Looking Behind the Curtain on Oil Prices
In previous posts (such as here, but you need to follow the links to get the whole story) I’ve summarized the main factors behind the crash in oil prices. However, to focus on facts such as “the Saudis are pledging to maintain production despite the price fall, which fueled even further price falls” is to ignore the larger geopolitical context.
Besides the 2008 financial crisis, there was another time when oil prices collapsed this much and with comparable rapidity, in the mid-1980s:
Now of course we can explain that fall by reference to supply and demand factors–particularly a crucial decision by Saudi Arabian officials–but it is a well-known theory (with varying degrees of endorsement) that U.S. officials pressured the Saudis behind the scenes to do this, in order to bring pressure on the USSR.
In our time, John Kerry visited Saudi Arabia in September, leading some (e.g. here) to suggest that this pattern is playing out once again.
In other words, maybe it’s not a coincidence that the world price of oil collapses “unexpectedly” when tensions between the U.S. and Russia are intensifying.
Krugman: I’m Only Keynesian to Botch 1980s Inflation Call
This one was too easy. He made the same faux pas in 2012. Krugman says it’s a myth that Keynesians were surprised by the 1980s disinflation, when there is an infamous 1982 Council of Economic Advisors memo in which he did just that.
Timid Guys Finish Last
Bryan Caplan linked to a tour de force from Scott Alexander (not his real name) on a topic that should ring true to many lonely libertarian male readers. Here’s how Alexander opens his post:
I recently had a patient, a black guy from the worst part of Detroit, let’s call him Dan, who was telling me of his woes. He came from a really crappy family with a lot of problems, but he was trying really hard to make good. He was working two full-time minimum wage jobs, living off cheap noodles so he could save some money in the bank, trying to scrape a little bit of cash together. Unfortunately, he’d had a breakdown (see: him being in a psychiatric hospital), he was probably going to lose his jobs, and everything was coming tumbling down around him.
And he was getting a little philosophical about it, and he asked – I’m paraphrasing here – why haven’t things worked out for me? I’m hard-working, I’ve never missed a day of work until now, I’ve always given a hundred and ten percent. And meanwhile, I see all these rich white guys (“no offense, doctor,” he added, clearly overestimating the salary of a medical resident) who kind of coast through school, coast into college, end up with 9 – 4 desk jobs working for a friend of their father’s with excellent salaries and benefits, and if they need to miss a couple of days of work, whether it’s for a hospitalization or just to go on a cruise, nobody questions it one way or the other. I’m a harder worker than they are, he said – and I believed him – so how is that fair?
And of course, like most of the people I deal with at my job, there’s no good answer except maybe restructuring society from the ground up, so I gave him some platitudes about how it’s not his fault, told him about all the social services available to him, and gave him a pill to treat a biochemical condition almost completely orthogonal to his real problem.
And I’m still not sure what a good response to his question would have been. But later that night I was browsing the Internet and I was reminded of what the worse response humanly possible. It would go something like:
You keep whining about how “unfair” it is that you can’t get a good job. “But I’m such a hard worker.” No, actual hard workers don’t feel like they’re entitled to other people’s money just because they ask nicely.
“Why do rich white kids who got legacy admissions to Yale receive cushy sinecures, but I have to work two grueling minimum wage jobs just to keep a roof over my head?” By even asking that question, you prove that you think of bosses as giant bags of money, rather than as individual human beings who are allowed to make their own choices. No one “owes” you money just because you say you “work hard”, and by complaining about this you’re proving you’re not really a hard worker at all. I’ve seen a lot of Hard Workers (TM) like you, and scratch their entitled surface and you find someone who thinks just because they punched a time card once everyone needs to bow down and worship them.
If you complain about “rich white kids who get legacy admissions to Yale,” you’re raising a huge red flag that you’re the kind of person who steals from their employer, and companies are exactly right to give you a wide berth.
Such a response would be so antisocial and unjust that it could only possibly come from the social justice movement.
If you’ve delved at all into the issue of Self-Proclaimed Nice Guys versus Online Feminists, you know exactly what Alexander is doing with the above, fictional, story. In his mind, he’s just demonstrated how awful women are who mock and demonize men when they complain that they can’t get a date whereas every a-hole in the bar has no problem taking a woman home.
If you’re into this type of thing, by all means read Alexander’s post. As usual, he has a lot of interesting thoughts and he links to all kinds of examples for his claims. I have only three points I wish to make:
==> Even though Alexander thought he was shaming the merciless feminists with that analogy, he actually convinced me that they are right (though still obnoxious and arguably horrible human beings). For if indeed there were an able-bodied man with average intelligence, complaining to me that after years of effort he was unable to get a job better than minimum wage, I would tell him he had to be doing something wrong. If he kept going through life blaming society at large, or racism, for his condition, then he would never get to the underlying problem.
