Category: Current Affairs

U.S.A. fact of the day

As President Trump threatened to shut down the U.S.-Mexico border in recent days, his Department of Homeland Security nearly doubled the number of temporary guest worker visas available this summer.

The Homeland Security and Labor departments plan to grant an additional 30,000 H-2B visas this summer on top of the 33,000 they had already planned to give out, the agencies confirmed.

The H-2B visa allows foreign workers to come to the United States legally and work for several months at companies such as landscapers, amusement parks or hotels. About 80 percent of these visas went to people from Mexico and Central America last year, government data shows…

With the additional visas, the Trump administration is on track to grant 96,000 H-2B visas this fiscal year, the most since 2007, when George W. Bush was president.

Here is more by Heather Long at WaPo, via Anecdotal.

When are national apologies a good idea?

That is the topic of my latest Bloomberg column, noting that lately Mexico has been demanding an apology from Spain for colonialism.  Here is one bit:

Some features of good apologies are sincerity, overall compatibility with what the apologizer now stands for in other contexts, and a broad social willingness to accept that something indeed has been settled for the better.

And:

OK, so how about Spain and Mexico? I am skeptical of this proposed apology, partly because it seems like a political maneuver by President Andrés Manuel López Obrador to garner political support and distract from his likely failure to successfully reform Mexico’s economy. The current Spanish government also is not a close descendant of the conquistadors, as it is a full-blown democracy and the conquest was almost 500 years ago. One can acknowledge the massive injustices of the history without thinking that current Spanish citizens necessarily should feel so guilty. And (until recently) Spain-Mexico relations have not been problematic, so it is not clear exactly what problem this apology is supposed to solve.

The current demand for an apology is a distraction from the enduring injustice of Mexico’s segregation. If Spaniards found their own reasons for wishing to apologize, that would be a good result. But on this demand, they are correct to give it a pass.

I also consider the United States, Australia, New Zealand, and Rwanda.

Brexit day has come and gone

I must have read two hundred tweets about how dysfunctional the British government is, or what a bad leader Theresa May has been.  Really?  That has yet to be demonstrated.  I’ve all along been “vote Remain,” but I also recognize Remain works only if British membership in the EU has a certain amount of internal legitimacy.

What might a process of testing that legitimacy look like?  Long, extended confusion, lots of back and forth, indecisiveness, and inability to form a durable majority for any other option, perhaps?

Right now the chances of Remain seem to be rising, or perhaps some version of Norway plus, and those are among the better options.  I am hardly distraught, noting that I genuinely do not have a strong sense of what will happen next.  I am pleased to see that not one of the seven versions of Brexit could command a majority.

Is it really so tragic and terrible to have all this — whatever comes to pass — revealed only at the last moment?  Isn’t that often how optimal search looks?  Isn’t it how the “to Remainers all-holy EU” so often does its business?  Alternatively, how smooth, open, and transparent did the American constitutional convention actually run?

I’m not predicting triumph or victory here, only that I don’t yet see that anything has fallen off the rails.  Nor is the British pound being hammered in the markets.  Nor do I know many (any?) people who could have done much better than Theresa May.

But now is the time to pay more attention again, these are the proverbial last five minutes of the basketball game…

Elizabeth Warren on food and agriculture

That is the topic of my latest Bloomberg column, here is on excerpt:

The most striking feature of her team’s plan, called “Leveling the Playing Field for America’s Family Farmers,” is what it doesn’t call for: namely, an abolition of farm subsidies, a reform favored by virtually all economists. Those payments often run more than $20 billion a year, and are typically considered an inefficient form of crony capitalism.

And:

Warren’s document asserts that “food prices aren’t going down.” That’s true but misleading. When the Federal Reserve is targeting near 2 percent inflation, most prices in the economy will rise steadily over time. The link behind that claim, to a U.S. Department of Agriculture report, offers some recent data, but it is hardly damning: In 2018, it notes, retail food prices rose 0.4 percent. “This was the first increase in 3 years, but the rate was still below the 20-year historical annual average of 2.0 percent.” Or how terrible are these numbers, from the same report: “In 2019, price growth may continue to remain low at the grocery store. Food-at-home prices are expected to rise between 0.5 and 1.5 percent, as potentially the fourth year in a row with deflating or lower-than-average inflating retail food prices.”

