29 Oct 2009

Holy Melodrama Batman!

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Author Michael Chabon has apparently written a horrifying work of nonfiction. Here’s Tyler Cowen’s blurb about the book: “I ended up enjoying this more than I do his trendy fiction. This supposed paean to family life collapses quickly into narcissism, but that’s in fact what makes it work. I was surprised but not shocked by the part where he deliberately tortures his infant son.”

Hmm that’s a rather surprising statement, don’t you think? Maybe Chabon had to do it to avoid even more torture by the FDIC?

Anyway Bryan Caplan is even more appalled: “It was only when I was reading Michael Chabon’s latest, Manhood for Amateurs, that I saw the face of evil…”

You know what they’re talking about, right? Chabon had his kid circumcised. And rather than doing it without a moment’s thought, he reflected upon it a lot, and then did it anyway.

Full disclosure: My wife and I decided not to get our son circumcised, for the obvious reasons that any decent GMU professor could give.

Another disclosure: As all who saw that B-movie from 2001 know, I am circumcised. I don’t consider my Catholic parents sadistic religious torturers.

Final disclosure: The above statement is obviously a joke. That movie was an artistic masterpiece.

29 Oct 2009

Robert Wenzel Reads My Critique and Decides to End It All

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…or something like that. I have a similar tale involving a ladder, near-death, and utter stupidity.

My last year at NYU, I lived upstairs in my grandma’s house in Copiague. I was out late drinking and being a hooligan (as all economics PhD students do) and then had to ride the Long Island Railroad for 2 hours to get home. Consequently it had to be at least 3 am when I walked up to my grandma’s front door.

Alas, my uncle also lived there, and when he had gotten back from his night shift, he had locked not only the main door, but the outer screen door as well. (He didn’t realize I was still out.) I only had a key to the main door.

So not wanting to wake anybody at 3 am or whatever time it was, I decided to be a ninja. My uncle’s day job was owning a roofing company, so he had a bunch of ladders in the back yard, and there was a deck off the second-floor bedroom where I stayed.

So I put the ladder in place, and then start climbing. However, the grass was dewy and I was wearing sandals. (It was the summer I think when this happened.) I get up to the top, and I just have to climb over the rail of the deck. So I grab one of the little slats (leading from the floor of the deck up to the chest-level handrail) with my left hand, the main handrail with my right hand, and I get ready to really heave my manly self up and over.

But just as I’m giving it the old grad-school try, the whole left slat comes out. So I’m standing on top of the ladder, staring at this thing in my hand, completely unconnected to the deck that I just ripped it from. I must have panicked since that was the last thing in the world I was expecting to happen, and then my feet slid forward a tiny bit but enough for me to fall.

I don’t know if I can really describe it in a blog post, but realize that the ladder was still propped up against the second-story deck at an angle, and I had been standing on the 3rd or so rung from the top of the ladder. So my whole body just scooted forward an inch or so, allowing me to fall straight down about three feet until my butt hit a ladder rung.

Then the whole ladder came down, and me with it. As I was falling I must have slowed things down by grabbing for the deck, because later on I noticed my right forearm was all scraped.

After the huge crash, I was on the ground sitting on the ladder. Not only was I unscathed (except for my forearm), but my bad back was totally cured.

It wasn’t until the next day that it really struck me how lucky I was. My legs were intertwined in the rungs of the ladder as I was falling. I could have easily snapped an ankle or worse.

As a religious person I have no problem saying angels saved me. If you prefer, you can thank a statistically improbably original configuration of molecules.

29 Oct 2009

It’s All About Framing

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The 3q GDP numbers are out, and Robert Wenzel lets his readers know who the better economic forecaster is:

Gross domestic product grew at a 3.5 percent annual rate in 3Q.

This does not surprise me. In fact, I have a bet with Bob Murphy, made in January, that it would. This is what I wrote in January when most economists were saying that the GDP wouldn’t turn positive until 2010:

…my whole point right along has been that the government will maneuver to make the official data look good. The real economy will be a mess.

Murphy predicts that there will be no net growth in real GDP during 2009. Again, expect the real economy to be a mess, but real GDP will turn positive no later than sometime during the second half of 2009

So there you have it, GDP is up and the economy is a mess. Again, I issue the challenge to find me any other economist that said the economy would be up AND a mess.

Now that was very considerate of Wenzel to open up the quote from his January post with an ellipsis. Wouldn’t want to tax his busy readers with irrelevant details. But since Free Advice readers are not day traders making split second decisions, I will give you the full quote and you can see where Wenzel decided to pick it up in the excerpt above:

Bob Murphy has responded to my latest comments regarding our differing views on the direction of the economy.

I continue to believe that Bernanke’s huge money drops will impact the economy to the degree that the official unemployment rate in 12 months will be lower than it is right now. Murphy expects the exact opposite. I note that Murphy expects some of the positive employment to come from the flaky government “stimulus” programs. I concur that it is questionable that the private sector employment label should be applied, if, say, it is “…a new job making solar panels…if it’s dependent on massive subsidies.” But, my whole point right along has been that the government will maneuver to make the official data look good. The real economy will be a mess.

