Ezra Klein Apparently Doesn’t Think Immigrants Are Part of the Universe
I don’t know what the timelines are, so maybe he didn’t have access to this information when he wrote his short post. But here Ezra Klein points to how encouraging the fate of Massachusetts is for health care reform (HT2MR). Nowhere does Klein mention this:
As lawmakers on Capitol Hill battle to create a nationwide health care system to cover all, Massachusetts is struggling to keep the state’s groundbreaking universal coverage program up and running.
Facing a massive budget shortfall, lawmakers are cutting roughly 30 thousand legal, taxpaying immigrants out of the state subsidized Commonwealth Care program.
Health Care for All, a Boston based advocacy group, is taking hundreds of calls on their help line from people like El Salvador native Eugenio Hernandez who is battling prostate cancer and will be among those losing coverage.
So apparently it’s still “universal” coverage even when you kick out a bunch of legal immigrants who are paying the government premiums just like they’re supposed to. But surely when they do it at the federal level, costs will go down (as they are wont to do with other government programs) and there will be no temptation to ration care to politically weak groups.
Besides Klein failing to mention the 30,000 immigrants getting dropped (which might not have been in the news when he posted, I don’t know), his excitement over the fate of Massachusetts baffles me. As I said on MR in the comments, Is Klein even making an argument here? It sounds like he’s saying, “This has to work, because otherwise it will fail.” Seriously, look at his post. I really think that’s a fair summary of his argument.
They Tried Easy Money Back in the 1930s
Bill R. sent me a link to this amazing site where they excerpt the news from WSJ from the corresponding day in 1930. For July 18, 1930:
Editorial: Constantly increasing taxation is a burden on “every form of enterprise”. It diverts money from productive uses to government functions which “though mostly indispensable, do not always require the scale of expenditure to which our public servants have become accustomed.” Total taxation (including local) has risen from under $3B in 1913 to about $9B now; recently rising about $500M/year. This aggravates the current depression.
…
Federal Reserve faces tough problem in how long to continue easy money policy, since in time “this has always stimulated speculation to dangerous proportions.”
…
Credit likely to remain easy for some time, but extremely low current rates seen unlikely to last (call money at 1.5%-2.5%). Rates for credit in the 3-6-month range have already begun to move up. This month seen as a low point for industrial activity; demand for credit anticipated to increase seasonally in August.
Now in fairness, someone like Scott Sumner would say, “Yes, those fools thought the Fed was engaging in ‘easy’ money, but it wasn’t!”
But let me point it out again: During the 1920-21 depression, the New York Fed jacked up its discount rate to a (then) record high, while in the aftermath of the 1929 crash, the NY Fed cut its discount rate to a (then) record low. Price deflation was more severe during the 1920-21 depression than during any comparable time period in the early 1930s. And I think it’s safe to say that the 1920s were a better economic experience than the 1930s.
We are truly repeating the mistakes of the 1930s. Scott Sumner’s has drawn the wrong lesson, and thinks that if only we did what they did times a hundred, then things will be rosy. Just as the Keynesians think Hoover and FDR didn’t run high enough deficits, the Friedmanites think that the Fed didn’t print enough green pieces of paper. Even though the deficits and money printing (as far as monetary base) were much more aggressive than in previous U.S. depressions, still for some reason a moderate dose of the “right medicine” (from Krugman and Sumner’s different viewpoints) led to the worst economic calamity in U.S. history.
Potpourri
* Here’s Bryan Caplan’s reply to Krugman and Drum.
* An interesting analysis of a paper (on boundary layer clouds and the effect on global warming) that clearly went into the IPCC summary, and yet had key words changed to match with the spirit of the IPCC report. (HT2 Rob Bradley)
* I have gotten a lot of negative feedback about my Mish article. Folks, before you confidently tell me that “in our system, money is debt and that’s why the money supply is shrinking,” please look at the below graph. M1 consists of checkable deposits, travelers checks, and currency in circulation; it is the money supply “held by the public.” I don’t see it crashing because of losses by lenders. That’s why, in my Mish article, I dealt with credit cards; I thought people couldn’t be talking about the money supply fostered by the fractional reserve banking system, since that clearly started exploding in late 2008.
DeLong on the State of Macroeconomics
A rare post in which I agree wholeheartedly with Brad DeLong (HT2 Bob Roddis):
The Economist gives us economists too much credit…
I would like to draw a distinction between economics as a way of thinking–the way good economists think, at least–and academic economics as a profession. Economics as a way of thinking is, I believe, still very valuable. But academic economics as a profession has proven itself to be not valuable at all in this financial crisis.
Yep. It would be hard to imagine a worse performance by professional economists during the last few years. Follow the link to the Economist pieces to see some examples of how badly the profession botched things.
