So, once again I must declare spoiler alert as I am going to correct errors in a big Hollywood movie about historical events, although Steven Spielberg does have it said it upfront that the movie is "inspired" by real events rather than claiming actual accuracy. In any case, just-released Bridge of Spies is probably more historically accurate than either The Imitation Game or A Beautiful Mind. To get to an important point, it turns out that a surprisingly important character in Bridge of Spies, whose events occurred during 1957-62, is 82-year old Swarthmore College economist, Frederic L. Pryor, the only one of the major characters in this movie who is still alive. And, it turns out that nobody associated with making the movie ever contacted him, not Spielberg, not the Coen Brothers, not the actor (with the all-American name of Will Rogers). They did not bother to talk to the one living witness to the events when they wrote and made the movie.
For those who have not seen the movie and do not know what it is about, I shall give a quick synopsis before pointing out where it is off. So, in 1957 Soviet master spy, Rudolf Abel (real name: Vilyam Genrikhovich Fisher, played admirably by Mark Rylance) was arrested in New York. Former OSS and Nuremberg attorney, James B. Donovan (played well by Tom Hanks), then in private practice, agreed to defend him and managed to get him a 30 year sentence rather than the death sentence that most of the public wanted for him (with Donovan suffering criticism and ostracism, with him looking like Gregory Peck in To Kill a Mockingbird at one point). In the meantime, Francis Gary Powers (played by Austin Stowell) got himself shot down in 1960 in a high-flying U-2 spy plane and was captured by the Soviets, who put him on a show trial and sentenced him to a long term in their prisons. After a letter arrived from Berlin from a fake wife of Abel, Donovan went to Berlin unofficially at the end of January, 1962, and after a lot of harrowing Cold War adventures with atmospherics of The Spy Who Came in from the Cold, negotiated an exchange of Abel for Powers. However, a complication arose for this in the form of Fred Pryor who had been studying trade patterns of Eastern European nations for a PhD at Yale (received later that year) when he got captured in East Berlin in an essentially snafu situation. CIA wanted Donovan to abandon Pryor, but Donovan heroically insisted on him also being released along with Powers, and in the end got his way, with the final exchange of Abel and Powers on the cinematic Glienicke Bridge getting held up for about half an hour while they waited for Pryor to be released at Checkpoint Charlie, which he was, letting the whole thing go through, with all-American hero Donovan/Hanks going home to well-deserved praise, and with what I have described here also corresponding relatively well to the historical facts. It is in details where things get messed up.
Let me begin with my friend Fred Pryor, who is one of the world's most important comparative economists, the man the film makers did not talk to. He has actually publicly spoken now in an interview in his hometown newspaper a few days ago, the Mansfield (OH) News Journal. He has dismissed his own role as "I don't think I was an important part. I was just a throwaway." Some years ago he told my wife my Marina that he was "just a pawn in their game," with us not knowing if he was consciously quoting Bob Dylan or not. Anyway, reading this interview one can get straight how things went down with him, which is not too far off from the movie version, although he is a much more substantial and acerbic character than Will Rogers played, whom Fred describes unhappily in his interview as "He looks like a delinquent." They show him passing through the half-completed wall in August, 1961 with a copy of his dissertation to give to an East Berlin economics professor. He encounters this professor's daughter, and seeing her appeals to her to get her father and escape to West Berlin, but then where he came in is sealed off and police see him and seize him while the young woman, apparently fond of him, escapes (and later appeals to the police about him). He is seen being knocked to the ground with a rifle butt, but little is seen of him being "interrogated" in jail or of his solitary confinement. His copy of his thesis is seized from him when he is arrested.
According to him, while he had mainly gone to the eastern side to attend a lecture, he was indeed taking a copy of his thesis to a prof he had attended the lectures of at the Free University, with his thesis on trade relations leading the police to think he was "doing legwork for a foreign trade blockade." There was a girl, but she was the sister of a friend who had requested he get news from her given that communications between the two Berlins had been mostly cut. However, it turned out she had already fled to the west when he got to her apartment. He was arrested while leaving her apartment, with them initially thinking he was there to "get her stuff."
It was the East Germans who dragged him into the deal and tried to turn the whole thing into a trade of just Pryor for Powers, which became a sticking point. They were trying to assert themselves with both the Americans and the Soviets. In the film at the climactic moment he is not at Checkpoint Charlie during the final wait, but is only driven up at the last moment (his father was on the other side to receive him when he crossed). In reality apparently the East Germans had him there for that whole time and only finally released him after pressure from the Soviets.
As near as I can tell, aside from not mentioning his previous work with the OSS (his Nuremberg trial work was mentioned), and a few minor details and exaggerations, it looks like Donovan was presented pretty accurately.
When we get to Abel/Fisher, things are more complicated, with only a small amount of the following shown in the movie. Born in 1903 near Newcastle-on-Tyne in northern England of German-Russian parents who were strong Bolsheviks who had fled tsarist Russia and then returned, Abel-Fisher had been with Soviet intelligence except for a few years from 1927 on based on his knowing five languages and being good with radios, aside from numerous other talents, including serious artistic ones (shown in the movie), with him indeed marrying a well-known Moscow harpist. During WW II he trained the real Rudolf Abel to do radio transmissions from behind German lines. Abel died in 1955 after being expelled from China, which Fisher knew. While he is known mostly to history as "Rudolf Abel," he never used that name until his arrest in the US in 1957. The film shows him being addressed by the arresting FBI agents as "Colonel Abel," but in fact all they knew that he was a colonel code-named "Mark." He had been betrayed by an incompetent underling who was being recalled to Moscow, but who managed to defect to the the US in Paris on the way back. He only knew the code name and "Mark's" rank, although Fisher had made the mistake of once letting him visit the hotel room where he stayed in Brooklyn, posing as an artist-photographer named Emil Gusfel, with this location the key to the FBI busting Abel/Fisher. Giving the FBI the name of this dead agent was his way of signaling to Moscow that he was loyal and would not leak, which he did not.
