Month: April 2012

The Big Easy’s School Revolution

Interesting op-ed in the Washington Post on schools in New Orleans.

…the levees broke and the city was devastated, and out of that destruction came the need to build a new system, one that today is accompanied by buoyant optimism. Since 2006, New Orleans students have halved the achievement gap with their state counterparts. They are on track to, in the next five years, make this the first urban city in the country to exceed its state’s average test scores. The share of students proficient on state tests rose from 35 percent in 2005 to 56 percent in 2011; 40 percent of students attended schools identified by the state as “academically unacceptable” in 2011, down from 78 percent in 2005.

….Most of the buzz about the city’s reforms focuses on the banishment of organized labor and the proliferation of charter schools, which enroll nearly 80 percent of public school students, up from 1.5 percent pre-Katrina. But what really distinguishes New Orleans is how government has re­defined its role in education: stepping back from directly running schools and empowering educators to make the decisions about hours, curriculum and school culture that best drive student learning. Now, state and school-district officials mostly regulate and monitor — setting standards, ensuring equity and closing failing schools. Instead of a traditional school system, there is a system of schools in what officials liken to a fenced-in free market. Families have more choice about where their children can best succeed, they say, and educators have more opportunity to choose a school that best aligns with their approach.

The population of New Orleans changed pre and post-Katrina so it’s difficult to compare pre and post-Katrina test scores; although given the state of the schools pre-Katrina it’s hard to believe that the schools have not greatly improved. What really drives innovation, however, is not a simple substitution of private for public but a system substitution of competition for monopoly. The key therefore is to expand charters and voucher programs.

The state of Louisiana just passed a voucher program that although limited to poor and middle class students in failing schools will offer as many as 380,000 vouchers to be used at private schools or apprenticeships. Indiana has passed a potentially even larger program that would make about 500,000 students voucher-eligible. Keep in mind that at present there are 50 million public school students and only 220,000 voucher students nationwide.

My ideal program would fund students not schools and would make vouchers available to all students on a non-discriminatory basis. We are far from that ideal but we are slowly moving in the right direction. Charters and the expansion of voucher programs around the country are starting to bring more competition, dynamism and evolutionary experimentation to the field of education.


I have to give this movie an A+.  It is an outstanding treatment of the history of Jamaica, the Caribbean cultural blossoming after World War II, possible equilibria in individual human affairs, and of course the protagonist Bob Marley himself, as well as much much more.  Marley by the way does not come off as a sympathetic character.  The scenes from Zimbabwe and Germany are remarkable.  The director is Kevin Macdonald, who also created The Last King of Scotland.

There are trailers here.  Here is one good review.  If you are seeking to normalize my review, in general I am not fond of “musical documentaries” and I do not consider Marley the peak of Jamaican music (I prefer Lee Perry, Desmond Dekker, and King Tubby, for a start).  Think of this as a movie flat out and go see it on a large screen.

The Armchair Economist-Revised Edition

The Armchair Economist includes my favorite line in all of popular economics:

Economic theory predicts that you are not enjoying this book as much you thought you would.

I laugh every time I read that line and I think what a brilliant opening to an essay on auction theory and the winner’s curse!  And then I think, but in fact I am enjoying this book more than I thought!

I first read Landsburg’s book some twenty years ago and dipping into the revised edition over the weekend I can see how influential The Armchair Economist has been on my own teaching and writing, particularly Landsburg’s wonderful and deep essay, Why Prices are Good: Smith v. Darwin. Around 1997, the Armchair Economist also inspired my (now) colleague Bryan Caplan to create a listserv to discuss economics with a small cadre of like minded readers. Many of the people on that listserv would later become well-known econ bloggers. My history makes me assume that everyone has read The Armchair Economist, after all, all my friends have read The Armchair Economist! More rational reflection tells me that time and the flowering of popular economics means that there is a whole new generation of readers ready to be delighted and inspired.

The cultures that is Europe

Many of the Spaniards say the work environment in Germany takes getting used to, with Germans far more direct than Spanish people and much quieter. No one makes personal calls during business hours, for instance. But the work day is much shorter.

They were surprised that they were expected to greet co-workers each morning with formal handshakes and to call colleagues “Herr” and “Frau” (Mr. and Ms.). Impromptu hallway conversations over work issues were cut off by Germans suggesting it would be more appropriate to schedule a formal meeting.

The German fondness for order, often joked about, has proved true, said Carlos Baixeras, 30, an engineer who started working near Frankfurt 18 months ago. “There are rules for everything,” he said. “There’s a trash police.”

There is also this demographic point:

Last year, though, even while deaths once again exceeded births, the German population grew for the first time since 2002, thanks to a net immigration of 240,000 people, nearly double the 128,000 net gain in 2010. Countries like Poland and Romania sent the most, but German government statistics showed thousands more coming from the crisis-stricken southern nations.

The full story is here.

Note that highly productive economic activity seems to be concentrating itself in the United States, in a smaller number of locations.  Perhaps the same is happening in Europe too.  That’s hardly Spain’s biggest problem right now, and migration can in some ways be a blessing for an economy with high unemployment.  Still, when the debt overhang is so high, this is troubling news too.

From the comments, on downturns, fiscal policy, and multiple equilibria

From Tall Dave:

We were less wealthy than we thought we were.

Call me an AD-denier, but I still think the basic issue here is that you can’t consume more than you produce. Production exists to satisfy demand, but at the same time demand is limited by production. We had a long boom built on the notion we could boost demand and thus supply and thus demand again in a virtuous cycle, and now we are seeing the cycle work in reverse as demand/supply seek their natural levels.

