Category: Political Science
Seasteading
First, I agree with Will Wilkinson that a seasteading community would likely evolve back to non-libertarian political visions.
Second and more fundamentally, I am for the seasteading idea. There are today many oil derricks, owned and run by energyl companies. There are many cruise ships, with more or less autonomous legal governance. More and bigger cruise ships would be better and if some of them moved more slowly that would be fine too. But when I step on to a cruise ship (well, actually that's the sort of thing I don't do; personally I hate cruise ships), I don't feel I am moving from an inferior political order to a superior political order.
I've wondered whether I should retire on to a cruise ship of the future, but I'm not attracted per se by the "politics" I would get there. I would expect more freedom in the Lockean sense but less of the positive freedom that comes from living in a larger, more diverse, and yes also a more stupid society. I wouldn't live on the Mensa cruise ship either. I'll take some of the stupidity of modern society (the landlubbing version) to get the diversity and the greater number of open niche spaces and free possibilities.
On a smaller scale, I live under different kinds of corporate, non-profit and university governance all the time. That's great, but I don't view their totalized extension as my preferred utopian path.
I'd like people to be smarter, more thoughtful, more tolerant, and more loving of liberty, yet in ways which do not drain away the diversity of the United States, which I feel is the best available foundation to build upon. No matter how good a seasteading charter may sound, any given venture just can't be that credible until it has succeeded for a very long time. History and precedent matter and by the way have you checked in on Estonia lately?
Addendum: Here is Alex on seasteading.
Congress opts out
Here is my latest column. Excerpt:
It’s not that anyone is behaving illegally or unconstitutionally,
but rather that Congress seems to want to be circumvented and to
delegate more power to the executive branch as well as to the Fed, at
least temporarily.
While Congressional leaders are consulted on
the major policies, Congress is keeping its distance, perhaps to
minimize voter outrage. This way, Congress can claim credit if a
recovery comes, but deny responsibility if the price tag ends up higher
than advertised or if banks seem to be receiving unfair benefits from
the government.
The Fed and the FDIC have become the major tools for enhancing executive power and working around Congress:
The traditional division of labor among policy makers was that the Fed
determined the quantity of money in the economy – it set monetary
policy – and Congress decided precise government expenditures – it
handled fiscal policy. These new programs blur that distinction and, in
essence, the Fed is running some fiscal policy.
The FDIC issues guarantees under the expectation that Congress will have to ratify them ex post but ex ante the executive branch is calling the shots.
Is this all good or bad? For any single choice, it is probably good. Congress does not, in general, improve the quality of economic policy, relative to the executive branch. But it is also a kind of deficit spending on the quality of future governance. The more Congress is accustomed to being allowed to punt, the worse Congress will become in the longer run. The executive branch will overreach more and also voters will apply successively more cynical standards to evaluating Congress, leading to a self-fulfilling prophecy.
To put it more concretely, this Congress shies away from accepting responsibility for the various bailouts, yet we think it will somehow solve far tougher problems? I, for one, am worried.
Separation of powers
Rep. Maurice D. Hinchey (D-N.Y.) vowed to force the White House to accept delivery of a new
presidential helicopter Obama says he doesn't need and doesn't want.
The helicopter program, which cost $835 million this year, supports 800
jobs in Hinchey's district. "I do think there's a good chance we can
save it," he said.
Here is much more. The Congressional Democrats don't like Obama's proposed "cuts" in spending.
Going to Extremes
That's the new book by Cass Sunstein and the subtitle is How Like Minds Unite and Divide. I am a fan of Cass Sunstein and I hope they confirm him for OIRA, but I am not persuaded by the main thesis of this book.
I take the main point to be that polarization is increasing and in a bad way. Sunstein offers plenty of good evidence that when people discuss a problem together, they tend to polarize if they disagreed in the first place. But this does not mean polarization is increasing in absolute terms. You can find poll-based public opinion diagrams which point in either direction, but viewing the problem in general and longer-run terms, here are a few offsetting forces:
1. Most of the time people aren't talking with others about controversial problems. During these "cooling off periods" their polarization might well decrease. It's not a one-way ratchet effect.
2. The population is aging in many countries. Even if you believe in the notion of "crochety old men," they are tame crochety old men.
3. Highly polarizing ideologies, such as communism and Nazism, have been on the decline. Maybe jihadism is on the rise but even that is not clear.
4. Wealth and commerce soften morals.
5. Public reactions to the financial crisis have been quite low-key for the most part.
6. Obama goes out of his way to adopt a non-polarizing style (no matter what you think of his policies) and it brings him considerable popularity. That suggests a demand for non-polarization, or at least the perception thereof. In many countries politicians have an incentive to straddle the median and bring outlying groups closer to the center, for purposes of governance and re-election.
