*Stubborn Attachments* opening week

I thank all of you buyers and reviewers for making the opening week of Stubborn Attachments: A Vision for a Society of Free, Prosperous, and Responsible Individuals such a success.

The book hit #1 in 4 Amazon browse subcategories over the last week:
– Macroeconomics
– Commerce
– Philosophy
– Theory of Economics, and also Comparative Economics

Why the U.S.-Saudi relationship has proven so enduring

That is the topic of my latest Bloomberg column, note I am continuing to see a larger backlash on the Saudi issue than one might have expected. The bigger underlying question is this: given all that has happened, so why is the United States still such an ally of the Saudis?  It’s longstanding and thus not just about Trump’s possible business dealings.  It’s also not just about the oil, here is one excerpt:

One feature of the geography of Saudi Arabia is that its major oil fields stand apart and can be taken over without controlling the major Saudi cities. That is one reason why the Saudis were so wary of Saddam Hussein.

That risk means the Saudis are especially dependent on American military protection. In turn, the U.S. knows it has a lot of leverage over the Saudis, and therefore making deals with the Saudis involves easier enforcement and lower transaction costs. The same cannot be said of deals with Iran. So in the Saudi-Iran rivalry, the U.S. ends up siding with the Saudis.

Historically, Iran has been a very difficult country to capture or control, and the population has fought fiercely to defend Iranian territorial integrity. Iran doesn’t need American protection to the same degree as do the Saudis, and so Iran is more willing to be prickly or openly hostile to the U.S.

Iran shared a border with the former Soviet Union (though not Russia) and shares Caspian Sea rights with Russia, and the two countries often have had close and cordial relations. Iran also is easier than Saudi Arabia for China to reach with its One Belt, One Road initiative, which aims to build close ties with the countries to its west. In sum, Iran is going to diversify its geopolitical bets, which pulls it away from the U.S., even if the issues surrounding nuclear weapons and support for terrorism somehow were resolved.

And this:

Of course, the Saudis have abused their position. They are dependent on the U.S., but they also know America has few other potential regional partners for cooperation on such a large scale. And so the Saudis have engaged in human-rights abuses over the decades, figuring it may harm but will not irrevocably damage relations with America.

There is more at the link, analytical throughout.

Monday assorted links

1. Who gained and lost the most from the Seattle minimum wage hike? (NYT)  Paper here.

2. Japan’s hometown tax.

3. Chinese leafy greens.

4. Is the Saudi influence machine running out of steam?

5. Actors are digitally preserving themselves to continue working beyond the grave: “The suite of services that the company offers actors includes a range of different scans to capture their famous faces from every conceivable angle—making it simpler to re-create them in the future.  Using hundreds of custom LED lights arranged in a sphere, numerous images can be recorded in seconds capturing what the person’s face looks like lit from every angle—and right down to the pores.”  And:

“Digital Domain has scanned signature hairstyles, wardrobes, and props as well. The total process takes up to two days and generates five to 10 terabytes of data, depending on the extent of detail being recorded. The full selection of services can cost a million dollars.”

*First Man* and the great stagnation

I enjoyed this movie, although I would not describe it as a must-see.  It is best for showing the rickety and claustrophobic nature of the moon landing program.

Three points struck me in particular, both concerning progress.  First, the space shots in this movie are not better than those of Stanley Kubrick in his 1968 film 2001: A Space Odyssey.  There are even several Kubrick homage shots, and they don’t look any better than the originals, and arguably somewhat worse.  Perhaps most cinematic progress has come in shooting or better yet constructing dense scenes, but that does not apply to space.

Second, I walked to my (non-fancy) car and turned on the ignition right after watching the movie.  It was immediately striking how much better and more reliable was the software in my car than in the whole well-funded moon program.  In this sense technological progress has been immense.  That said, most cars in operation today are not that much better than cars from 1969, and they perform more or less the same functions, albeit more safely.  Improving car manufacture is not that hard, but improving the usefulness of cars in our daily lives is where the problem lies.  So this supports the “the consumer space is already filled out” interpretation of the great stagnation.

