Thursday assorted links

1. “And the real Dr. Ashkin wrote to his doppelganger in Utah with a remarkably generous offer. He said he would find a place for Hewitt in an actual physics program where he could quickly earn an actual Ph.D. and relieve himself of the stress of being an imposter. Hewitt declined and the university quietly dismissed him.”  Link here.

2. “For those unfamiliar with it, Dynamicland (from what I know of it, at least) is a computing environment at room / space scale. The room is the computer, and as much as possible, computing happens with physical objects. This enables you to interact with your whole body, to see systems by picking them up, and to share computing space with multiple people (compare this to traditional computing with a mouse and keyboard, with 1 person per computer and minimal sharing).

For starters, there’s a newly active twitter account showing off things…”  Source link here.

3. Books Mises wanted to see written: most of them still have not been done…get to work!  And the silent comedy of Jackie Chan.

4. Matt Notowodigdo recommends some favorite economics articles from the year, very good list.

5. Is the Republican tax plan raising the effective capital gains rate?  And for homes?

6. The game theory of recognizing Jerusalem, by Noah Feldman.


From #3, "Books Mises wanted to see written," I like this one:

"Book suggestion: Dumping: appearance of the idea and the history."

#6: I would say don't read too much into a symbolic gesture whose real world ramifications will be pretty negligible.

Well, the real world ramifications depend directly on how much people read into the symbolic gesture, doesn't it?

It'll be negligible if everyone remembers not to feed the troll, but that's a big if.

People can read whatever they want; their actions are still constrained by the facts on the ground, and an embassy in one city instead of another doesn't really change those. Whether this is meant to signal a shift in US policy in the region or not, I don't think it really will, I guess is what I'm trying to say.

Hey, flying the Nazi flag (no, I am not saying there is symbolic equivalency between that and moving the embassy) at the American Embassy in Israel would change nothing of substance, the USA could even keep allying with Israel.

OK, but I think the Israelis would prove themselves as unreasonable at this point as the Palestinians and Arabs are proving themselves now. And THAT would change things on the ground.

Important, if true.

We will never know, will we?

The Palestinians learned a long time ago that there are never any negative repercussions from the international community for anything that they do.

Firing rockets into population centers used to be regarded as a crime against humanity, but Obama responded by demanding that Israel open Gaza to Iranian boat traffic.

So this move might be a small symbolic step in the opposite direction.

"The Palestinians learned a long time ago that there are never any negative repercussions from the international community for anything that they do."

But plenty from Israel, which probably affects their decision making more.

I'll wager you 80% of the financial patronage has occidental countries at its source, either through direct subsidy or laundered through UN agencies. Why not start closing that valve?

Most Palestine refugees are kept alive by the UN's refugee bureaucracy. They have their own agency - UNRWA. Its budget is about $.123 billion.

Most of UNRWA's funding comes from European countries and the United States.

In 2009, UNRWA's total budget was US$1.2 billion, for which the agency received US$948 million.[22] In 2009, the retiring Commissioner General spoke of a $200 million shortfall in UNRWA's budgets.[23] Officials in 2009 spoke of a 'dire financial crisis'.[24]

In 2010, the biggest donors for its regular budget were the United States and the European Commission with $248 million and $165 million respectively. Sweden ($47m), the United Kingdom ($45m), Norway ($40m), and the Netherlands ($29m) are also important donors.[25] In addition to its regular budget, UNRWA receives funding for emergency activities and special projects.

The Palestinians get more aid per head than any other group of refugees in the world.

I think a reasonable person might ask why the West is paying for the terrorism that kills Westerners. If Trump wants to drain the swamp, I can see a quarter of a billion dollars lying on the street waiting to be picked up right there.

The article starts off unhinged, as is required at Bloomberg for all Trump coverage.

However, analysis in the middle of the article seems solid and I agree that this was a good negotiating move. It isn't world shattering but it may be solid signaling.

I know. Bloomberg is the worst. Except maybe for Pew. They claim only 32 percent approve of the president.

Is there any way we can unbias these polls?


Run your own to refute their results.

#1. I can understand why he wouldn't want to enroll in a PhD program just to earn a credential if he already understood the material well enough to teach it. However, it sounds like it more or less worked out in the end - despite his lack of credentials people eventually recognized the objective merits of his work. So does this indicate that credentialism is a big problem or not a problem?

Hewitt seems like an atypical case that really shouldn't be used to assess the American system of credentials.

I would suggest the issue is misrepresentation as opposed to credentials or lack of them. By the accounts he was smart and gifted, could teach as well. Someone found a good deal on those qualities.

"Hewitt seems like an atypical case that really shouldn’t be used to assess the American system of credentials."

I would agree with this.

Soi-disant libertarians anxious that their status in the faculty rat will fall have to talk about occupational licensure, drug laws, and 'mass incarceration'. They'd have no other topics to discuss if they acknowledged these were humbug.

