be other examples as well.

3. Hero: Norman Borlaug.

4. Actor: John Wayne is from Iowa, but I can’t call him a favorite.  I guess he is my favorite version of…John Wayne.  If that.  Can one call Johnny Carson an actor?  I never took to him either.

5. Jazz musician: Yes there is one, Bix Beiderbecke.  Art Farmer too, and also Charlie Haden.  Yet how rarely one hears of the “Iowa jazz tradition.”

6. Guitarist: Dick Dale, don’t by the way forget his Lebanese background, which you can hear in his riffs.

7. Movie, set in: What’s Eating Gilbert Grape?  Honorable mention to the more obvious Field of Dreams, an OK but not great film in my view.

The bottom line: Who would have thought “jazz musician” would be the strongest category here?  Those Iowans are so busy with their jazz, it is amazing they have time to lobby for their ethanol subsidies.

81.105

That is a new paper by Ali Faraji-Rad and Michel Tuan Pham, here is the abstract:

Uncertainty is an unavoidable part of human life. How do states of uncertainty influence the way people make decisions? We advance the proposition that states of uncertainty increase the reliance on affective inputs in judgments and decisions. In accord with this proposition, results from six studies show that the priming of uncertainty (vs. certainty) consistently increases the effects of a variety of affective inputs on consumers’ judgments and decisions. Primed uncertainty is shown to amplify the effects of the pleasantness of a musical soundtrack (study 1), the attractiveness of a picture (study 2), the appeal of affective attributes (studies 3 and 4), incidental mood states (study 6), and even incidental states of disgust (study 5). Moreover, both negative and positive uncertainty increase the influence of affect in decisions (study 4). The results additionally show that the increased reliance on affective inputs under uncertainty does not necessarily come at the expense of a reliance on descriptive attribute information (studies 2 and 5), and that the increased reliance on affect under uncertainty is distinct from a general reliance on heuristic or peripheral cues (study 6).

The pointer is from Cass Sunstein on Twitter.  File under “The culture that is Iowa”?

Every year since 2006 more democracies have experienced erosion in political rights and civil liberties than have registered gains, as we find in our annual Freedom in the World report. In all, 110 countries, more than half the world’s total, have suffered some loss in freedom during the past 10 years.

That is from Mark P. Lagon and Arch Puddington at the WSJ.  I would like to see a good theory of how liberty, democracy, and liberalism — or however we wish to characterize that bundle — comove across the globe, in both positive and negative times.

Mexican non-oil exports to USA in December (y/y): -4.5%. Excluding autos: -8.7%.

That is from Genevieve Signoret, via this source.

It’s funny how these numbers seem to indicate someone is starting to enter a recession.  Who might that be?  Maybe it’s just noise, I don’t see any other mediocre economic reports wandering around these parts…  Or maybe it’s Mexico that’s the problem

Andrew Batson thinks it is simpler than many people make it out to be:

…these analyses…fail to even mention the most straightforward and direct explanation of why China’s growth is much slower today than it was in say, 2010 or 2007. It’s not like it’s a secret. From about 2003 to about 2010 China had the biggest construction boom of modern times and probably in all of human history. Then in 2011-12 the construction boom ended. That’s it. Really, that’s all you need to know. Well, you might need one more fact: housing and construction account for as much of a third of China’s GDP, once all their indirect linkages to other sectors are considered. I think a housing downturn explains very well the timing, severity and distribution of the economic slowdown that has actually occurred.

Here is the full post, which also criticizes the idea of the middle income trap.  I would add two points, which may represent a deviation from Batson’s argument.  First, I don’t think the Chinese growth slowdown is as sudden as a culling of media reports might suggest.  Second, to the extent the contraction is sudden, it is perhaps Chinese investors have woken up to the idea of a risk premium, and realized there is no eternal ten or even seven percent growth to validate so-so quality investments.  The dynamics of information arrival can compress economic adjustments into “too short” a space, a common theme in business cycle theory and not an issue restricted to contemporary China.

…whoever you think the four most likely Americans to be the next president of the United States—who are probably Ted Cruz, Donald Trump, Bernie Sanders, and Hillary Clinton—none of them are in favor of TPP. That has to say something about the political—the political environment.

And this:

The Economist had a remarkable statistic. The IMF makes forecasts for every country every April. There have been 220 instances across several decades and some number of countries where growth was positive in year T and negative in year T+1. Of those 220 instances, the IMF predicted it in April in precisely zero of those 220 instances. So the fact that there’s a sense of complacency and relative comfort should give very little comfort.

The dialogue, with Richard N. Haass, is interesting throughout.  Haass seems to be too negative about India and Pakistan.

Clinton

I found the article and its photos interesting throughout.  Here is commentary from Robin Hanson.

I was too early in 2006

by on January 26, 2016 at 2:28 pm in Current Affairs, Economics | Permalink

I wrote:

The yuan should not, as matters stand, float freely with free capital movements. Large quantities of Chinese savings, currently restricted to the domestic currency, would probably flee the country, worsening the serious solvency problems at Chinese banks. The Chinese must first clean up their banking system before they can have free capital markets. Contrary to the conventional wisdom, a market-determined value for the yuan might well be lower than today’s exchange rate, not higher.

