David Glasner: James Buchanan Calling the Kettle Black: Weekend Reading

San Francisco from Abovee Berkeley

IIR, back in 1986 I was one of two two people at the MIT economics Wednesday faculty lunch willing to say that I thought the award of the Nobel Prize to James Buchanan was not a travesty and a mistake. I would now like to withdraw that opinion.

Buchanan was a hedgehog. Hedgehogs are wise in one big thing and very stupid otherwise. They may be intellectually useful for a community, or they may be tremendously destructive—it depends. But they are not wise. And they should not be given prizes that lead outsiders to think that they are wise:

David Glasner: James Buchanan Calling the Kettle Black: "In the wake of the tragic death of Alan Krueger, attention has been drawn to an implicitly defamatory statement by James Buchanan about those who, like Krueger, dared question the orthodox position taken by most economists that minimum-wage laws increase unemployment among low-wage, low-skilled workers whose productivity, at the margin, is less than the minimum wage that employers are required to pay employees. Here is Buchanan’s statement...

...The inverse relationship between quantity demanded and price is the core proposition in economic science, which embodies the presupposition that human choice behavior is sufficiently relational to allow predictions to be made. Just as no physicist would claim that “water runs uphill,” no self-respecting economist would claim that increases in the minimum wage increase employment. Such a claim, if seriously advanced, becomes equivalent to a denial that there is even minimal scientific content in economics, and that, in consequence, economists can do nothing but write as advocates for ideological interests. Fortunately, only a handful of economists are willing to throw over the teachings of two centuries; we have not yet become a bevy of camp-following whores.

Wholly apart from its odious metaphorical characterization of those he was criticizing, Buchanan’s assertion was substantively problematic....

Continue reading "David Glasner: James Buchanan Calling the Kettle Black: Weekend Reading" »


Via Adrienne Porter Felt: A "SMASH THAT LIKE BUTTON!!' from 1355: William: William and the Werewolf:

...And there he saw the lovely child, weeping in that horrible hollow, clothed like a king's son.

So ends the first part of this tale. All who would like to hear more should offer an 'Our Father' to the High King of Heaven for the noble Earl of Hereford, Sir Humphrey de Bohun, nephew of old King Edward who lies at Gloucester. For he is the first to have this tale translated from French into English for the benefit of all Englishmen; whoever prays thus, may God grant him bliss!

The cowherd's wife looked after the little boy as though he were her own son...

Continue reading " " »


I do not think that Steve Moore was "an amiable guy" to the people of Kansas (except for those who benefitted from his pass-through loophole). I would accept "a seemingly-amiable grifter", but "an amiable guy" seems to me to miss the mark...

Now where are all the other professional Republican economists? Coming out against Moore-to-the-Fed is a really cheap and easy virtue signal to make even if you are not virtuous at all. Failing to come out against Moore-to-the-Fed is to send a strong vice signal to the administration, and the world:

Greg Mankiw: Memo to Senate: Just Say No: "The president nominates Stephen Moore to be a Fed governor. Steve is a perfectly amiable guy, but he does not have the intellectual gravitas for this important job.... It is time for Senators to do their job. Mr. Moore should not be confirmed...

Continue reading "" »


Leonid Bershidsky: Russia's Annexation of Crimea 5 Years Ago Has Cost Putin Dearly - Bloomberg: "His overconfidence after the successful annexation lured him into a trap where he lost all bargaining power: Five years ago, on March 16, 2014, the Kremlin held a fake referendum in Crimea to justify after the fact the peninsula’s annexation from Ukraine.... The highest cost to Putin came in bargaining power rather than in cash. Immediately after Crimea, geopolitical bargains were still possible for Putin.... After the eastern Ukraine adventure, and especially after the downing of Flight MH17 and all the laughable Russian denials that followed, his credibility was shot. Nobody knew if he would keep his end of any bargain.... Putin’s lack of credibility is an important reason he can’t build any alliances at all.... At the same time, Russians’ post-Crimea enthusiasm is gone, eroded by six years of falling incomes.... Russia, the world and, likely, parts of the Russian establishment are waiting for Putin to go, even if no one can make him leave.... Meanwhile, Fortress Russia is locked and no one’s coming to parley...

