02 Jul 2015

Is This a Good Way to Help the Downtrodden?

Economics, Shameless Self-Promotion 19 Comments

My latest article at FEE poses some hypotheticals:

Or consider families who adopt children from war-torn regions. These actions, though seemingly noble, are clearly a drop in the bucket, with hundreds of thousands of orphans left behind. What if the government passed a law saying that US families were only allowed to adopt foreign children if they did so at least 15 kids at a time? Would activists agree that such a “pro-adoption” measure would increase the number of adoptions and be an unmitigated boon for foreign orphans?

Currently there are people who volunteer to teach adults how to read. But adult illiteracy is still a vexing problem in certain communities, so clearly these volunteer efforts have been inadequate to overcome the challenge. The obvious, pro-literacy way to fix things is to pass a law saying volunteers must give at least 15 hours of tutoring per week. If they are caught only teaching adults how to read for, say, 14 hours, then the volunteers will be heavily fined.

You see where I’m going with this?

02 Jul 2015

Scott Sumner: “I’ll Be Making All the Ironic Jokes Around Here, Thanks”

Scott Sumner 34 Comments

Oh Scott, why do you vex me so? In the midst of an EconLog post, Scott had this throwaway line (in my bold):

I first got into blogging in 2009 out of frustration over Fed policy. The US obviously had a huge demand shortfall, and the Fed wasn’t doing enough to address the problem. Indeed I believe the Fed caused the huge demand shortfall.

So most people think I’m a demand-side economist. (Some even equate “demand-side” with “Keynesian,” which would make Milton Friedman roll over in his grave.)

Now follow me on this. In order for that parenthetical statement to make any sense whatsoever, surely both of the following statements must be true:

(1) Milton Friedman never said that his occasional focus on monetary aggregates could arguably qualify him as a Keynesian.

(2) Scott Sumner never referred to himself as a Keynesian.

And yet, Milton Friedman famously said there is a sense in which all (sic) economists were Keynesians because they rely on the Keynesian language and apparatus, and Scott once referred to himself as the last New Keynesian economist.

(That giant sucking sound you hear is the universe imploding.)

30 Jun 2015

Chinese Stock Market Crashing

Business cycle 24 Comments

Details here. It’s down about 25% in the last two weeks, and 11% in the last two days.

Meanwhile, Scott Sumner is running victory laps, over those broken records who called it a “bubble” but didn’t give the precise timing. (See the P.P.S. in his post.)

30 Jun 2015

Bias in the Published Estimates of Social Cost of Carbon

Climate Change, Shameless Self-Promotion 10 Comments

This is a bit technical, but if you care about the climate change policy debate, you should try to get through it. I made it as easy as possible.

28 Jun 2015

Chris Tomlin Mellows Out With Live “Indescribable”

Religious 3 Comments

This is a big hit for this guy, but this live version is more mellow than his standard one.

27 Jun 2015

Quick Comment on SSM and I’ll Move On

SSM 56 Comments

If you want to see my thoughts, see FB. I want to make one quick comment here, but first, watch Obama:

I am not shocked by libertarians saying, “On balance, I am glad this happened, though I totally understand people who are alarmed that consolidated federal power will end up destroying any prospects for liberty long-term in this country.”

But I DO have a problem with people–and yes I have specific people in mind, I’m not just throwing out strawmen–who would have, without irony, called Obama a war criminal on Thursday, on Friday gushing about how beautiful the White House rainbow light show was, and denouncing any opponents as cold-hearted bigots.

26 Jun 2015

An Even More Damning Gruber Clip on State Exchanges

Health Legislation 7 Comments

OK, this one is pretty clear. There is no ambiguity about a “federal backstop” and what that might mean. (Thanks to the honorable Keshav for passing this along, even though he disagrees with me.)

It is now pretty obvious to me that Gruber thought the bill would deny tax credits to people in states where exchanges were not set up. Now Gruber is just playing dumb, saying he must have been mistaken when speaking with such confidence. Well, he doesn’t sound like he’s ill-informed in this video. He sounds like he was part of the discussions (which we know he was, although everybody involved tried to deny it) and he is obviously very intelligent and a details kind of guy.

This bill was enormous. The fact that Matt Yglesias wasn’t talking about this particular aspect doesn’t really mean much to me. In my research (which you’ll see in my forthcoming book on U.S. health care, in the fall, co-authored with an ER doctor) I dug up all sorts of stuff that nobody has talked about.

UPDATE: Notice in the very beginning, Gruber says of this risk “the one folks aren’t talking about.” So for Gruber to now say, “Well geez, I must have been crazy back then, because nobody else was talking about this,” is kind of fishy. And gosh, I guess that’s the trouble Gruber when you admit to the world that you are willing to deceive people to push through your political agenda–now people have a hard time believing you.

26 Jun 2015

The Smoking Gruber Gun?

Health Legislation 9 Comments

I had seen people in print refer to this, but it helps to watch the actual video. Many of my libertarian brethren (and sistren) think this is obviously Gruber saying the feds intended for the subsidy carrots to induce the states to set up their exchanges for the ACA. However, the one thing that troubles me in that interpretation is his use of the term “backstop.” Watch the short clip and then consider my two interpretations of what Gruber is saying.

Option #1 (libertarian hope): Gruber is saying that if the state doesn’t set up an exchange, then the feds will, thereby allowing people to buy health insurance, but not to receive federal subsidies for it, ever.

Option #2 (progressive escape hatch): Gruber is saying that if the state doesn’t set up an exchange, then the feds will have to, and of course the people in that state are then eligible for subsidies too. When Gruber warned about the citizens losing out on tax credits, he was merely referring to the interim period when the bungling and slow-moving feds were trying to set up their own exchange.

I am leaning toward Option #1, and my strongest bit of evidence is the “billions of dollars” line. If Gruber had been merely referring to a one-shot missing out of subsidies, would the number have been that big? Well, it’s hard to say, since this is Gruber after all–maybe he had some crazy scenario in mind where the feds drag their feet for years, and he wants the states to do the policy he wants, so why not say whatever pops into his head?

I’m genuinely not sure how to interpret this video. You would think it would be decisive, and yet he doesn’t (in my mind) come down clearly enough in one camp or the other to be absolutely certain.

(Naturally, I am here referring to this one, short video. There is other evidence we could examine to determine whether the infamous four words in the legislation were a typo or not.)