Here is the rest of my 2006 column on China.

That is the title of the new and forthcoming Robin Hanson book, due out in May.  I was asked to supply a blurb, and offered two possibilities.  One was:

“Robin Hanson is one of our most original and important thinkers.  This is his book.”

The ostensible premise of the book is that people have become computer uploads, and we have an entirely new society to think about: how it works, what problems it has, and how it evolves.  One key point about this new world is individuals can be copied.  But this is more than just a nerdy tech book, it is also:

  1. Straussian commentary on the world we actually live in.  We are already something-or-other, uploaded into humans,and very often Robin is describing our world in cloaked fashion, albeit with some slight tweaks to parameters for the purpose of moral illumination.
  2. A reminder of how strange everything is, and how we use self-deception to come to terms with that strangeness.  It’s a mock of all those who believe in individual free will.
  3. An attempt to construct a fully rational theology, proving by various deductions that God is not fully benevolent in the traditional sense.
  4. An extended essay on the impossibility of avoiding theology, given the imposition of competitive constraints on a world where production and copying are possible.  And ultimately it is a theodicy, though it will not feel that way to Westerners, Jews, Christians, or Muslims.  It hearkens back to medieval theology, Descartes, and the idea of living in God’s possibly terrifying simulation.
  5. A satire on the rest of social science, and how we try to explain and predict the future.
  6. A meta-level growth model in which energy alone matters and the “fixed factor” assumptions of other models are relativized.  Copying is taken seriously, besides how special are you anyway?  In the meantime, we learn just how much of the world we know depends upon the presence of various fixed factors.  But surely that is temporary!
  7. A challenge to our notions of wherein the true value of a life resides.

I hope enough readers pick up on some of this.  And yes, there is a chapter on sex, love, and affairs.

It is hard to excerpt from this book, but here is one short bit:

Compared with humans, ems fear much less the death of the particular copy that they now are.  Ems instead fear “mind theft,” that is, the theft of a copy of their mental state. Such a theft is both a threat to the economic order, and a plausible route to personal destitution or torture.  While a few ems offer themselves as open source and free to copy, most ems work hard to prevent mind theft.  Most long-distance physical travel is “beam me up” electronic travel, but done carefully to prevent mind theft.

I am wildly enthusiastic about everything the Robin upload does, and some of his copies are better yet.  Here is the book’s home page.

Em

Addendum: Here is Robin Hanson’s response.

I know that Tyrone, my evil twin brother, has been fairly silent in 2015, but that’s only because he’s been so busy whispering things in my ear.  He’s also been spending his profits from having shorted the Chinese stock marketAnd having shorted the Democrats.

Can you imagine his latest?  Electoral politics once again, his weakest area (not nearly as good as Tyrone the neo-Fisherian).  Well, I scribbled down some notes on a napkin, over lunch, so this is an imperfect rendition of what he really said.  Tyrone in fact didn’t want me to write this post, fearing people would take it the wrong way.  Here goes, here is Tyrone at his mischievous worst:

Tyrone: It is obvious that intellectual Democrats, especially those concerned with climate change, should vote for Donald Trump for President.  Furthermore they should welcome his ascent, as should intellectual Republicans.

Let’s accept the commonly argued premise that climate change, if not quite an existential risk, can drastically lower the quality of life on earth for generations to come.

There is some chance that Trump will in fact support some kind of comprehensive climate change legislation.  After all, he used to be a liberal, but perhaps more importantly he wants to think of himself as a savior.  The chance of this is higher than that of any other Republican, and he is hardly beholden to the standard lobbies.

Most importantly, the chance of Trump “going Nixon” is higher than Hillary’s chance of selling meaningful climate change legislation to an oppositional Republican Congress.  She’ll be unpopular from day one, and the salaries of Dutch kunstmatige land consultants will skyrocket; that would bring a new Dutch disease, not just the one you get in those pretty Amsterdam shop windows.

OK people, let’s say Trump sticks to the mainstream Republican position.  What will happen then?  Won’t greedy capitalists rape the earth, not to mention building that energy-consuming wall?

Well, in the short run, maybe.  (Don’t forget Lennon on the omelette and those broken eggs!)  But we all know how disastrous Trump’s economic ideas would be in practiceThey would lower the growth rate of gdp and impoverish the masses.  Even if you read Trump as a policy moderate, just imagine what his volatile temperament would do to the equity risk premium.  (Then they would have to give Robert Barro a Nobel prize!)  And so, four or maybe eight years later, — or is it two? — what we could expect to find?  A fully Democratic Congress and White House.  (And dear reader, is there any other way to get there?)  And thus would arrive comprehensive climate change legislation, just as we got Obamacare post-2008.  Voila!  That’s way more important than maintaining America’s status as a nice, well-respected, and tolerant country, isn’t it?