I’ll go even further, and say that I totally understand why DeLong (and Krugman) think Fama et al. are being crazy in their opposition to fiscal stimulus. They are trying to use accounting tautologies to “prove” that deficit spending can’t reduce unemployment. But that doesn’t work; it’s not necessarily true that “every dollar the government borrows means one fewer dollar spent by the private sector.”
Naturally, I oppose DeLong (and Krugman) in their call for greater fiscal stimulus; I think their recommendations are awful. But as I argued in this article, the real problem is that even if deficit spending (temporarily) reduced unemployment, it would simply delay the sectoral adjustments needed to restore the economy to a sustainable growth path.
Note that I’m not saying deficit spending will always reduce unemployment; I am rather saying that Fama et al. are wrong for claiming that it will necessarily have zero effect on it. In fact, some of the opponents of “stimulus” are trying to have it both ways. Before the plan passed, it seemed (many of them) were saying that government spending would be perfectly counterbalanced by private sector losses, and so the effect on employment should have been nil. And yet now that the stimulus passed and unemployment jumped higher than most were predicting, the critics are saying, “See? We told you this would destroy jobs!” (Of course, there was not a unified voice of criticism of the stimulus package; some people made arguments at the time saying it would “destroy jobs on net.” So those critics could claim justification.)
A lot of people ask me if I think Krugman (and DeLong) are liars or just stupid. They’re certainly not stupid, and I don’t even think they’re necessarily dishonest. After all, they each have thousands of fans who leave comments on their blogs, so presumably it’s not a giant Keynesian conspiracy. Yes they will often make (in my opinion) unfair attacks on their opponents, or will conveniently overlook certain facts that hurt their cases, but there are people on “my” side who do the same thing from time to time.
The one thing that does bother me about these two guys is the ease with which they accuse their intellectual opponents of being stupid and/or evil. Ah well.
Hillary Clinton, Pod Person?
Once you start entertaining the notion that there are secret groups running world governments, you see evidence all over the place. What’s really funny is that, if you want to debate a conspiracy theorist, you can’t say, “You have no proof of that plan.” Because the conspiracy theorist will give you actual quotes from people like David Rockefeller and other big guns saying literally what the conspiracy theorist claims is their plan for worldwide domination. So the skeptic has to fall back on, “Oh come on, you’re reading too much into that,” or, “Surely that must be a joke.”
Case in point, take Hillary Clinton’s recent speech to the Council on Foreign Relations. (HT2 David Kramer for all of this.) Her opening remarks:
Thank you very much, Richard, and I am delighted to be here in these new headquarters. I have been often to, I guess, the mother ship in New York City, but it’s good to have an outpost of the Council right here down the street from the State Department. We get a lot of advice from the Council, so this will mean I won’t have as far to go to be told what we should be doing and how we should think about the future.
Richard just gave what could be described as a mini-version of my remarks in talking about the issues that confront us. But I look out at this audience filled with not only many friends and colleagues, but people who have served in prior administrations. And so there is never a time when the in-box is not full.
Now I’m sure people were laughing, and that these remarks were supposed to be the opening joke before she got into the meat of her speech. You could say that just because the CFR tells her what the State Department “should do,” doesn’t mean Clinton will obey those instructions. And of course, I don’t think she was literally saying the CFR headquarters was an alien spacecraft.
But at the same time, the part I put in bold is exactly what the conspiracy theorists say about the CFR (and other groups like the Trilateral Commission, Bilderberg Group, etc.). So if you challenge them to prove their “crazy” claims, all they need to do is point at Hillary Clinton’s latest speech as an example.
I was curious to see the actual delivery of these remarks, to see just how ha-ha Clinton’s tone was when she said it. Aww too bad, this MSNBC video leaves out the above two paragraphs, and starts at the third paragraph of the transcript linked above. No need to waste the viewers’ time with silly jokes about the CFR running the government! We’ve got to leave time for the story about Michael Jackson’s kids.
Last One: BLS’ SA CPI as of July 17, 2009
Another post for posterity: I want to take a snapshot of the BLS’ figures for actual and seasonally adjusted CPI for the first half of 2009, since I predict that they will revise those figures later on, in order to suppress the reported monthly inflation rates.
Month….CPI….SA CPI
=====================
Dec08…210.228…211.577
Jan…..211.143…212.174
Feb…..212.193…213.007
Mar…..212.709…212.714
Apr…..213.240…212.671
May…..213.856…212.876
Jun…..215.693…214.459
=====================
And while we have the numbers in front of us, just note again that actual CPI has risen at a 5.3% annualized rate this year, while seasonally adjusted CPI has only risen at a 2.7% rate. In and of itself this isn’t necessarily sinister, but it is surely odd that we are being told we’re on the edge of a deflationary cliff, when actual prices are rising at such a rate, and even when adjusted prices are rising at a rate higher than Bernanke’s “comfort zone”!
