Wednesday assorted links

1. Megan McArdle on Elizabeth Warren, recommended.

2. Damien Ma Iowa China podcast.

3. “The church wants to attract more young families. The present members, most of them over 60 years old, will be invited to worship somewhere else. A memo recommends that they stay away for two years, then consult the pastor about reapplying.”  Link hereCottage Grove, Minnesota.

4. “And the island’s puffin population has almost trebled in 15 years.”

5. Rent control #TheGreatForgetting.

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Zero-sum game underway between puffins (Northern hemisphere) and penguins (Southern hemisphere)?

Today's score: Puffins, 1/Penguins, 0.

Yes, but 538 had a recent piece on how well the Penguins have been able to hold it together in spite of a number of injuries of the type that would cripple most teams.

A+ comment

It was as good a comment as Bryan Rust has been at scoring this season.

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Would make for a good rivalry, but the recent link about puffins using tools said nothing about hockey sticks

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I love it (not) when people want to give other people Rights that don’t exist. In the US, we have a Law based Right to own private property and there are laws that protect that Right. More specifically, in the US there is a law around Government Takings. Rent control is the taking of people’s property. I get / deeply appreciate the values side of the argument but values are specifically established not only because of the limitations associated with Rights but the slippery slope associated with turning values into Rights (having a home is not an unalienable Right) and ultimately Laws that blatantly violate Rights - especially those protected by laws.

Now you're the one who is making up rights. Rent control does not remove anyone's ownership of anything. Beyond that, it's all just interpretation/values.

But asset forfeiture does.

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Everything is "just interpretation/values".

But rent control sure sounds like a takings-level infringement of property rights, just like "you can't sell this at all" would be - despite "you can't sell this" literally not affecting "ownership".

Note that OP did not say "ownership", but "property rights", and "taking". Taking is a a term of art from that "Constitution" thing, which, you know, does establish enumerated rights in the US?

Rent control is an oppressive and abhorrent socialist inspired policy. It does not work, creates a semi-lottery system where some renters get great deals at the owners expense while other renters get left out in the cold. Fix the problem not the symptoms. Reduce the regulations and fees required to build homes. Reduce or eliminate property taxes. Reduce the regulations requiring new homes to include politically inspired extras. Make more buildable property available. Get the government out of the process.

If you can use the awesome power of the federal government (or local government) to tell people what their rents or wages can be, why not set a maximum wage as well. Set the minimum wage to $15/hour and the maximum to $30/hour. No exception, even for CEO's and self employed. After all if it is such a good idea lets make everyone live by it.

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Regarding #3, the Methodist church is already struggling with a proposed split over the issue of gay marriage; they don't need publicity like this story right now. It seems that the real issue is the core group is too insular/too unwelcoming to outsiders, so the church hasn't grown. If that is indeed the case, you'd think that a new minister could work on that - e.g. inspire the core/base to adopt a new, welcoming stance and practice outreach. But effectively throwing them out of their own church won't solve anything....and I seriously doubt that's one of the acceptable practices in the Methodist's Book of Discipline.

Problem #1: they have a Book of Discipline.

The alternative is ... making up your rules as you go along?

Every big organization has bylaws, necessarily.

(Note to entire thread, the UMC is the one in question, and is not the only set of Methodists, though I think it is the largest in America.)

The pun...

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Christians already have a rule book. It's called the bible.

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Keep in mind, Trent, that in Methodism, congregations do not select their ministers. Bishops assign ministers to congregations.

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This is very reminiscent of something that happened at a friend's Methodist church. The old dude who had probably been faithfully attending for fifty years, through all sorts of changes, highs and lows, long before women pastors, long before it adopted the gay-pride flag for its logo, long before it became more of a social-justice "center" than a church - none of which he had any sort of problem with, if he even noticed - was told he could no longer usher. His hail-fellow-well-met, corny old-guy patter, with which he had always greeted everyone, was off-putting. Or over-friendly. Or the wrong image. Or something. They didn't say.

No sense of how that might hurt him. Or of how his manner might reflect his best effort at connecting with the world, given whatever limitations he has, as we all have.

So little charity, so much cold hubris.

So what? Such is life. Don't you think the Pope got annoyed when Protestants ditched him? Don't you the Pharisees had hurt feelings when the early Christians ditched them?

Do unto others as you would have them do unto you.

It is not that simple. It is written: "The father shall be divided against the son, and the son against the father; the mother against the daughter, and the daughter against the mother; the mother in law against her daughter in law, and the daughter in law against her mother in law."

Being the hit-and-miss document it is, a morbidly excessive interest in the Bible, obscure corners and all, is decidedly a Protestant failing. But I guess it gave them something to argue about for a time. Now they've moved on to new ways of separating themselves. It's starting to seem like the arguing is all. It definitely didn't seem like that at Wednesday night supper, Trinity Baptist Church, circa the 1970s. But the people were there, I expect, for reasons much older, simpler and better than sectarianism.

