Category: Current Affairs
That was then, this is now
Obama’s goal now is to make clear to adults in Central America that there is no payoff for sending their children on the dangerous journey northward, said Cecilia Muñoz, the White House domestic policy director. “He feels intensely a responsibility to prevent an even greater humanitarian crisis,” she said.
That, however, means speeding the deportation of most of those who have already arrived, which many in Obama’s own party are resisting.
That is circa 2014, here is the full story. I thank an MR reader for the pointer.
People, the streets are empty here, in and around D.C.
…sales have slowed, with one exception: Happy hour. People are coming in earlier and staying longer, but often not having dinner.
“It’s increasing happy hour and decreasing dinner,” he said.
He said he had moved happy hour earlier to 3 p.m. from 4 p.m. for anyone showing government identification, and that people were coming in as early as 2 p.m.
And this:
On Tuesday, the City Council gave the mayor emergency authority to issue marriage licenses, because the Marriage Bureau, funded by the federal government, is closed.
That is all from Sabrina Tabernise in the NYT, the article has other interesting points.
The World Bank reappointment process
Kim had been a lame duck for some while, and few outsiders grasp how active is the role of the Board in the World Bank. So it is probably good they got him out of there sooner rather than later.
I know you’re all aghast that Trump will pick the successor, but remember the good ol’ days when everyone fell apart when Bush picked Paul Wolfowitz, considered to be one of the architects of the Iraq War? Whatever you think of Wolfowitz and his tenure at the Bank, it was not The End Times or even the beginning of the end.
It is very hard for a bad Bank president to shut down the works. The World Bank has borrowed a lot of money and to pay it back the Bank needs to make profitable loans. The mechanism for this to happen is already in place, and short of bankrupting the institution it is hard to imagine how a Bank president can totally gum up the works. That is also why good Bank presidents find it hard to reform the place.
It is trendy to call for a “meritocratic” approach to this appointment and who could be opposed to that? That said, there are plenty of plausible candidates ex ante, but it is not so easy to determine who will be effective ex post. So if you read someone calling for meritocracy here, odds are they have some other political agenda in mind (which may be fine, but evaluate that agenda on its own terms). There are plenty of Americans qualified at the highest level for this post.
I think America and yes DT should pick the next Bank president and should pick an American. How do you think it is going to go the next time the Bank calls for more capital from the US and UK? Whose certification there do you think is most important? And which country is the most nervous about the World Bank doing something geopolitically unpopular, as say the UN repeatedly has done? All this will run most smoothly if the U.S. feels, to some extent, that the Bank is its preserve. And of course the “we’ve really got to up China’s quota and get it more involved” days are long since past.
You’re all out there saying Trump should not disengage America from the world, blah blah blah etc. I agree. But let’s be honest about what the terms of that engagement were in the first place, and be willing to swallow the whole package deal once again.
Here is some FT analysis, noting that not all of its suggested candidates are good ideas.
Border Crime
Alex Nowrasteh at Cato shows that crime is lower in counties adjacent to the Mexican border than in the rest of the United States:
If the entire United States had crime rates as low as those along the border in 2017, then the number of homicides would have been 33.8 percent lower, property crimes would have been 2.1 percent lower, and violent crimes would have dropped 8 percent.
Obviously border counties are different than non-border countries, more rural etc. Nevertheless, the raw fact is striking in comparison to the heated rhetoric about illegal immigration and American blood.
The new committee to re-elect Donald Trump
It has some surprising members:
Rep. Alexandria Ocasio-Cortez has been promoting the idea of a 70 percent top marginal tax rate, and Paul Krugman has been defending it. Matthew Yglesias of Vox has written that 70 percent might be too low.
Here is my full Bloomberg column on the topic. You will note by the way that if you only apply the tax on say $10 million and up, it will all be converted into capital income and the tax will distort without raising much revenue. And here is a sentence toward the end of the piece, part of my advice for Democrats:
Recognize that you’ll never be that popular on the tax issue.
I see this as a kind of catnip issue, one where the Democratic Left is so, so tempted to make redistribution the central idea of the party, a disastrous urge in my view.
Ethereum Classic Double Spend Attack?
