Assorted links


I wrote about how liberal Dane County, home of Madison, WI, has the worst racial disparities in the country last month:

It's not just Madison. Milwaukee's slums are very bad, even by the standards of Chicago.

In general, African-Americans tend to do worse in liberal places. Wisconsin is an old Progressive state with German social democrat tendencies. These work well with a high work ethic culture, such as that found among Wisconsin's Germans and Poles. For other cultures, generous welfare and other government services increase moral hazard.

"In general, African-Americans tend to do worse in liberal places."

Possibly, but not sure. I believe Hawaii ranks #1 among all states for smallest black-white gap in a number of statistics. On the other side red states like Tennesse and Louisiana have some of the highest crime rates.

Selection effect. Most blacks in Hawaii are probably soldiers or their children.

Louisiana is a red state?

La Griff du Lion described the effect and provided parsimonious explanation seven years ago:

I think there's other explanations at play. Being a liberal location a lot of handouts and welfare shelters etc. are a lot more generous than other locales. As a result Madison keeps attracting an itinerant crowd from other locations (e.g. Chicago / Milwaukee) who couldn't find help there.

Obviously this drags the stats down. The blacks doing reasonably in Chicago have no more reason to move to Madison but if you are out of luck in Chicago there's a strong reason.

There's a selection effect at play here.

Bingo. The black population increased by 50% in the past decade. What are the demographics of those people.

As some other researchers have noted, in Madison there is "a much stronger correlation than in some other states, between ethnicity and socioeconomic status".

Being a liberal location a lot of handouts and welfare shelters etc. are a lot more generous than other locales

Other locations like Chicago and Milwaukee, which are not left-wing now?

Steve Sailer would rather live in the Southside of Chicago than Madison's Eastside? Lolz!


It’s not just Madison. Milwaukee’s slums are very bad , even by the standards of Chicago.

That made me laugh. Sailer, have you actually been to Madison's "slums"? Pray, what streets did you visit?

Madison's "slums" are a joke by Chicago standards. By any standards really. Madison is as tame as tame can be.

I am someone who first moved to Madison a half century ago and have regularly visited since I stopped living there. A few points.

The point that the Af-Am pop has risen 50% since 2010 is telling. One of those isolated fringe communities is in a development I once lived in. It rather suddenly turned overnight from a place full of grad students and junior UW faculty into an almost entirely black and very poor neighborhood that became almost overnight a focus of much reporting about how troubled and crime ridden it was. One tidbit was that nearly everybody in it had come from Chicago. They were all very poor and uneducated to start with. I think it a bit silly to talk about Madison being a "KKK" like place bacause it has attracted a bunch of very poor uneducated people who cannot get jobs in its mostly high tech or academic or state government sector. What were they thinking when they moved there? Steve Sailer would probably get all bent out if they started getting hired as Assistant Professors or jobs at the state Department of Revenue requiring lots of education.

I would also note that the claim that there is no conventional black neighborhood is baloney. That neighborhood is in South Madison just to the east of Park Street and has been the city's established black neighborhood for many decades. It was there when I arrived, and it is still there. What were reporters for the WSJ writing when they made this false claim. I debated against the late Eugene Parks while in high school, who was from that neighborhood, who was on the Madison City Council for many years and also served as the city's main Human Rights officer, and was long considered to be the leader of the local black community and civil rights community more broadly until his death a few years ago in his late father's tavern, Mr. P's Place, on the southside.

The article, and certainly the silly commentary by Sailer, is wildly misleading.

Oh, and Benny Lava, the eastside (except for Maple Bluff) is indeed lower income and more working class than the westside, but it is not where the blacks live particularly. Most of the more problematic of those isolated areas are on the far southwestside.


Now here's someone who knows what he's talking about. @Barkley: In addition to the far southwest the northeast is turning out to be another hot spot.

Steve Sailer has no clue what he's writing about here and the Socialist Mag has its own agenda to push.

But he didn't write anything about any slums in Madison.

ObamaCare = OcommieScare. = OcommieScare.sov.

I'm sorry, but #6 is just irredeemably stupid.

The fact that you link stuff like this makes me seriously question the validity of your otherwise sound-seeming arguments on other matters.

Why is it so "irredeemably stupid"?

I personally thought the transition from "dairy farmers have political power over consumers" to "1 percent have canceled insurance" to be kind of a dropped ball. I mean, it was a good set-up. There are powerful producers in health care. That might be a better continuation, from farmers to insurers. But that the canceled will (a) remain angry, and (b) become a powerful interest group? Really?

What you're missing is concentrating on the "canceled" when the piece is really about voters who had cancellations or rate increases. Someone paying a couple extra hundred dollars a month is likely to remain angry.

He says both add up to 1%. No one really knows at this point. I know my Kaiser policy was safely grandfathered.

To be honest, it's like he's saying the Dairy Industry will be controlled by the animated minority who demand raw milk. Didn't really work out that way.

Actually, the piece is about the way insurance works.