They were old then. They'd be really old now! Old enough to make a thoroughly modern Methodist minister tremble. And the mashed potatoes were powdered!

My point is that, all things considered, to every thing there is a season, and a time to every purpose under the heaven: A time to be born, and a time to die; a time to plant, and a time to pluck up that which is planted; A time to kill, and a time to heal; a time to break down, and a time to build up; A time to weep, and a time to laugh; a time to mourn, and a time to dance; A time to cast away stones, and a time to gather stones together; a time to embrace, and a time to refrain from embracing; A time to get, and a time to lose; a time to keep, and a time to cast away; A time to rend, and a time to sew; a time to keep silence, and a time to speak; A time to love, and a time to hate; a time of war, and a time of peace."

Tudo é vaidade!

Exactly.

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Why in portuguese?

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Seriously, you lost me. I'm clinging by a thread, I'm from freaking Arizona here.
"If the clouds be full of rain, they empty themselves upon the earth: and if the tree fall toward the south, or toward the north, in the place where the tree falleth, there it shall be."

"... I'm from freaking Arizona here.

Then you'll know that what has been will be again, what has been done will be done again; there is nothing new under the sun. Especially MR commenters. Some are goofily faux-Brazilian when it suits them. If you doubt, google "Marginal Revolution Thiago Ribeiro", circa, uh,, 2016? Or Marginal Rev'n. War of Paraguayan Aggression. Or President Captain Bolsonaro. Sporadically amusing - but better not to, on the whole. Knowledge is powerlessness in this case as in most others.

That had occurred to me. In the middle of the night I decided that google had confused me and that your "all is vanity" was Latin.
I wasn't getting the Thiago vibe off "Joseph Lewis", but I see you are right.
The multiple identities are thick and fast these days, but in a mostly cheerful way that our host has pointed is a positive contribution to the chatter.
This new guy doing word salad makes me misty-eyed for Clockwork Orange. If he is one and the same, I hope his game gets back up to his old poetic magnificence!

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This is not quite as shocking as it seems in the clickbait titles that various websites have given the story.

The church has only 25 members and is financially unviable. The UMC cannot pay a pastor, so the members just show up and do some readings on their own.

It's more of a closing of a failed church with an almost simultaneous opening of a new church with updated facilities and different kinds of programs that might appeal to young families.

Asking the current members to keep a wide berth is, admittedly, unseemly. You can see, however, how an existing, set-in-their-ways group of seniors could discourage new members.

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Minnesota nice on full display.

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#5. "Among economists, rent regulation seems be in similar situation as the minimum wage was 20 years ago. "

Yeah... As something that has negative effects which are true and obvious, but which no longer fits the ideology of economists. So, we have to forget everything we knew about these subjects and retconn some new 'facts' to justify them.

Have you read any studies of the effects of minimum wage laws lately?

Probably not, given the empirical evidence largely is in favor of little to no employment effects from minimum wage increases. You still see a few holdouts (AKA Neumark), but most have come around on it.

I'm not surprised the same thing is happening vis a vis Econ 101ist arguments about Rent Control. I still think the empirical evidence is against rent control as a policy, but it really depends on the details (a rent stabilization law with a cap on annual rent increases beyond 5-10% is probably not going to be a huge barrier on rental housing construction except in times of high inflation).

"the empirical evidence largely is in favor of little to no employment effects from minimum wage increases."

Wasn't there a Chicago survey on this?

Of course if you make a tiny change in minimum wage and employers cut hours a little and work everyone a little harder it's not going to show up in the unemployment numbers, but obviously there is an effect.

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If I recall correctly, the Seattle study pretty definitively showed a small but real and significant reduction in employment and take-home earnings amongst the minimum-wage class

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This seems like a pretty inaccurate assessment of the literature. The typical study finds a modest but significant disemployment effect. Most studies (like most high min wage laws) are in cities where the cost of living and thus prevailing wage are already high enough that increase doesn’t effect even many low skilled workers (and over time they tend to migrate to places with lower cost of living and, incidentally, lower minimum wages; see I think Clemens’s studies on unskilled migration patterns).

So it’s not a matter of Econ 101 overstating the case or monopsonies being rampant. A modest minimum wage increase in an expensive city causes little harm because it does hardly anything at all. The converse is true too: you could lower the minimum wage in San Francisco to 7.50 and hour, and there won’t be some dramatic fall in wages, since hardly anyone would work in SF for 7.50 anyway. Few of these studies that look at effects on income, but one was done I think in Germany last year, and what they found was that raising the min wage didn’t have a significant effect employment or on income; IOW, it had neither a positive nor a negative effect. It was essentially useless. I expect this is what most innocuous minimum wage increases look like: they are harmless because they have very little effect at all.