You don't really need a PhD in physics in order to teach it at the undergraduate level -- in fact, many graduate students teach their first few semesters in the program. Being well organized and having a good speaking style is enough to make someone a good undergraduate instructor.

Bear in mind that this is all happening in the early 1950s, when American physicists were both rare and in great demand after the Manhattan project / radar / etc. And Hewitt wasn't looking for a high powered prestige job -- he was taking jobs lower in the pecking order, and apparently was a pretty good teacher.

I agree with the poster who said that Hewitt is an atypical case. There are probably a few people out there like Hewitt, but not many. Most people who have both the ability and the inclination to hold down a physics job have a PhD as well, because that's the first step you take in order to get those jobs.

Reference for #2:

5 the first seems silly, the second is important. Having a very profitable tax free opportunity distorts the market. The incentive is to limit supply and roll existing properties as opposed to developing new supply.

I wouldn't say it's silly exactly, but he's point out an edge case that isn't going to effect very many people. It might amount to a small tax increase for those that's only likely to effect individual with very large amounts of stocks.

It distorts the market. All taxes do, but some only distort. Serious investors won't pay, they will act differently.

I fail to see how the second issue will raise home prices. If anything it seems to make home ownership more unappealing which would have the effect of lowering prices.

That is what I meant. The current situation is what I was describing.

Correct this will have a small downward pressure on housing prices.

The 1st will actually be quite a pain unless tooling is in place to making compliance easier. I hope that the rules change will take effect in a number of years and not in 2018.

"6. The game theory of recognizing Jerusalem, by Noah Feldman."

This is much ado about nothing. Jerusalem has been the capital for decades. This is all a political charade.

That being said, this is a good article about the issue.

The Reagan tax reform in 1986 hiked the effective capital gains rate. It was treated like ordinary income.

The GOP quickly added rot to the tax code by carving out tax dodges and picking winners, like real estate pump and dump artists over construction workers.

If tax cuts are so Great, why was the Midwest so hollowed out after the Reagan and GOP tax cutting to create jobs and wealth since 1981?

Why is it the Blue States with poverty creating high taxes the place with housing shortages from high income working creating new businesses while low tax Red States have so much excess housing its falling into decay and needs to be removed to create a clean vacant lot to increase the price of ol still occupied 50s era houses?

The primary reason Blue States pay so much more SALT is incomes are much higher in Blue States than in Red States. The GOP seems to be seeking to cut taxes in Blue States by making them as poor as Alabama, Kentucky, Ohio, Kansas.

Texas has a legacy based on high taxes, high government spending and government tax giveaways, just by Congress picking Texas as a winner thanks to LBJ, et al., continuing FDR buying votes of blue dogs tradition. Texas has turned down only one influx of Federal money to create high income jobs, Medicaid expansion. Though Texas didn't defend the high income jobs for the SSC so that money ended up paying for investments in CERN. CERN gets credit for finding the Higgs, not Texas. But i guess that is worthless because it produced no hundreds of billions in capital gains.

Ah Mulp, it's good to see you back to your standard, Republican's are Evil Geniuses rhetoric. Exemplified by Trump, no doubt.

"Trump is an idiot, but all we can do is what he says, and hope for the best."

Yep, that's the problem with a monarchy. It's a shame we don't have some kind of system with a Check on that kind of power, to you know, Balance out the vagaries of one person or group.

"Son in laws make the best diplomats, in a democracy."

The diplomats under previous administrations sure did a wonder with the Israeli-Palestinian conflict.

"“Son in laws make the best diplomats, in a democracy.”"

I hear that Conyers endorsed his son for his Senate seat, too.

'"What about" is the highest form of political discourse.'

“Son in laws make the best diplomats, in a democracy.”

Sadly, as the FBI and various other government organizations are proving on a daily basis, Trump has little other choice. No one else understands what professionalism means.

Still, the previous effort at appointing a wife did not work out that well. Nor did appointing a fancy boy whose only career achievement was marrying the widow of a rich man. So be thankful that the SoS is not Michelle or some male porn star.

‘”What about” is the highest form of political discourse.’

So is "Yeah but it is totally different when we do it". These are the rules you just chose. You can live by them or you can die by them. But you cannot deny they are the rules you chose.

"We never have to ask for better, because we can always find an obscure "what" to "about.""

"‘”What about” is the highest form of political discourse.’"

That's a pathetically bad argument. It's not a logical rejoinder, but instead it's a weak form of special pleading. Your're attempting to restrict the criticism to just one person, when the basic issue is common and widespread.

Either you follow a set of principles consistently or you don't. It would be fine to say nepotism is bad. But to have a valid position you have to apply it consistently. So, it would be fine to say I decry the nepotism that both the Trump administration and Congress and politicians in general engage in. However, instead you resort to a juvenile tactic of trying to restrict the argument to just the people you don't agree with.