Yesterday, I warned that double spend attacks were cheap and particularly likely for smaller coins using standard hash algorithms. Coincidentally (?) later that day there was this:
We can confirm that there was a successful 51% attack on the Ethereum Classic (#ETC) network with multiple 100+ block reorganization. We recommend all services to closely monitored the chain and significantly increase required confirmations.
— Bitfly (@etherchain_org) January 7, 2019
It’s not entirely clear whether that is true or if there is an alternative explanation. Coinbase, however, says that approximately $500,000 was double spent. You can find a good discussion on Hacker News. You can also find an interesting calculation of the cost of renting enough hashing power to 51% dominate various networks here. It’s cheap. The costs given are underestimates in one respect since they don’t include block rewards but overestimates in another as renting may not always be possible.
Here’s some back of the envelope calculations on the cost of the ETC attack. If I am reading the blockchain stats correctly, ETC has a block time of about 15 seconds and the chain was reorganized almost to a depth of 100 blocks or 1500 seconds, i.e. 25 minutes. The cost of dominating the ETC hasing power for an hour is around $5000. Thus, this attack could have been very profitable, even adding in substantial setup costs. Feel free to write in the comments if these numbers look wrong.
As I mentioned yesterday, it’s not surprising that this is happening now because with massive falls in prices in most cryptocurrencies there is an excess supply of computation. Expect more stress testing this year.
Hat tip: The excellent Jake Seliger.
Predictions for the next twenty years
From New York magazine, here are mine:
American politics will return to the precedent of the 19th century. Then, there was lots of fake news; partisanship was extreme; the media was very biased; Americans reacted politically with extreme emotions and all debates seemed to be full of rancor and bitterness. So in some fundamental ways, this country has not changed. We had a break from that state of affairs in the 20th century because we had the major enemies of the Nazis and then the Soviets. But as those enemies disappeared, we’re fighting among ourselves more, and the nation will go back to an earlier version of its politics, which were highly dysfunctional. You had plenty of people becoming president who probably should not have been.
I don’t see any evidence that we’re headed toward anything like a civil war. Today is a more peaceful era. If you look at polls, you see a generalized loss of trust in many institutions, but the No. 1 clear winner by far is still the military. Police tactics have much improved over the past few decades. The riots of the 1960s are very, very far away. The fighting will stay on social media. The happy people will be those who turn off their smartphones or who don’t put Twitter on them and who just go about living their lives.
But I think the intellectual classes and people in the media will become less and less happy. They’ll be more stressed, and every day they’ll feel like they’re being put through the wringer. Social media has become a kind of opiate of the intellectual class. So, grandparents use social media to track what their grandkids are doing — that’s nice and wonderful. But people who keep on refreshing Twitter for the latest developments in the Mueller investigation — frankly, I think it’s a big waste of time. I think there has been great wrongdoing. I fully support what Mueller is up to. But, at the end of the day, following it moment-to-moment is a kind of trap.
Keep in mind that during a lot of the 19th century, America’s economy grew one and a half percent or 2 percent annually, which was okay. But it was not 4 or 5 percent growth. People felt resources were very scarce. Everything was argued over. A small amount of tariff revenue was a big deal. I think that, too, will be our immediate future. There will be a lot of scarcity. Budgets will be stretched, and, again, everything will be an emotional debate, precisely because there’s so much gridlock. We will look to symbolic politics — who deserves higher status, what kind of rhetoric is permissible. Right now, it’s the coastal elite in major cities versus many other parts of the country. But that will be in flux. Latinos — at what rate will they vote Democratic? Will Asian-Americans defect to the Republican Party?
Democrats still have a big problem: What are they going to run on? They could run on more preschool or no more paid maternity leave. They’re just not that big a deal — not major changes in how America works. I don’t think they’ll end up as the main things we’re debating. If you look at all the attention the “caravan” got — that was just a few thousand people. I think that kind of debate is our future.
The article offers numerous other distinguished and interesting entries.
Does Exposure to the Refugee Crisis Make Natives More Hostile?