But trying to impose San Francisco minimum wages on Boise, as some politicians want to do, would definitely vindicate Econ 101.

I’d also add that the empirical case against rent control is actually quite robust; the upward movement of wages tends to render minimum wages innocuous, while the upward movement of housing prices exacerbates rent control. Sorry, but there’s no excuse for rent control surviving this long as an idea.

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Yes, I have. The studies that show little to know unemployment effect have looked at small changes, and the effects of small changes are hard to tease out of the data. Nonetheless, they were used to refute decades of other studies showing negative effects, and since the minimum wage has been increased by larger amounts in various jurisdictions, new studies have definitely shown a rather serious and negative effect on unemployment - especially among the least qualified minimum wage employees. As previous studies, basic theory, and freaking common sense have always shown.

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$5 - JW Mason arguing for rent control was well argued, but, as a DC slumlord myself in the 1% (min. net worth greater than $10M) I would say the seeds of Mason's rebuttal is found in his arguments themselves: that rent control only damages the supply of rentals over a span of 40 years, and that's "too long" to worry about. I disagree. Forty years is a blink of the eye. The same argument is made in patents: why allow patents for anything since people will invent regardless, and any temporary patent monopoly is bad? This may be true for the short-run (inelastic supply, indeed most people in the short term are drawn to the scientists invent regardless and don't care about either patents or even making money) but the long run supply curve slopes upwards, and lack of incentives will skew the curve to shift to the left (lower supply; anybody who wants to make money will go into business and not science).

Bonus trivia: this was a good JW Mason post: https://jwmason.org/slackwire/utz-pieter-reich-on-the-nominal-and-the-real/ (nominal is more 'real' than 'real', has implications for PPP and for historical "real" values that don't include hedonistic adjustments).

Ray, per St. Greta 40 years is more than THREE times the lifespan of the earth if we all don't go back to living in "Stone Age Splendor".

Except that the elites get to keep Jetting around as if there is no crisis what-so-ever. Don't you keep up with the famed magazine-of-record Time?

Oh man I've never seen a snarky joke about Greta and AOC and the 12 years until doom before! You should be on Laugh-In!

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In the absence of rent control or other measures to control housing costs, an area that sees rising productivity or improved amenities may see a sharp rise in rents and become affordable only for higher-income households. Besides the questions of equity this raises, there are economic costs here, as it becomes difficult for people holding lower paid jobs to live within commuting distance;

If only there were some theory to explain what might happen in situations when local labor supply shrinks and demand increases or remains constant.

Wages must rise!

+1, Along with the CPI but in many large metropolises, this is eclipsed by housing costs and overall inflation.

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This, for god's sake. There is hardly a greater indictment of the thinking skills of modern economists than the broad warming to min wage laws. Insufferably dumb.

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#3 is especially awful considering the support & socialization that church communities provide to older folks.

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Shorter McArdle: "Yes, Warren is full of it, but of course I'm going to vote for her anyway."

Vote for Warren!

Look at Venezuela. Everyone is rich. The monthly minimum wage (there were 11 increases in the past two years) 27,091 bolivars with an additional 63,720 bolivar food subsidy. [Sarcasm switch to off.]

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With the recent discussion of Will Wheaton’s latest political fashion statement, my thoughts turned to McArdle? What has become her? Ah, she’s still at the WaPo? She must be keeping her head down. No room for heterodox thinkers there, or at her former employer, Bloomberg.

My wife and did enjoy her columns about cooking and the latest cooking gadgets.

Those columns have basically disappeared at the WaPo. She started a separate blog for them ( https://cookerymonster.com/ ), but hasn't been updating it much. The usual holiday gift guide was most recently done as Twitter posts.

Thanks. I stopped following McArdle once her writing moved behind the *WP* paywall, but at least I can find her cooking posts, which were particularly enjoyable.

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Why is it important what somebody unoriginal says about somebody who won't get elected?

Because she name checks Tyler. But you probably already knew that.

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#5: Loopholes and escalator clauses aside, all those benign effects of rent control are likely found because they are short run and they are local. Of course building will not be torn down today just because of new rent control laws, but they will be allowed to deteriorate. A small locality with rent control is merely limiting its population to that which fits into the existing housing stock.

For large localities and in the long run, as Assar Lindbeck said, comprehensive rent control is as effective as aerial bombing in destroying cities. Anybody who doubts that should look at pictures of the South Bronx in the 1980's.

A much faster way than the depreciation story, and what will actually happen, is that the landlord will sell #6 rental unit and buy #8 owner-occupied unit next door. Or sell #6 rental unit and we have fewer rental units. Rent control makes sense if you macroeconomically favour owner-occupation, because it is a good way to vaporise existing rental markets.