While most of the problems with the film's depiction of Abel/Fisher involve things left out, there is one important error relevant to the worsening condition of US-Russian relations today. At the end of the exchange on the bridge, Abel/Fisher is seen as being put into the back seat of the receiving car without being hugged or even his hands shaken, with him looking significantly at Donovan still left at the other end of the bridge. Just prior to his release Donovan asked him how he would be treated by the Soviets when he returned to which he said he did not know. But he then said that if they hugged him he would be fine, but if they just put him in the back seat of the car he would not be.
Well, what was shown was inaccurate. In fact, he was hugged and treated not only well but as a major hero to the point of overstating his skill and exploits. Apparently the KGB decided to use him for propaganda purposes precisely as that, a hero of Soviet intelligence, sort of like how Stakhanov was a hero-worker in the 1930s. In 1968 a movie was made about his exploits called "Dead Season," which having seen some of it appears to be less accurate than Bridge of Spies, although the latter really shows very little of what he was spying on or what he was actually doing, with probably the most important of that being in the late 40s when he was in Santa Fe serving as a major link in the network associated with the Rosenbergs spying on nuclear activities at Los Alamos (if Julius Rosenberg had cooperated with the FBI and thus probably saved the life of his wife, Ethel, it is probably the case that ratting on Abel/Fisher would have been the biggest catch he could have revealed to them). Dead Season had him chasing after German Nazi scientists working on chemical weapons for the US, which does not appear to have been what he was up to in reality, but a handsome and famous actor played him, and he provided an introduction at the beginning praising in general the KGB's work abroad. This movie was played many times and was very popular. Abel/Gutsfel/Fisher would die peacefully in bed in 1971, a full-blown Hero of the Soviet Union. Donovan died of a heart attack in 1970 at the age of 53.
So, here is the thing. This movie is back. It is now being played repeatedly on Russian TV, a movie that heroizes the old KGB and suggests that the US was working with Nazi German scientists on chemical weapons. Of course there were many former German scientists in the US working on military stuff, but the most important were those associated with Werrnher von Braun (whom my late father knew) who worked on rockets, as is widely known (and the Soviets managed to get some of the German military scientists, although the majority went over to the US of their own volition, particularly the group led by von Braun). But I find it curious that while in the US we have a major movie being made about Abel/Fisher that suggests falsely that he was mistreated by the Soviets after he was returned to them, whereas at the same time an old movie made glamorizing him is now being repeatedly played on Russian TV.
Regarding Powers there are some apparent discrepancies about details of how he was shot down with the movie version probably partly inaccurate. There remains controversy about those details to this day, with an NSA report on it still classified, even though Powers wrote a book on it that was made into a movie with Lee Majors in 1976 the year before Powers died in a helicopter crash. While Powers was mistreated initially on his return for failing to destroy the U-2 plane and for not killing himself with a device he was given before he flew, he has come to be viewed more favorably, receiving a Silver Star posthumously in 2012 for not breaking or leaking classified information during his harrowing interrogation in the Lubyanka. But much about what really happened with Powers, especially the details of his shoot down, remain unclear.
As it was, Donovan died in 1970, Abel/Fisher in 1971, and Powers in 1977. But Fred Pryor remains alive and active and a most admirable and interesting person, a highly innovative economist whose work showed the way to doing comparative economics after the fall of Soviet bloc communism, on which he was (and still is) an expert. I shall note that a major part of this innovation was to consider broader cultural influences as economic systems as well, such as Islamic economics or the Catholic economics that led to corporatism (an invention of the 19th century Catholic Church, as he has pointed out), among others. But I shall not pursue this topic here further at this time, other than to say it has strongly influenced the work of me and my wife.
Barkley Rosser
Tuesday, October 20, 2015
Saturday, October 17, 2015
What Oil Companies Can Do if They Care About Climate Change
Nice to see that a consortium of oil companies wants to keep global warming at 2ºC. Here’s the thing, though: preventing catastrophic climate change comes down primarily to leaving as much fossil fuel as possible in the ground—petroleum, gas and coal. Everything else is about how to make that happen. Companies that own or whose market value depends on those reserves aren’t going to abandon them unilaterally. It’s inconceivable. It will take forcible government action to keep most of that stuff out of reach.
So what can a public-spirited oil company do? One thing: they can publicly pledge not to lobby on carbon policy or to finance politicians based on their promises to go easy on taxes or carbon permits. That’s actually conceivable, albeit at the borderline of political imagination, almost more like an exercise in logically possible worlds than a believable stance. Still, if they’re listening, that’s what I’d ask them to do.
So what can a public-spirited oil company do? One thing: they can publicly pledge not to lobby on carbon policy or to finance politicians based on their promises to go easy on taxes or carbon permits. That’s actually conceivable, albeit at the borderline of political imagination, almost more like an exercise in logically possible worlds than a believable stance. Still, if they’re listening, that’s what I’d ask them to do.
The Neo-McCarthyite Meme That Bernie Sanders And His Wife "Honeymooned" In The Former Soviet Union
Yes, folks, you heard Anderson Cooper hand it out, and Bernie Sanders did not deny it: he and his wife "honeymooned in the Soviet Union."! He did not deny it, and unlike Bernie coming to defend Hillary against all the email charges, she did not rush forward to defend him against this ridiculous garbage. She carefully avoided supporting it, but after Bernie praised Denmark she chose to suggest that Denmark did not support small business like the US, even though data exists showing that Denmark may actually be better at that than the US. But Bernie missed properly responding to any of this, which is probably why he will probably not be POTUS.