So Democrats, if you really care about Bangladesh and Vietnam, and don’t just have this silly mood affiliation fancy that Tyler has fabricated, you should promote the candidacy of Donald Trump.  The more Democratic you are, the better.  The more worried about climate change you are, the better.  Your man has arrived on the national scene.  Finally.

Remember the take of Borges on Judas?  He made the real sacrifice of his reputation, so that the rest of us could be saved by Christ.  It is time for you too to be like Judas…[TC: At this point the absurdities piled up so high I just had to cut Tyrone off.]

trump

Tyler again: Readers, I am so sorry for this.  I receive numerous requests for more Tyrone, but usually I resist.  The only reason I occasionally oblige is to show you all, once again, how crazy he is.  How unreasonable he is.  How subject he is to his own mood affiliations, foibles, and quirks.  How little heritability can explain, once you look get past superficial sibling similarities and look more closely at the details of the intellect.

Tyler’s view — my view — is that good Democrats in fact should support…[at which points Tyrone cuts Tyler off, and the two tumble over the proverbial cliff]…

Very good sentences

by on January 24, 2016 at 7:02 am in Books, Current Affairs, Political Science | Permalink

Moreover, the forces that are disfiguring the right are likely to spread in future years, consuming the Democrats in much the same way as they have consumed the Republicans. The stagnation of the living standards of average Americans is creating widespread angst. The culture wars are extending to new areas. The ­Internet-enabled news-cum-entertainment industry stokes political resentments even as it creates epistemic anarchy. Interest groups are finding ever more ingenious ways to pretzel the political process. Interesting times don’t remain confined to one part of the political spectrum for very long.

That is from an Adrian Wooldridge review at the NYT.

The disaster in Flint, Michigan is being treated as an aberration but Werner Troesken’s excellent book The Great Lead Water Pipe Disaster demonstrates that there is a history of such problems in the United States.

In The Great Lead Water Pipe Disaster, Werner Troesken looks at a long-running environmental and public health catastrophe: 150 years of lead pipes in local water systems and the associated sickness, premature death, political inaction, and social denial. The harmful effects of lead water pipes became apparent almost as soon as cities the world over began to install them. Doctors and scientists noted cases of acute illness and death attributable to lead in public water beginning in the middle of the nineteenth century, and an editorial in the New York Herald called for the city to study the matter after a bizarre illness made headlines in 1868. But officials took no action for many years. New York City, for example, did not take any steps to reduce lead levels in water until 1992, long after the most serious damage had been done. By then, in any case, much of the old lead pipe had been replaced with safer materials.

Troesken examines the health effects of lead exposure, analyzing cases from New York City, Boston, and Glasgow and many smaller towns in Massachusetts, New Hampshire, and England. He draws on period accounts, government reports, court decisions, and economic and demographic analysis to document the widespread nature of the problem, the recognized health effects—particularly for pregnant women and young children—and official intransigence. He presents an accessible overview of the old and new science of lead exposure—explaining, for example, why areas with soft water suffered more harmful effects than areas with hard water. And he gives us compelling and vivid accounts of the people and politics involved. The effects of lead in water continue to be felt; many older houses still have lead service pipes. The Great Lead Water Pipe Disaster is essential reading for understanding this past and ongoing public health problem.

Full disclosure: Troesken was a colleague at GMU a few years ago around when this book was published.

South Africa’s high court has upheld a decision to legalize domestic sales of rhinoceros horn, a controversial plan that some hope will reduce poaching by creating a legal source of supply, but limited to South Africa, for the endangered animal’s parts.

…John Hume, a rancher in South Africa with more than 1,100 rhinos, made the application with another farmer to overturn the ban. He said he can only afford to keep his farm going if the local horn trade is legalized.

Here is the WSJ story, and here is another useful source.  Note this:

Right now, there are only 29,000 rhinos left on the planet, most of which are in South Africa. It’s an incredible drop from the 500,000 that roamed Earth at the start of the 1900s, and sadly, the majority have been killed as a result of poaching, which increased 9,000 percent (yes, you read that right) between 2007 and 2014.

That means more than 1,000 rhinos are now killed illegally each year for their horns. Most of these end up in Asia, where they can reach up to US$100,000 per kilogram on the black market. Those prices are driven by the fact that many countries see rhino horn as a status symbol, and in Vietnam it’s believed (with no evidence whatsoever) to cure cancer.

Farmers claim they can harvest rhino horn without killing the animals, critics claim that rhinos will be in danger as long as the Asian demand continues, and in essence legalization cannot make supply sufficiently elastic, sufficiently quickly, to solve the problem.

Expecting less inflation

by on January 21, 2016 at 2:13 pm in Current Affairs, Economics | Permalink

inflationexp

Here is the associated WSJ article.  Yes oil is down and the Fed did a slight rate hike, but still the broader lesson is that we are moving into economic corridors we do not understand.  I don’t know that any theory has done a good job predicting inflation dynamics.  Wages are showing (finally) some very modest growth, so the “we were in a liquidity trap, deflation was delayed because wages are sticky, finally wage are falling” explanation also seems wrong.  I also don’t think we will be seeing another Fed rate hike anytime soon.