Category: Political Science

The official told FOX News there are no signs of
instability in North Korea now, but the likelihood of a smooth
transition of power in that country is not high.

Here is the story, fully speculative throughout.  Many people think Kim is in very bad shape.  Apparently the U.S. and China are drawing up contingency plans for what comes next, financed in part by those interest payments on the agency debt.

One topic at today’s lunch was to guess the chance that the North Korean communist regime might collapse forever in the next few years.  I said p = 0.3, which others found to be a high estimate.  A second topic was, if reunification of the Koreas occurred (itself an open question), how long it would take for the South to grow again, given the amount of reconstruction it would have to finance in the North.  I said twenty years, though upon reflection I’ll revise that downwards a bit.

It’s hard to say much about these topics with any grounding, but since no one else in the econ blogosphere is talking about them, I will.  It’s by far the most important drama going on in the world right now.

I know this is serious stuff and it shouldn’t cause me to snort.  But it does.  I loved this dual question:

What is the European Union, and how does it function?

Not quite as good is:

What is the function of the Federal Reserve?

The link is from Ezra Klein.  Bear Stearns, Ireland, Georgia, and Denmark are invited to submit their answers as well.  How about Lehman Brothers and Turkey?

Addendum: On this list, questions #2, 4, 6 and 17 bear some pondering too.  Nor is #3 as simple as many people think.

In case you had forgotten:

"Have you ever heard of insect politics? Neither have I! Insects don’t
have politics…. they’re very brutal. No compassion…. no compromise.
We can’t trust the insect. I’d like to become the first insect
politician. I’d like to, but…. I’m an insect…. who dreamed he was a
man, and loved it. But now the dream is over, and the insect is awake."

That’s from David Cronenberg’s The Fly.  I was reminded of the scene by this post.  Best of all, the YouTube of that scene is here.  I will genuinely be glad when this campaign is over.

Addendum: The new operatic version of The Fly is receiving negative reviews.

First, war.  War is the antithesis of the libertarian philosophy of
consent, voluntarism and trade.  With every war in American history
Leviathan has grown larger and our liberties have withered.  War is the
health of the state. And now, fulfilling the dreams of Big Brother, we are
in a perpetual war.

A country cannot long combine unlimited government abroad and limited
government at home. The Republican party
has become the party of war and thus the party of unlimited government.

With war has come FEAR, magnified many times over by the governing party. Fear is pulling Americans into the arms of
the state. If only we were better at
resisting. Alas, we Americans say that
we love liberty but we are fair-weather lovers.  Liberty will flourish only with peace. 

Have libertarians gained on other margins in the past eight years? Not at all. Under the Republicans we have been sailing due South-West on the Nolan
Chart – fewer civil liberties and more government, including the largest new
government program in a generation, the Medicare prescription drug plan, and
the biggest nationalization since the Great Depression. Tax cuts, the summum bonum of Republican
economic policy, are a sham. The only
way to cut taxes is to cut spending and that has not happened.

The libertarian voice has not been listened to in Republican politics for a
long time. The Republicans take the libertarian wing of the party for granted
and with phony rhetoric and empty phrases have bought our support on the
cheap. Thus – since voice has failed – it is  time for exit.  Remember that if
a political party can count on you then you cannot count on it.

Exit is the right strategy because if there is any hope for reform it is by
casting the Republicans out of power and into the wilderness where they may
relearn virtue. Libertarians understand better
than anyone that power corrupts. The
Republican party illustrates. Lack of
power is no guarantee of virtue but Republicans are a far better – more libertarian –
party out-of-power than they are in power. When in the wilderness, Republicans turn naturally to a critique of
power and they ratchet up libertarian rhetoric about free trade, free
enterprise, abuse of government power and even the defense of civil liberties.  We can hope that new leaders will arise in
this libertarian milieu.

No country with a McDonald’s outlet, the theory contends, has ever gone to war with another….

Thomas
Friedman, who invented the theory in 1996, said people in McDonald’s
countries "don’t like to fight wars. They like to wait in line for
burgers."…

The Russia-Georgia conflict has finally blown this theory out of the water.