==> For a dozen years I too had been bamboozled by the theories that “women love a-holes” and “nice guys don’t get laid.” (There was even a book that seemed to lay it all out for me, which someone showed me in college.) But these aren’t correct. It’s not true that women love a-holes. Rather, a much more precise statement is that insecure women are attracted to a-holes. This is very noticeable, however, because often the most insecure women are drop dead gorgeous, as they starve themselves and spend 3 hours getting ready to go out. If you’re a dateless guy in a whiny mood, you simply overlook the dozens of examples of perfectly nice guys dating perfectly cool and pretty girls staring you in the face. Furthermore, it’s not that nice guys finish last, but rather timid guys who do. There is an overlap between guys who are confident and guys who are a-holes, and between guys who are nice and guys who are timid. If you feel horrible about life because you’ve fallen for one of these (false) theories, think about my nuances and re-evaluate your own observations.
==> In his post, Alexander says how he went through life with very little dating success, and seems to think he just got lucky by meeting the right girl (his girlfriend as of the time he wrote the post back in August). She chimed in in the comments, saying how great he was, and that she bets he was great before she met him. I don’t know Alexander, of course, but I’m going to go out on a limb and guess that he had no idea how to recognize when a woman was interested in him.
Think of it this way: If you are a shy, lonely guy, and you get a crush on a girl, what do you do? Do you walk up to her and say, “Hi, I am very attracted to you, I was thinking we could go to a movie and maybe make out?” Of course not. Indeed, you take great pains to hide the fact that you like her. But, if she’s really attractive and has all kinds of guys developing crushes on her–and that’s just the kind of unattainable girl you like to pine after, isn’t it, you self-destructive idiot?–you expect her to “read the signs” and know that you say moronic things around her because she makes you nervous.
OK great, but now imagine that there are women in your past who had crushes on you. You think, “They don’t exist, women at best think I’m their big brother who is always there for them when their boyfriend cheats on them,” but remember, when someone really likes someone else, the first move is to hide it. So just because you don’t recall any women walking up to you and saying, “Hi, I’m really attracted to you, I was thinking we could go to a movie and make out?” that doesn’t mean no one has ever been interested, does it?
The reason I had such epiphanies is that I first saw it in other people. For example, a guy I hung out with in grad school one time was pseudo-flirting with a girl working at the reference desk at the NYU library. The first few minutes, I thought she was miserable and wanted us to leave, and as time passed my shock at my buddy’s rudeness escalated. But then suddenly she relaxed and was laughing at his jokes etc., and I realized she had really liked him and was super nervous in the beginning. In my own adventures through near celibacy, I would never have gotten to that stage; at the first sign of discomfort I would have run for the hills, thinking I needed to work on my comedic intro.
So in conclusion, I’m saying that one of the biggest differences between “nice guys” and those who are “good with girls” is that the latter can tell when a girl is interested, whereas the former literally don’t even know what it feels like to be making progress.
Last thing: I have absolutely no idea how to categorize this blog post. I will pick “Great Depression” in homage to my grad school days.
Using FRED Graphs to Evaluate Keynesian Model
My latest Mises CA post accuses Krugman of changing his narrative on the economy:
For years, Paul Krugman has been warning that the inadequate fiscal stimulus package of early 2009, coupled with the disastrous spending cuts of the “sequester” package, were leading to a “postmodern recovery” and “jobless trap” for the millions of Americans locked out of employment due to coldhearted Republicans. Even though GDP growth had officially returned by the summer of 2009, Krugman told us, we could expect a terrible plight for America’s workers, all because the people in charge were more concerned with fiscal prudence than American families.
Well, now that we’ve had a few quarters of decent GDP growth and private sector job creation–at least according to the official statistics–Krugman has had to alter his narrative. Now, you see, Obama’s recovery has actually been impressive–much better than the recovery under George W. Bush from the dot-com recession. Does this prove that Krugman was wrong about the need for big deficits? Of course not. No, it just shows that the right-wing critics of ObamaCare and other regulations were wrong for thinking these regulations would hurt hiring.
Then I use the very same FRED data that Krugman had deployed, in order to reach the opposite conclusion. Imagine that.
Be Careful When Evaluating Pro-ObamaCare Studies
I can’t really excerpt from it, just check out my analysis of the Gruber/McKnight study on restricted choice health networks.
Potpourri
==> Tom Woods and Lew Rockwell talk about Murray Rothbard. This is an older podcast but I just heard it.
==> Jeff Tucker reflects on falling oil/gasoline prices.
==> I actually liked this Krugman column on war being counterproductive. However, he’s still locked into the “American war is the fault of Republicans” mindset.
==> Speaking of oil prices and Krugman…Rob Bradley does.
==> China bailing out Russia?
Ultra Magness and Optimus Murphy Fight Piketty
Phil Magness (GMU historian) and I have a working paper up, critiquing the empirical contribution of Thomas Piketty’s bestseller. If you religiously follow this blog, the stuff I added to the paper won’t be new, but when you combine it with what Phil dug up, I think it’s pretty compelling.
