The Missing Dockworkers
One of the most amazing facts to come out of the dockworker strike (now resolved, it seems):
WSJ: Start with the astounding fact that there were 50,000 or so ILA strikers but only 25,000 or so port jobs. That’s right, only about half of the union’s members are obliged to show up to work each day. The rest sit at home collecting “container royalties” negotiated in previous ILA contracts intended to protect against job losses that result from innovation.
Hat tip: Scott Lincicome.
How to allocate space rights?
One alternative approach, I’ve argued, would be to establish a framework to enable individuals and groups to acquire time-limited conditional legal property rights to plots of spaceland, on a Georgist-inspired market system (Lowe, 2022a, 2022b). On my approach, competitors would keep the full profit they made from the permissible use of their plots but competition for the temporary ownership of these plots would consist in paying ‘rent’, the rate of which would vary depending on supply and demand, and would be partially rebated in relation to the meeting of various conditions inspired by the Lockean property provisos of ‘enough and as good’ (e.g. if the use of spaceland contributed to poverty alleviation) and ‘spoilage’ (e.g. if the use of spaceland contributed to conservation efforts). This rent would be paid into a fund administered to enable an increasing number of individuals and groups to compete for plots, through investment in space innovation.
That is from a new article by Rebecca Lowe, on the economic value of space. The citations are:
Lowe, R. (2022a). Space Invaders: Property Rights on the Moon. Adam Smith Institute. https://www.adamsmith.
org/research/space-invaders
Lowe, R. (2022b). Space is an opportunity to rethink property rights. Reason, December, https://reason.com/
2022/11/15/space-is-an-opportunity-to-rethink-property-rights/
The costs of U.S: tariff imposition
We use an advanced model of the global economy to consider a set of scenarios consistent with the proposal to impose a minimum 60% tariff against Chinese imports and blanket minimum 10% tariff against all other US imports. The model’s structure, which includes imperfect competition in increasing-returns industries, is documented in Balistreri, Böhringer, and Rutherford (2024). The basis for the tariff rates is a proposal from former President Donald Trump (see Wolff 2024). We consider these scenarios with and without symmetric retaliation by our trade partners. Our central finding is that a global trade war between the United States and the rest of the world at these tariff rates would cost the US economy over $910 billion at a global efficiency loss of $360 billion. Thus, on net, US trade partners gain $550 billion. Canada is the only other country that loses from a US go-it-alone trade war because of its exceptionally close trade relationship with the United States.
Ouch! That is from Edward J. Balistreri and Christine McDaniel, in their recent study.
That was then, this is now…
Oil companies are conveying an unlikely message to the GOP and its presidential candidate: Spare President Biden’s signature climate law. At least the parts that benefit the oil industry.
In discussions with former President Trump’s campaign and his allies in Congress, oil giants including Exxon Mobil, Phillips 66, and Occidental Petroleum have extolled the benefits of the Inflation Reduction Act. Many in the fossil-fuel industry opposed the law when it passed in 2022 but have come to love provisions that earmark billions of dollars for low-carbon energy projects they are betting on.
Some executives in the largely pro-Trump oil industry are worried the former president, if re-elected, would side with conservative lawmakers who want to gut the IRA. They fear losing tax credits vital for their investments in renewable fuel, carbon capture and hydrogen, costly technologies requiring U.S. support to survive their early years.
Here is more from the WSJ.
Saturday assorted links
1. Ross Douthat on late term abortion (NYT).
2. That’s a lot of AI subscriptions. Somehow I found that link hilarous.
3. Centre Pompidou outpost in…New Jersey?
4. Poland to suspend asylum rights temporarily.
5. Michael Pettis profile (WSJ…p.s. prices are flexible in the medium-term).
Dario Amodei on AI and the optimistic scenario
Here is a longish essay, here is one excerpt:
Economists often talk about “factors of production”: things like labor, land, and capital. The phrase “marginal returns to labor/land/capital” captures the idea that in a given situation, a given factor may or may not be the limiting one – for example, an air force needs both planes and pilots, and hiring more pilots doesn’t help much if you’re out of planes. I believe that in the AI age, we should be talking about the marginal returns to intelligence7, and trying to figure out what the other factors are that are complementary to intelligence and that become limiting factors when intelligence is very high. We are not used to thinking in this way—to asking “how much does being smarter help with this task, and on what timescale?”—but it seems like the right way to conceptualize a world with very powerful AI.
I view human imperfections, and current institutional and legal constraints as more binding than Dario does, and thus I think speeds of progress will be lower than he does. But there is much in his essay I agree with.
