Assorted links

1. Reprogramming predators, and maybe a pan-species welfare state too.

2. The six great fantasy novels?

3. Forum on the new Robert Pozen book on the financial crisis.

4. Do you wish to hear the other side?  Here is George Selgin's case for deflation, now on-line and free.

5. Ezra and Mark Bittman, the behavioral economics of Thanksgiving.  And here, with Dan Ariely.

6. Pollution is moving to Asia; good maps.

6. Future deficits are worrisome.  James Hamilton: "Is it possible that some time within the next five years, the U.S.
Treasury will run an auction in which there are not enough bids to roll
over the debt? My answer is yes."

Comments

the fed puts in offers when they know it is undersubscribed.

Hamilton's piece is premised on a ceteris paribus arguments (everything will keep going the way it is at this moment) and

that we will have to pay off the debt all at once,

and also that: "It's going to be a real problem for any politician who tries to service the growing debt burden by raising taxes."

Only if you are a Republican who takes a kool-aid pledge to be irresponsible and never raise taxes.

Wow, it took all of _three_ responses this time to dive into the partisan muck.

Hamilton takes no risk in saying this. It's become dramatically more common for economists and other commentators to be willing to make 'startling' claims like this because they know (especially with a tiny bit of hedging) they'll never be called on it, and in fact no one will remember it. And if someone does, well, gosh, there's always the hedge.

On the other hand, if they turn out to be right, or nearly right, they'll be "the guy who predicted the whatever-it-was." (Even if technically they didn't predict what is claimed.)

I don't know why more economists aren't throwing stuff like this out there all the time now.

Re: reprogramming predators: I'm in favour of genetically modified foods, genetic engineering and any and all kinds of biological and technological enhancements for humans, yet my instant reaction to the idea of a reprogrammed non-predatory lion was moral revulsion. Why? I'm not sure, but I find it interesting to observe my own reaction.

Can't link to the fantasy books site, blocked by work, but I'm thinking it is like greatest diners of all time. Even if the food is really good, it's never gonna be great.

"Is it possible that some time within the next five years, the U.S. Treasury will run an auction in which there are not enough bids to roll over the debt?"
Well some congress critters are threatening to tax financial instrument transactions (I have yet to see a reference to where the Constitution gives them the power to do this). I think a rational retaliation would be for the primary dealers to agree to sit out one auction and bid $0. If the primary dealers didn't show up to today's 7-year auction there would have been a few million more than $32 billion bid to cover the slightly less than $32 billion the Treasury needed to sell.

So assuming that Congress critters are stupid (history would support this thesis) I say yes it is possible we will have a failed auction.

Jay wrote: "I have yet to see a reference to where the Constitution gives them the power to [tax financial instrument transactions].

Commerce clause, of course. And in contrast with some of the ways it's been used, there's actually interstate commerce involved.

Also, I'm not sure the idea of dealers sitting out would work. They might agree to do so, but there would be excellent rewards for anyone who cheated, so rationally they would all cheat. One might even argue that they had a fiduciary duty to do so, in the interests of their companies and clients.

Whoever is doing those geographic center calculations is seriously math deficient. I only had to glance at their map to be sure they must have made an error: there is no way that the georaphic center of anything is near the arctic circle.

Just for kicks, I took Wikipedia's list of the top 25 countries by GDP and by CO2 emissions and looked up their geographic centers on Wolfram alpha. The georaphic center of GDP is about 34N, 14E, in the Medeterrenian Sea below Italy. The geographic center of CO2 emissions is about 35N, 29E, in the Medetterrenian Sea below Turkey. If anyone wants to see my excel spreadsheet, I'll gladly oblige.

That's about what you would naively expect. Both points are at the same lattitude as the U.S. and China and have a longitude in between them. CO2 is slightly further east than GDP, since China is more CO2 intensive than the US. The article has these points near the arctic circle moving bewteeen Iceland and Siberia! I want some of what they were smoking...

For reference, the latest calculation of US Federal tax revenue is under 15% of US GDP, down from more than 20% during the last few years of the 90s.

That means "the American people" have 5% of GDP more money to "spend more wisely than government" than back when everyone was worried their would be no Federal debt to buy. They seem to spending it all on Federal debt given the zero to negative rates at auction. Clearly the "wisdom of crowds" says the Federal deficit is a good thing to buy. The tax cuts are a great way to have tax payers super happy to fund all the government spending.

David Write wroght: "Whoever is doing those geographic center calculations is seriously math deficient. I only had to glance at their map to be sure they must have made an error: there is no way that the georaphic center of anything is near the arctic circle."

Au contraire, I think. You don't find the "center" between two points by averaging their latitudes and longitudes separately. That supposes a plane surface for the Earth instead of a spherical one. The "center" (unweighted) between New York and Beijing is the mid-point of the great circle route between them, somewhere quite close to the North Pole.

A different question would be "so what?" What useful information does that give us about anything at all?

As I recall the last few years of the 90s were mainly skewed by capital gains taxes which turned out to be bubble/false profits.

In a shrinking economy where taxes are levied (rightly) on profits, a drop in tax per GDP is understandable and of course desirable, otherwise the taxes would be more pro-cyclical.

To change the subject, does anyone know of a breakdown of what exactly were the loan losses that precipitated the financial crisis? You can't always call the marginal effect the cause, but I want to figure out just how much The Fed is to blame by raising the rates that resulted in the jingle mail.

Those other countries are more Socialistic, so their citizens get more services, while at the same time they have lower per capita GDPs so they may get less for their money overall, so I'm not sure what you are comparing.

Get less of what? Less oil to heat large badly designed inefficient buildings? Less oil to waste hours a week unproductively driving long distances in inefficient vehicles?

8% of GDP less to make up for the extra pollution or other harmful environmental factors that drives the need for twice as much health care in the US to match the quality of health in those socialist nations?

And if the US is so great, why does it require what amounts to more than two thousand dollars in foreign aid per person as measured by the current accounts deficit. That is about the cost of oil imports into the US.

And if you blame liberals for not allowing drill baby drill, you are calling for more of the government handouts to industry that one associates with welfare states. Sure, the US government has been using force to implement land redistribution from those who owned and occupied the Americas, to immigrants and corporations. Railroads have traditionally been large landowners thanks to the government giving them a square mile of native American land for each mile of track they laid, plus cash on top of that. The first century of the US is certainly one marked by government handouts.

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