If you have serious questions / criticisms you should probably email them to Phil, because I’m spread pretty thin right now.
What the Bible Says About Salvation
I want to keep this post relatively short to encourage more people to read it through. Let me offer only this preface, in case it helps some of you relate: When I was younger, I had this notion that your relationship with God was between Him and you, and ultimately when you died, you’d find out if you had lived a sufficiently good life to pass the bar and get into heaven.
At the time, it didn’t occur to me that someone might have a sound basis for arguing against my view; I thought spiritual things were very important, but ultimately not amenable to argument. This was even (shortly) after I had become a Christian after my long bout with atheism. I had accepted Jesus as my personal Lord and savior, but I didn’t realize the biblical significance of doing that.
In my case, it was the preacher who married my wife and me that set me straight, during the counseling sessions before the wedding. In the rest of this post, let me quote from some famous episodes in the New Testament to show why Bible-based Christians emphasize faith in Jesus, and think that yes indeed there is an objective answer to the crucial question of, “What must we do to be saved?”
==> In Acts 16, Paul and Silas are in prison. There is an earthquake and the prison breaks open.
27 The jailer woke up, and when he saw the prison doors open, he drew his sword and was about to kill himself because he thought the prisoners had escaped. 28 But Paul shouted, “Don’t harm yourself! We are all here!”
29 The jailer called for lights, rushed in and fell trembling before Paul and Silas. 30 He then brought them out and asked, “Sirs, what must I do to be saved?”
31 They replied, “Believe in the Lord Jesus, and you will be saved—you and your household.” 32 Then they spoke the word of the Lord to him and to all the others in his house. 33 At that hour of the night the jailer took them and washed their wounds; then immediately he and all his household were baptized.
==> In Acts 8 Phillip is led by the Holy Spirit to share the good news with someone reading the Old Testament:
And behold, a man of Ethiopia, a eunuch of great authority under Candace the queen of the Ethiopians, who had charge of all her treasury, and had come to Jerusalem to worship, 28 was returning. And sitting in his chariot, he was reading Isaiah the prophet. 29 Then the Spirit said to Philip, “Go near and overtake this chariot.”
30 So Philip ran to him, and heard him reading the prophet Isaiah, and said, “Do you understand what you are reading?”
31 And he said, “How can I, unless someone guides me?” And he asked Philip to come up and sit with him. 32 The place in the Scripture which he read was this:
“He was led as a sheep to the slaughter;
And as a lamb before its shearer is silent,
So He opened not His mouth.
33 In His humiliation His justice was taken away,
And who will declare His generation?
For His life is taken from the earth.”[b]34 So the eunuch answered Philip and said, “I ask you, of whom does the prophet say this, of himself or of some other man?” 35 Then Philip opened his mouth, and beginning at this Scripture, preached Jesus to him. 36 Now as they went down the road, they came to some water. And the eunuch said, “See, here is water. What hinders me from being baptized?”
37 Then Philip said, “If you believe with all your heart, you may.”
And he answered and said, “I believe that Jesus Christ is the Son of God.”
38 So he commanded the chariot to stand still. And both Philip and the eunuch went down into the water, and he baptized him.
==> However, lest you think the crucial thing is baptism, remember the thief hanging on the cross with Jesus (Luke 23):
39 One of the criminals who hung there hurled insults at him: “Aren’t you the Messiah? Save yourself and us!”
40 But the other criminal rebuked him. “Don’t you fear God,” he said, “since you are under the same sentence? 41 We are punished justly, for we are getting what our deeds deserve. But this man has done nothing wrong.”
42 Then he said, “Jesus, remember me when you come into your kingdom.[d]”
43 Jesus answered him, “Truly I tell you, today you will be with me in paradise.”
==> And of course, the most succinct statement, from the mouth of Jesus Himself, which you will see cited at sporting events (with signs touting “John 3:16”):
16 For God so loved the world that he gave his one and only Son, that whoever believes in him shall not perish but have eternal life. 17 For God did not send his Son into the world to condemn the world, but to save the world through him.
So there you have it. The above passages and others like it–especially Paul’s exposition in his epistles–are the foundation for the belief in salvation through faith in Christ. You may sometimes hear it expressed as power in the name of Jesus.
If you believe in God, but have a vague sense that as long as you’re not a really awful person and usually try to do the right thing you’ll make the cut…I empathize with that perspective because it’s a natural, earthly way to look at it. But it’s not what the New Testament says. I would encourage people who think Jesus was a wise teacher to read the above passages in context to understand this radical and initially counterintuitive perspective.
One last thing: If you’re a parent, you can at least understand the idea that no matter what your kid did, it wouldn’t make you stop loving him or her. Yet even so, you wouldn’t force your (grown) kid to spend time with you or accept gifts from you. I think this is one of the reasons God revealed Himself to us in the form of an earthly Son relating to His Heavenly Father.
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