A look at the longer-term historical data also shows slow, steady inflation in the food and beverage sector, rather than a recent crisis of price spikes. Food price inflation does become higher after 1973, but that is probably due to higher energy prices and the more general productivity slowdown that has plagued the U.S. economy.

In this context, Warren’s lengthy complaints about monopoly and market power in the food sector just don’t seem that persuasive. Furthermore, America’s food sector has been remarkably innovative in terms of product choice and rising diversity of options.

Warren also calls for greater agricultural protectionism and the banning of foreign investment in American farmland.  And she is supposed to be the leading policy thinker in the race?  People, this is not good, and furthermore it is the same tiresome “tested by social media let’s bash the corporate villains” set of cliches.  My close:

If American voters want to be inspired, then opposing seed-company mergers won’t be nearly enough.

Tabarrok on Bail

I spoke recently at Brookings on the movement to eliminate cash bail. I think we hold too many people pre-trial and the use of judicial aids such as algorithms could safely increase the number of people released prior to trial as well as reduce the variance and disparity of treatment. Nevertheless, I think eliminating cash bail is a poorly thought out idea that may very well backfire. The proponents of eliminating cash bail also present a misleading picture of who is held on bail, the focus of my remarks at Brookings.

I was the only one at the event to oppose eliminating cash bail and I think the audience was a bit shell-shocked. Certainly, not everyone on the panel agreed with my comments. The American Bail Coalition posted the clip from CSPAN but otherwise had nothing to do with my remarks which begin around 35 seconds in.

The winners and losers of the Mueller revelations

As the information trickles out that the Mueller report probably will not end the Trump administration, it is worth thinking about how the broader landscape has changed, and who might be the winners and losers.

Politically, the biggest loser is probably Joe Biden.  The belief that he can run as the “safest,” most vetted Democrat against an ailing, politically destroyed Trump all of a sudden seems less relevant.  It now seems more important that Biden has run for president several times before, and never done extremely well, in part because he has not been an entirely convincing campaigner.  He’s never come close to winning the nomination.  He is a candidate of the past, for better or worse, but the dominant mood may not be one of restoration.  The Mueller report makes it clear that we really are in a post-Obama era, and that even Trump critics need to be thinking about what comes next rather than looking to the past.

Which candidates then are helped the most?  Most likely that would be the dynamic or potentially dynamic, relatively centrist Democrats, and that includes Beto O’Rourke, Pete Buttigieg (dynamic in a Mister Rogers sort of way), and Kamala Harris.  I don’t see the candidates further to the left getting a boost from this development.  Many Democrats might have been tempted to think: “Trump is so sure to lose, this is our chance to get a real radical in.”  That now seems like a less convincing chain of reasoning.

There is another reason why Beto and Buttigieg might benefit, and that has to do with the risks from not so securely vetted candidates.  It now seems they can survive in office, even if they partially screw up, as long as they don’t commit too many obviously treasonous crimes.

On the Congressional side, Nancy Pelosi looks wise for having talked down impeachment fervor in advance.  Her political capital ought to go up and it probably will.

Many Democratic Congresspeople are better off too.  Had the report levied stronger charges against Trump, they would have faced pressures from their base to impeach, even though impeachment might not have played well with independent and centrist voters.  It is now likely those charges have been defused.  Policy wonks may come back into fashion again, at least relative to where things stood a month or two ago.

Within the Republican Party, the Never Trumpers lost further ground, and in any case the momentum has been turning against them.  Mike Pence has kept whatever political future he had, and he will not seem unacceptable as a president, due to moral taint, if say Trump later has to step down because of illness.

The media comes up as one of the biggest losers.  While Matt Taibbi’s recent critical account is exaggerated, the mainstream media did talk up the Russia collusion story for two years plus, and now it seems overdone.  After the media botched the “Hillary’s emails” story, there was plenty of talk of “never again.”  It now seems that all along a new false set of stories was being created, albeit in a different direction.  That will be perceived as a significant loss of media credibility, even if you think there is a more finely grained exculpatory story involving accountability some highly suspicious circumstances.