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Rent control gets implemented and construction doesn't increase (because it was already very difficult at the pre-rent control margin; perhaps due to byzantine zoning and permitting laws) and therefore supply and demand doesn't work? Oh wait, you think your model can aggregate multi-faceted and inconsistently applied local zoning and permitting laws into a single variable? Got it, that all makes sense. Rent control is good.

*decrease

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1. McArdle knows class conflict. Don't focus on the 1%, or even the quintiles a few above, focus on the poor saps in the quintile right above you, where you aspire to be and they fear to leave, for they are a few paychecks away from being where you are. McArdle excels in low class, class warfare. McArdle is not alone: everybody, it seems, hates the middle class, especially the white upper middle class, college educated, liberal on social issues, with a house on a cul-de-sac in the suburbs, and a net worth dependent on rising asset prices that is a financial crisis from annihilation. Be afraid, very afraid, you middle class losers.

I don't think you know what the word quintile means.

Quintile: any of five equal groups into which a population can be divided according to the distribution of values of a particular variable. Do you have a different definition?

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5. That's a very disingenuous analysis. Obviously, rent regulation which (i) includes vacancy decontrol and (ii) doesn't apply to new construction will not reduce housing supply. The primary effect will be on housing quality, and landlords who receive below market rents will skimp on maintenance until the quality of the housing is reduced to market clearing levels. There is also a negative welfare effect, as people are "locked in" to housing sub-optimal for their personal situation, but of course economists only measure consumer welfare effects when evaluating Trump's policies.

I mean devil's advocate -- and I live in a rent controlled apartment.

Yes it's crappy. Coin-op laundry. Not enough electrical. No garbage disposal (not to mention dishwasher)...

But it's half the cost of an equivalent (in terms of sq ft and bedrooms) apartment.

I'd much rather save 750/mo than have a nicer apartment. If not for rent control, I'm 100% sure my landlord would spruce the place up, add a combo washer/dryer, a dishwasher, and double the rent.

Of course you're totally right on negative effects:

* I was originally going to live in my 2br alone, since it's cost was the same as the next best 1br basement type units in the area.

* I definitely don't intend to move (since even 10-15 miles away a 1br costs more) which means my commute is now longer than it would be

Still, if there were more cheap dumpy apartments for cheap dumpy men like myself to live in, I'd be really happy.

May I say, that I'm really glad this government policy takes welfare away from others in order to benefit ES. I always want a bureaucrat to decide winners and losers.

Yep - the simple fact that rent control creates such a steep distinction between the haves and the have nots should be enough to classify it as a terrible idea.

In fact, don't we have great big wars about haves and have nots? You know, with people saying that just because you're born into something shouldn't give you these wonderful benefits?

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If ES would never consider moving, that means his landlord has plenty of room to let the quality of the apartment deteriorate further. Will the basic integrity of the landlord class prevent this? Will stern, dedicated bureaucrats be able to effectively regulate ES's landlord and overcome what economic rationality tells him to do? What does anyone think?

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"There is also a negative welfare effect, as people are "locked in" to housing sub-optimal for their personal situation..." The author acknowledges this, but tries to spin it favorably as "neighborhood stability"

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#3 - Could we do the same with municipal planning/zoning meetings?

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#1: I find it *insane* that we are talking about Warren in a libertarian context. Really, this is stuff that Ayn Rand couldn't think of. Now, I understand Trump is no libertarian either but I don't see a lot of libertarians saying he is! Both Warren and Bernie are the personification of big government bureaucrats and to try to frame them in any other context is a total and complete absurd. By the way, the whole "college loan forgiveness" is one of the most mesmerizing issues of all time to me. Are we saying that there would be no more student loans after that? Are we really saying that all private colleges would be turned into government funded entities? If not, are we saying only people with money to pay the tuition can attend them? Seriously, why is no one asking these questions and pretending this is some kind of libertarian debate?????

Then are those that have paid off their student loans reimbursed or do they become the vanguard of a civil war.

Details, details. Fauxcahontas is a heap big picture-thinker.

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It's Cowen/McArdle that are genuinely evaluating and considering Warren in a libertarian context, not "we".

Trump has flaws, but by any reasonable definition of libertarian, Warren is much further away from that than Trump is. And Cowen/McArdle and others are being more than a little bit unreasonable and even dishonest on this.

Cowen doesn't fully support Warren, but is clear that he doesn't oppose or discourage supporting her for President. And he strongly opposes Trump. McArdle is clear that she loudly, clearly supports Warren for President against Trump. This isn't remotely libertarian or anything close to libertarian.