OK, so maybe this is a dead duck issue, but I am really offended that obvious right wing jerks who should know better are pushing this garbage meme about Bernie. I am speaking in particular about Charles Krauthammer, who in today's (well, yesterday's) WaPo said, "Amid the playacting between today and Clinton's coronation next summer, we can joyfully savor the most delightful moment of the debate, when we were reminded by Anderson Cooper that Sanders had honeymooned in the Soviet Union."
The facts are that indeed in 1988 when perestroika was in full play Sanders was Mayor of Burlington, VT, which city had become a sister city of Yaroslavl, USSR, some distance northwest of Moscow. It came to pass that the formal trip to establish this city-to-city relationship happened in 1988, which he had to participate in along with various with leading civic figures in Burlington, which he did with Jane. It also happened to be that they got married just before this trip, and they later joked about how this official government trip along with all these other people was their "honeymoon." I note that at this time they would have been politically sympathetic to the reformist anti-traditional-Soviet political forces in the old USSR, although he would have been focusing on all this local government sister city sort of stuff.
Needless to say neither Anderson Cooper nor Charles Krauthammer has remotely noted this or how ridiculous and McCarthyite their lines are. They must be called out for the disgusting scum they are, McCarthyites of the worst order. If and or when this crap resurfaces it must be shot down and those who push these garbage lines should be unequivocally denounced in the clearest and most fervent terms.
Barkley Rosser
OK, so maybe this is a dead duck issue, but I am really offended that obvious right wing jerks who should know better are pushing this garbage meme about Bernie. I am speaking in particular about Charles Krauthammer, who in today's (well, yesterday's) WaPo said, "Amid the playacting between today and Clinton's coronation next summer, we can joyfully savor the most delightful moment of the debate, when we were reminded by Anderson Cooper that Sanders had honeymooned in the Soviet Union."
The facts are that indeed in 1988 when perestroika was in full play Sanders was Mayor of Burlington, VT, which city had become a sister city of Yaroslavl, USSR, some distance northwest of Moscow. It came to pass that the formal trip to establish this city-to-city relationship happened in 1988, which he had to participate in along with various with leading civic figures in Burlington, which he did with Jane. It also happened to be that they got married just before this trip, and they later joked about how this official government trip along with all these other people was their "honeymoon." I note that at this time they would have been politically sympathetic to the reformist anti-traditional-Soviet political forces in the old USSR, although he would have been focusing on all this local government sister city sort of stuff.
Needless to say neither Anderson Cooper nor Charles Krauthammer has remotely noted this or how ridiculous and McCarthyite their lines are. They must be called out for the disgusting scum they are, McCarthyites of the worst order. If and or when this crap resurfaces it must be shot down and those who push these garbage lines should be unequivocally denounced in the clearest and most fervent terms.
Barkley Rosser
Friday, October 16, 2015
More on Interest Rates, Ideology and Caring About the Future
In a previous post I referred to the economic principle that low interest and discount rates translate into greater concern for the future relative to the present. At low interest and discount rates you would cut fewer trees, burn less carbon and make more investments in physical and human capital that will pay off in years to come. If you’re the sort of person who looks ahead and wants to build for the future, you should be for lower interest rates.
It’s interesting that this point, which as far as I know is incontrovertible, is directly contradicted by the presumption of the Very Important crowd that a low interest rate regime is decadent and reflects a live-it-up-now attitude on the part of pandering policy-makers. How can we understand this?
I suggest that it has to do with the difference between individual and social perspectives on planning for the future. At the individual level a person can save. This reduces current consumption but builds up a stock of financial claims that can later be traded in for goods and services: it shifts your consumption into the future. High interest rates are an inducement to or reward for saving, so being a hard money, high interest rate kind of person shows that you’re a grown up, thinking about the future and not just the passing moment.
But an entire society can’t save for the future. In a closed system, financial claims have to net out: having a vault stuffed with paper money or paper assets doesn’t make a society any wealthier if they just reflect payments from some people in that society to others. On the contrary, the future will be better off if we make investments today, and investment is a type of spending, not saving. Finance 101 tells us that more investment projects will pass our hurdle rate of return or be financed by commercial lenders if interest rates are lower, all other things being equal.
True, in an open system, one with international trade, a country can accumulate financial claims against foreigners and therefore become more wealthy through saving, but this is a small component of wealth compared to the capital stock created by investment, and accumulating an external surplus typically requires a weak currency—which is fostered by, among other things, low interest rates.
So the perspective of the individual saver is a terrible guide to planning for the future, even though it tends to dominate politics. From a social theory standpoint, this is a nice example of the conception of ideology based on salience. People with sufficient income to save have to solve the problem of self-control, and the effect of interest as a reward for this virtuous behavior is what stands out to them. People whose future income depends on making investments today, like students borrowing to finance their education, see interest as the cost of borrowing. Each view of interest is ideological, in the sense that it generalizes the particular interpretation of a social phenomenon (like interest rates) from personal experience. It happens in this case that the borrower’s perspective aligns with reality at an economy-wide level, and the saver’s perspective is misleading.
It’s interesting that this point, which as far as I know is incontrovertible, is directly contradicted by the presumption of the Very Important crowd that a low interest rate regime is decadent and reflects a live-it-up-now attitude on the part of pandering policy-makers. How can we understand this?
I suggest that it has to do with the difference between individual and social perspectives on planning for the future. At the individual level a person can save. This reduces current consumption but builds up a stock of financial claims that can later be traded in for goods and services: it shifts your consumption into the future. High interest rates are an inducement to or reward for saving, so being a hard money, high interest rate kind of person shows that you’re a grown up, thinking about the future and not just the passing moment.