When I had a mortgage and money, I paid $50-60 a month to pay to replace the stuff someone I didn't know lost in a break in, or to repair their home when a tree fell on it, or to repair the building when they set their house on fire. Maybe the people helped by the insurance payments were nice people, but why was I required to pay for their losses which are probably their fault - it they looked really poor then no one would break in to steal what would obviously be Goodwill rejects.

I ran short of cash and stopped paying and nothing bad happened, so obviously the authoritarian banks were forcing me to buy a totally useless product to spread my wealth around for their benefit, not mine.

Insofar as CNBC's Rick Santelli almost single-handedly launched the Tea Party with his spontaneous rant in Feb 2009, i) when NO prospective Tea Partier was having the Federal govt. inform him that his health insurance policy was deficient (according to standards decreed by the Federal govt.) and ii) when the Federal govt. was not yet responsible for initiating mandated health insurance premium increases and mandated enrollments, I'd say yes, the odds are quite good that the fomented anger will be alive and well through the 2014 elections if not also at least through the 2016 elections.

I rather doubt the c. 3,000,000 thus affected (so far) will all become raging Tea Partiers, but most won't have to: all they'll have to be are irate voters showing up at polls to let Obama and the Democratic Party know what they think of Democratic magnanimity. Thinking of "domestic volatility" as the character of the remainder of Obama's second term doesn't require wild imagination.

Santelli's appeal was to the majority burdened by the few nor vis-versa.

Are you an Elf-Lord or River Spirit? Or do you work for one?

One reason income tax works in the US is because the cost is "hidden" in most people's pay stubs, and many treat their free loans to the government as free money, i.e., "tax refunds".

If we all had to actually send money to the IRS and our state and local governments each April paying what we owe instead of having it automatically deducted every pay period, do you think so many would be taxed so willingly? My bet is that the tax system would collapse.

But then I'm not an Elf-Lord or River Spirit....

3) if you extend the idea of "wealth illusion" to government bonds, (1) can you really ex tempt corporate bonds from a similar claim, and (2) without bonds there really isn't much left (intangible) that is wealth. I guess it's a hard money (literally, coin) argument.

(1) If a country doesn't control its currency like say Italy, it is conceivable that an Italian corporate bond could be a better default risk than the government bond. In the U.S. I assume that the government would inflate away the debt so the corporate bonds would have the same "wealth illusion" . (2) There is equity and securities with claims to specific revenue claims that might be less "illusionary" And even general revenue bonds are going to have some value and not completely an illusion.

The value of corporate bond reflect an expectation about future profits of the company. This could lead to double-counting if others include those profits in *their own* wealth. Counting the bonds as balance-sheet liabilities is supposed to prevent this.

Government bonds are similar, they reflect expectations about future taxable revenue. Hopefully the assets that generate that revenue already have those tax expectations deducted from their value. This is a much fuzzier thing: if the "asset" is human being paying income tax, then what are we discounting from?

Not fuzzy to me. $17 trillion divided by 310 million is about $60k. That's $240k on my family-of-four balance sheet.

If you're a baby boomer of fortunate older Xer like me, you should take these numbers seriously. It's the grown-up thing to do, to pay for the mess on our watch.

More and more people are adopting this mentality, to the discomfiture of economists.

You can make arguments about the reliability of those bonds (please do, to improve my yield), but I think it is somewhat absurd to claim that markets are wrong, and the vehicle deemed safest in the world is just wealth illusion.

A rejection of markets to prove a fallacy of government?

Millwright? What does a millwright do these days? Adjust the level of the millpond to meet the quantity of wheat that must be ground into flour today? Are many people of color suffering because they can't break into that business?

Misc. agricultural workers are 92% white? These must not be any form of agriculture I'm familiar with. Is this a euphemism for indoor agriculture of a crop that can also be used to make rope? How do they gather statistics on that? Knock on the door? "No, no, I'm not a cop! I'm an economist!"

Millwrights build, maintain, and repair water turbines and pumps., especially in hydropower There are an awful lot of those. You seem to be confusing them with millers, a different occupation.

As to Ag workers, most ag is not in the fruit or vegetable business. It doesn't take a lot of workers to farm these days. Most minorities involved in ag are in processing. Also I would note that the chart is not labeled "white, non hispanic." Since I left the south I have only seen a couple of American farmworkers who could not be classified as either anglo or hispanic. The exceptions were asian.

Millwrights assemble and install all kinds of machinery, factory production lines, turbines, etc. Just as teamsters currently drive trucks rather than horses.

Based on the demographics, it's probably organic niche farmers or something like that like Cowgirl Creamery.

Not hailing from the Left Coast, I'd never heard of "Cowgirl Creamery". Apologies to the universe, et cetera, but upon encountering the firm's name, highly risible and most unfortunate visual associations leapt spontaneously to my wicked, evil mind, which of course I'm doing nothing to dispel for the moment.

Cowgirls, ropes, whips, and cream. Plenty of cream.

Hispanic criminals are frequently "white" for reporting purposes. "Hispanic" is an "ethnicity", not a "race" (the only one in fact) on the census as well. That data point about agricultural workers means there's probably something similar going on here.