One way to justify this model is in terms of multiple equilibria, and that we have been walking (bouncing our heads?) back down the escalator.  Arguably for the United States this downward bouncing is over.  Along the way we are sending signals about the quality of our institutions and thus shaping the course of the future.

In this model there is still a useful role for fiscal policy.  For one thing, fiscal policy can smooth that ride down the escalator, by spreading the losses out over time, at the cost of future debt of course.  This may be needed if only to make the political economy of decline less bitter; see Spain and Greece.   Nonetheless fiscal policy cannot make up for the output losses at will.  We are not standing in an IS-LM diagram where the difference between “what we have” and “what we could have” is thwarted only by some supposed Austerians who won’t shift the proper curve and yet somehow have taken over some of the biggest spending social democratic, insider-leaning governments in world history.  The IS-LM approach fits in nicely with the view that policy improvement is all about yakking about the obstructionists.  Instead, policy is also about rebuilding trust, not just maintaining ngdp on a decent keel.

There is another possible role for fiscal policy, as there usually is in models of multiple equilibria.  If you ran some super-duper fiscal policy, and invented the flying car, a cure for cancer, and other marvels, the market might suddenly latch its expectations on to a much more positive scenario.  There could be a significant upward bounce to a much higher equilibrium of output and employment.  In any case, the quality of fiscal policy matters, and Keynesian ditch digging probably doesn’t do much for inferences about institutional quality and for the selection of multiple equilibria.  “Spend the money, anywhere” is in my view a deeply pernicious attitude, somewhat akin to thinking you can create a good NBA team, with a strong ethic for quality and work, by tanking for better draft picks at the end of every season.  But no, the internal ethic matters and cannot be first destroyed and then recreated at will.  Good teams don’t usually work that way, and neither do good fiscal policies.

Right now we Americans are building back up to better equilibria, slowly, by showing that our economic institutions are not totally crummy.  This process can take a good while, but in fact our recovery is going better than many people believe.  The eurozone is far — very far — from being on that kind of rebuilding track.

There is plenty of talk about various commentators don’t understand the lessons of Econ 101.  There is a reason why we teach classes beyond 101, and why we spend so much time studying institutions and the theory and empirics of public choice.

Assorted links

1. Scott Sumner on his economic method (with a passing mention of ngdp).

2. Do French kids snack?

3. How much does deleveraging matter?: a U.S.-UK comparison.  And is the UK price behavior just due to the VAT?

4. Man’s best friend?  Maybe Argentina can export these dogs to Spain soon, and what’s all this about the Michael Jensen/Werner Erhard connection?

5. Is the health care cost curve finally bending?

California fact of the day

Data available from the UC Office of the President shows that there were 2.5 faculty members for each senior manager in the UC system in 1993. Now there are as many senior managers as faculty.  Just think: Each professor could have his or her personal senior manager.

And there is this:

A report on administrative growth by the UCLA Faculty Association estimated that UC would have $800 million more each year if senior management had grown at the same rate as the rest of the university since 1997, instead of four times faster.

What could we do with $800 million? That is the total amount of the state funding cuts for 2008-09 and 2009-10, and four times the savings of the employee furloughs. Consider this: UC revenue from student fees has tripled in the last eight years. The ratio of state general fund revenue to student fee revenue in 1997 was 3.6:1. Last year it was 1.9:1. If we used that $800 million to reduce student fees, the ratio would go back to the 1997 value. To put another way, it could pay the educational fees for 100,000 resident undergraduates.

Here is more.  For the pointer I thank David Colquhoun.

Is Africa the next big food trend?

Josh Schonwald says yes:

One night, after reading about sugar-cane drinks and fresh lobster skewers, I started cooking. I made a spicy okra salad, grilled shrimp piri piri and steamed vanilla pudding. The next night, Zanzibari pizzas—chapati stuffed with eggs, meat and spices. Later, I had a Mozambican seafood stew with Senegalese-style jollof rice. I started seeing it.

…As fast-growing African nations become more prosperous, they will develop something that is rare right now—a middle class with disposable time and income. Poverty, hunger, war and sickness are why Africans—from Cameroon to Mozambique to Namibia to Congo—have been unable to develop a baobab-infused vinaigrette.

I very much enjoyed Josh’s new food book The Taste of Tomorrow: Dispatches from the Future of Food, and I can recommend it for its pro-science stance, its interesting speculations, and its excellent reporting.  My prediction, by the way, based on demographics, is that the next big food trend will be more from the Latino cuisines, fused with American ideas to appeal to the (North) American palate.  Chipotle is but one step in this direction.  Sadly, in my view most Americans have room for only a few foreign cuisines in their lives.  Thai and Indian are knocking on the door of Mexican and Chinese (all in their American versions), but I do not see new contenders for that throne.

Thiel’s Law

Thiel’s law: A startup messed up at its foundation cannot be fixed.

That is from the new section of Peter’s lecture notes, recommended of course.  To pose a simple question, how many other people are there in the world you would rather listen to?  Does that not mean Peter is one of the seminal public intellectuals of our time, albeit working through some non-traditional media of communications?

Hat tip goes to The Browser, which by the way is better than The Tatler ever was.

What Americans want

Ask Americans if they are willing to spend more to buy American-made products, and nearly half say they are often willing to do this. But in the latest Economist/YouGov Poll, the country where a product is made trails price, quality, and even convenience, as an important factor in consumer decision-making. The public gives even less importance to a product’s brand, its impact on the environment, or the political leanings of the company that produces it.

Here is more, and for the pointer I thank Bruce Bartlett.  Once again, here is Bruce’s new book on taxation.