Category: Current Affairs

How to make you stupider

The Maine official who moved to disqualify former President Donald Trump from the state’s 2024 Republican primary ballot on Thursday visited the White House this year to meet with President Biden and previously referred to the Electoral College as a “relic of white supremacy.”

Here is the full story.  This is exactly what I am not going to cover in 2024, so right now you get your miniature, one-time dose.  I am not saying this is not important.  I am saying that reading a lot about it, and commenting on it, will make you stupider.  In fact, the non-elastic Parmenides universe is arranged such that anyone who leaves a comment on this post, no matter what that comments says, will lose two IQ points.

Good luck, and see you next year!

Uber and Traffic Fatalities

Abstract: Previous studies of the effect of ridesharing on traffic fatalities have yielded inconsistent, often contradictory conclusions. In this paper we revisit this question using proprietary data from Uber measuring monthly rideshare activity at the Census tract level. Using these more detailed data, we find a consistent negative effect of ridesharing on traffic fatalities. Impacts concentrate during nights and weekends and are robust across a range of alternative specifications. Overall, our results imply that ridesharing has decreased U.S. traffic fatalities by 5.4% in areas where it operates. Based on conventional estimates of the value of statistical life the annual life-saving benefits are $6.8 billion. Back-of-the-envelope calculations suggest that these benefits are of similar magnitude to producer surplus captured by Uber shareholders or consumer surplus captured by Uber riders.

The authors, Michael Anderson and Lucas Davis, note that alcohol involvement is reported in approximately 30% of fatal crashes, which is an amazingly high number unless you think a lot of people are driving drunk. I am reminded of a clever paper by Levitt and Porter who use the proportion of crashes involving two drunk drivers to estimate that it is not that lots of people are driving drunk but rather that “drivers with alcohol in their blood are seven times more likely to cause a fatal crash” and “legally drunk drivers pose a risk 13 times greater than sober drivers.” Thus, substituting a sober driver for a drunk driver is a very good thing and so it’s plausible to me that Uber significantly reduces traffic fatalities.

Consider this a public service announcement.

Nicholas Kristof on good things in 2023

Just about the worst calamity that can befall a human is to lose a child, and historically, almost half of children worldwide died before they reached the age of 15. That share has declined steadily since the 19th century, and the United Nations Population Division projects that in 2023 a record low was reached in global child mortality, with just 3.6 percent of newborns dying by the age of 5.

That’s the lowest such figure in human history. It still means that about 4.9 million children died this year — but that’s a million fewer than died as recently as 2016

Or consider extreme poverty. It too has reached a record low, affecting a bit more than 8 percent of humans worldwide, according to United Nations projections.

All these figures are rough, but it seems that about 100,000 people are now emerging from extreme poverty each day — so they are better able to access clean water, to feed and educate their children, to buy medicines.

Here is the full NYT column, and no he doesn’t deny the bad things that are going on, please don’t engage in the usual mood affiliation people…

Happy New Year to come!

Summary trends of 2023

That is the topic of my latest Bloomberg column, here is my biggest worry:

Another takeaway from 2023 is more depressing: Deterrence is less powerful than I thought. Persistence, combined with a belief in one’s cause, is worth more.

The Israeli military is much stronger than Hamas, for example, and is currently proving that on the ground. Yet that did not stop Hamas from proceeding with a violent incursion into Israel. In Ukraine, substantial support from the US and other NATO nations has not stopped Russia from pursuing a war, even with very heavy losses in terms of its military power and international reputation. Russian President Vladimir Putin simply wants Ukraine, and believes some parts of it rightfully belong to Russia.

None of this is good news for the US, which relies on deterrence to support its numerous alliances. It is also bad news for the world at large, because deterrence tends to support peaceful outcomes and the status quo.

Which leads me to another piece of academic research: I am increasingly inclined to reject psychologist Steven Pinker’s view that the world is becoming more peaceful. Unfortunately, the available evidence suggests that international conflict is on the rise again, after a long period of decline. Cyclical theories of world peace and conflict — in particular the idea that peace eventually breeds the conditions for war — are thus due for an upgrade.

You could add the Houthis to that list as well.  I consider AI and governance issues as well.

The Sullivan Signal: Harvard’s Failure to Educate and the Abandonment of Principle

The current Harvard disaster was clearly signaled by earlier events, most notably the 2019 firing of Dean Ronald Sullivan. Sullivan is a noted criminal defense attorney; he was the director of the Public Defender Service for the District of Columbia and he is the Director of the Criminal Justice Institute at Harvard Law School, he advised President Obama on criminal justice issues, he represented the family of Michael Brown. He and his wife were the first black Faculty Deans in the history of the college.