Murphy predicts that there will be no net growth in real GDP during 2009. Again, expect the real economy to be a mess, but real GDP will turn positive no later than sometime during the second half of 2009.

So to summarize:

(1) Wenzel predicted in early January that Bernanke’s huge money drops would mean lower unemployment in 12 months than at the time, contradicting my prediction of higher unemployment in 12 months. Then Wenzel went on to disagree with my prediction of negative GDP growth for 2009 as a whole.

(2) Three months after Wenzel wrote that, Bernanke stopped pumping in new money. The reason I know this is that Wenzel hasn’t shut up about it since that time. (And good for him, because it’s important and he was the first person who made me realize that “inflating Bernanke” was no longer our situation.)

(3) Unemployment has continually risen.

(4) Official 3Q GDP is in fact positive. However, if I’m reading these figures right–and I confess I might not be–it’s not even close that total real GDP in 2009 will be lower than in 2008. Furthermore, 4q GDP would have to be 5% higher than 3Q GDP (when they are at annualized rates) in order for 2009 GDP to be higher than 4 x 4Q 2008 GDP. (Again, I might be getting mixed up; it’s tricky to do these calculations with annualized quarterly figures.) So assuming I set that calculation up correctly, I still think I’m on track to having a correct GDP call, and Wenzel is on track to being wrong.

(5) Wenzel quotes the one part of his January post where we discussed GDP growth, and leads his readers to believe he blew me up. He leaves out the part where the whole premise of his prediction was Bernanke’s money growth (which was choked off back in March) and he leaves out the first bone of contention he picked with me, namely the unemployment rate, which is surely a much more important element of the “official data” that you would think the government would manipulate to keep the masses happy.

Conclusion: I pick on Wenzel a lot because the lad has promise. (In contrast, I pick on Paul Krugman a lot because his work is evil and everyone reads him.) I also am very conscious of the ability of economic forecasters to give a very selective interpretation of their previous writings, in order to paint a flattering picture of their prowess to their readers.

Let me be clear, I totally missed the ball on price inflation in 2009. Part of what happened is that I (and I think Wenzel) assumed back in January that Bernanke was going to keep the monetary floodgates open. Had that happened, I think my price inflation call would have come true, while it’s possible that official GDP stats would have upset me, if only because it gives the BLS statisticians more to play with when prices are rising across the board.

29 Oct 2009

Defending the Superfreaks from Brad DeLong

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In my new post at MasterResource, I give the background on Superfreakonomics and then defend Levitt from Brad DeLong’s claims that his views are “just not economics.” An excerpt:

DeLong is right, what Levitt said is “not economics.” Rather, it’s a historical claim. Maybe it’s right, maybe it’s wrong, but DeLong can’t trump it by citing a tautology from microeconomics. I am sure that Levitt would concede the narrow point, that if governments around the world instituted a massive carbon tax, and enforced it with draconian penalties for evasion, then global emissions would indeed fall quickly.

But one of Levitt’s main points is that governments around the world are not going to do this, that it is naive to expect them to sacrifice their own economies when (in Levitt’s opinion) the climate science is not nearly certain enough to justify this painful step. Levitt is making a prediction–based on his interpretation of history–that if manmade global warming really does require drastic measures in the next few decades, that the response will involve various forms of geoengineering, which (Levitt predicts) will cost a tiny fraction of what the carbon mitigation proposals would require. To repeat, I’m not saying I necessarily endorse Levitt’s glib proclamations on these points, but DeLong is wrong for dismissing them as somehow “not economics.”

29 Oct 2009

Landsburg Takes It Easy On Dawkins

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This morning I had an email from Steve Landsburg in my inbox. I thought that he was either inviting me to co-author a book with him, or wanted to tell me he was using my PIG to Capitalism as the main textbook in his graduate classes.

Turns out it was an automatic message letting me know about his new blog. The top post right now showcases a ludicrous excerpt from Richard Dawkins, which I reproduce below, followed by Landsburg’s response. (And yes, I know there are plenty of evangelicals who say similarly ridiculous things about evolution. But Dawkins is supposed to be the expert who knows what he’s talking about.)

[Dawkins:] Where does [Darwinian evolution] leave God? The kindest thing to say is that it leaves him with nothing to do, and no achievements that might attract our praise, our worship or our fear. Evolution is God’s redundancy notice, his pink slip. But we have to go further. A complex creative intelligence with nothing to do is not just redundant. A divine designer is all but ruled out by the consideration that he must be at least as complex as the entities he was wheeled out to explain. God is not dead. He was never alive in the first place.

[Landsburg:] But Darwinian evolution can’t replace God, because Darwinian evolution (at best) explains life, and explaining life was never the hard part. The Big Question is not: Why is there life? The Big Question is: Why is there anything? Explaining life does not count as explaining the Universe.

