Diane Ravitch turns on school choice and testing
Her new book is The Death and Life of the Great American School System: How Testing and Choice are Undermining Education. Her bottom line is this:
The more uneasy I grew with the agenda of choice and accountability, the more I realized that I am too "conservative" to embrace an agenda whose end result is entirely speculative and uncertain. The effort to upend American public education and replace it with something market-based began to feel too radical for me. I concluded that I could not countenance any reforms that might have the effect — intended or unintended — of undermining public education.
Ravitch of course was once the number one advocate of these very ideas; read this excellent article on her intellectual evolution.
Overall it is a serious book worth reading and it has some good arguments to establish the view — as I interpret it — that both vouchers and school accountability are overrated ideas by their proponents. (Short of turning the world upside down, some school districts will only get so good; conversely many public schools around the world are excellent.) But are they bad ideas outright? Ravitch doesn't do much to contest the quantitative evidence in their favor. There are many studies on vouchers, some surveyed here. Charter schools also seem like a good idea.
Is American public education such a huge success these days that it should be immune from significant restructuring? I don't think so. One of the best arguments for our current system is simply that — because it is lax — it doesn't waste too much time for the really smart kids who want to be doing other things. That's an important factor but hardly a ringing endorsement for the system as a whole.
Questions that are rarely asked
On my electric stove, there are two big coils and two little coils. The big coils, not surprisingly, heat up food much better. Why can't I have four big coils? There seems to be room for them. Is that asking too much? Do the little coils have some special use I am not aware of?
Assorted links
Predictions about Yemen
Most experts predict Sana'a, the fastest-growing capital in the world at 7% a year, will run out of economically viable water supplies by 2017. That is the same year the World Bank says Yemen will cease earning income from its oil, which currently accounts for three-quarters of the state's revenues.
Here is the full article. The Yemeni government, by the way, is still subsidizing water usage.
Speculative thoughts on shadow banking and the fiscal deficit
I've been thinking about my last Gary Gorton post and the use of Treasury securities as collateral for the shadow banking system. You will read many arguments that we should restrict the shadow banking system and limit its leverage and it is easy to see where these views come from. At the same time we observe that the U.S. federal government is on an unsustainable fiscal path, and yet able to sell its debt securities at very high prices.
Might there be a connection here? What is the actual trade-off? If leverage and shadow banking were much smaller, and we had safe, itty-bitty Canadian-style banks, how much would the demand for Treasury securities go down?
Just asking. If China stopped manipulating its currency, how much would the demand for Treasury securities go down? How much harder would it be to finance deficits?
Why are these issues rarely discussed in terms of trade-offs? I'd like to see a deeper study of the factors — possibly temporary or "artificial" — holding up the demand for Treasury securities.
This is Chile, not Haiti
"There is a certain lawlessness in this country that the government enabled," he said in Spanish. "They don't protect people and people don't respect them and criminal elements get out of control. People also have a high sense of entitlement. They expected the government to have water and power and things under control."
There is much more at the link or try this tweet: "The situation in Concepción is deteriorating. Citizens have taken up arms to defend themselves and their stores. 8 PM to 12 PM Army curfew." By no means is it just a bunch of people trying to feed themselves: "…many residents in the most damaged areas have not only taken food from supermarkets, but also robbed banks, set fires and engaged in other forms of lawlessness."
Haiti, on the other hand, remains fairly orderly and there have been reports that police corruption has gone down significantly.
One implication here is that I fundamentally distrust the use of "social trust" or "social capital" indicators in cross-country growth regressions. Repeat three times after me: context-dependence, context-dependence, context-dependence. The lessons for social science run deep.
My deeper worry is that this event will change Chile and set it back more than the damage alone would indicate. It will alter their self-image and national unity could decline. An alternative story is that Chile will become more progressive, as there will be greater common knowledge of income divisions and it will be harder to pretend everything is just fine.
Maybe it is a sign of social health to have some looting after an earthquake. In this part of blogland we do not dismiss the counterintuitive conclusion out of hand. For instance perhaps Haiti is so orderly because a) looters would be killed on the spot, and b) the entire fate of the nation is at stake and thus every small event is taken very seriously. Neither factor is exactly good news.
Message for *The Atlantic*
Give us your blogs back. We're right about this one, just trust us. We love you AM, but as it stands now, you've destroyed them. There's more here and here.
Addendum: Ezra offers his analysis. And some fixes are forthcoming.