But an entire society can’t save for the future. In a closed system, financial claims have to net out: having a vault stuffed with paper money or paper assets doesn’t make a society any wealthier if they just reflect payments from some people in that society to others. On the contrary, the future will be better off if we make investments today, and investment is a type of spending, not saving. Finance 101 tells us that more investment projects will pass our hurdle rate of return or be financed by commercial lenders if interest rates are lower, all other things being equal.
True, in an open system, one with international trade, a country can accumulate financial claims against foreigners and therefore become more wealthy through saving, but this is a small component of wealth compared to the capital stock created by investment, and accumulating an external surplus typically requires a weak currency—which is fostered by, among other things, low interest rates.
So the perspective of the individual saver is a terrible guide to planning for the future, even though it tends to dominate politics. From a social theory standpoint, this is a nice example of the conception of ideology based on salience. People with sufficient income to save have to solve the problem of self-control, and the effect of interest as a reward for this virtuous behavior is what stands out to them. People whose future income depends on making investments today, like students borrowing to finance their education, see interest as the cost of borrowing. Each view of interest is ideological, in the sense that it generalizes the particular interpretation of a social phenomenon (like interest rates) from personal experience. It happens in this case that the borrower’s perspective aligns with reality at an economy-wide level, and the saver’s perspective is misleading.
Wednesday, October 14, 2015
The Real Lesson of Leap (and VW and maybe Uber): Libertarian Tech Hubris
I think Farhad Manjoo draws the wrong lesson from the Leap debacle. Leap, you’ll recall, was the private, for-profit and very posh bus service launched in the Bay Area a few years back. It was pilloried for the way it catered to well-heeled techies at a time when ordinary people were finding it impossible to live in SF and many of the surrounding communities. Well, yes, but what killed Leap was not its bad image but the fact that they tried to operate—twice!—without municipal and state permits. The regulators shut them down.
And this isn’t an isolated case. Uber has been facing increasing resistance from local governments around the world for trying to run a taxi service without adhering to taxi regulations. One of the factors behind the VW diesel exhaust scandal is the disdain that the company’s engineers had for environmental regulations, or any regulations that would diminish the performance of their sleek machines.
In other words, there’s a libertarian, antiregulatory mood that has become the default culture of the techie class. We are on the cutting edge, inventing all kinds of cool stuff; they are the dinosaurs trying to enforce brain-dead rules to hem us in.
Of course, a lot of regulation is garbage, designed to protect the interests that had a hand in writing them, and there are bureaucrats who will trot out any dumb rule they can find to maintain their power to interfere. But most regulations, to a greater or lesser extent, exist because there were problems that people needed regulations to solve. Transportation services have to be safe, and they can’t discriminate between people who are willing to pay to get from point A to point B. Their service area decisions have large impacts on land values and community sustainability, and there needs to be a public process for talking these things out. And of course the diesel exhaust standards exist because of the public health consequences.
What we’re finding out—and this is the main lesson of Leap—is that techie libertarianism is not only shallow politics, it can be lethal for business in a justifiably regulated world. Grow up.
And this isn’t an isolated case. Uber has been facing increasing resistance from local governments around the world for trying to run a taxi service without adhering to taxi regulations. One of the factors behind the VW diesel exhaust scandal is the disdain that the company’s engineers had for environmental regulations, or any regulations that would diminish the performance of their sleek machines.
In other words, there’s a libertarian, antiregulatory mood that has become the default culture of the techie class. We are on the cutting edge, inventing all kinds of cool stuff; they are the dinosaurs trying to enforce brain-dead rules to hem us in.
Of course, a lot of regulation is garbage, designed to protect the interests that had a hand in writing them, and there are bureaucrats who will trot out any dumb rule they can find to maintain their power to interfere. But most regulations, to a greater or lesser extent, exist because there were problems that people needed regulations to solve. Transportation services have to be safe, and they can’t discriminate between people who are willing to pay to get from point A to point B. Their service area decisions have large impacts on land values and community sustainability, and there needs to be a public process for talking these things out. And of course the diesel exhaust standards exist because of the public health consequences.
What we’re finding out—and this is the main lesson of Leap—is that techie libertarianism is not only shallow politics, it can be lethal for business in a justifiably regulated world. Grow up.
Homo Socialis By Gintis and Helbing In ROBE
Folks,
I ususally do not do this sort of advertising, but it is picking up commentary here and there, so I problably should. The journal I edit, Review of Behavioral Economics, has recently published a major target article by Herbert Gintis and Dirk Helbing, "Homo Socialis: An Analytical Core for Sociological Theory," a long paper that presents several provocative arguments, with this issue being 1 and 2 of our second volume. It is accompanied by 14 lively commentaries by people from several disciplines along with rejoinders by each of the coauthors. The comments are by Catherine Eckel and Jane Sell, Mauro Gallegati, Robert L. Goldstone, Michael Hechter, Geoffrey M. Hodgson, Alan G. Isaac, Paul Lewis, Siegwart Lindenberg, Michael W. Macy, Andrzej Nowak and Jorgen Andersen and Wojciech Borkowski, Paul Ormerod, Vernon L. Smith, Ulrich Witt, and David H. Wolpert.
Addendum: Journal link now works, and issue is there.
