Month: August 2012
Sentences to ponder
…I find it remarkable that I have yet to receive a thank you note for paying my taxes. When I fill out my taxes, I notice that even receipts for $25 donations have thank you notes attached. But for the tens of thousands of dollars I give each year to help keep our wonderful Republic afloat, nothing. Can’t we do a little more as a nation to honor our taxpayers individually?
…And how about a dinner at the White House honoring the top 100 taxpayers in the country? Not the 100 richest people in the country, but the top 100 taxpayers. One might object that they would just use the opportunity to lobby for lower taxes, but if they did, they wouldn’t get invited the next year.
That is from Miles Kimball. Of course very often these individuals are criticized for not wanting to pay higher taxes.
*Science Left Behind*
The authors are Alex Berezow and Hank Campbell, and the subtitle is Feel-Good Fallacies and the Rise of the Anti-Scientific Left. I agree with many of the particular claims in this book, and also I find those undervalued in broader intellectual discourse. Nonetheless I am struck by a mismatch between the book’s message and some of its tone, as well as the sense that one side should be singled out for condemnation (the same point can be made about left-wing books on related topics).
This excerpt made me giggle:
…despite what some progressives will contend, the purpose of this book is not to demonize all progressives. We just want to demonize the loony ones.
Assorted links
1. The truly important use for drones.
2. Peter Orszag on competitive bidding for Medicare.
3. Comments from an Irish burglar, and Caplan defends Bastiat.
4. The culture that is Finland, don’t miss the tag at the end.
6. What levels of immigration would be needed…?
7. Dean Baker on how much housing policy could have helped.
That’s a lot of links for today but they are worthy.
Monkeys reject unequal pay
Greg Mankiw points us to this revealing video from Frans de Waal. This is an excerpt from a longer TED video, also excellent.
http://youtu.be/g8mynrRd7Ak?t=30s
Jeff Sachs reviews Acemoglu and Robinson
As you might expect, he stresses geography rather than institutions:
In places where production is expensive because of an inhospitable climate, unfavorable topography, low population densities, or a lack of proximity to global markets, many technologies from abroad will not arrive quickly through foreign investments or outsourcing. Compare Bolivia and Vietnam in the 1990s, both places I experienced firsthand as an economic adviser. Bolivians enjoyed greater political and civil rights than the Vietnamese did, as measured by Freedom House, yet Bolivia’s economy grew slowly whereas Vietnam’s attracted foreign investment like a magnet. It is easy to see why: Bolivia is a landlocked mountainous country with much of its territory lying higher than 10,000 feet above sea level, whereas Vietnam has a vast coastline with deep-water ports conveniently located near Asia’s booming industrial economies. Vietnam, not Bolivia, was the desirable place to assemble television sets and consumer appliances for Japanese and South Korean companies.
The review is interesting throughout, though I would stress the old saying: “As usual, the truth lies somewhere in between.”
The Hispanic high school graduation rate is increasing
The number of young Hispanics enrolled in college, which surpassed black enrollment for the first time in 2010, jumped to almost 2.1 million last year, from about 1.3 million in 2008. That is partly a product of a swelling Hispanic population, as well as the increased rate of college attendance.
But it also reflects a fast-rising high school graduation rate. In the 1990s, fewer than 60 percent of Hispanics 18 to 24 had a high school diploma, but that figure hit 70 percent for the first time in 2009, and 76 percent last year.
Here is a bit more.
Education as loss leader?
And then there is the Walt Disney Company. It is building a chain of language schools in China big enough to enroll more than 150,000 children annually. The schools, which weave Disney characters into the curriculum, are not going to move the profit needle at a company with $41 billion in annual revenue. But they could play a vital role in creating a consumer base as Disney builds a $4.4 billion theme park and resort in Shanghai.
Here is more, mostly on whether media companies enjoy any synergies in education markets, interesting throughout.
Assorted links
1. Who dies from Russian roulette?
2. Interview with the new GMU President, Ángel Cabrera.
3. Lawrence Summers on government growth (very good piece), or try this link, and a Reihan follow-up.
4. Sokurov’s Faust will be out on DVD soon, it has received rave reviews.
5. Updated results on right to carry laws, and Medicaid seems to improve black child mortality but perhaps not white child mortality.
Evan Soltas is now writing for Bloomberg
Here is his excellent column on decentralized provincial health care provision in Canada. Excerpt:
By fixing the maximum federal contribution, block grants offer Canada’s provincial and territorial governments far better incentives to reduce the cost and improve the quality of the medical services they purchase. When costs rise, the provinces that run the programs are forced to pay 100 percent of the added costs at the margin, unlike in the U.S., where state governments pay an average of 43 cents at the margin for every dollar of added Medicaid expense.
Decentralized administration gives provinces the flexibility and the accountability to design their programs according to their needs and particular local challenges, rather than federal “one-size-fits-none” imposition. It also creates opportunities for innovation. By sharing notes, provinces and territories learn from one another and improve their Medicare programs.
Canada has been using block grants for 35 years. After several years of ruinously high growth in Medicare expenses during the 1970s, their federal government abandoned a 50-50 cost-sharing plan in 1977. Through the Canada Health Transfer program, which gives states some money directly and some through tax-shifting agreements, Canadian provinces and territories receive equal per capita aid, regardless of actual health care expenditure.