The article on polygamy was weird.

Not only did it have a map that missed the whole of arab africa across the top where Polygamy was rife, but they managed to do the whole analysis without once mentioning the word "religion".

Now I know that social scientists like to pretend that religion doesn't exist, but in this case it is taking the "blind eye" approach to new levels.

They draw the dots between polygamy and the slave trade, but completely consider whether or not this is due to the fact that both slavery and polygamy are permitted by Islam.

If anything, Islam constrains sub-Saharan African polygynous tendencies. Islam places limits on polygamy and suppresses promiscuity.

"Islam places limits on polygamy" - islam only limits the number of second wives a man can have at a time, it does not discourage the practice. Even the formal limit is often circumvented by divorces or outright ignored. Margaret's comment stands.

I never said Islam discourages polygamy. I said that it places limits on polygamy and suppresses promiscuity in general, which has the effect of constraining polygynous tendencies, especially among people with highly polygynous tendencies like sub-Saharan Africans.

Margaret's comment doesn't stand because she ignores race and biology.

Yes, it's a pity religion was left out, but look at the data and learn something. Religion as the core of polygamy predicts lots of things contradicted by the data. It predicts a north-south gradient in west Africa and an increase in polygamy with time.

@#1 on John Cochraine's Grumpy Economist blog post: I don't trust this guy. I actually am sympathetic to his putative I-hate-Keynes views though. He makes the absurd statement that he "just learned" something new about Keynesian models, quote: "While fiddling with a recent paper, "The New-Keynesian Liquidity Trap" (blog post), a simple insight dawned on me on the utter and fundamental difference between New-Keynesian and Old-Keynesian models of stimulus. " yet he's an economics superstar, see Exhibit A below. Either he is lying or incompetent--which is it? I think also the confusion in this field may be the result of people talking past each other, see Exhibit B.

This is yet another reason why people don't trust economists.

Exhibit A:
John H. Cochrane - In real life I'm a professor at the University of Chicago Booth School of Business, a Senior Fellow of the Hoover Institution, and an adjunct scholar of the Cato Institute.
New vs. Old Keynesian Stimulus - While fiddling with a recent paper, "The New-Keynesian Liquidity Trap" (blog post), a simple insight dawned on me on the utter and fundamental difference between New-Keynesian and Old-Keynesian models of stimulus.

Exhibit B: (from Cochrane's comments)
Anonymous November 9, 2013 at 4:49 PM Neo-Keynesian and New-Keynesian are something different

BTW, I do not think that any serious Keynesian defends "what you spend does not matter, just spend" thing. Money shall be spent on high multiplier projects that will not create crowding-out effect such as infrastructure spending..

I guess you skipped the part of the post entitled "Models and stories".

John Cochrane alone wouldn't be sufficient authority for me to believe something, but in this case Nick Rowe agrees. I had been reading Rowe and others for a while and was still surprised to learn recently about the lack of unique equilibria in New Keynesian economics, and how much depends on the assumption that the economy will return to full employment (which is the sort of things Old Keynesians would emphasize you shouldn't assume).
My interpretation of Rowe's view is that most of the problems with New Keynesian economics go away if you explicitly model money instead of focusing on interest rates.

#6 will come home to roost for the doubters when, sometime next Summer, it becomes clear that the numbers of people facing significant premium increases and those who opt to drop their coverage is double or more the number of people who buy subsidized policies on the exchanges. This is going to be far worse than the supporters of ACA believe because they don't know that for most localities, the subsidies drop out long before you reach 400% of poverty level.

On Cochrane's piece, since I don't believe either Keynesian story, I find it amusing. On the New-Keynesian model, I do question the idea that after a temporary increase in consumption, consumption returns to trend, but leads to increased demand. What does that mean exactly? If I own a factory, I can be induced to increase my consumption today by ignoring capital maintenance and capital expansion, both of which are factors in the trend of future consumption. However, afterwards, I have to go well below the trend to make up for the capital deficit, so how is it that demand is increased again?

I find it interesting that there have been few comments regarding Cochran (#1). His article was obviously an attack on Krugman and his acolytes who believe that at least in the current economic situation, the old version of Keynes from the mid-1970's when Krugman was in graduate school still has a lot to tell us. Cochran points out that at least since the early 1980's no article using the structure of old Keynesianism would be accepted for publication by any semi-respectable journal. Ergo, Krugman is wrong. Cochran's assessment about what journals will publish is probably correct, but I'm not sure he fully understands why the journals don't publish pro-old-Keynesianism articles. I think a major reason is that old Keynesianism is regarded as too simplistic. The reward system in economic journals favors mathematical sophistication over insights useful for public policy. Krugman supports old Keynesianism because, as Keynes wrote, "It is better to be vaguely right than exactly wrong."

The black-white disparity in Madison has been well explained above. The socialist article accusing Madisonians of being racist has an even more straightforward explanation: you get more money out of liberal white polities by accusing them of being racist, then you do out of conservative white polities. They are going where the hunting is best.

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