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FYI,

But you are probably unaware that "libertarian" is a word that originally came out of the left wing in France in the 19th century, with its more individualistic right wing version only appearing in the 1950s. In the 1920s there were people calling themselves "libertarian communists" and Noam Chomsky calls himself a "libertarian socialist," a term that apparentlyi the late James Buchanan applied to himself a few times as well.

Super neato factoids. But Warren is a Presidential candidate in the United States of America which lends context to the use of "libertarian" and "Libertarian".

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The NYT has a girls' magazine-type 20-question quiz out, with which you can match yourself to your perfect Dem. candidate. My husband took it. How'd you do? He got Biden, 8/20. His worst match was Buttigieg, 2/20. I told him that surprised me: as far as I knew, Buttigieg was one of the ones who's not a socialist. He figures it's because Buttigieg is so young, versus the Boomers, who are necessarily going to be more normal just by sheerest virtue of when they were alive. Even Bernie. Yes, I reminded him that Bernie wasn't technically a Boomer.

This kind of partisan crap is so freaking boring. It's the equivalent of calling Trump a fascist.

Oh no, I certainly didn't mean to suggest Biden was anything!

You didn't need to be surprised your husband's closest match is Biden, as Biden is also "one of the ones who's not a socialist".

My surprise was Buttigieg not scoring higher with him. Despite the oddity of his parents (shades of Obama) Buttigieg seems perfectly anodyne to me.

Biden's election would be a matter of indifference to my husband, as I expect to most people. Indeed might well be good for him in a purely narrow, personal way, depending on whom Biden put at Interior, Fish, Forest Service, NRCS, etc. ...

May I cross the bridge now?

Sorry to detain you

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5. BTW, rent regulation which includes vacancy decontrol and exempts new construction may meet all the desiderata of non-ideological politicians (which is most of them), i.e., it advantages a large but manageable class of local voters at the expense of people who do not currently live in the jurisdiction, without seriously diminishing property tax revenue.

I've semi-joked that rent control is basically a way for cities to provide public housing without having to pay for it. It's no wonder it's an attractive political option - if they wanted to spend a ton of money on affordable housing, they'd just build public housing.

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"the rents 40 or more years in the future are simply not a factor in the construction of new housing"

Remind me not to send kids to John Jay College of the City University of New York.

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#3 Can't we just throw old people at the sea?
#4 It is good to see good news environment-wise. Another piece of good news: Brazil's leader, President Captain Bolsonaro, has ordered a federal initiative protect Brazil's rain forests.
#5 Rent-control is not perfect, obviously, but society needs some tools to make sure there is an adequate supply of houses to be made homes by American families.

Re: #5

Perhaps I'm misunderstanding you...but rent control, in most of the prevailing economic theories, slows the supply of housing.

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Can anyone explain to me, a non-economist, why raising the minimum wage has no effects on employment? (Obviously, everyone would agree that raising it high enough would have effects on employment, but why is it the case that raising the minimum wage in Arizona from $11/hour to, say, $15/hour has no effects on employment?

Yes, a minimum wage of $30 ph say would have an effect on unemployment. In fact, most of the evidence shows a small negative impact of minimum wage rises on employment, but sometimes it could just be random chance. The standard story for smaller increases is that poor people can't negotiate, but this applies to wage increases more like +20c than +$10.

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Neumark's story [referred to by Brett, way above] goes like this: An increase in the minimum wages leads to churning into and out of the labor force. The low skilled get laid off, but drop out of the labor force [a fact, not a necessity]. More productive workers, currently not in the labor force, are attracted to the higher minimum wage jobs, and they are worth it to the employer. Where do they come form? They drop out of high school! These costs of the minimum accrue in the future, when the labor force is less skilled than otherwise. Meanwhile, change in measured employment equals zero.

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The problem is that you're asking the wrong question. The correct question is:

"Can anyone explain to me, a non-economist, how is it possible for a study designed by supporters of a higher minimum wage to conclude that raising the minimum wage has no statistically-significant effects on employment?"

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1. I don’t think you can draw such broad conclusions about people based on income. What evidence is there that upper-middle-class people are more protectionist than billionaires? You can probably find protectionists and people who welcome competition among all classes. If anything, it seems to be more of an age issue, with younger people being less protectionist. My social and professional networks are mostly younger upper-middle-class people and politically we complain all the time about NIMBYs and arcane licensing rules. And while some billionaires did get rich by disrupting cozy local monopolies (and good for them), there are plenty of others who got rich in protected industries and through government contracts too.

In terms of who is causing more inequality though, it really is the top 1%, and probably more like the top 0.5% or less, not the top 10%. Look at the third chart here (and ignore the misleading horizontal line that is at 1.5% instead of 0): https://www.vox.com/policy-and-politics/2017/8/8/16112368/piketty-saez-zucman-income-growth-inequality-stagnation-chart. There seems to be an inflection point around the top 1% where income growth goes from a mild slope to an extremely steep one.