"“‘”What about” is the highest form of political discourse.’”"

Also, I missed the obvious. You don't understand Whataboutism actually. Whataboutism is when you deflect an argument by pointing out something unrelated to the topic. Conyer's endorsement of his son and Trumps Son-in-law acting as a diplomat are both examples of nepotism.

"Conyers futilely 'endorsing' his son, to no effect, is exactly like Trump sending his son off on diplomatic missions without oversight."

"They are *exactly* the same"

"On so many levels"

"Retired and disgraced congressmen have just as much personal power as serving presidents."

"Sons of congressmen with endorsements can just run off and make foreign policy."

Etc. Idiot.

"Etc. Idiot."

The true indication that somebody can't manage a cogent argument is when they just start hurling names.

Why is it the Blue States with poverty creating high taxes the place with housing shortages from high income working creating new businesses while low tax Red States have so much excess housing its falling into decay and needs to be removed to create a clean vacant lot to increase the price of ol still occupied 50s era houses?

The low tax Red States overall have much faster population growth, so surely the difference in housing shortages (and higher homelessness in Blue States) has to do with the much slower pace of housing construction in Blue States. Indeed, in my experience and in the data it's certainly the Blue States that have a higher rate of housing being still occupied 50s era houses. (Some of them, as in CA, are still the 50s era houses in name only due to Prop 13 and other tax dodges, but again that's on those states for bad governance encouraging that.) I certainly grant that with additional housing construction many more people might move to Blue States, and that it might even be better for the country. So one doesn't even have to claim that the Red States have better policy in things other than housing to realize that the housing shortage isn't a good thing.

Mulp and the Democrats in Blue States seem to be seeking to "eliminate poverty" by refusing to build houses (and using zoning to help do so) in an effort to force all the poor people to leave. It's vicious anti-immigration and anti-migrant behavior on par with Trump and the alt-right.

The "hot location" California problem is that any amount of housing (or transportation infrastructure) gets saturated in short order.

There are vouchers for housing, but formerly "low income" apartments can increasingly be rented higher up market, leaving vouchers and bearers with no place to go. Perversely, the economic recovery reduces low prices housing stock, increasing homelessness. It would take far more than zoning to change that. It might even take "projects."

"The “hot location” California problem is that any amount of housing (or transportation infrastructure) gets saturated in short order."

California doesn't have particularly high net migration . Both Florida & Texas have, for example, averaged 5 to 10 times the California rate over the last 5 years.

Cumulative numbers though. In 1960, around 16 million people lived in California. Today it is 40 million.

I was born here, but it often seems that most people I know were not. That shapes the way I look at things. The orange groves of my youth are filled with people. The freeway that used to fly with 2 lanes can't move with 6.

For comparison, in the same time Kansas went from 2 million to 3.

Texas went from 10 million to 30, a higher percentage growth, but a lower total growth than California in the same period. And of course they have a bigger sandbox.

This whole thing seems hard to assess at the state level. By “California” you mean two mega cities, the larger of which sits on the edge of a desert, the smaller of which surrounds a bay.

By Texas, you mean 4 or 5 cities from big (DFW) to medium (El Paso) but none that are enormous, and most of which are surrounded by plains, at least One direction, though one of the big ones also sits in a swamp.

#6. The Palestinians seems to play games a little differently than we do. As in, they are much more likely to resort to the "don't piss me off, I'm fucking crazy" strategy as a negotiating tactic. So, does Trump have bigger balls than Hamas? Can he win a game of chicken with them?

Someone should write something comparing the simple factual announcement of the Trump policy with the lies and self-serving BS of Kerry's lame duck UN speech.

This is a good point. My gut feeling is that, if anything, Trump's "irrationality" and his willingness to stray from the lame, predictable American foreign policy playbook should give Hamas/Erdogan cause for concern.

It is working great in Korea.

(Apparently the latest update is that we ARE going to the Olympics.)

(Apparently the latest update is that we ARE going to the Olympics.)

That is to say, the usual bed wetters are such bed wetters they invent imaginary fears to wet the bed over. There was no suggestion that the US was not going, but hey, those beds won't wet themselves.

Let's check with the one news source we can trust!

The feeling of prestige among civil servants was never imported to the United States. European reverence for government employees never transferred here. On the Mayflower, there were no civil servants. We can't understand the status of government employees — royal functionaries, colleagues of the great, considered themselves intellectuals. Selling postage stamps was "intellectual," but selling groceries proletarian. When wages of workers (even a simple worker) get higher than a government employee, the intellectuals, colleagues of professors, ask 'why should we get such small pay?'