African poverty is falling
Xavier Sala-i-Martin and Maxim Pinkovskiy report:
The conventional wisdom that Africa is not reducing poverty is wrong. Using the methodology of Pinkovskiy and Sala-i-Martin (2009), we estimate income distributions, poverty rates, and inequality and welfare indices for African countries for the period 1970-2006. We show that: (1) African poverty is falling and is falling rapidly; (2) if present trends continue, the poverty Millennium Development Goal of halving the proportion of people with incomes less than one dollar a day will be achieved on time; (3) the growth spurt that began in 1995 decreased African income inequality instead of increasing it; (4) African poverty reduction is remarkably general: it cannot be explained by a large country, or even by a single set of countries possessing some beneficial geographical or historical characteristic. All classes of countries, including those with disadvantageous geography and history, experience reductions in poverty. In particular, poverty fell for both landlocked as well as coastal countries; for mineral-rich as well as mineral-poor countries; for countries with favorable or with unfavorable agriculture; for countries regardless of colonial origin; and for countries with below- or above-median slave exports per capita during the African slave trade.
Not only has poverty fallen in Africa as a whole, but this decline has been remarkably general across types of countries that the literature suggests should have different growth performances. In particular, poverty fell for both landlocked as well as coastal countries; for mineral rich as well as mineral poor countries; for countries with favorable or with unfavorable agriculture; for countries regardless of colonial origin; and for countries with below or above median slave exports per capita during the African slave trade. Hence, the substantial decline in poverty is not driven by any particular country or set of countries.
Assorted links
1. Translating Ulysses into Finnish.
2. Trinidad singer Edward Cumberbatch, now on YouTube.
3. Does Chile already have more looting than Haiti?
4. A test for religious open-mindedness.
5. I love Kottke, and this photo, but I would call the post "How genetics doesn't work."
Sentences to ponder
This note shows that the aggregate fiscal expenditure stimulus in the United States, properly adjusted for the declining fiscal expenditure of the fifty states, was close to zero in 2009. While the Federal government stimulus prevented a net decline in aggregate fiscal expenditure, it did not stimulate the aggregate expenditure above its predicted mean.
That's from Joshua Aizanman and Gurnain Kaur Pasricha. I don't currently see an ungated copy.
Super-K
The pre-existing conditions of Nicole Kidman
Kidman injured her knee during the filming of Moulin Rouge in Australia in 2000, resulting in a $3 million insurance loss, and then quit Panic Room in 2001, leading to the insurer having to pay some $7 million for the replacement actress (Jodie Foster). As a result, her public and critical acclaim notwithstanding, Miramax was initially unable to get insurance on her for its film Cold Mountain, which had a budget approaching $100 million. From the perspective of the insurer, Fireman's Fund, she was a definite risk. As an insurance executive noted in an email, "…the fact remains that the doctor we sent her to for her examination noted swelling in the knee." The executive goes on: "The other major fact that can't be changed is our paying three claims for this actress's knees over the years."
To get the necessary policy from Fireman's Fund, Kidman agreed to put $1 million of her own salary in an escrow account that would be forfeited if she failed to maintain the production schedule, and she agreed to use a stunt double for all scenes that the insurer considered potentially threatening to her knee. In addition, the co-producer, Lakeshore Entertainment, added another $500,000 to the escrow account…Having made the all-important move from borderline uninsurable to borderline insurable, she could make movies again. No matter how great their acting skills and box office drawing power, stars cannot get lead roles if they are uninsurable. Great acting skills and box office drawing may make the star, but insurance is what it takes to make the movie.
That's from the new and noteworthy The Hollywood Economist: The Hidden Financial Reality Behind the Movies, by Edward Jay Epstein. You can buy it new, in paperback, for only $11.
Claims that some people find very interesting
Here is a new result which Yoram Bauman has pointed my attention to. The title is "Markets are efficient if and only if P = NP" and the author is Philip Maymin. Here is the abstract:
I prove that if markets are weak-form efficient, meaning current prices fully reflect all information available in past prices, then P = NP, meaning every computational problem whose solution can be verified in polynomial time can also be solved in polynomial time. I also prove the converse by showing how we can "program" the market to solve NP-complete problems. Since P probably does not equal NP, markets are probably not efficient. Specifically, markets become increasingly inefficient as the time series lengthens or becomes more frequent. An illustration by way of partitioning the excess returns to momentum strategies based on data availability confirms this prediction.
Points like this seem to be rediscovered every ten years or so; I am never sure what to make of them. What ever happened to Alain Lewis?
Jonathan Rauch on the Ryan plan
Someone who at least tried [to cut spending] is Rep. Paul Ryan of Wisconsin, the ranking Republican on the House Budget Committee, who recently unveiled a new edition of what he calls a "Road Map for America's Future." Its willingness to reform entitlement programs is laudable. But it keeps taxes at 19 percent of gross domestic product while raising (repeat: raising) federal spending from 21.6 percent of GDP in 2012 to more than 24 percent in the 2030s. It balances the budget, all right — in 2063.
Here is the article, interesting throughout, it mostly focuses on George Wallace.