Although Europe has experienced unprecedented numbers of refugee arrivals in recent years, there exists almost no causal evidence regarding the impact of the refugee crisis on natives’ attitudes, policy preferences, and political engagement. We exploit a natural experiment in the Aegean Sea, where Greek islands close to the Turkish coast experienced a sudden and massive increase in refugee arrivals, while similar islands slightly farther away did not. Leveraging a targeted survey of 2,070 island residents and distance to Turkey as an instrument, we find that direct exposure to refugee arrivals induces sizable and lasting increases in natives’ hostility toward refugees, immigrants, and Muslim minorities; support for restrictive asylum and immigration policies; and political engagement to effect such exclusionary policies. Since refugees only passed through these islands, our findings challenge both standard economic and cultural explanations of anti-immigrant sentiment and show that mere exposure suffices in generating lasting increases in hostility.
That is the abstract of a new paper by Dominik Hangartner, Elias Dinas, Moritz Marbach, and Konstantinos Matakos, via the excellent Kevin Lewis.
Why private regulation of internet speech doesn’t make many people happy
That is the topic of my latest Bloomberg article, here is one excerpt:
I’d like to suggest a simple trilemma. When it comes to private platforms and speech regulation, you can choose two of three: scalability, effectiveness and consistency. You cannot have all three. Furthermore, this trilemma suggests that we — whether as users, citizens or indeed managers of the platforms themselves — won’t ever be happy with how speech is regulated on the internet.
There is much more at the link.
China fact of the day
But China’s public capital stock per head is already far bigger than Japan’s at comparable incomes per head.
That is from Martin Wolf at the FT. Here are the associated conclusions:
Slowing urban household formation means that fewer new homes now need to be built. Not surprisingly, returns on investment have collapsed. In sum, investment-led growth must come to an early end. Because of its size, China has also hit the buffers on export-driven growth, at a lower level of income per head than other high-growth east Asian economies. The trade war with the US underlines this reality. China’s working-age population is also declining. Given the huge rise in debt as well, sustaining fast growth will be very hard.
We will see, perhaps indeed in 2019, one way or the other.
What Europeans Talk about when They Talk about Brexit
I am tempted to call this long piece on a boring subject the best I have read in 2019, but you know I think that might remain true by the end of the year. Here is an excerpt from the Belgium section:
I was in Brussels recently, taking my son to watch Anderlecht play, when I heard some English people in a café asking the waiter why no one liked the English. They were nice people asking a genuine question, but often it’s the wrong people who ask the right questions. The waiter replied, politely and in perfect English: ‘We can read your newspapers and watch your television; we hear what your politicians and your journalists say about us.’ That summed it up: all this time we Brits thought we were talking to ourselves, and we were, but everyone else was listening in. Belgians are not surprised by Brexit: it’s just the coagulation as policy of what’s been flowing as attitude for decades.
Or Denmark:
The leftish Information provides the most useful articles. One has a headline in English, though anchored in the land of Elsinore: ‘To Be or Not to Be, That Is Not the Question’. The real ‘question’ doesn’t concern the merits of Leave or Remain, but the complexities of a twin crisis, in both the UK and the EU. Another piece, published shortly after the referendum, describes the division of a nation into Leavers and Remainers as afgrundsdyb. Meaning ‘abyssal’, the term, I am told, hints at the unfathomable as well as the unbridgeable, while evoking something that is certainly dangerous to approach.
I enjoyed this line:
Croatia has more experience than most of entering and exiting alliances.
From the Germany section:
‘Brexit shows that the Brussels bureaucracy, that alleged monster that employs no more civil servants than a central German city administration, has done a great job. The extent of interconnectedness at all levels has to be renegotiated: supply chains, industry standards, food and pharmaceutical standards, security architectures, rural and air transport structures, fishing rights, research collaborations, student exchanges, a vast frictionlessness system is now in jeopardy’ (Gustav Seibt, Süddeutsche Zeitung).
This I had not known:
…in Norway the conservative right is overwhelmingly in favour of joining the EU.
And finally:
Being a Brit in Sweden can be embarrassing just now. We’re one of the Swedes’ favourite peoples, admired for our history and culture, and loved for Engelskt humor. Shocked they may be; but a diet of Monty Python and Fawlty Towers means that Swedes are not altogether surprised.