The real inequality problem in my view is inequality of wealth rather than income. A person who comes from nothing is never going to catch up with a person who starts with a $5 million inheritance without a high amount of luck. Even if they make $200,000 a year every year in their job that’s just going to match a conservative investment return on the $5 million, and they’ll have to pay higher taxes to boot. That defeats the idea that anyone can get to the top through their own efforts. While a wealth tax seems hard to administer and I don’t support it, I do support generally efforts to shift the tax-burden from income earners to wealth holders, and am glad Warren is bringing that discussion to the table. At a minimum, taxes on inheritance should be increased and rules that favor inheritance over wealth earned in one’s own lifetime like step-up basis should be abolished.

Because it's bad enough that a person develops skills and talents that allow them to generate a high income for a year, and it's even worse that some of these people persist in providing these services for many years, and then to top it all off, they save and invest it in even more productive activities that and up creating even more stored wealth.
Just imagine all the destruction these people wreak on society by being productive, saving for the future, investing in other productive assets! And if their vision of the future includes helping their kids, well too bad, we are going to impose Plato's Republic where philosopher kings rule and the state seizes and raises all the kids equally, except of course the philosopher kings' kids get sent to the best schools and get invited to sit in the philsopher king court, given their good breeding.

Yes help your kids, but do they need $1 billion?

Do they need $200?

They’ll be fine regardless and that money would be better spent on malaria nets and HIV meds. Don’t split hairs.

Forget common sense, go to the extreme and declare uh, victory, I guess.

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1) Before the WaPo paywall comes crashing down I can see the headline -- The Issue with Warrren Can Be Summed Up in a Single Question. But I'm left to my own devices to guess the question --- kind of like some ditzy contestant on The Match Game or Family Feud.

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#5 Econ 101. Plot the supply and demand curves for housing. Draw the rent control line. Plot the supply and demand curves for labor. Draw the minimum wage line. It's two sides of the same coin. You can't argue with the market. Next, see what happens when a market has both a minimum wage and a rent control. Discuss.

Ah, but in Econ 301 they let you know that supply curves of labor can be backward bending. Did you get that far in economics, Dominic?

Pigs can fly indefinitely if shot out of a cannon at escape velocity. Doesn’t mean that I expect to encounter a flying pig in everyday life.

Similarly, niche theoretical economic constructs rarely find broad application in the real world.

Sorry, Jody, not a "niche theoretical economic construct" at all. You seem not to know much economics.

As for the matter of what happens to the employment with an increase in minimum wages, the emprical debates over this are ongoing, but anybody who simply dismisses the possibility that employment might rise with at least a small increase in minimum wages because that is what an Econ 101 textbook would predict is not a serious commentator on all this.

As someone noted, one reason one may not see a decline in employment is that those holding jobs may be much less inclined to quit them. Of course, a sufficiently large increase in the minimum wage will bring about the Econ 101 textbook prediction, but how much that is depends very much on specific situations.

All true.

Now do the labor market for ex convicts. I want to know what happens to those whose market clearing wage is actually close to or at the minimum.

We can ignore the reservation wage effects of raising the minimum for now.

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An apt metaphor for the bending over backward contortions required to produce math showing that minimum wages don't reduce employment and rent control doesn't reduce the supply of rental properties.

The profession of economics has seemingly run out of useful things to say, so they spend their time rehashing this garbage.

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5. In summary, standard economics predicts that rent control will lead to a shortage of rental units. But the evidence actually shows that rent control laws have a negative effect on the supply of rental housing by encouraging condo conversion. Therefore... economics is wrong... because housing construction isn't affected?

Jesus Christ.

Ah, in his comments section he makes his motivations known:

"I think everyone has a right to remain in their homes. I don’t see security of tenure for renters as charity for the needy, but as a basic feature of a civilized society."

This reminds me of the recent Piketty-Saez-Zucman fiascos in which shoddy economic analysis was later revealed to be shallow (and poorly done) rationalizations of pre-existing non-economic ideological convictions. Like Arnold Kling says, econ might be turning into sociology.

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#5 Great article, well written and succinct. One of the more salient points about egregious landlord actions is related to housing discrimination, whereby landlords blatantly ignore federal laws for disabled access when and if they can. A more sensitive issue, especially in large urban areas, is racial discrimination as well.

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1. This is a somewhat useful framing, but I don't think it really dares to address the billionaires question in all it's political facets.

News this week was that (billionaire) Crown Prince Mohammed bin Salman hacked (billionaire) Jeff Bezos cell phone.

This says to me that the horse has left the barn, and we live in a world of sometimes battling sometimes conspiring billionaire oligarchs.

So yeah, a strong argument for Warren.

Now there’s a non sequitur if ever one existed.

