L'Esprit de l'Escalier: May 10, 2013
I think what I would say is that if there were no safe-asset shortage the current low level of economic activity would not be self-sustaining--that if there were no safe-asset shortage, at current interest rates people would be dumping safe assets and funding risky investments and buying currently-produced goods and services and we would be heading for a boom. And I would point to the enormous spread between real Treasury yields on the one hand and equity earnings yields on the other. Perhaps you would be happier if I said that, once you are in a depressed economy like this one, depression will continue until and unless you have a surplus of safe assets to kick the economy out of its low-level equilibrium?
Alas! I do not know enough about the genealogy of Niall Ferguson's--repeatedly expressed over the past several decades--idea that Keynes's theories sprang not from an analysis of the economy but from the psychological imperatives of being a gay childless deviant pervert comes from. There was an oral tradition at Harvard that Schumpeter hated Keynes for many reasons, of which his bisexuality was one, and people did used to shake their heads at the low-class Schumpeter showed in the obituary… And there was a great deal of fuss about how it was unfair for neocons to be attacking Keynes while praising Allan Bloom to the skies as a low blow--that even if you bought the neocon "Victorian morals and religion are good things for gentlemen and hoi polloi to have", Keynes was certainly a philosopher…. But I don't know any more, other than that since the Schumpeter Keynes obit "Keynes was a perv and his theory is perverted and decadent and his followers are pervs too" coupled with a strikingly false misconstrual of the "in the long run we are all dead" quote has been a thing to say on the right for 67 years now: Hayek, Himmelfarb, . Ferguson and others have made it a thing to tiptoe up to this line for decades. He is now trying to cope with the fact that the world has changed--much in the same way that William F. Buckley had to cope with his discovery that apologizing for domestic terrorism--saying southern whites could defend segregation "by any means they found appropriate"--was not the wisest thing, given the circles in which he wished to move.
"Bradford DeLong praised the authors for their contribution to documenting and explaining polarization in American politics. He thought it important to differentiate between ideological polarization and partisan polarization, with the latter being much more in evidence today. To illustrate the difference, DeLong noted that a century ago Theodore Roosevelt began his political career as an ideological firebrand, yet was also very willing not only to cut deals across partisan lines but even to wreck his own party’s electoral chances to promote the policies he supported. That was an example of ideological but not partisan polarization. By contrast, the current Congress demonstrates so much partisan polarization--predominantly but not overwhelmingly on the Republican side--that it cannot even enact policies on which the two parties have historically agreed." Jacob Jensen et al.: Polarization and the Dynamics of Political Language: Evidence from 130 Years of Partisan Speech:
Sally Marks, I believe, goes all the way there: Says that Keynes's attitude toward German reparations was determined by his lust for Carl Melchior. Ferguson weighs the issue and in the end dismisses it in A Pity of War, but goes their whole-hog in the Spectator piece.
"Bradford DeLong agreed with Davis that it was unlikely that the observed wage differences during 1999–2007 fully captured the shift in labor market opportunities as perceived by workers. He thought that this failure might be particularly large for those in households with two potential earners, in which labor supply decisions are affected not only by the wages each part- ner can command but also by each partner’s likelihood of finding a good job match. DeLong also thought it significant that Moffitt had not found any determinants of the fall in the employment-participation ratio between 1999 and 2007, and hence could not use any such relationship to find a changing factor whose acceleration after 2007 could be invoked to explain the decline in the post-2007 employment-population ratio." Robert Moffitt: The Reversal of the Employment- Population Ratio in the 2000s: Facts and Explanations.
Re: "First and foremost question that needs to be answered: what could possibly lead to no effect on blood sugar among 600+ diagnosed patients?" There was a drop--20% of high A1C patients became low A1C patients. I would have expected 40% if Medicaid worked perfectly, but we already know that Medicaid-style protocols are lousy at dealing with patients with chronic conditions. Nevertheless, for Medicaid to be 50% clinically effective seems to me a significant win for Medicaid--the problem is that it is not statistically significant because the study lacks power to detect clinically-important effects.
NS said... "But [Himmelfarb's] essay (which drips with venom regarding its [Bloomsbury] subjects) is from 1985. TLDR of Himmelfarb: The Bloomsbury Group were non-Christian and lots of them were gay. Therefore, may they be cast into the outer darkness." But... But... But... But... Allan Bloom! And New York neoconservatives were overwhelmingly Teh Jew!
Is "Those damn Bloomsburies started the rot..." a quotation or a paraphrase? It is certainly the case that Niall Ferguson wants to exterminate Bloomsbury and all of its works rather than seeing it as a valuable part of Western Civilization's properly-diversified intellectual portfolio. From my perspective, Ferguson in "The Pity of War" wants to have it both ways--the Bloomsburies who didn't want to fight the war were traitors to the Empire, and yet those who did want to fight the war were traitors to History and to Europe.
“.@davidgraeber: ‘.@Pawelmorski @delong’s… attacks… in violation of twitter protocols’” What are these protocols and when did I agree to be bound by them? I don't see them anywhere in Twitter's terms of service. It is a very interesting type of "anarchist" indeed that @davidgraeber: an I-can-do-whatever-I-want-and-you-can-do-whatever-I-want anarchist… #GraeberErrors ;-)
In my inbox: "I thought [Ruth Marcus's] column was not a crime, just a metaphor in search of a reality."
Herndon did very good work. And I am kicking myself for not asking R&R for the details of their calculations two years ago, because my people and I were not able to replicate the details (although there is a negative correlation between growth and debt).
Ryan's Medicare plan wanders all over the map. It used to be that it was to reduce Medicare spending growth via cutting waste as much as ObamaCare does--but instead of using the money to pay for seniors' drugs and fill other gaps in the system, use it for tax cuts for the rich. Then it was to restore the $750 billion in waste to insurance companies, for-profit hospital executives, and over-treating specialists, and leave Medicare untouched. Then it was to give today's middle-aged when they become seniors a smaller voucher and make them, not experts, figure out how to bring Medicare spending growth down. Now it seems to be to take the $750 billion in ObamaCare Medicare savings and use them to (very partially) finance tax cuts for the rich again, with no planned program changes in Medicare at all--save to keep the IPAB from daring to make efficiency improvements that might hit the pockets of specialists.