Barkley Rosser
I ususally do not do this sort of advertising, but it is picking up commentary here and there, so I problably should. The journal I edit, Review of Behavioral Economics, has recently published a major target article by Herbert Gintis and Dirk Helbing, "Homo Socialis: An Analytical Core for Sociological Theory," a long paper that presents several provocative arguments, with this issue being 1 and 2 of our second volume. It is accompanied by 14 lively commentaries by people from several disciplines along with rejoinders by each of the coauthors. The comments are by Catherine Eckel and Jane Sell, Mauro Gallegati, Robert L. Goldstone, Michael Hechter, Geoffrey M. Hodgson, Alan G. Isaac, Paul Lewis, Siegwart Lindenberg, Michael W. Macy, Andrzej Nowak and Jorgen Andersen and Wojciech Borkowski, Paul Ormerod, Vernon L. Smith, Ulrich Witt, and David H. Wolpert.
Addendum: Journal link now works, and issue is there.
Barkley Rosser
Monday, October 12, 2015
Interest Rates and the Shadow of the Future
There’s an interesting quote from Axel Weber, one of Germany’s most influential economists, transmitted by Dean Baker this morning:
The funny thing is that I am just preparing a lecture on natural resource policy where the central variable, of course, is the discount rate. Low rates put more emphasis on the future, high rates on the here and now. And that’s true for all investment, whether in nature, produced capital or human capital. It’s what r is fundamentally about. Low r stimulates economies by encouraging more spending on investment.
People who’ve already amassed a lot of money and want to earn a return on it—creditors—like high interest rates. The rest of us, who either borrow money to invest or depend on a robust economy for jobs and higher wages, see things the other way around. But in the end, a lower r gives more weight to the future. It’s about as basic an economic truth as you’ll ever find.
“When I travel around the world, I find hardly anyone supporting the Fed’s policy on interest rates,” said a senior European official, who did not want to be publicly identified criticizing the I.M.F. “The fund has become very short-term-oriented."I hear this a lot. Stimulative monetary policy, in the spirit of the dissolute John Maynard Keynes, is all about living it up in the present and hardly giving a thought to what follows. Remember Niall Ferguson and the “quip” about Keynes not caring about the next generation because he was gay and wouldn’t have any?
The funny thing is that I am just preparing a lecture on natural resource policy where the central variable, of course, is the discount rate. Low rates put more emphasis on the future, high rates on the here and now. And that’s true for all investment, whether in nature, produced capital or human capital. It’s what r is fundamentally about. Low r stimulates economies by encouraging more spending on investment.
People who’ve already amassed a lot of money and want to earn a return on it—creditors—like high interest rates. The rest of us, who either borrow money to invest or depend on a robust economy for jobs and higher wages, see things the other way around. But in the end, a lower r gives more weight to the future. It’s about as basic an economic truth as you’ll ever find.
Sunday, October 11, 2015
Disclosure of What?
A comment to my last post, on the Litan affair and the importance of disclosure, has got me thinking. As was point out, Litan had disclosed his funding; what he hadn’t disclosed was that his funder had commissioned the work. This raises the larger question of what sorts of disclosure ought to be required. A researcher’s relationship to external interests is not a binary, yes-no matter; there are multiple levels.
The obvious answer, how much money changed hands, is not very informative, in my opinion. A lot of funding can be earmarked for expenses, and even the meaning of an “expense” is open. If a professor has a course bought out, is this an expense or a benefit?
I think the question that tripped up Litan, whether the funder commissioned the work in question, is germane, although there are large ambiguities here as well. Sometimes a researcher will go to an agency or foundation with a proposal and request that a particular piece of work be commissioned; I’ve done this myself. But is that the same as having someone come to you, ask for a specific product and then pay you enough to convince you to do it?
For me the most important question is whether the researcher has an obligation to share results or manuscript drafts prior to public dissemination. Whether there is a further understanding that the funder’s explicit approval is necessary to go forward may be relevant, but not necessarily. The critical line, in my opinion, divides research with strings, like the obligation to submit drafts, from research without. I believe it should always be specified whether a report or article was reviewed by an interested party before it was released to the public.
These are preliminary thoughts on my part, and readers may have insights I haven’t considered.
The obvious answer, how much money changed hands, is not very informative, in my opinion. A lot of funding can be earmarked for expenses, and even the meaning of an “expense” is open. If a professor has a course bought out, is this an expense or a benefit?
I think the question that tripped up Litan, whether the funder commissioned the work in question, is germane, although there are large ambiguities here as well. Sometimes a researcher will go to an agency or foundation with a proposal and request that a particular piece of work be commissioned; I’ve done this myself. But is that the same as having someone come to you, ask for a specific product and then pay you enough to convince you to do it?
For me the most important question is whether the researcher has an obligation to share results or manuscript drafts prior to public dissemination. Whether there is a further understanding that the funder’s explicit approval is necessary to go forward may be relevant, but not necessarily. The critical line, in my opinion, divides research with strings, like the obligation to submit drafts, from research without. I believe it should always be specified whether a report or article was reviewed by an interested party before it was released to the public.
These are preliminary thoughts on my part, and readers may have insights I haven’t considered.
Saturday, October 10, 2015
Litany of Tainted Research
Most of what Luigi Zingales has to say about the Litan affair is right on target: reputation effects are not sufficient to prevent researchers from shading their conclusions to satisfy funders. Litan himself was guilty of failure to disclose his sponsors, the Capital Group, for testimony he presented to Congress, irrespective of the merits or otherwise of his work: who is paying for research is relevant to forming a judgment on it, and not only whether this or that variable was properly identified. And Senator Warren was right to call him out.
Still, there are problems of omission and commission with Zingales’ piece. Commission #1: I strongly disagree that public funding of research raises the same issues as private. Says Z: “Eliminating private funding will leave research completely in public funding’s hands. It will not eliminate the bias; it will simply tilt it in the direction of the government.” Really, Zingales has been hanging out in Chicago too long. As a sometimes recipient of public funding (disclosure), I think it’s ludicrous to say that the interest of the “government” bears on how us grantees do our work. Seriously, what government interest does NSF represent? In any case, there is a legal basis for exposing bias and malfeasance in public research support that does not exist in the private sector.