Continue reading "" »


I confess, I do not understand any of these three objections: (1) Weinberg is disturbed by many-worlds just as earlier physicists were disturbed by quantum waves, but the universe does not care and does not avoid every feature that might disturb East African Plains Apes. (2) The Born rule is a problem for all formulations of quantum mechanics, but many-worlds has come closer to it than any other formulation and may well have derived it. (3) The non-locality of EPR, "entanglement", and "spukhafte Fernwirkung" is not a problem for many-worlds, but rather a problem for all other formulations—including instrumentalist ones—as Sidney Coleman said, it's either "quantum mechanics in your face" or non-locality; it's not "quantum mechanics in your face" and non-locality: Steven Weinberg: The Trouble with Quantum Mechanics: "The realist approach has a very strange implication... Hugh Everett... The vista of all these parallel histories is deeply unsettling, and like many other physicists I would prefer a single history. There is another thing that is unsatisfactory about the realist approach.... We can still talk of probabilities as the fractions of the time that various possible results are found when measurements are performed many times in any one history.... Several attempts following the realist approach have come close to deducing rules like the Born rule that we know work well experimentally, but I think without final success. The realist approach to quantum mechanics had already run into a different sort of trouble... Einstein... Podolsky and... Rosen... 'entanglement'.... Strange as it is, the entanglement entailed by quantum mechanics is actually observed experimentally. But how can something so nonlocal represent reality?...

Continue reading "" »


Comment of the Day: Graydon: "Education could do with much, much more of 'theory informs; practice convinces'. If you want people to exhibit empathy for those whose state is not theirs and whose expertise is different, you need to make most of education involve failure; do this material thing at which you are unskilled. Allowing education to be narrow, and to avoid all reminder that the world is wider and that to a first approximation everyone is utterly incompetent, just encourages arrogance. Arrogance is terrible insecurity management; it makes the other monkeys less inclined to help you. (Yes of course we should overtly teach both insecurity management and band-forming best practices in simple overt language.)...

Continue reading "" »


Note to Self: There are few enough things in the world or concerning the state of the (non-House) federal government to be thankful for these days. But one i that, despite his enormous deficits and unfitness for the office of president, Donald Trump is not a chickenhawk:

Continue reading "" »


Hoisted from the Archiyes: Why We Hate Chickenhawks: Selections from SFF Author David Drake

Hammers slammers Google Search

David Drake, a good chunk of whose work is best classified as horror and is really about his experiences as an interrogator in the 11th Armored Cavalry Regiment, the "Blackhorse", when it went through the Cambodian market town of Snuol:

I [now] had much more vivid horrors than Lovecraft's nameless ickinesses to write about.... I wrote about troopers doing their jobs the best they could with tanks that broke down, guns that jammed—and no clue about the Big Picture.... I kept the tone unemotional: I didn't tell the reader that something was horrible, because nobody told me.... Those stories... were different. They didn't fit either of the available molds: "Soldiers are spotless heroes," or... "Soldiers are evil monsters"... [...] The... stories were written with a flat affect, describing cruelty and horror with the detachment of a soldier who's shut down his emotional responses completely in a war zone... as soldiers always do, because otherwise they wouldn't be able to survive. Showing soldiers behaving and thinking as they really do in war was... extremely disquieting to the civilians who were editing magazines...

Continue reading "Hoisted from the Archiyes: Why We Hate Chickenhawks: Selections from SFF Author David Drake" »


Hoisted from the Archives: Why We Have Good Reason to Hate Chickenhawks

I need an adult How are you supposed to even play Muscovy in ironman eu4

Hard Power, Soft Power, Muscovy, Strategy, and My Once-Again Failure to Understand Where Niall Ferguson Is Coming From: Live from Le Pain Quotidien: In which I once again fail to understand where Niall Ferguson is coming from:

Niall Ferguson: The ‘Divergent’ World of 2015: "Hard power is resilient...

Continue reading "Hoisted from the Archives: Why We Have Good Reason to Hate Chickenhawks" »


The Fed Should Buy Recession Insurance: Now Not Quite so Fresh at Project Syndicate

Hundred Dollar Bill Peel and Stick Jumbo Size Removable Wall Decal 100 Dollar Bill Google Express

Now Not Quite so Fresh at Project Syndicate: The Fed Should Buy Recession Insurance: If the United States falls into recession in the next year or two, the US Federal Reserve may have very little room to loosen policy, yet it is not taking any steps to cover that risk. Unless the Fed rectifies this soon, the US–and the world–may well face much bigger problems later.

Continue reading "The Fed Should Buy Recession Insurance: Now Not Quite so Fresh at Project Syndicate" »


A Firebell in the Morning...

Lesson one of central banking: yield curve inversion should only be allowed when the central bank wants to push inflation down. So what does the Fed think it's doing? Is it that confident that the bond market does not know what it is doing? Show me any optimal control exercise that says that right now is a good time to allow yield curve inversion: Vildana Hajric and Sarah Ponczek: Stock Market Today: Dow, S&P Live Updates for March 22, 2019: "U.S. equities fell and Treasuries rose after miserable data from the German manufacturing sector.... The yield on 10-year Treasuries, already at a more-than-one-year low, extended its decline. The three-year/10-year yield curve inverted for the first time since 2007...

Continue reading "A Firebell in the Morning..." »


This Has Certainly Been One Crazifying Fed Tightening Cycle...