The authors are numerous, the whole piece was published in The London Review of Books, definitely recommended. I would note that “what group X really thinks of Y” remains an under-exploited genre in journalism, and elsewhere, and it is one of the best ways of learning about a topic.
a16z Podcast: Talent, Tech Trends, and Culture
I interview Marc Andreessen and Ben Horowitz, not a Conversation but nonetheless a conversation, they were both in top form. Here is the link.
The moral horror of America’s prisons
That is the topic of my latest Bloomberg column, here is the final bit but not the main argument:
So what then to do? The first and most important step is for Americans to realize they have been creating and sanctioning a moral horror, and to treat it as a major political issue. Step No. 2 is to modify the career incentives for prosecutors to seek out ever tougher sentences. Step No. 3 is to experiment with more electronic monitoring of criminals, and to see if that can limit the number of people behind bars. Step No. 4 is to frame prison reform in more straightforward economic terms. It is not only about guaranteeing rights on paper. It’s also about designing the economic incentives for prisons to create secure and orderly environments. That has hardly been the focus of current systems. Finally — and this idea is broader in scope — the decriminalization of additional offenses should also be considered.
I realize these are complex issues, and potential remedies require far more consideration than I can give them here. But if you think America’s current penal system is the very best we can do, that is about the most pessimistic verdict on this country I have ever heard. Has anyone ever suggested that the American prison system is the world’s best? The can-do attitude is one of my favorite features of American life. We just need to apply it a little more broadly.
Can I simply say “I am right”?
52 things learned by Kent Hendricks
Here are a few:
Contrary to the beliefs of roughly 33% of Americans, Kansas is not the flattest state. In fact, it’s the 9th flattest state, and it’s one of only two Great Plains states to make the top ten (the other is North Dakota). The flattest state is actually Florida, the second flattest state is Illinois, and the least flattest is West Virginia. (Disruptive Geo)
…The average high school GPA of a representative sample of 700 millionaires in the United States is 2.9. (Eric Barker, Barking Up the Wrong Tree: The Surprising Science Behind Why Everything You Know About Success Is (Mostly) Wrong)
…Dinosaurs roamed the earth for a long time. Tyrannosaurus Rex is closer in time to humans than to Stegosaurus. (Peter Brannen, The Ends of the World: Volcanic Apocalypses, Lethal Oceans, and Our Quest to Understand Earth’s Past Mass Extinctions)
…Pepperoni pizza is subject to more government regulation than plain cheese pizza. That’s because cheese pizzas are regulated by the Food and Drug Administration, while pepperoni pizzas—which have meat—are regulated by the Department of Agriculture. (Baruch Fischhoff and John Kadvany, Risk: A Very Short Introduction)
Here is the full list, interesting throughout.
At what ages do children stop believing in Santa Claus?
Research in the Journal of Cognition and Development in 2011 shows that 83% of 5-year-olds think that Santa Claus is real, the study’s lead author, Jacqueline Woolley, wrote in The Conversation last year.
“We have found in more recent studies that that number of 85% sounds about right,” said Thalia Goldstein, assistant professor of applied developmental psychology at George Mason University in Fairfax, Virginia.
“Children’s belief in Santa starts when they’re between 3 and 4 years old. It’s very strong when they’re between about 4 and 8,” she said. “Then, at 8 years old is when we start to see the drop-off in belief, when children start to understand the reality of Santa Claus.”
What about across the pond? They seem to be asleep over there:
Of 161 parents in the United Kingdom, 92.5% thought Father Christmas was real for their children up to the age of 8, according to a research paper presented at the annual meeting of the European Early Childhood Education Research Association in Finland in 1999.
And here is a study vulnerable to the replication crisis:
The interviews revealed that 39.2% of the children believed that the man they visited was the same Santa who came down their chimneys…1.3% had a somewhat “adult belief,” Goldstein said, in which they said that the man was not Santa and did not live at the North Pole but could communicate with the real Santa.
That is a CNN article from last year. Why is the word “marginal” declining in popularity? How many seven year olds know what “marginal” means? How many know not to believe everything the President says? How many understand hedging?