Third, perhaps it is the very absence of the internet and advanced information technology that made the moon program possible.  When Armstrong arrives at the moon, you realize it is pretty boring and it has not so much to offer, either in 1969 or today.  Would they have gone to such trouble if there had been better problems to work on?  Well before the end of the movie, I found myself wanting to check my email and refresh my Twitter feed.

By the way, this movie has bombed at the box office, perhaps not a good sign for the revival of adventure in contemporary culture.

*Frederick Douglass: Prophet of Freedom*

Although it can never really be measured, he may also have been, along with Mark Twain, the most widely traveled American public figure of his century…It is likely that more Americans heard Douglass speak than any other public figure of his times.  Indeed, to see or hear Douglass became a kind of wonder of the American world.  He struggled as well, with the pleasure and perils of fame as much as anyone else in his century, with the possible exceptions of General Ulysses S. Grant or P.T. Barnum.  Douglass’s dilemma with fame was a matter of decades, not merely of moments, and fraught with racism.

That is from the new David W. Blight biography of Douglass, outstanding in every way, appearing to rave reviews, and slated for the top tier of the year’s “Best of 2018” non-fiction list.

A new “ideal” proposal for immigration reform

The IDEAL policy creates a long-term visa program in which 3mm immigrants are selected to live in the U.S. per year.

The IDEAL policy is simple and includes the following details:

  • Immigrants pay $30,000 for a five-year live/work visa renewable for an additional five years at no additional cost contingent upon each IDEAL immigrant proving to be a net asset to the U.S. economy.
  • At the end of ten years, immigrants whose impact to the U.S. is net positive are eligible for citizenship. Immigrants with a net negative impact will be asked to leave the U.S. Acceptance and impact will be determined by a pre-determined scoring system.
  • IDEAL visa-holders are ineligible for any government benefits until attaining full citizenship and IDEAL visa-holders will be required to secure health insurance through an employer or through other means during those ten years.

Each applicant is given an acceptance score and ranking based on the following criteria:

  • Age;
  • Education level;
  • English language proficiency;
  • Existing job offers from one or more U.S. companies;
  • Previous successful U.S. work history; and
  • Willingness to live in a IWC (Immigrant Welcoming Community).

An Immigrant Welcoming Community meets all of the following criteria:

  • An urban or rural community in the bottom 25% of U.S. income;
  • A community that has suffered population losses over the preceding decade; and
  • A community that opts-in to the IDEAL program via local government consent.

Here is the full website.

Memphis

A few days ago, a few of you thought I was dumping on Memphis.  I did say the city is not an economic development success story, but it is perhaps my favorite place to visit in the American South.  It has the best musical traditions, for instance generating Jerry Lee Lewis, Elvis, Carl Perkins, and Johnny Cash, all at more or less the same time, with many others later including Lonnie Mack, Isaac Hayes, and Booker T.  It is one of the classic barbecue cities, most of all for ribs.  Beale Street remains a wonderful place to hear music, as it is not nearly as ruined by tourists as Broadway in Nashville or Bourbon Street in New Orleans.  It is also one of the American cities most likely to look as if it is still 1963, or is that 1957?  Finally, Memphis is the starting off point for a drive down Highway 61 into the heartland of the Mississippi Delta, one of the essential American journeys and yes you still can hear rural blues music there.

If you have never done a three-day Memphis trip, I would strongly urge this upon you.

The high-return activity of raising others’ aspirations

Yesterday I had lunch with a former Ph.D student of mine, who is now highly successful and tenured at a very good school.  I was reminded that, over twenty years ago, I was Graduate Director of Admissions.  One of my favorite strategies was to take strong candidates who applied for Masters and also offer them Ph.D admissions, suggesting they might to do the latter.  My lunch partner was a beneficiary of this de facto policy.

At least two of our very best students went down this route.  Ex ante, neither realized that it was common simply to apply straight to a Ph.D program, skipping over the Masters.  I believe this is now better known, but the point is this.