FRED Graph FRED St Louis Fed

This has certainly been one crazifying Fed tightening cycle.

The 10-year nominal Treasury rate is only 0.2%-points higher than it was back in mid-2015, when liftoff appears imminent. the 10-year real rate is back where it started at 0.65, after having gone as low as zero and as high as 1.1%. And—unless it is triggered by strong good growth news—any further increase in the federal funds rate would invert the yield curve, which the Federal Reserve has decided not to do.

I really wish I had some idea of just what the Federal Reserve plans to do to fight the next recession, whenever the next recession come along. It has know since at least mid-2010 that the bond market believes that secular stagnation—at least in its effect on long-term interest rates—is a very real thing.

Presumably the Fed still believes that when the next recession comes it has one job: to drop the 10-year real Treasury rate so that expanded construction and exports can take up some of the emerging labor-market slack and so cushion the downturn. But I have no idea what policies it thinks it will pursue that will accomplish that...

Continue reading "This Has Certainly Been One Crazifying Fed Tightening Cycle..." »


A Baker's Dozen of Books Worth Reading...

The Vela

  1. The Vela https://www.serialbox.com/serials/the-vela
  2. Barbara Chase-Ribaud: Sally Hemings; A Novel https://books.google.com/books?isbn=1569766797
  3. Annette Gordon-Reed: Thomas Jefferson and Sally Hemings: An American Controversy https://books.google.com/books?isbn=0813933560
  4. Kevin O'Rourke: A Short History of Brexit https://books.google.com/books?isbn=0241398339
  5. E.M. Halliday: Understanding Thomas Jefferson https://books.google.com/books?isbn=0060957611
  6. Guy Gavriel Kay: A Song for Arbonne https://books.google.com/books?isbn=1101667435
  7. Harriet Beecher Stowe: A Key to Uncle Tom's Cabin https://books.google.com/books?isbn=1557094934
  8. Keri Leigh Merritt: Masterless Men https://books.google.com/books?isbn=110718424X
  9. Gareth Dale: Karl Polanyi: A Life on the Left https://books.google.com/books?isbn=0231541481
  10. Philip Auerswald: The Code Economy: A Forty-thousand-year History https://books.google.com/books?isbn=0190226765
  11. John Judis: The Nationalist Revival: Trade, Immigration, and the Revolt Against Globalization https://books.google.com/books?isbn=099974540
  12. Richard Baldwin: The Globotics Upheaval: Globalization, Robotics, and the Future of Work https://books.google.com/books?isbn=0190901772
  13. Patricia Crone: Pre-Industrial Societies: Anatomy of the Pre-Modern World https://books.google.com/books?isbn=1780748043

Continue reading "A Baker's Dozen of Books Worth Reading..." »


Martin Wolf: Theresa May Is Taking a Hideous Brexit Gamble: "Why, then is the prime minister so set on getting this deal through parliament? It is surely because she believes it is the only way to achieve three conflicting objectives at one and the same time: keep her party united; agree with the EU; and deliver the promised Brexit. These objectives are not unreasonable.... But sticking so doggedly to this strategy is also extremely risky...

Continue reading "" »


Fairly Recently: Must- and Should-Reads, and Writings... (March 21, 2019)

6a00e551f080038834022ad3b05124200d


  1. David Warsh: Austerity is Defunct: "Long-term stagnation is a real possibility...

  2. Wikipedia: Gregor MacGregor

  3. Andy Matuschak and Michael Nielsen: Quantum Computing for the Very Curious: "Presented in an experimental mnemonic medium, which makes it almost effortless to remember what you read...

  4. Remaniacs Podcast

  5. Laura Tyson and Susan Lund: The Blind Spot in the Trade Debate: "Digital flows and services.... As governments assess their external balances and competitive positions, hammer out trade deals, and set national policy agendas, they need to look beyond manufacturing and agriculture...

  6. Notice anyone missing from Clive Crook's list of Brexit villains? That's right: no Johnsons, no Farages, no ERGs. Somehow the right-wing nutjobs whom he has spent so much of his career carrying water for have no agency, and so are not worth mentioning as bearing responsibility. Bless their little hearts: Clive Crook: Britain’s Next Great Brexit Mistake: "No great regard for the EU.... Cameron’s bungling.... Rarely... did May miss a chance to make things worse.... This pitiful result... the Remain majority in Parliament chose to let it happen...

  7. Casey Newton: Instagram's Reckoning Arrives

  8. Petitions: Revoke Article 50 and remain in the EU: "The government repeatedly claims exiting the EU is 'the will of the people'. We need to put a stop to this claim by proving the strength of public support now, for remaining in the EU. A People's Vote may not happen-so vote now...

