None of these foreclosed houses is going to disappear. After a
foreclosure, one family moves out, and another moves in. We see the sad
faces of the people moving out, but we don’t as often see the happy
faces of the new homeowners moving in. Nevertheless, those happy faces
are out there, and we should not discount them.

Here is more.  I take the case against foreclosures to be the following.  The people getting kicked out lose their credit ratings and in the medium term they spend less.  The people moving in presumably have higher credit ratings but they probably aren’t rich.  They transfer a big chunk of their liquid wealth to a possibly-low-propensity-to-spend financial institution.  So foreclosures lower nominal aggregate demand and in times of a downturn this can be bad.

Landsburg’s title may just be provocative but I would make a distinction between the case for allowing foreclosures (I do not advocate that the federal government rewrite the mortgage contracts, although renegotiation could be made easier) and the case for foreclosures.  I should note he is quite correct to insist that foreclosure victims are hardly among the world’s — or even America’s — neediest cases.  If you think government can do anything well at all, ask what it can do for underprivileged young children.  On both justice and efficiency grounds the greatest potential gains lie there.  And continued home ownership is not the main thing they need.

Here are some more oddities about the study.  According to this report:

"the study found that 29 percent of the
male and 21 percent of the female students had verbally coerced sex
from another person….The percentages of those who physically forced sex were much lower: 1.7 percent   of the men and 1.2 percent of the women…."

Don’t these percentages seem very high? Especially for the women?

And get this,

"Straus found that 15 percent of the men and 13 percent of the women
had insisted on sex without a condom at least once in the past year.

Using the four-step corporal punishment scale, Straus found that of
the group with the lowest score on the corporal punishment scale, 12.5
percent had insisted on unprotected sex. In contrast, 25 percent of
students in the highest corporal punishment group engaged in this type
of risky sex."

13 percent of the women insisted that the man not use a condom?

More importantly, I believe that there is a causal connection between child abuse (rather than spanking) and later problems of violence but to me a connection between the kid being spanked and later engaging in risky sex is especially suggestive that the connection is a risk-loving person.  Children who take a lot of risks, like running out on to the street a lot, are going to get spanked more.  Later these same children also engage in risky activities.  Not having seen the data I would be willing to bet that spanking is also correlated with skydiving, not wearing your seatbelt, gambling, and many other risky behaviors which are plausible not caused by spanking.

Finally, how about this for a non sequitur of the day:

"because over 90 percent of U.S. parents spank toddlers, the potential
benefits for prevention of sexual and relationship violence is large,”
Straus says."

During my visits in England and Spain — admittedly two of the winners — I was wondering if we haven’t underestimated European growth rates.  It is well known that when new commodities are entering the market, measured growth rates can significantly understate the real increase in well-being.  (Imagine that the price of an iPod fell from infinity in 1995 to $200 or so today; measuring this gain in terms of "more bundles of $200 in value" is missing some of the very high gains from those people who love iPods but were previously "at a corner" of no purchases, due to unavailability.)

So how does this apply to Europe?  I’m not mainly talking about iPods.  Rather migration is rampant.  When a Pole moves to London he can buy many more goods and services.  It’s a big move up in real income plus lots of new goods are introduced to the consumption basket.  So when there is lots of voluntary movement from poorer to richer regions, changes in measured income will understate some of the true gains.

Frequently I stressed to Spanish reporters just how big a success their country and economy has been; they almost didn’t believe me.  When I said things like: "Spain is in a much better competitive position than China, which still doesn’t have half the per capita income of Mexico" they were truly shocked.

Ed Glaeser writes:

Poor people come to cities because urban areas
offer economic opportunity, better social services, and the chance to get by
without an automobile. Yet the sheer numbers of urban poor make it more costly
to provide basic city services, like education and safety, and those costs are
borne by the city’s more prosperous residents. Taking care of America’s poor
should be the responsibility of all Americans. When we ask urban residents to
pick up the tab for educating the urban poor, then we are imposing an unfair
tax on those residents. That tax artificially restricts the growth of our
dynamic cities.

It is fair to say that urban dwellers receive higher positive and negative externalities from their neighbors, relative to suburbanites.  I’m not sure why the bundle as a whole is unfair, least of all to the wealthier city residents (or why there is so much talk of unfairness to the wealthy in the first place), or for that matter why it is a significant marginal distortion.  The net value of the externalities is surely positive for people who live in cities and pay the higher rents.  All taxes involve some distortions but it seems like what is essentially a tax on city land does not involve a higher distortion than the average tax, if anything the contrary.  What’s really the case for lower property taxes and higher federal income taxes, combined with a move against federalism?

If there is any unfairness, maybe it is toward the people can’t afford to live in desirable cities but would like to.  If we lower the property tax burden in cities, rents will rise and this problem will become worse rather than better.  The more general point is that urban land owners, not all residents, benefit disproportionately from good policy changes.  Urban improvements have unfair distributional effects by the very nature of city land.

If there is a case for federalizing urban education and welfare, surely it refers to what will help the poor (if indeed that would), not what will help the urban non-poor.  And are city residents even a meaningful class of people to which the concept of fairness applies in a significant way?  Glaeser is very very smart but frankly I found most of this piece puzzling; perhaps I have misunderstood him.

In other words, which trends or tendencies flourish when the economy is underperforming?  This source makes a (weak) case for facial hair.  In 1926 George Taylor claimed that hemlines went up with strong economies; presumably skirts become longer when times are bad.  This post and chart suggest that dystopian science fiction movies go away in bad times.

Which of these tendencies — if any — are the most reasonable to actually believe?

Here is his new paper, but start first with this Mark Thoma summary, and two graphs from Brad DeLong.  The main point is that some U.S. imports may be more labor-intensive and less skill-intensive than previous classifications had indicated.  Here is one key paragraph (p.20):

But what are we to make of NAICS 334, Computer and Electronic Products? In U.S. data it ranks as the most skill-intensive of industries, yet it is also an industry in which more than three-quarters of imports come from developing countries, especially China.

If these sectors count as "importing labor," we can find that trade is creating more downward pressures on U.S. wages than we had thought. 

I don’t think Krugman is quite right to claim: "the apparent sophistication of imports from developing countries is in large part a statistical illusion."  I would sooner say that China and some other Asian countries are specializing in new (and sophisticated) techniques of cooperation, made possible by long-term historical investments in human capital and social norms.  At least in certain sectors, they are combining complementary labor inputs, with complementary capital inputs, more effectively than before; it’s hard to explain that change in the impoverished vocabulary of the substitution-obsessed Heckscher-Ohlin model.  The skill is in the combination not in the people themselves.  "Capital-intensive" vs. "labor-intensive" or "skilled" vs. "unskilled" are not simple either/or questions.   

So I think Krugman is confused on the semantics, but in the final analysis this perspective supports and perhaps even strengthens his point.  If the paper looked at wages and employment in northern Mexico, following the move of China onto the world stage, the revisionist conclusions would fall more easily into place.  On one hand Chinese competition hit Mexico (a home of unskilled but relatively cooperative labor) very hard; on the other hand northern Mexico responded successfully by moving up the value chain rather than by folding and losing.  Both developments suggest that the Chinese competition is not just a simple example of skill-intensive labor.

You might say: "Chinese competition with northern Mexican textiles and plastics isn’t at all like Chinese competition in the hi-tech sector."  I would sooner say: "The Chinese are applying common production techniques across the board."  Of course the phenomenal Chinese levels of both personal savings and labor migration to urban areas also support the overall interpretation of complementarity.

Addendum: Here is a good paper on the changing nature of Chinese exports.