Polarization is highly visible in certain segments of the media, including the web. But I am not convinced that increasing polarization is occurring or is a major problem, once we adjust for what one might call "perennial stupidity."
Chavez and the Power of the State
Between 2002 and 2004 millions of Venezuelans signed petitions calling for a vote to remove Hugo Chavez from office. Signatories were not anonymous and during the petition campaign Chavez supporters hinted darkly that there would be retaliation. Chavez was in fact forced into a recall election, but unfortunately he won (not one of democracy's better moments). After the election, the list of signatories was distributed to government agencies in an easy-to-use database. The database included the names and addresses of all registered voters and whether they had signed an anti-Chavez petition. Technology thus provided Chavez supporters the information they needed to retaliate.
Technology cuts both ways, however, and in a truly remarkable paper, Hsieh, Miguel, Ortega and Rodriguez match information in the petition database to another database on wages, employment and income. What the authors find is shocking, albeit not surprising. Before the recall election, petition signatories and non-signatories look alike. After the election, the employment and wages of signatories drop considerably, about a 10% drop in wages relative to non-signatories. Survey evidence conducted by the authors is consistent with retaliation by Chavez supporters especially in the form of job losses in the public sector. The authors estimate that the retaliation was so widespread, many workers were pushed into informal employment, that the Venezuelan economy was significantly damaged.
This is original, important and actionable research. Bravo to the authors, especially to Ortega who–as of this posting–has a job in Venezuela.
Is there a silver lining for Mexico?
To be sure, tourism to Mexico is devastated and the country will suffer many economic problems (yes, real business cycle theory still is relevant these days). But is there any upside?
I hesitate to speak too soon but I'm actually somewhat impressed by how the Mexican government, at least at the national level, has responded. There have been many failures of Mexican health care systems at local levels but keep a few things in mind: a) some of the problems lie with citizens who won't go see doctors, or who won't go see non-shaman doctors, b) too many Mexicans self-administer antibiotics, and c) when there is so much air pollution it is harder to discover flu cases, especially in the midst of flu season there. Nonetheless Mexican reporting systems seem to have discovered an unusual flu fairly promptly.
Once the national government discovered what is going on, they acted decisively and without undue panic. There has been very little denial, a common feature in the early stages of health crises (how long was it until the U.S. government acknowledged AIDS?). No one is treating the Mexican federal government like a banana republic or a basket case or thinking that the Canadian government would have done so much better.
Am I wrong? Could this episode in the longer run bring Mexico closer to the community of developed nations? Might Mexicans now be more likely to self-identify with a government that is at least partially competent?
Time will tell.
Interview with Obama
This is exactly the sort of link which MR normally shuns. But it really is worth reading. David Leonhardt runs the interview. I do not agree with Obama on all points but he understands economic policy better than do most professional economists, whether Democrats, Republicans, etc.
The game theory of Arlen Specter
Will writes:
My quick take is that this sucks, because the more choke points in the policymaking process the better. That said, it probably doesn’t change all that much unless Senate Dems can muster reliable intraparty unanimity. A few things that wouldn’t have passed will, and those could be an important few things, but most final votes won’t be different. The one way this hurts the Dems is that it makes a narrative of GOP obstruction less plausible, and if various things go south by the mid-terms, the Republicans can more plausibly say that all of it’s the other guy’s fault.
If the guy is willing to switch parties, he was already in the first place willing to switch policies (if indeed he needed to change his mind at all). He's suddenly lost of a lot of bargaining power (he had to hold off Pat Toomey, who presumably would have beaten him in the primary) and some of that power has been redistributed to the most conservative Democrats in the coalition. That could be an improvement.
Note also that Democratic Senators may find it harder to oppose Obama once a policy initiative is announced, so they may work harder behind the scenes, and well in advance, to shape legislation in their preferred directions or simply just kill it off. In contrast, a Republican veto-voice will be more reactive ex post.
On the marketing side, maybe now the Republicans, being denied the filibuster, will have to come up with some ideas that are actually appealing to voters outside their core constituencies.
Addendum: Here is Matt's analysis. And here is the academic evidence that voting behavior changes, following a party switch.
Timothy Geithner: a study in facial micro-expressions
Here is the source article. Here is an interesting article about judging creditworthiness by a person's looks. How different would the politics be if Geithner looked like Scarlett Johansson? Would that make the case against bank nationalization more persuasive?
Here is a sample of pictures. This, I think, is the least nervous-looking one.