Commission #2: “....reputational incentives work relatively well only for academic papers that circulate widely in the relevant academic community and are independently scrutinized in peer review.” I wish. The reality is that peer scrutiny is not a process that separates the worthy from the unworthy in an objective, reliable manner. Just look at any journal: quite a bit of shady stuff survives peer review and gets published, even if their results are not replicable. In addition, as any author knows, there are a myriad of detailed matters in research that can be resolved in a variety of ways. You can push the boundaries of a category a little bit this way or that, make or not make a restrictive assumption, and so on. Your peers are not going to write you off just because your choices lean a little in a particular direction as long as you are technically sound. The moral of the story: disclosure of funding sources is essential for all published research, no matter how and to whom it is disseminated.
Omission: Zingales provides two suggestions for reform, advance posting of expert testimony at least two weeks before a Congressional hearing and public disclosure of the identities of expert witnesses. But the most important reform is missing: we need a single, consolidated source of information on all publishing economists disclosing all their sources of funding. This could be a website where any journalist, congressional staffer or interested member of the public could find out if a given author had taken money that might influence his or her work. Beginning with the AEA, professional associations and journals could make accurate listing in this database a condition for participation or submission. Who’s paying you should not be treated as a trade secret, not if you claim to be contributing to the store of human knowledge.
Still, there are problems of omission and commission with Zingales’ piece. Commission #1: I strongly disagree that public funding of research raises the same issues as private. Says Z: “Eliminating private funding will leave research completely in public funding’s hands. It will not eliminate the bias; it will simply tilt it in the direction of the government.” Really, Zingales has been hanging out in Chicago too long. As a sometimes recipient of public funding (disclosure), I think it’s ludicrous to say that the interest of the “government” bears on how us grantees do our work. Seriously, what government interest does NSF represent? In any case, there is a legal basis for exposing bias and malfeasance in public research support that does not exist in the private sector.
Commission #2: “....reputational incentives work relatively well only for academic papers that circulate widely in the relevant academic community and are independently scrutinized in peer review.” I wish. The reality is that peer scrutiny is not a process that separates the worthy from the unworthy in an objective, reliable manner. Just look at any journal: quite a bit of shady stuff survives peer review and gets published, even if their results are not replicable. In addition, as any author knows, there are a myriad of detailed matters in research that can be resolved in a variety of ways. You can push the boundaries of a category a little bit this way or that, make or not make a restrictive assumption, and so on. Your peers are not going to write you off just because your choices lean a little in a particular direction as long as you are technically sound. The moral of the story: disclosure of funding sources is essential for all published research, no matter how and to whom it is disseminated.
Omission: Zingales provides two suggestions for reform, advance posting of expert testimony at least two weeks before a Congressional hearing and public disclosure of the identities of expert witnesses. But the most important reform is missing: we need a single, consolidated source of information on all publishing economists disclosing all their sources of funding. This could be a website where any journalist, congressional staffer or interested member of the public could find out if a given author had taken money that might influence his or her work. Beginning with the AEA, professional associations and journals could make accurate listing in this database a condition for participation or submission. Who’s paying you should not be treated as a trade secret, not if you claim to be contributing to the store of human knowledge.
Friday, October 9, 2015
Picasso: A “Lost” Treasure
I don’t know how this Spanish case over who has custody over a Picasso portrait, the Spanish government or the billionaire owner, is going to turn out, but I heard a nice story that I’d like to pass along.
It took place at an outdoor café, I believe along the Riviera. Picasso was at a table chatting with a family. The family wanted show the Great Man their daughter’s artwork, so, with the little girl at the table, they pulled out one of her creations. Picasso examined it and said, “Yes, but let’s see another way of doing it. We could begin like this,” and he began drawing on a napkin. He made a few lines, said a bit more, then drew more. Soon an elegant sketch was taking form. Meanwhile, all eyeballs from the surrounding tables had turned toward Picasso and especially this napkin. What would it be worth?
Picasso discussed his drawing with the girl, pointing out how a few strokes of a pencil could stand in for a lot more detail. But then, looking around to his expanded audience, he added, “But enough about me! What about you? Let’s see you draw something else!” And with that, he shredded his napkin into little pieces.
I heard this second-hand from someone who claimed they knew someone who was there. The specifics may be wrong, or maybe the whole story is apocryphal. If any readers can pin it down, I’d appreciate it.
It took place at an outdoor café, I believe along the Riviera. Picasso was at a table chatting with a family. The family wanted show the Great Man their daughter’s artwork, so, with the little girl at the table, they pulled out one of her creations. Picasso examined it and said, “Yes, but let’s see another way of doing it. We could begin like this,” and he began drawing on a napkin. He made a few lines, said a bit more, then drew more. Soon an elegant sketch was taking form. Meanwhile, all eyeballs from the surrounding tables had turned toward Picasso and especially this napkin. What would it be worth?
Picasso discussed his drawing with the girl, pointing out how a few strokes of a pencil could stand in for a lot more detail. But then, looking around to his expanded audience, he added, “But enough about me! What about you? Let’s see you draw something else!” And with that, he shredded his napkin into little pieces.
I heard this second-hand from someone who claimed they knew someone who was there. The specifics may be wrong, or maybe the whole story is apocryphal. If any readers can pin it down, I’d appreciate it.
Where Does the Minimum Wage Max Out?