From the Guardian.  Clearly the theory was over-identified.  Perhaps no two countries with Taco Bell’s every go to war with one another.

Hat tip to Chris Blattman.

Ezra Klein channels Andrew Gelman:

…small states tend to be more approving of their governors. Why? Gelman
has some theories: "In a large state, there will be more ambitious
politicians on the other side, eager to knock off the incumbent
governor; small states often have part-time legislatures and thus the
governor is involved in less political conflict; small states (notably
Alaska) tend to get more funds per capita from the federal government,
and it’s easier to be popular when you can disburse more funds; large
states tend to be more heterogeneous and so it’s harder to keep all the
voters happy. As the graphs show, the pattern isn’t perfect, but it
looks real to me."

I have an additional hypothesis.  People from small states, especially atypical small states, sometimes have an inferiority complex vis-a-vis the other states or regions.  Taking pride in their politicians is one way of compensating for that.  Furthermore there is often less to do in underpopulated states and is not pride sometimes a substitute for action?  New Yorkers are not in fact so proud of the Metropolitan Opera, but in parts of Wisconsin the Green Bay Packers are king.

Find it here.  Here is Ezra’s version of Markets in Everything.

The classic paper is Buchanan and Faith, AER 1987.  Here is a recent extension of this classic work, with a dash of economic determinism:

Secessionist movements present themselves to the global public as analogues of colonial liberation movements: long-established identities are denied rights of self-determination by quasi-imperial authorities. Self-determination is presented as the solution to the challenge of peaceful coexistence between distinct peoples. The global public not only accepts this message but reinforces it: both Hollywood and diasporas relay it back to populations in developing countries. In this paper, we will argue that the discourse of secessionist movements cannot be taken at face value. We will suggest that a more realistic characterization of secessionist movements is that their sense of political identity is typically a recent contrivance designed to support perceived economic advantage, if the secession is successful, and facilitated by popular ignorance.

There are, of course, plenty of successful secessions.  Slovakia has been successful nation because of a language and a desire to be free of Czech rule, backed by EU free trade, EU largesse and political precommitment.  Or secession can help you break free of an evil empire, such as when Georgia left the former Soviet Union.  The most likely American state to make a success out of secession is, I think, Texas (or offer up your pick in the comments).  A Texan nation is hardly a good idea, but at least the state is big, has a diversified economy, has an outlet to the water, has a history of independence, and has a border with another nation, namely Mexico. 

The least likely American state to make a success of secession is, I think…Alaska.  The state takes in lots of federal money, has only a small natural population base, and is not too far from Russia.  Here are some data on which states receive the most on net from the federal government.  According to these numbers, only the state of New Mexico benefits more in (proportional) fiscal terms.  The states which fare the worst from federal transfers are New Jersey, Connecticut, New Hampshire, Minnesota and Illinois.

Martin Feldstein and John Taylor reassure us:

And by maintaining strong control over the growth of government spending, Mr. McCain will bring the budget into balance. His long record of fighting against excessive government spending, his plans to veto earmarks and reverse the spending binge of the past few years, and his strong commitment to balancing the budget can make this goal a reality.

Here is the full article, hat tip to Greg Mankiw.

This article claims that goldfish are as smart as mice.

Palin has an outside, straight talker, pro-reform, true blooded
American, take no prisoners image much as Perot did.  (A second point of comparison is Arnold Schwarznegger, with some obvious differences.)  And she has only begun to cultivate that image.  Do
you recall how much impact Perot had on the American people? 

Of
course if Perot actually had had the chance to be President, the
results probably would not have been pretty.  He would have been forced
to act like "just another politician," as has been the case with Arnold because in fact the job revolves around knowing how to govern. 

There is one biographical fact about Palin’s life that the critics
(Drum, DeLong, Yglesias, Klein, Sullivan and Kleiman are among the ones I read)
are hardly touching upon.  I mean her decision to have a Downs child
instead of an abortion.  This is the fact about her life and it will be viewed as such from now through November and perhaps beyond. 