Small ideas for a much better world
If you wait in the line in the post office (well, at least the one branch I visited) in Lisbon, they take advantage of your time. They have out on display books and CDs as overpriced "impulse buys." We bought one.
Here is one (American) rumination on waiting in line at the post office.
Last Man Standing
Here is my Wilson Quarterly essay on the economic and geopolitical "fallout" from the crisis. Here are the closing paragraphs:
Despite the separation of powers built into the American political system, U.S. political institutions have, by global standards, proven themselves unusually decisive and effective at critical times. The ability to react swiftly to new challenges is an underlying theme in American history, whether we consider the early missions to the moon, the breakthroughs of the Âcivil Ârights movement, the pioneering of environmental regulation, or the Âpro-Âmarket Reagan reforms of the Â1980s.
It’s a paradox that it’s the large, diverse nations such as the United States that have the greatest ability to maneuver in a crisis and turn on the proverbial dime. That’s good for us, of course, but if a new American Century is about to be born, it’s another sign that the world faces very serious challenges. And that’s not a cause for anyone to Âcheer.
Dan Drezner comments on related issues.
Economists and Societies
That's by Marion Fourcade and the subtitle is Discipline and Profession in the United States, Britain & France, 1890s to 1990s.
I very much liked this book and I might call it one of my favorite history of economic thought books, period. It skips textual exegesis and looks at what the economics profession actually did — in the comparative sense — in the United States, England, and France.
On France, I liked the data on p.6. Circa 1981, only 52 percent of French economists thought that rent control reduced the quantity and quality of the housing stock. Only 49 percent of French economists thought that flexible exchange rates were "effective," compared to 94 percent in the United States and 92 percent in West Germany. Remember Alex's blog posts on this topic, here and here?
The extent of hierarchy in the profession in England shocked even me:
Joan Robinson, for instance, did not become a professor until the ripe age of sixty-two. And such a well-respected economist as Roy Harrod never rose higher than a readership at Nuffield College.
Definitely recommended. Here is the book's home page.
The best sentence I read three days ago, Japanese edition
The appointment of the three envoys comes a year after Doraemon, a
rotund blue cartoon cat with no ears, was named a special ambassador.
Here is the article, interesting throughout and focused on the idea of the ambassador in Japanese culture.
Words of wisdom
The question here is what would Adam Posen have done if he had Tim
Geithner’s job? And based on Posen’s analysis, I think the only
conclusion you can reach is that he’d have done more-or-less the same
thing. Talking about a different issue last week, I heard Tyler Cowen
forcefully make the point that you have to think of the political
constraints as a real policy consideration. Suppose Geithner had asked Congress to appropriate $1 trillion to implement a program of bank
nationalization, asset writedowns, and loan guarantees–what would that
have accomplished? It certainly wouldn’t have gotten Congress to
appropriate $1 trillion to implement a program of bank nationalization,
asset writedowns, and loan guarantees. It might have derailed the
budget and thrown the political momentum on the Hill to proponents of a
neo-Hooverite spending freeze program. It might have caused panic. And
it certainly would have undermined the credibility of the inevitable
effort by Geithner to do the most he can with the authority he already
has.
One thing I like about Bryan Caplan's book is an interpretation which he will probably hate. The truly decisive actors are people directly in the political process. Maybe the "libertarians" who are or have been in politics are not just "sell outs." Rather they are implementing the net-liberty-enhancing policies that a real libertarian would favor if he or she were truly a decisive agent.
Would Idaho have more people if it were a separate country?
Call me silly but I think about questions like this. It's a big state with only about 1.5 million people, even though it is the only place with six pointed star garnets (refined here). Much of the state is beautiful.
Imagine the counterfactual that, in 1846, when the U.S. and Great Britain resolved the border, one part of the area went its own way. Today an independent Idaho would probably a) be more "right wing" than the U.S. as a whole, and b) free ride upon U.S.-provided public goods, such as national defense. A federal Idaho government might be more concerned with boosting tax revenues (it would be full residual claimant) than is the current state-level government. All those factors would militate in favor of population increase. Most of all, I have the odd (Bayesian?) notion that since it would look and feel like an underpopulated country, more people would flow in.
On the other hand Idaho would face the risk of trade barriers and its legal order might be less secure than for the U.S. as a whole. The prospect of mobility barriers could either keep people in the area or out of it.
Would the place still be called "Idaho"? I doubt it. Might the town of Nampa — #2 in the state — be much better known to the world at large? I think so.
Does EU accession add or drain people from its smaller units, such as Slovakia and Estonia? There's much at stake here, yet governments sign on to many agreements without thinking about the long-term consequences for their populations, whether pro or con.
Note: The comments section on this post is not for rehashing standard debates over immigration.