Alan Krueger says we should set a nationwide wage floor no higher than $12/hr, since that’s as far as our research knowledge extends. We know that a statutory minimum at that level will have little or no employment impact, but anything above that is beyond empirical familiarity—we just don’t know. He is open to cities, where wages and living costs are higher, to experiment with higher wage floors, but not the Feds.
Far be it from me to dispute Krueger, who, with David Card, launched the revolution in empirical minimum wage studies a generation ago, finding in the process that he has become a poster boy for quasi-experimental methods. Good for him! But I don’t think his inference from the existing research is warranted, for three reasons.
1. From a policy perspective, the minimum wage could be set either too low or too high. It would be too low if large gains in equity, poverty reduction and economic dynamism could be achieved at little cost in employment. (Dynamism could take the form of innovation to offset higher labor costs.) It would be too high if employment at the low end of the labor market were crippled. What Krueger seems to be aiming at is a zero risk of overshooting the ideal minimum, as if there were no cost to undershooting it. But surely, if we know that $12 is unlikely to bite back, then a proper balancing of risks should take us somewhere above $12.
2. A high percentage of low-wage jobs are intermittent. People work for a while, get laid off or quit, then go back to another crapola job, and so on. This means that a lot of the employment loss of a “too high” minimum wage simply means that workers will earn more money per hour but work fewer hours per year. What that means for their bottom line depends on the elasticity of labor demand with respect to the wage mandate. Even the economists on the payroll of the restaurant industry who have done battle with Card & Krueger find low elasticities, meaning that most intermittent workers would come out ahead despite longer spells of unemployment. This doesn’t mean that we shouldn’t worry about unemployment at all, but that it isn’t quite the problem it’s made out to be.
3. Even if the minimum wage is set at a level that eats into employment, this can be offset by other policies. Macropolicy, especially on the fiscal side, should push for lower overall unemployment rates. We should finally begin to treat all young people, especially from low income backgrounds, as the repositories of incredible potential they are, by investing in their education, skill and practical experience—there are lots of models for this. A ramping up of skill would, over time, lead to productivity gains that would support a higher wage structure. The point is that the minimum wage is one piece of a much larger mosaic of economic policy, and its effects differ depending on what else is being done.
So is $15 the magic number? I don’t know. Like Krueger would probably say, we need more research. But what I do know is that, if $12 is very safe, the right number is higher than that.
Far be it from me to dispute Krueger, who, with David Card, launched the revolution in empirical minimum wage studies a generation ago, finding in the process that he has become a poster boy for quasi-experimental methods. Good for him! But I don’t think his inference from the existing research is warranted, for three reasons.
1. From a policy perspective, the minimum wage could be set either too low or too high. It would be too low if large gains in equity, poverty reduction and economic dynamism could be achieved at little cost in employment. (Dynamism could take the form of innovation to offset higher labor costs.) It would be too high if employment at the low end of the labor market were crippled. What Krueger seems to be aiming at is a zero risk of overshooting the ideal minimum, as if there were no cost to undershooting it. But surely, if we know that $12 is unlikely to bite back, then a proper balancing of risks should take us somewhere above $12.
2. A high percentage of low-wage jobs are intermittent. People work for a while, get laid off or quit, then go back to another crapola job, and so on. This means that a lot of the employment loss of a “too high” minimum wage simply means that workers will earn more money per hour but work fewer hours per year. What that means for their bottom line depends on the elasticity of labor demand with respect to the wage mandate. Even the economists on the payroll of the restaurant industry who have done battle with Card & Krueger find low elasticities, meaning that most intermittent workers would come out ahead despite longer spells of unemployment. This doesn’t mean that we shouldn’t worry about unemployment at all, but that it isn’t quite the problem it’s made out to be.
3. Even if the minimum wage is set at a level that eats into employment, this can be offset by other policies. Macropolicy, especially on the fiscal side, should push for lower overall unemployment rates. We should finally begin to treat all young people, especially from low income backgrounds, as the repositories of incredible potential they are, by investing in their education, skill and practical experience—there are lots of models for this. A ramping up of skill would, over time, lead to productivity gains that would support a higher wage structure. The point is that the minimum wage is one piece of a much larger mosaic of economic policy, and its effects differ depending on what else is being done.
So is $15 the magic number? I don’t know. Like Krueger would probably say, we need more research. But what I do know is that, if $12 is very safe, the right number is higher than that.
Wednesday, October 7, 2015
Dean Baker Sends Mixed Message On Bailing Out Banks
Unfortunately I seem to be unable to provide functionng links to Dean Baker's Beat the Press, and I am overwhelmingly most of the time on board with him as beats the press for its many errors and sins. However, today he seems to have gotten himself confused in a post aimed not at the press but at Ben Bernanke and statements in his memor, entitled "Of course Ben Bernanke could have saved Lehman," which very accurately argues that indeed Bernanke and the Fed could have saved Lehman in September, 2008 but did not do so. I have not read Bernanke's memoir, but I shall take it as true that Bernanke indeed makes this false claim. So, so far so good for our usually intrepid Dean.
But there is a problem here, which several commenters on his blog have pointed out. For years he has beaten a drum that there should have been no bank bailouts, especially not TARP. His favored outcome was to let whatever big banks were in deep doo doo to go down, to fail, with their depositers being paid off. Now to pay off those depositers would have certainly made the FDIC go bankrupt, but indeed probably Congress would have come through, if perhaps with some lag, and paid off all those depositers. This would have indeed probably at a minimum led to the careless and venal managements of those big banks being removed, if not necessarily being sent to jail as both Dean and Ben Bernanke also say they wished had happened (as have many of the rest of us as well). Dean has also regularly dismissed the concerns of Bernanke that failing to bail out the big banks would lead to any further failures of banks or other problems in the financial system that might have led to a 1931 style outcome, which Bernanke feared, an outcome that did give us Adolf Hitler and all that followed (uh oh, have I broken Godwin's Rule, or whatever that is? note official self hand slap).