The bigger negative effect may be on media profitability.  Trump- and Russia-related stories often have done very well for getting clicks, and indeed the dramatic stakes with those issues have been very, very high.  But now it is easy to see the American public losing a lot of its interest in this line of inquiry.  The line of “Trump is still corrupt and New York state now will get at him,” while quite possibly correct, isn’t nearly as big of a draw.

Among intellectuals, Glenn Greenwald has been insisting throughout that the Russia collusion story was phony.  Whether or not his extreme skepticism was entirely correct, he is due to rise in status.  Ross Douthat of The New York Times also had been suggesting that the Russia collusion angle may not pan out and some of his columns now seem pretty wise.  John Brennan loses big time.

Oh, and another beneficiary is Steve Moore, Trump’s most recent nominee to the Federal Reserve Board.  He has come in for a great deal of critical commentary, but at this point Republican Senators are less likely to cross a jubilant, resurgent Trump on the matter of a single nomination, and not one very much in the public eye.

The biggest winner of course is the United States of America.  It seems, after all, that we did not have a president, or even presidential staff, who colluded with the Russians.  Maybe you wanted Trump to go down on this one, but that is most of all big reason to celebrate.

Missing markets in everything?

Or do the offer curves simply not intersect?:

Just over half of Americans between the ages of 18 and 34 — 51 percent of them — said they do not have a steady romantic partner, according to data from the General Social Survey released this week. That 2018 figure is up significantly from 33 percent in 2004 — the lowest figure since the question was first asked in 1986 — and up slightly from 45 percent in 2016.

Here is the story, via the excellent Kevin Lewis.

How bad would a hard Brexit really be?

This account has some gloomy rhetoric, but doesn’t drum up such an awful scenario, for instance:

Among the little-noticed impacts: U.K. citizens and businesses will no longer be able to register internet sites using the .eu domain, and any U.K. entities that currently have such sites will not be able to renew them.

As mentioned, no doubt British truckers would be badly hurt, but what else?  This sounds correct to me:

Custom delays could create food shortages. The U.K. is vulnerable because an extreme heat wave and summer drought caused by global warming have already reduced food output.

Tariffs would be reimposed. They are as high as 74 percent for tobacco, 22 percent for orange juice, and 10 percent for automobiles. That would hurt exporters. Some of that pain would be offset by a weaker pound.

Tariffs would increase prices of imports into the U.K. One-third of its food comes from the EU. Higher import prices would create inflation and lower the standard of living for U.K. residents.

Is this the biggest danger?:

Health Secretary Matt Hancock has warned medical drug companies to expect six months of “significantly reduced access” to the main trade routes between Britain and Continental Europe if there is a no-deal Brexit.

This one seems exaggerated:

“Bodies may remain uncollected and children might miss exams due to gridlocked roads in the event of a no-deal Brexit”, the report said.

So people, what’s the deal?  Put aside the longer and medium-term effects on gdp and the like, what are the greatest short-run dangers of a hard Brexit in the weeks to come?  Or is it a big, overstated worry, the new Y2K?

The culture that is Alexandria, VA

A proposal to open a halal butchery facility in Alexandria hit a snag Saturday after some local business owners and dog owners objected. DC Poultry Market wants to open a facility that would sell fresh, humanely killed chickens on Colvin Street in a mostly industrial area of Alexandria between Duke Street and railroad tracks. There are no residential properties in the immediate area, but pet businesses abound: Pinnacle Pet Spa & More, Frolick Dogs, Dogtopia, and the Wholistic Hound Academy.

Therein lay a problem. Though city staff and Alexandria’s planning commission recommended approving DC Poultry Market’s application, dog  lovers showed up to the Alexandria City Council’s March 16 meeting to object on olfactory grounds (“My dog can smell when there’s a cookie down the block,” one resident said) and on proximity to poultricide (“Knowing that my dogs may be walked by a business that holds chickens in a windowless room before their throats are slit while fully conscious does not make me feel that my dogs are in a safe environment,” another said).

Here is the full story, via Bruce A.  Few seem to be complaining about the chickens.

Sentences to ponder

Oregon lawmakers are considering raising their annual pay by nearly $20,000, a move the sponsors say will attract more diverse candidates to the statehouse.