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We are primates. As primates, we're more concerned with the interests of our family, troop, and community, than with people we don't interact with. This is how we rationalize buying the new sous vide joule that we read about courtesy of Megan when we know there is someone starving or homeless out there in the world (cognitive dissonance?). When it comes to our children, it's even easier. It's not that we want poor kids to get a bad education. It's that we want the best for our own kids and we'll work, save and spend to get them into the best districts. The question is where is the right spot on what I'll call the social Laffer curve (because I don't know if there is a term for it). Redistribute too much, and you lower incentive, GDP, opportunity, and quality. Redistribute too little and the aggregate social benefit declines. The exact same is true for medicine. I want a low income mother and child to have access to medicaid. I also want the best possible Drs for myself and my family. I recognize that the best quality Drs (schools, neighborhoods) will command a higher price. Call around to the best rated Drs in your area and see if they accept Medicaid (they don't).

These conflicts are not unique to the "dream hoarders," they are simply a slice of that social Laffer curve.

Vilifying the billionaire class isn't the best way to discuss these rebalances. But, software's ability to scale cheaply has allowed a few innovators to grab bigger slices of wealth. I don't really want to take away their voting equity, but they should be a part of the redistribution and the fact that they gather and realize gains in wealth that are regressive (low LT Cap gains tax, caps on SocSec, etc.) needs to be addressed.

Finally, there are probably ways to raise the peak of this curve through better policy (rather than sliding along it). I believe there are ways to lower the cost of education, housing and medical care via innovation, public policy, and better zoning.

Let's focus on the policy initiatives that affect both the amplitude and the location on this social Laffer curve.

Reasonable, +5 i.p.

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The trouble with this is that you need someone to decide how to redistribute the wealth. Even if you find a pure saint who will perfectly redistribute wealth in the ideal fashion, that person has a finite lifespan. (That's if you can define "saint", and if you're willing to ignore the arguments against Moral Saints [that's a reference to a paper on the topic, fyi]...) The odds of the next person being a pure saint? Half a percent, maybe. Assuming special interests don't co-opt this immediately (they will try, see environmental regulation and regulatory capture), by the third generation they'll be deeply entrenched.

Even ignoring all of that, remember the lesson from 2016: Other opinions exist, and sometimes they win. What's going to happen when this Laffer Curve Czar position you've created is occupied by someone who's political views are diametrically opposed to your own?

The point is: By establishing someone who will make these decisions you are creating a very powerful position. Power WILL end up in the hands of people who don't agree with you, and power WILL attract people looking to use it for personal gain (such people will try to take the office, or influence the office). Unless you have a way to prevent that, this plan is doomed from the start.

...that the redistribution decision would be made by one person, saintly or not. It's simply a framework for looking at redistribution, which is necessary on several dimensions in the real world. The absolutist ideologies of extreme socialism (total redistribution) and extreme libertarianism (zero redistribution) are childish and completely unworkable. A healthy society requires some provision by the productive and wealthy (not always or even on average the same people) for the unhealthy, old, young, and destitute.

That’s not really the focus of the current debate, which is more: should we redistribute simply for the sake of reducing the variance of our incomes/wealth. For some, like Zucman, even people become worse off on average, it’s worth it. Personally, I don’t care about inequality eo ipso at all, I care about well-being, so at the very least a redistributive policy has to actually be welfare increasing, which I don’t think can be trivially assumed.

Maybe most people aren’t like me and their happiness is affected by the Gini coefficient, but that only suggests what society will do, not what it should do.

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#5 He did however find evidence that rent control decreased the number of available rental units, by encouraging condo conversions.

So rent control doesn't decrease the overall housing stock -- just reduces the fraction available for rent. But rent-control laws have no negative effects. Sheesh.

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#5 - interesting paper. Anyone else notice the spelling error in the very first paragraph? Distracting.

No. I just assumed that it was like those Brolex watches they sell on the street.

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With respect to 1 my problem with Warren is that she was a celebrity bankruptcy expert at a time when there was a huge debt problem happening right under her nose!?! So she was focused on evil doctors and hospitals charging people for saving their lives all the while liberal arts departments were convincing 18 year olds to take out huge amounts of debt to pay for a degree they said was valuable?!? So a professor like Warren didn’t see a huge problem because she was engaging in the lazy conventional wisdom along with self serving groupthink that her fellow professors had important jobs worthy of benefiting from a federal program that made it easy for 18 year olds to take out loans.

So to McCardle’s issue with the oligopoly/billionaires problem is the exact same problem with student loans—lazy conventional wisdom and self serving groupthink. So we have an example of how that plays out with respect to our dysfunctional economy from 2001-2008. The Big Oil oligopoly believed North America had hit peak energy production and dismissed fracking out of hand as not economically viable. So they made huge profits but refused to invest those profits into fracking. So America had a quiet energy crisis that undermined our economy. Then in 2009 we find out fracking was viable but only after a Financial Meltdown that caused great hardship for all Americans.