If only for this reason, she will be seen as a candidate who stands on principle.  I don’t think the critics are sufficiently appreciating how tired the American people are of candidates who say one thing and do another and who abandon their principles at the first provocation.  This is a deep and very strong current and it runs through virtually every group of American political voters.  Because of her decision to have a Downs child, many voters will not view Sarah Palin in a cynical light, no matter what the critics say.  No story about firing a state trooper will break that seal.

In my jaded view, "politicians who break their word, violate their ideals, and do not follow through on their promises" is not one of the major problems in American politics.  In fact it’s often good that political promises are forgotten in the light of the realities.  So the American obsession with political promise-keeping does not resonate with me.  But the American people have been hungry for a "promise keeper, ideals believer" for decades and when was the last time they actually got one?

By the way, my mom’s first reaction to the nomination (hi mom!) was
that other mothers of "different" children (what exactly is the right word here?) would very much identify
with Palin and view her life as validating theirs and thus support her.

Go away and watch a Frank Capra movie and think about Palin again.  Larry Ribstein gets it.

I do recognize and indeed emphasize that this analysis requires that she is good on TV.  I give that p = 0.63.  I’ll also give p = 0.13 that she ends up off the ticket, but most of that chance comes from her deciding she needs to spend the time with her kids.

Addendum: The best argument against the pick is this, although it does not much revise my priors.

Around the blogosphere you will see many left-wing writers criticizing Palin for lack of experience.  Maybe this criticism is correct, but these commentators are falling into The Trap.  Most American voters do not themselves know much detail about foreign affairs and their vision of an experienced leader does not require such knowledge.  Was it demanded from Reagan?  Doesn’t everyone agree that Cheney and Rumsfeld knew plenty?  Rightly or wrongly, many American voters will view Palin’s stint as mayor of small town, her background in sports, her role in a beauty contest (yes), her trials raising teenage children, and her decision to stick with her priinciples and have a Downs Syndrome baby as all very valuable and relevant forms of experience.  The more the word "experience" is repeated, no matter what the context, the more it will hurt Obama.  Palin needs to appear confident and capable on TV and in the debates, but her ticket is not going to lose votes if she cannot properly spell Kyrgyzstan or for that matter place it on a map.

Addendum: Here is early response over at The Clinton Forum.

Trying to appear moderate is not always the best strategy for capturing votes during an election, reveals a new study. Extreme positions can build trust among an electorate, who value ideological commitment in times of uncertainty.

Here is the full story, with a hat tip to Eduardo Pegurier.  And here’s Robin Hanson:

In a TV game show, pretty contestants were not better or more cooperative players, but other contestants seemed to act as if they were.

I don’t know much about the substance or qualifications of Sarah Palin, but I believe that Democrats should be a little worried right now.  The otherwise-expected Romney and Pawlenty gifts have been taken off the table.

Addendum: Here’s Palin talking economics with Larry Kudlow.

Now over 80 percent in the betting markets.  And here is the gossip behind that.  Electorally this is a very effective pick I think (if indeed it is true), though it is hard for me to imagine a President with five (young) kids.

Addendum: No, that wording isn’t quite right.  How should I put this…?

Second addendum: Her stock in the market is now plummeting, now down to about 35, as there is a report she is still in Alaska.  I am told that last night Pawlenty was up to about 85 but then fell dramatically as well.  It has been a wild ride in this market.  And now Palin is back up again, etc.  Whatever.  Now it’s at 96.  Now confirmed.

More: Credible signals, in one link or less.

Here are some of her votes.  Her ACU voting lifetime record is 91 percent.  She is strong on free trade and seems to be a relatively conservative and corporatist Republican on economic issues.  She’s way up in the betting markets for the Republican VP spot, about 30 percent last I looked.  Note that she is not pro-life according to conservatives.  She has been very pro-drilling and very active on energy issues.  Since picking Mitt Romney would violate all known economic models of rational choice, and picking a woman would pop the Democrats’ post-convention bounce, I suppose this is a rumor to be taken seriously.  Here is her Wikipedia page.