“We’re a diverse state, we need a diverse legislature,” Senate Majority Leader Ginny Burdick, one of the legislators leading the effort, told Oregon Public Broadcasting. “Because of the low pay, we are automatically screening out people who really should be represented here.”

That may sound cynical, but in fact the case for doing this is not crazy, and in general the U.S. underpays many (not all!) of its public sector employees:

The move comes only a few weeks after a 28 percent legislative pay raise went into effect. Lawmakers were not behind that raise, and the increase was tied to collective bargaining agreements that affected nearly 40,000 state employees.

Legislators now make $31,200, plus an extra $149 a day when the Legislature is in session.

Here is the full story, with further detail of interest, and for the pointer I thank Mark West.

The 2019 Public Choice Outreach Conference

It’s time to get your applications in for the 2019 Public Choice Outreach conference, a crash course in public choice for students from all fields and walks of life! Professors, please encourage your students to apply!

When is the Public Choice Outreach Conference?
The 2019 Outreach Conference will be held June 14-16th at the Hyatt Centric Arlington in Rosslyn, VA.

What is the Public Choice Outreach Conference?
The Public Choice Outreach Conference is a compact lecture series designed as a “crash course” in Public Choice for students planning careers in academia, journalism, law, or public policy. Graduate students and advanced undergraduates are eligible to apply. Many past participants of the Outreach seminar have gone on to notable careers in academia, law and business.

What will I learn?
Students are introduced to the history and basic tools of public choice analysis, such as models of voting and elections, and models of government and legislative organization. Students also learn to apply public choice theory to a wide range of relevant issues. Finally, students will be introduced to “constitutional economics” and the economics of rule making.

This is a chance to hear talks from Robin Hanson, Alex Tabarrok, Shruti Rajagopolan, Tyler Cowen and more.

Who can apply?
Graduate students and advanced undergraduates are eligible to apply. Students majoring in economics, history, international studies, law, philosophy political science, psychology, public administration, religious studies, and sociology have attended past conferences. Advanced degree students with a demonstrated interest in political economy or demonstrated interest in political economy are invited to apply. Applicants unfamiliar with Public Choice and students from outside of George Mason University are especially encouraged.

What are the fees involved?
Outreach has no conference fee – it is free to attend. Room and meals are included for all participants. However, ALL travel costs are the responsibility of the participants.

Click here for the 2019 Outreach Application

*The People Next Door*

The author is T.C.A. Raghavan and the subtitle is The Curious History of India’s Relations with Pakistan.  Here is one excerpt:

The massive rigging of the March 1977 election led to a Bhutto majority the size of which stunned even his supporters and, by some accounts, even embarrassed him.  He and his party had been expected to win but the near-total decimation of the opposition made the election results lose credibility.  “Why did you do this to me?” he is widely believed to have rhetorically asked a group of senior civil servants as the results came in.  In any event, the loss of popularity and personal legitimacy was swift.

This book is must reading for these days, and it will be making my 2019 “best of the year” list.  Order from abroad here, or in the U.S. it comes out in July.

FDA Tiered Approval

have an interesting op-ed on a tiered approval regime for the FDA:

Instituting a codified approval paradigm based on four tiered levels of clinical effectiveness (biomarkers, clinical signs and symptoms, disease modification and clinical outcomes) — with evidence regarding clinical utility progressively increasing — would greatly reduce the regulatory uncertainty and subjectivity, as well as the time to approval of innovative medicines.

Moreover, the four tiers, coupled with a commitment to apply state-of-the-art technologies (Apple Watch, telemetry and other health monitoring systems) to obtain clinical evidence would allow for additional learnings from use of drugs by practicing doctors treating real world patients. This knowledge would unearth additional uses, information that can be added to the product label to allow safer and more effective use of drugs and the identification of drug combinations that lead to even greater health benefits.

See also Bartley Madden’s work on Free to Choose Medicine which would similarly create dual tracks, one the standard FDA process and a second observational track that would bring drugs to market more quickly with the tradeoff being fewer clinical trials. As clinical trials rise in expense and more treatments are targeted towards smaller patients groups (i.e. personalized medicine) and as statistical techniques improve, we will need and can benefit from reforms to the FDA process along these lines.