Matt Yglesias on regulation and deregulation
…it’s notable that if you look at the major deregulator measures of the past four years, it mostly happened under Jimmy Carter (Natural Gas Policy Act of 1978, Airline Deregulation Act of 1978, Motor Carrier Act of 1980, Depository Institutions Deregulation and Monetary Control Act of 1980) or Bill Clinton (Interstate Banking and Branching Efficiency Act of 1994, Telecommunications Act of 1996, Graham-Leach-Bliley Act of 1999) rather than Reagan. What Reagan did was cut taxes, staff the agencies with business-friendly appointees, and build the power of the conservative legal movement. Similarly, George W. Bush cut taxes, staffed the agencies with business-friendly appointees, and built the power of the conservative legal movement. Donald Trump, who in some ways represented a conceptual break with the Reagan-Bush political tradition, also cut taxes, staffed the agencies with business-friendly appointees, and built the power of the conservative legal movement.
That’s what Republican presidents do. Deregulatory efforts tend to happen when market-oriented thinkers persuade some prominent Democrats that they’re right about something, and then bipartisan deals get made. Also note that there’s something funny about the extent to which Carter has become retroactively famous for legalizing home brewing rather than, say, the natural gas thing, which legitimately transformed the national and global economy.
Here is the whole post (gated), with other interesting points as well.
From the Department of Energy
PIER Plans will be evaluated as part of the merit review process and will be used to inform funding decisions. The review criterion, Quality and Efficacy of the Plan for Promoting Inclusive and Equitable Research, will be included as one of the merit review criteria that peer reviewers will use to evaluate applications.
The Office of Science’s standard merit review criteria are set forth by 10 CFR Part 605.10 and may include additional criteria relevant to the scope and objectives of the solicitation.
Here is the notice, with further detail, it seems that will apply to all of their grant funding?
Via a loyal MR reader.
Friday assorted links
2. Why are fewer men going to college?
3. Warren Nutter’s Soviet research for the CIA.
4. Those new service sector jobs: “This Texas Mom Charges Over $1,000 for Her Elaborate Pumpkin Displays.”
5. Pizza Hut Will Deliver Your Resume Printed on a Pizza Box to Prospective Employers (NYC only).
Optimus personal assistant robot
U.S.A. facts of the day
The U.S. Senate Committee on Commerce, Science, and Transportation minority staff (Committee), which oversees federal science agencies including NSF, analyzed 32,198 Prime Award grants NSF awarded to 2,443 different entities with project start dates between January 2021 and April 2024.
Committee analysis found 3,483 grants, more than ten percent of all NSF grants and totaling over $2.05 billion in federal dollars, went to questionable projects that promoted diversity, equity, and inclusion (DEI) tenets or pushed onto science neo-Marxist perspectives about enduring class struggle. The Committee grouped these grants into five categories: Status, Social Justice, Gender, Race, and Environmental Justice. For the purposes for this report, “DEI funding,” a “DEI grant,” or “DEI research” refers to taxpayer dollars NSF provided to a research or engagement program that fell into one of these five groups.
Here is the full report. Note that by early 2024, that figure had risen to 27 percent.
Arbitrage! (at multiple levels)
Starting today: Kalshi will pay you 4.05% interest on both your cash and open positions.
Here is the link.
Thursday assorted links
The Economic Way of Thinking in a Pandemic
During the pandemic, economists often found themselves at odds with politicians, physicians, epidemiologists and others. Some politicians, for example, were worried that the pharma companies might engage in profiteering while economists worried that the pharma companies were not nearly profitable enough. Physicians focused on maximizing the health of patients while economists focused on maximizing the health of society–during the pandemic these were not the same and this led to disputes over testing, first doses first and human challenge trials. During the pandemic economists were often accused of not staying in their lane. But what is the economist’s lane?
In this talk, I discuss the economic way of thinking and how it conflicted with other ways of thinking. My talk pairs well with my recent paper also titled The Economic Way of Thinking in a Pandemic.
South Africa update
The African National Congress no longer regards privatisation as a “swear word” and has accepted that “bringing private sector money on board is not selling your soul”, said South Africa’s deputy president Paul Mashatile.
In an interview with the Financial Times at the end of a week-long investor roadshow to Britain and Ireland, Mashatile said South Africa’s new government, in which the ANC is sharing power with the market-leaning Democratic Alliance, had understood the need for more private investment in sectors such as energy, water and infrastructure. “We don’t have the money to do it, so we need the private sector,” said Mashatile, considered a potential successor to President Cyril Ramaphosa.
Investor sentiment towards South Africa has improved dramatically since the formation of the GNU, after 15 years in which the economy has barely grown against the backdrop of corruption scandals and government mismanagement of basic services.
The South African rand has risen more than 12 per cent against the US dollar this year, behind only the Argentine peso and Turkish lira. The Johannesburg bourse’s benchmark index is up 21 per cent in US dollar terms including dividends.
Here is more from the FT.