People who sell postage stamps are not your problem. Ditto people who collect garbage, repair sidewalks and work on the cleaning crew at the war memorial. Ditto police and firefighters. Their managers are your problem (as they lobby for excess staff and then deploy and discipline them indifferently). Their unions are a problem (as they intercede for bad employees and lobby for bloated compensation). The elected officials ultimately setting their budgets and contracts are a problem. The public employees who are a problem in essence are social workers, school administrators, and lawyers (and the lesser sort among teachers).

I loved Jackie Chan did get a lifetime Oscar award this year and I wish they would have included his speech during the Oscar ceremony. This is especially weird as the Oscars are getting more international flavor the last several years and honoring an Asian action star fits that narrative. Just look at the international movie grosses of any action or animated sequel and it is not a mystery why they are moving more International the last decade.

Well I would tell everybody to watch Project A 1 & 2 as it was his slapstick comedy action movie yet.

Agreed - Chan is a genius.
The stepladder fight scene from First Strike is my personal favourite.

What was his golden age? 1983-1996?

Jackie Chan = Australia's most popular actor.

Or rather, I should say Jackie Chan is, or was, the world's most popular Australian actor.

Reducing the capital gains exclusion for selling a home (here, a limited move of requiring living in the home more to get it) combined with allowing a capital loss for selling at a loss (not under discussion) could be an interesting move to address inequality, especially since so much of the recent gains in wealth inequality are rents in housing. The disadvantage is primarily the paperwork and record-keeping, which currently can be almost entirely avoided for many people. (If gains and losses are possible, then people must keep track of improvements, and of course distinguish improvements on a house from mere maintenance, which leads to the possibility for intentional or unintentional inaccuracy.)

5. Of course, these are just two ways Republicans stick it to middle and upper middle class taxpayers. As for the second change (to the requirements for deferral of gain on the sale of a principal residence), other commenters treat the deferral (it's not an exclusion it's a deferral) as some kind of indefensible loophole, but it facilitates owners who wish to sell their residences so they can move someplace else. How many times has Cowen posted on the need to adopt policies that encourage people to move. I don't have strong opinions about this, but the grab bag of tax increases in the Senate tax bill to keep the increase in debt caused by the bill to "only" $1 trillion is outrageous.

It's an exclusion, not a deferral. It's not a like kind exchange where the gain reduces basis, the gain is just not recognized, being excluded from income.

1) Great podcast segment on Marvin Hewitt:

#5..".It will become less efficient to buy into the same broad market index mutual funds over time, the way most sensible advisors recommend today. This also works to the advantage of the mutual fund companies, who have a whole gang of higher-priced funds to sell.

Investors might also prefer to take untaxed portfolio loans rather than realize capital gains. Enterprising platforms might find ways to let their investors re-register their investment accounts as mutual funds. That's the fun part about unintended consequences -- we never see where they will go."

"As I wrote in The OverTaxed Investor, "A stable but imperfect code is preferable to one constantly changing according to whatever latte-swilling K Street lobbyists are plating up for our representatives. The constant tampering with the tax code by Senators and Congressmen buying and selling favors results in less efficient revenue collection than under a predictable, steady-state system."

There is a silver lining. As an investment advisor, I will make more money helping clients minimize their taxes under the new rococo regime. In fact, the more bewildering, the better. Thank you, Congress. Keep up the good work!"

Special Pleading of the Day..."The hard-lobbying mutual fund companies have carved out an exemption to this rule for themselves." Presumably, these taxes, laws, codes, etc., are meant to be evenly and equally applied as they are based upon a common reasoning concerning the issue, taxes, etc. But no. Instead, a particular business or industry must needs extra help to fairly compete. This is the basis of our system. Exemptions on demand. Is there any industry that does not feature Special Pleading? This is Oakeshott's point. In a culture of Special Pleading, don't bullshit us about caring about fair rules and competition. Either you believe in it or you don't.

When you read the experts who contort their bodies to reach certain conclusions, where you can't reason through the math, at least make a list of qualifying terms used in the essay ( it could be that, it seems likely, one possible explanation, etc. The experts always want to have an out position should the essay be deemed crap generally. Of course, Keynes General Theory is full of qualifications, as well. And, watch out. Economists are slowly cornering the market on bullshit, even as we speak.

"Hewitt returned to Philadelphia, bringing his wife to live with his mother. By now Hewitt’s father had died. He and another police officer had been gunned down by a car thief."
Such is life in America!!


I wonder if he's single. (yes, he reveals that he is, but I'm still making this comment)

#3 An uninspiring and unimpressive list, especially in the later years.

#5 It is too clever by half to defend an idiotic accounting loophole that is abolished as a loss of "one of the most important" tools of investors today (i.e. the bill abolishes the right to distinguish between fungible shares of stock purchased in a particular lot for capital gains tax purposes for individuals), although umbrage at mutual funds for receiving special treatment denied an individual investor isn't wrong.

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