  9. Robert Shrimsley: No words: "We're close to a gangrene moment" said one senior European Commission official...

Continue reading "Fairly Recently: Must- and Should-Reads, and Writings... (March 21, 2019)" »


Comment of the Day: Erik Lund: "In later stages, the AI taught itself to recognise school ties and to perform Masonic handshakes. Unfortunately, on being informed that software wasn't eligible for Skull and Bones or Opus Dei, it became critically unstable and tried to run away to join SEAL Team 6...

Continue reading "" »


I agree. This is bending to reality. But the reality has only changed a little bit since last December: John Authers: Federal Reserve Bends to Economic Reality: "Looking at various recession indicators, several of which are produced by the Fed, it looks as though Powell may be bending to the evidence of economic trouble ahead and not, as many claim, bending to pressure from the financial markets...

Continue reading "" »


John Authers: Things Are Finally Looking Up for Theresa May: "EU... patience has run out and they do not want to waste more time waiting for the infuriating British to make up their minds.... EU leaders have decided that they are ready for a no-deal Brexit and could handle the consequences. This is probably not true of the U.K. And so the EU is prepared to risk forcing the issue, and forsaking the (still slim) chance that the U.K. might yet decide to stay. Thus, Theresa May, for whom personal support appears to have evaporated, might conceivably be in position to snatch victory from the jaws of defeat...

Continue reading " " »


The real lesson, I think, from AI-machine learning is that AI-machine learning is a lot like "human judgment"—we have remarkably little insight into what features decisions of the situation are salient to the mind or to the whatever that is actually making the deciding. Thus this is not just a cautionry tale for AI-machine learning, it is also a cautionary tale for human "experts": Andrew Hill: Amazon Offers Cautionary Tale Of AI-Assisted Hiring: "Amazon, one of the most innovative and data-rich companies in the world, leapt on that possibility as early as 2014. It built a recruiting engine that analysed applications submitted to the group over the preceding decade and identified patterns. The idea was it would then spot candidates in the job market who would be worth recruiting...

Continue reading "" »


In response to a query from Nancy M. Birdsall on what are the most important contributions to feminist economics, Equitable Growth's Kate Bahn provides a shoutout to, among others, my college classmate Joyce Jacobsen of Wesleyan—who got me my first economics RA job: Kate Bahn: "Some good resources are Beyond Economic Man and Toward a Feminist Philosophy of Economics. I particularly like Joyce Jacobsen's essay on 'Some implications of the feminist project in economics for empirical methodology' in the latter...

Continue reading "" »


Dani Rodrik has, I think, a better way to frame the problems that he and Richard Baldwin are both thinking about this winter: Dani Rodrik: The Good Jobs Challenge: "[For] developing countries... existing technologies allow insufficient room for factor substitution: using less-skilled labor instead of skilled professionals or physical capital. The demanding quality standards needed to supply global value chains cannot be easily met by replacing machines with manual labor. This is why globally integrated production in even the most labor-abundant countries, such as India or Ethiopia, relies on relatively capital-intensive methods.... The standard remedy of improving educational institutions does not yield near-term benefits, while the economy’s most advanced sectors are unable to absorb the excess supply of low-skilled workers. Solving this problem may require... boosting an intermediate range of labor-intensive, low-skilled economic activities. Tourism and non-traditional agriculture... public employment ... non-tradable services carried out by small and medium-size enterprises, will not be among the most productive, which is why they are rarely the focus of industrial or innovation policies. But they may still provide significantly better jobs than the alternatives in the informal sector...

Continue reading "" »


Pedro Nicolaci da Costa, newly-installed over at EPI, is doing a bang-up job: Pedro Nicolaci da Costa: These 5 Charts Show Inequality Is Bad for Your Health—Even If You Are Rich: "Pickett and Wilkinson kept coming back to a single uniting factor—inequality: 'What the research shows—not just ours but that of hundreds of researchers around the world—is that inequality brings out features of our evolved psychology, to do with dominance and subordination, superiority and inferiority, and that affects how we treat one another and ourselves, it increases status competition and anxiety, anxieties about our self worth, worries about how we are seen and judged'.... Here are five charts from their presentation...

Continue reading "" »


Question: How long before internet searches for "Delong economist" come up not with me but with this guy?: Delong Meng: Optimal Mechanisms for Repeated Communication: "We consider a repeated communication model with a long-run sender and a long-run receiver.... A biased adviser who prefers policy θ + b, whereas the receiver wants to implement policy θ. The sender’s utility is uS(a,θ) = -(a−θ−b)2, and the receiver’s utility is uR(a,θ)= −(a−θ)2.... For the optimal mechanism the receiver chooses a function a(ht) that maximizes her expected payoff with respect to the sender’s incentive constraint.... We characterize the payoff set as the discount factor goes to one, and we analyze the rate of convergence to points on the frontier of this limit payoff set...

Continue reading "" »