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#3:

"Afterward, William Gackstetter said the aging membership has been asked to continue maintaining the church until it reopens without them.

Cheryl Gackstetter added: “We are supposed to be silent partners, and still give money.”"

This is an absolutely dumb idea. I grew up Methodist, and generally speaking, the old retirees account for something like 80% of the tithing. There's virtually no chance that a small church can survive on the donations of younger parishoneers. Someone thinks that money grows on trees and that young families with children will fund the church and not their kids braces.

Yet, it is written: ye pay tithe of mint and anise and cummin.

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#5. The IGM Economic Experts Panel (which includes top economists from schools such as MIT, Harvard, Yale, Chicago, Stanford, Princeton, Berkeley, Columbia, Northwestern - but none from John Jay College) considered the following statement in 2012:
Rent Control. Local ordinances that limit rent increases for some rental housing units, such as in New York and San Francisco, have had a positive impact over the past three decades on the amount and quality of broadly affordable rental housing in cities that have used them.
The results were:
Strongly Agree 0%
Agree 2%
Uncertain 7%
Disagree 49%
Strongly Disagree 32%
No Opinion 2%
When weighted by each expert's confidence,
Strongly Agree 0%
Agree 1%
Uncertain 4%
Disagree 43%
Strongly Disagree 52%
But Mason tells us that the consensus is in favor of rent control. Either things have changed a whole lot since 2012 or Mason is out of his mind.

Mason lives in Massachusetts.

More interesting are the figures you provide. They show that five or nine percent of eminent economists are not really eminent. And here we have a tool for determining which five or nine per cent! :-)

The guy who won the Nobel prize for discovering that HIV caused AIDs also believed in homeopathic medicine; the guy who won it for inventing PCR is an AIDS denialist. And these are Nobel prize winning biologists. Unfortunately, even many brilliant experts’ expertise diminishes rapidly beyond their very specific area of study. Also see most of what Paul Krugman writes outside of macroeconomic and trade theory.

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#5

> So what rent control is limiting are the rent increases that are not the result of anything the landlord has done — the rent increases that result from the increased desirability of a particular area, or of a broader regional shortage of housing relative to demand. There is no reason that limiting these windfall gains should affect the supply of housing.

Huh? You're saying that eliminating a substantial portion of the DCF of an asset shouldn't impact its backward discounted valuation? What kind of twisted retard logic is this? The discounted value of prospective housing supply is negatively impacted by rent control - which obviously influences economic decisions with regard to its construction. Why is a PhD economist making such a trivially falsifiable statement?

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#5 Mason delivers his own head shot

"They, may, however, reduce the supply of rental housing if it is easy for landlords to convert apartments to condominiums or other non-rental uses. This suggests that limitations on these kinds of conversions may be worth exploring"

So the text book supply and demand rules have exactly the predicted effect, lower supply of rental housing. The market discovers the most efficient mechanism is through condo conversion rather than new starts. That is not a side effect, it is THE effect.

He thinks they can modify the rules to block this effect without appearing to realize the nature of what he is suggesting.

Its a good look into the thinking behind regulations spiraling out of control, with the regulator continually wrestling the invisible hand without ever understanding they themselves are forcing the outcome they decry.

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#1 School kids used to pledge allegiance to the flag and to the republic for which it stands. Republics don’t have billionaires, aristocracies do. Whatever an aristocracy is, it’s not a republic. For info on aristocracy and a republic, read Plato, Justice Brandeis and perhaps former Fed Chair Marriner Eccles.

Republics don’t have billionaires?

Why, because they don’t have global economies of scale?

Or because you’re an idiot?

See Plato’s Republic…fascinating, self-recommending. “Wise men speak because they have something to say; Fools because they have to say something.”

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"A 2007 study...finds evidence that rent controls actually increase the supply of rental housing, by incentivizing landlords to subdivide larger rental units."
Does the logic here bother anyone else? I'll assume the data are sound but what about the logic. Subdividing units results in more "units" but does it result in more "housing." If my apartment for my family of four is divided in two you could get two smaller apartments that would be usable by couples (no gain in people housed) or singles (fewer people housed). This study should probably look at occupancy or square footage.

Uh-huh. The entire article was full of stuff like that. Elisions, legerdemains, strange-framings, dubious definitions....

You wonder where things are going with this sort of link until about 5 para in you go "Ah-ha! Got it! Tyler thinks this guy is a moron but doesn't want to say so..."

Gotcha. I'm kind of new here. Didn't realize that questionable items were linked without comment. Good to know.

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#5 A more honest title would've switched the words "Considerations on" for "Whitewashings of"

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