For those who are baffled, you must realize that Bernanke’s “comfort zone” of 1%-2% inflation refers not to the actual CPI, nor to the seasonally adjusted CPI, but to the “core” seasonally adjusted CPI, which has had those pesky and misleading items of food and energy taken out.
So don’t worry, inflation is well under control. Your government is in charge and is taking care of you.
Glenn Beck vs. Goldman Sachs
Glenn Beck does a surprisingly good job explaining all the shenanigans involving Goldman Sachs the last year. (HT2 Wenzel, who was on to Goldman a long time ago.)
I’m glad to see that this stuff is finally going mainstream. Of course, it’s a bit like the Jedi Council finally realizing Palpatine is the Sith lord, after he’s declared himself emperor and has an army of clones under his command. But hey, maybe the Americans will come out of this three movies from now.
The Problems With Materialism
Hi my name’s Bob and I’m a recovering materialist. I’d like to thank my sponsor Gene, who talked me down from the ledge a few years ago…
Over at Crash Landing, my frequent critic Tokyo Tom decided to throw caution to the winds and went head to head(s?) against Gene Callahan and me on materialism. Specifically, Tom labors under the belief that something doesn’t “really” exist unless it’s physical, or at the very least corresponds to something physical. Now you have to overlook Gene’s impatience, but in my book we whupped Tom good. It wasn’t even close.
However, I sympathize with Tom because several years ago I thought the exact same thing he did. Rather than write a huge essay here, let me just give some bullet points. What I’m trying to get you to see is that it is a completely baseless bias to reserve “objective existence” only for items of the physical universe. So here goes:
* Does Sherlock Holmes exist? Where is he then? Can you point to him? (And don’t point to a book talking about him; that’s not Sherlock Holmes himself, that’s a book describing him.)
* OK so maybe he exists in our thoughts, and thoughts are “really” just a part of our brains. But why do we say that? Why aren’t our brains just “really” a part of our thoughts? We know brains exist, and we know minds exist, and for some reason we attribute more objective reality-ness to the former. Why?
* This is the deep part. We know that our subjective experiences are real. We only hold a theory that there is a physical world. It is logically possible that we are in the matrix, that this is all a dream, that we are being deceived by an evil demon, etc. But as Descartes famously argued, we can’t be mistaken about our own consciousness.
* Now here’s an argument Gene used on me back in the day, which at the time I dismissed as flippant. But now I realize, I had to just blow it off, because it was crushing. Daniel Dennett convinced me at the time that consciousness was a “user illusion.” During evolution, it became advantageous for our ancestors to learn to “talk to themselves,” and so our bodies now create the illusion of consciousness. But Gene asked a simple question, “Whom are they fooling?” (Actually I bet Gene’s question was less grammatical.) You can’t have a “user illusion” if there really is no user!
* Is 2+2=4 an objective, true statement? Is it physical? Can you point to it? Sure, you can point to two balls, and then another two balls, and then say that all four of them are, well, four balls. But that’s not the same thing as grasping the truth of the equation, and in fact, it’s entirely possible that one of the balls will disappear while you’re counting (maybe it’s a ball of ice on a stove), or will multiply while you’re counting (maybe it’s a ball of Tribble fur). So when you try to “demonstrate” 2+2=4 with physical objects, it might not work. But you rule out such counterexamples, because you know a priori–without having to look at the physical universe–what the equation means. So all of mathematics seems like a pretty important thing that exists and yet is not physical.
* OK let’s assume that all of reality consists entirely of atoms (or quarks or whatever). We’re watching them bounce around, obeying the laws of physics. Whoa, say what? What the heck is a law of physics? Where is it? Can you point to it, weigh it, see how much bathwater it displaces? No, it’s just a pattern governing the motions of the “real” stuff. But is the law itself real?
* This last point is at once incredibly obvious and yet unbelievably profound. (That’s how I roll on Free Advice.) You can control matter with your mind. (!!) In fact, right now I am making the molecules in my “fingers” (just an arbitrary label we give to these group of cells) move in very specific ways, in order to influence the electric charges in my “laptop” (another label for molecular configurations). I know scientists can peer really hard at the action, and tell me that it seems to be completely due to the laws of physics with no ghostly interference from the spirit world, but I tell ya, I can really control my fingers with my mind. We can sit here all day, and my predictive powers over the motions of the molecules in my fingers will be uncanny. So by the positivist’s own criterion, it seems as if there is more to existence than mere matter in motion.
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