From then on, I don’t agree with Landsburg’s overall conclusion, since he too is an atheist it seems.

I would have to think about it more, but it’s possible Landsburg is making the same type of mistake Dawkins is. In other words, Dawkins knows a heck of a lot about the workings of evolution, and somehow concludes that the process rules out God. Landsburg, in contrast, is actually more of a mathematician than an economist (I’m not knocking him–someone at the U of R told me he just teaches the math classes), and he ends up concluding that the existence of mathematics makes God unnecessary.

Thus far I haven’t heard Paul Krugman say that comparative advantage proves Jesus couldn’t have been perfect and hence wasn’t God, but it wouldn’t shock me at this point.

28 Oct 2009

The Seasteading Institute’s Annual Report (from last April)

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I decided to check in on Patri Friedman and The Seasteading Institute. I’m very excited for them to actually get a floating residence up and running in international waters. I think the oceans will be the frontier of the 21st century.

Anyway here is their one-year report [.pdf] from last April. They opened up shop in April 2008 largely fueled by a $500,000 grant from Peter Thiel. Friedman predicts that within 5 years there will be at least 10–and possibly hundreds of–full-time residents on “Ephemerisle.”

Since I’m really hoping that this thing pans out, I read the opening letter from Friedman looking for concrete achievements. Besides media hits, new donors, etc. (all crucial of course), he reported:

On the technical front, we have finished and applied for a patent our first seasteading 368K ft^2 spar platform resort for 200 guests at a cost of about $300 per square foot. This confirms our initial thesis that new land can be built for less than the cost of Silicon Valley estate. In addition, the community has experimented with smaller structure designs.

Let’s just hope they applied for the patent in self-defense. I don’t know that I could live on a floating anarchist utopia that was propped up by IP laws.

28 Oct 2009

More Fun With the Intertubes

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Aristos passes on this neat trick:

(1) Go to Google.

(2) Type in “Location of Chuck Norris”

(3) Click “I’m Feeling Lucky.”

Now my question for the internet geeks in the crowd: Did it take a while for this page to become the top hit and for the joke to work? Or were there just not that many hits in the first place for “location of Chuck Norris”?

28 Oct 2009

More 3-Strikes Horror Stories

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Many states have “three strikes” laws, where you have to do serve huge mandatory prison sentences once you’re convicted of your third felony. The rationale for such a rule is obvious: “Liberal activist judges” weren’t obeying the law, and were letting repeat offenders back on the streets after a slap on the wrist. Lock those rapists and murderers up and throw away the key! And pass me the red meat.

The problem is that there are all sorts of felonious crimes that really aren’t so awful in the grand scheme of things. For example, some kids brought in smoke bombs for high school graduation and that was one strike right there.

NPR is doing a series on California’s “three strikes” rule, passed fifteen years ago. (My understanding is that California is the only state in which the “third strike” need not be violent. However, I believe that in all the states, the first two strikes need not be violent.) Anyway, check out this case:

[Sue Reams’] son Shane is in prison, doing 25 years to life for being with a friend when the friend sold $20 worth of cocaine to an undercover cop.

“They considered my son the lookout,” Reams says.

And that was Shane’s third strike. He’s one of 3,000 people doing 25 years to life for nonviolent crimes, such as shoplifting, auto theft or possessing small amounts of drugs. And each of those prisoners costs the state more than $48,000 a year.

Shane’s third strike came about partly because of a decision his mother made years before when she noticed some things missing from her house — her husband’s antique model cars, money, jewelry.

She figured that Shane took the stuff to get money for drugs. He’d had a problem with that since his teens. And Reams tried to deal with it by practicing tough love.

“Tough love tells you that you take a stand,” she says. “So I, I took a stand.”

And she called the police. Shane had also stolen some stuff from a neighbor’s house and Reams persuaded her neighbor to press charges as well. Then she gave Shane the news.

“And I said, ‘You need to turn yourself in, maybe you’ll get a drug program. You need a drug program,’ ” she says. “I drove him to the Irvine Police Department and he went in and told them what he had done.”

But instead of getting a drug program, Shane was charged with two counts of residential burglary. He did some time in prison. And years later, when he got picked up on that drug charge, the burglary convictions counted as his first two strikes.

“I’m angry with myself,” Reams says. “I feel terribly guilty. I guess that’s why I’ve worked so long to try and change the law.”

If you go read the story, you can see the viewpoint of the people who support the law, including the guy whose daughter was shot and killed by a repeat offender, and who made a deathbed promise to her that he would do everything he could to change the system and make sure her fate didn’t happen to other kids.

This is just another classic example of why GOVERNMENT MONOPOLIES ARE AWFUL. The government doesn’t keep murderers and child molesters locked up, and then to “fix” that mistake the government gives minor criminals sentences of 25-to-life.

We wouldn’t dream of letting the government run restaurants or computer companies. So why do we trust them with protecting society from violent criminals?

If you are open-minded but can’t imagine any other way, try this [.pdf].