Controversy erupted, however, when Sullivan joined Harvey Weinstein’s legal defense team. Student protests ensued. The students argued that they couldn’t “feel safe” if a legal representative of a person accused of abusing women was also serving in a role of student support and mentorship. This is, of course, ridiculous. Defending an individual accused of murder does not imply that a criminal defense attorney condones the act of murder.

Harvard should have educated their students. Harvard should have emphasized the crucial role of criminal defense in American law and history. They should have noted that a cornerstone of the rule of law is the presumption of innocence and the right to a fair trial, irrespective of public opinion.

Harvard should have pointed proudly to John Adams, a Harvard alum, who defied popular opinion to defend hated British soldiers charged with murdering Americans at the Boston Massacre. (If you wish to take measure of the quality of our times it’s worth noting that Adams won the case and later became president—roughly equivalent to an attorney for accused al-Qaeda terrorists becoming President today.)

Instead of educating its students, Harvard catered to ignorance, bias and hysteria by removing both Sullivan and his wife from their deanships. Harvard in effect endorsed the idea, as Robby Soave put it, that “serving as legal counsel for a person accused of sexual misconduct is itself a form of sexual misconduct, or at the very least contributes to sexual harassment on campus.” Thus Harvard tarred Sullivan and his wife, undermined the rule of law and elevated the rule of the mob. Claudine Gay, then Dean of the Faculty of Arts and Sciences, contributed to the ignorance, bias and hysteria. (It’s also notable, that Sullivan also criticized Harvard’s handling of the investigation of Roland Fryer as being “deeply flawed and deeply unfair.” This may have been Sullivan’s real sin, as the investigation of Fryer was under Dean Claudine Gay.)

Thus, we see in the Sullivan episode disregard for free speech, unprincipled governance in which different rules are applied to different actors in similar situations, and a bending to the will of the mob, all issues which have repeated themselves under the Gay regime. Sad to say, however, that these flaws were not so much ignored at the time as lauded.

Harvard followed the mob and when the mob turned and the season changed it had left itself no defense.

Addendum: See also Tyler, My thoughts on the Harvard mess.

Claims about Japanese immigration

Japan will become an immigration powerhouse. Before the pandemic, the country was on track to accept about 150,000 new non-Japanese employees per year. This more than doubled to almost 350,000 in the first half of 2023. There are now approximately 3.2 million non-Japanese residents of Japan, up from barely half a million 30 years ago. Visa and permanent-residency requirements continue to ease. Most importantly, the biggest obstacle to employing non-Japanese talent—seniority-based rather than merit-based compensation—is beginning to change. All said, it is now perfectly reasonable to expect that about 10 percent of employees will be non-Japanese by 2030. That’s more than double the current rate of just below four percent.

Here is more by Jesper Koll, the piece is interesting on Japan throughout, mostly about demographics and the Japanese labor market.

What should I ask Marc Rowan?

I will be doing a Conversation with him.  If you don’t know, here is a snippet from Wikipedia:

Marc Jeffrey Rowan…is an American billionaire private equity investor. He co-founded Apollo Global Management in 1990 with Josh Harris and Leon Black and took over as CEO in 2021.

Marc also has been involved in recent disputes over academia, anti-Semitism, and in particular concerning the University of Pennsylvania.  But please note this Conversation was scheduled before all those issues came to the fore, and I do not intend to obsess over them.

So what should I ask Marc?

Sebastian Bensusan on Milei reform impressions (from my email)

This was great:
https://marginalrevolution.com/marginalrevolution/2023/12/argentina-reform-impressions.html

I think the biggest things that you missed are:

1. He is using the same “emergency measures” (DNUs ~ Executive Orders) that the Kirchner’s used. Many of the things in that DNU are very hard to justify as emergency measures and as such, I consider the method unconstitutional. In other words, he is playing dirty.

2. Many of the things in the bill are not directly relevant to the immediate economic crisis, are not necessarily why he was voted in, and are especially offensive to the side of the country that didn’t vote for him. For example, removing Ley de Tierras is not going to bring foreign investment immediately (nobody wants to invest in Argentina at this time) but it infuriates the losing side further. It is another example of him being ideologically driven. The more of these crusades he fights at the same time, the more likely a strong coalition forms against him.

Argentina Milei reform impressions

I didn’t have much time in Argentina, but I can pass along a few impressions about how Milei is doing, noting I hold these with “weak belief”:

1. He is pretty popular with the general population.  He is also popular in B.A. in particular.  People are fed up with what they have been experiencing.  It is incorrect to think of him as mainly a candidate for the elites.