At critical moments in time, you can raise the aspirations of other people significantly, especially when they are relatively young, simply by suggesting they do something better or more ambitious than what they might have in mind.  It costs you relatively little to do this, but the benefit to them, and to the broader world, may be enormous.

This is in fact one of the most valuable things you can do with your time and with your life.

Saturday assorted links

1. QuantEcon is a NumFOCUS fiscally sponsored project dedicated to development and documentation of modern open source computational tools for economics, econometrics, and decision making.  Main link here.

2. Learning others’ political views reduces the ability to assess and use their expertise in nonpolitical domains.

3. The new American songbook? Thirty song selections.  (How did Oasis and Celine Dion get on this list?)

4. Are there eight main channels of innovation?

5. Nebraska school cook who served kangaroo meat chili loses job.

What I’ve been reading

1. Catherine Clinton, Harriet Tubman: The Road to Freedom.  I hadn’t realized that so much was known about her life, or that she spent so much time in Canada, or that she fell into such obscurity during the early part of the twentieth century.  She died the same year Rosa Parks was born.  I liked this book very much.

2. Tom Miller, China’s Asian Dream: Empire Building Along the New Silk Road.  A good look at the new conflicts between China and its southeast Asian and central Asian neighbors.  Clear enough to be a good introduction, detailed enough to be useful to those who already know something about the topic.

3. Robert Alter, The Art of Bible Translation.  Alter is one of today’s most important doers, and his forthcoming Hebrew Bible translation is likely to be definitive and the most important act of publication this year.  This short volume presents his perspective on what he has done, most of all focusing on how to turn Hebrew into English.

4. Michael Tomasello, Becoming Human: A Theory of Ontogeny.  How does human psychological growth run in the first seven years, in particular how does it instill “culture” in us?  Tomasello address this question in a Belknap Press book by comparing us to chimpanzees and bonobos.  Most of all, how does the capacity for shared intentionality and self-regulation evolve in people?  This is a very thoughtful and also important book, but I’m not sure it finally succeeds into tying up all the pieces into a broader picture of…shared intentionality.

5. Camille Paglia, Provocations.  At first I was discouraged by the notion of a recycled Paglia compilation, but the quality of these pieces is often high and many of them are not readily available elsewhere.  The now-classic  Sexual Personae is still the best introduction to her work, but if you think you might be tempted by this one, you should buy it.  I would put the hit rate at about fifty percent (who else will give you running commentary on the main cinematic adaptations of Homer’s Odyssey?), and it is sad to see so far it has not been seriously reviewed.

Iceland book fact of the day

Icelanders bought 47% fewer books in 2017 than they did in 2010, a very sharp decrease in a matter of only six years. In a recent poll in Iceland, 13.5% of those who responded had not read a single book in 2017, compared to 7% in 2010.

Iceland has a wonderful tradition of giving books as Christmas presents, with people reading into the night on Christmas Eve. However, even this may be under threat: in 2005, an Icelander received an average of 1.4 books as gifts at Christmas; this number is now 1.1, with 42% of Icelanders not receiving a single book for Christmas according to the most recent poll…

Recent research shows an alarming rise in students under 15 struggling to read their own language. And they are picking up English at a much faster pace than before – it is not strange to hear them speaking it in the playground.

Here is the full story.

A different and mortgage-related reason why monetary policy stimulus is weaker at lower rates

Using a household model of mortgage prepayment with endogenous mortgage pricing, wealth distributions and consumption matched to detailed loan-level evidence on the relationship between prepayment and rate incentives, we argue that the ability to stimulate the economy by cutting rates depends not just on the level of current interest rates but also on their previous path: 1) Holding current rates constant, monetary policy is less effective if previous rates were low. 2) Monetary policy “reloads” stimulative power slowly after raising rates. 3) The strength of monetary policy via the mortgage prepayment channel has been amplified by the 30-year secular decline in mortgage rates. All three conclusions imply that even if the Fed raises rates substantially before the next recession arrives, it will likely have less ammunition available for stimulus than in recent recessions.

That is from David W. Berger, Konstantin Milbradt, Fabrice Tourre, and Joseph Vavra, via the excellent Kevin Lewis.

Friday assorted links