Hat tip goes to Miles Kimball.
Does new information slow down your life?
From William Reville, here is a speculation:
Finally, here is a “guaranteed” way to lengthen your life. Childhood holidays seem to last forever, but as you grow older time seems to accelerate. “Time” is related to how much information you are taking in – information stretches time. A child’s day from 9am to 3.30pm is like a 20-hour day for an adult. Children experience many new things every day and time passes slowly, but as people get older they have fewer new experiences and time is less stretched by information. So, you can “lengthen” your life by minimising routine and making sure your life is full of new active experiences – travel to new places, take on new interests, and spend more time living in the preset.
Most of the short article considers why “the return journey” often seems to run by much faster.
Recent figures on capacity utilization
Industrial production picked up in July after two months of slight growth, the Federal Reserve said Wednesday in the latest reading that shows the economy in the third quarter got off to a decent start. Industrial production picked up 0.6% in July after slender 0.1% monthly gains in May and June, the Fed said. The Fed had previously reported a 0.4% gain in June and a 0.2% drop in May. The 0.6% gain was as expected in a MarketWatch-compiled poll of economists. Capacity utilization rose to 79.3% in July from 78.9% in May – the highest level since April 2008. Even so, it’s still 1% below its average from 1972 to 2011.
The link is here. It suggests there is excess capacity, but not in wild amounts. Elsewhere, in China:
Capacity utilisation has dropped from about 80% before the crisis to a mere 60% in 2011. That compares with about 78.9% for the US currently for total industry (which is not very high by US’s historical average), and 66.8% at the financial crisis trough according to the Federal Reserve. In other words, current capacity utilisation in China appears to be even lower than that of the US during the 2008/09 financial crisis.
Beware all Chinese numbers, but still that cannot be taken as a good sign. Note that the real estate bubble probably is not fundamental to the Chinese economic crisis (though it is a problem), but excess capacity is.
Assorted links
To the point (Austro-Chinese business cycle theory)
“There is persuasive evidence to conclude that the Chinese economy is actually growing at just 4 or 5 per cent right now based on a composite of other indicators,” says Patrick Chovanec, a business professor at Tsinghua University in Beijing.
“Of China’s 9.2 per cent GDP growth in 2011, 5 percentage points came from investment which means that if China builds just as many roads, bridges, condos and villas as it built last year and no more it will knock five points of this year’s GDP growth. Growth is dependent on ever-rising levels of investment in an environment where that investment is not creating adequate returns.”
That is from the FT. Does this paragraph reassure you?:
Officials and state media reports have suggested local governments will be able to compensate for slumping exports and real estate construction by embarking on a new infrastructure building binge.
Racism by Political Party
It is undeniably the case that racist Americans are almost entirely in one political coalition and not the other.
Chris Hayes, Up w/ Chris Hayes, August 18, 2012.
Here is data asking whites the question Do you Favor Laws Against Interracial Marriage (this is from 2002, the latest year available for this question).
| Favor Laws Against Interracial Marriage | |||||
| Democrat | Ind | Repub | Other | TOTAL | |
| YES | 11.9 | 9.6 | 11.5 | 5 | 10.8 |
| NO | 88.1 | 90.4 | 88.5 | 95 | 89.2 |
Here is data asking whites whether they agree with the sentiment that Blacks Shouldn’t be Pushy.
| Blacks Shouldn’t Be Pushy | |||
| Democrat | Ind | Republican | |
| AGREE STRONGLY | 14.9 | 14.2 | 15.8 |
| AGREE SLIGHTLY | 20.4 | 20.6 | 26.6 |
| DISAGREE SLIGHTLY | 30.2 | 28 | 25.9 |
| DISAGREE STRONGLY | 34.5 | 37.2 | 31.7 |
Finally from 2008 here is data asking whites whether they would vote for a black for President. (Row: racpres, column partyid, filter: race(1) year(2008)).
| Would Vote for Black President | |||||
| STRONG DEMOCRAT | NOT STR DEMOCRAT | NOT STR REPUBLICAN | STRONG REPUBLICAN | ||
| YES | 92.4 | 94 | 93.9 | 94.7 | |
| No | 7.6 | 6 | 6.1 | 5.3 | |
It is true that there are more differences across party lines on policy questions such as on affirmative action, again with a mix in both parties but with more Republicans than Democrats opposing. I don’t consider these types of policy preferences to be grounds for calling someone a racist, however.
It is undeniable that some Americans are racist but racists split about evenly across the parties. No party has a monopoly on racists.
Addendum: John Sides, Reihan Salam and Razib Khan offer further comment.
What I’ve not been reading
These books have been sent to me, they appear to be of high quality, but they are still sitting in my pile:
1. Nicolai Foss and Peter Klein, Organizing Entrepreneurial Judgment: A New Approach to the Firm.
2. Peter Brown, Through the Eye of a Needle: Wealth, the Fall of Rome, and the Making of Christianity in the West, 350-550 AD.
3. Barry Cunliffe, Britain Begins.
4. David R. Montgomery, The Rocks Don’t Lie: A Geologist Investigates Noah’s Flood.
5. Evan F. Koenig, Robert Leeson, and George A. Kahn, editors, The Taylor Rule and the Transformation of Monetary Policy.
6. Martin B. Gold, Forbidden Citizens: Chinese Exclusion and the U.S. Congress: A Legislative History.