2. Even if you think he “plays a clown on TV,” he is not a clown.  He is a serious thinker who has facility with economic arguments, including at the academic level.

3. If he can lick hyperinflation, but that causes a recession for a year or two, the population will accept that trade-off.

4. Licking hyperinflation will not be so easy.  The currency is still declining in value, and Milei has to solve major fiscal problems with 10-15 percent representation in the two-house legislature.  For this reason alone, the whole project still could very easily fail, and it would be a long time before libertarian-style ideas would be given another chance in Argentina.

4b. Right now Argentina is auctioning off (FT) $3.6 billion USD worth (but denominated in pesos) in fresh debt.  The goal is to clear off central bank debt, and to put fiscal instruments where fiscal instruments ought to be, and sever them from the monetary authority.  Right now short-term central bank debt is about 10% of the country’s gdp, a bad place to be.  But how well will this new borrowing go?  How far can it be extended?  The fate of the whole plan may rest on the efficacy of this very particular transition, and if more central government borrowing in Argentina makes you nervous it should.  Keep in mind hyperinflation is not just “money printing” (though it is that too), it is after a while an entire interwoven web of corrupt and malfunctioning institutional arrangements.  Just how easily and how quickly can those be untangled?

5. Milei’s political enemies are not entirely keen to seize power right now, since they would have to deal with a hyperinflation and possibly a recession.  This is operating in his favor.

6. Some of his support is based in a kind of “free lunch” voter desire to simply have more dollars, as some of the populace expects  “dollarization” to bring.  That is one reason why he won, but it is worrying for his ability to sustain support.

7. What I understand from his deregulatory measures I am very much in support of.  But until a broader business confidence is restored, they may not help economic growth much.  I don’t think we are going to see a Ludwig Erhard-style economic miracle in Argentina.

8. So far he has yet to make an obvious mistake.

9. Fossil fuel megaprojects (WSJ), such as “Vaca Muerta” may prove Milei’s ace in the hole, if he can hold on long enough.

10. U.S. mainstream media are not doing a good job covering these developments, or even devoting much attention to them.

I will continue to follow this issue.

Why France is underrated

That is the topic of my latest Bloomberg column, here is one bit:

Since the West European economic boom ended in the 1970s, the French civil service has been at best a mixed blessing. French administrators have gotten a lot done, reflecting their impeccable education and internal culture. But they have also helped to make the French economy overly static and too reliant on bureaucracy. A lazier, less activist civil service might have been better.

Fast forward to 2023. War and conflict are now more common on the global scene, a trend that shows no signs of abating. Populist governments are on the rise, and China and Russia are active and restless. None of those problems is easy to solve, and they all require greater involvement from the public sector. Nations with high-quality leadership and civil-service traditions will stand a better chance of navigating the turmoil.

So the bureaucracy that was once a hindrance to France may now turn out to be a comparative advantage. And at a time when governance seems to be deteriorating around the world, Macron continues to have a reputation as a relatively responsible leader.

This year has shown how this advantage plays out. Post-pandemic France has been a bit of a mix, with soaring energy prices, inflation, rising interest rates, continuation of the Ukraine war, labor strikes and protests, and a variety of European migration crises. Yet France avoided a credit downgrade and the French economy continued to create more jobs. Performance has hardly been perfect and the risk of recession remains, but France has done better than might have been expected 18 months ago.

I also consider the relatively successful French start-up scene, including in AI.

Milei in action

It only took a day into his term as Argentina’s new president for Javier Milei to get rid of the Ministry of Culture. Milei was inaugurated on 10 December, and the following day, the boisterously libertarian economist and former television commentator fulfilled his campaign promise with typical bravado. Also on the chopping block—or, rather, in the path of his chainsaw, which Milei carried throughout his campaign to symbolise his intent to slash government spending—was the Ministry of Women, Gender and Diversity.

Several other ministries were downsized and recombined into new entities. The Ministry of Social Development, Ministry of Education and Ministry of Labour, Employment and Social Security will be pared down into a newly formed Ministry of Human Capital, headed by the former TV producer Sandra Pettovello. Meanwhile, the Ministries of Public Works, Transportation, Energy, Mining and Communications will merge into a new Ministry of Infrastructure. (It appears that the Ministry of Culture and Ministry of Women, Gender and Diversity will be completely dissolved.)

Here is the full story. Whether or not you favor a Ministry of the Arts in the abstract, I don’t think you should during a fiscal crisis and hyperinflation…