Now one clear reason why it might not have been as bad as 1931 was indeed that we now have the FDIC, which was not put in place until 1935. The wave of bank failures after Fall 1931 (and before as well) wiped out the savings of many people who were not at all insured. Probably the scale of wipeouts would not have been nearly as bad. OTOH, the degree of interbank connectedness now around the world is much greater and more opaque when the shadow banking system is taken into account than was the case in 1931. That global financial collapse took many months, having started in May with the failure of the Creditanstalt in Vienna, then spreading across Germany and France over the summer to UK by end of summer and finally to the US by Septermber (and on to Japan later). It remains not widely reported, although I think Dean knows it (in fact I think he and I have personally discussed this), that the really serious thing that was going on that September was the Fed bailing out the ECB, which was having trouble propping up top German and Franch banks that were threatening to go under due to their exploding AIG problem. This was truly an enormous mess, and the threat to the full global financial system appears to have been extreme, with all this brought on by the fall of Lehman, which Dean now says should indeed have been propped up. I guess maybe if it had been propped up, we would not have had to prop up the rest, but who knows?
One final trivial note. TARP ended up making money for the US Treasury. A massive bailout of depositers in failed banks after an FDIC bankruptcy would have certainly cost the Treasry and taxpayers money, as was the csse with the S&L bailouts of an earlier decade. But this is trivial compared to the possible losses that might have occurred if there were no bailouts of the big banks. In any case, I think Dean has a bit of an inconsistent story going on here, whether or not Ben Bernanke did well or ill.
Barkley Rosser
But there is a problem here, which several commenters on his blog have pointed out. For years he has beaten a drum that there should have been no bank bailouts, especially not TARP. His favored outcome was to let whatever big banks were in deep doo doo to go down, to fail, with their depositers being paid off. Now to pay off those depositers would have certainly made the FDIC go bankrupt, but indeed probably Congress would have come through, if perhaps with some lag, and paid off all those depositers. This would have indeed probably at a minimum led to the careless and venal managements of those big banks being removed, if not necessarily being sent to jail as both Dean and Ben Bernanke also say they wished had happened (as have many of the rest of us as well). Dean has also regularly dismissed the concerns of Bernanke that failing to bail out the big banks would lead to any further failures of banks or other problems in the financial system that might have led to a 1931 style outcome, which Bernanke feared, an outcome that did give us Adolf Hitler and all that followed (uh oh, have I broken Godwin's Rule, or whatever that is? note official self hand slap).
Now one clear reason why it might not have been as bad as 1931 was indeed that we now have the FDIC, which was not put in place until 1935. The wave of bank failures after Fall 1931 (and before as well) wiped out the savings of many people who were not at all insured. Probably the scale of wipeouts would not have been nearly as bad. OTOH, the degree of interbank connectedness now around the world is much greater and more opaque when the shadow banking system is taken into account than was the case in 1931. That global financial collapse took many months, having started in May with the failure of the Creditanstalt in Vienna, then spreading across Germany and France over the summer to UK by end of summer and finally to the US by Septermber (and on to Japan later). It remains not widely reported, although I think Dean knows it (in fact I think he and I have personally discussed this), that the really serious thing that was going on that September was the Fed bailing out the ECB, which was having trouble propping up top German and Franch banks that were threatening to go under due to their exploding AIG problem. This was truly an enormous mess, and the threat to the full global financial system appears to have been extreme, with all this brought on by the fall of Lehman, which Dean now says should indeed have been propped up. I guess maybe if it had been propped up, we would not have had to prop up the rest, but who knows?
One final trivial note. TARP ended up making money for the US Treasury. A massive bailout of depositers in failed banks after an FDIC bankruptcy would have certainly cost the Treasry and taxpayers money, as was the csse with the S&L bailouts of an earlier decade. But this is trivial compared to the possible losses that might have occurred if there were no bailouts of the big banks. In any case, I think Dean has a bit of an inconsistent story going on here, whether or not Ben Bernanke did well or ill.
Barkley Rosser
Wednesday, September 30, 2015
Huffing And Puffing Ideologically Over The Export-Import Bank
Tyler Cowen at Marginal Revolution has sympathetically linked to an article in the latest issue of Econ Journal Watch by Veronique de Rugy, Ryan Daza, and Daniel B. Klein that argues that libertarian/conservative bloggers have been frequently and firmly critical of the supposedly awful Export-Import Bank, whose charter was renewed not too long ago, even while they admit that at least a few leftist bloggers have criticized it, most notably Dean Baker, who was all over its case today (perhaps in response to this article, although he made no mention of it or Cowen's post).
While some commenters at MR attempt to criticize the methodology of the authors, it looks to me like they are basically correct. Dean Baker is one of the lefty bloggers to post multiple times to criticize the Export-Import Bank as a protectionist subsidizer of big corporate interests, most notably Boeing and General Electric. OTOH, many righty bloggers have complained about its rechartering frequently, with Donald Boudreaux at Cafe Hayek leading the pack with 72 such posts, followed by Daniel Mitchell at International Liberty at 43. For the authors this apparently shows some kind of hypocrisy by statist protectionists on the left, even though the only blogger identified as supporting the Ex-Im Bank outright is Barry Ritholtz, a professional financial adviser whom I have not yet heard of presenting talks in URPE sessions at conferences.
For the record, I agree with Dean Baker about the Ex-Im Bank. It does not deserve to exist, and it clearly exists solely to help out some big corporate interests, even if one wants to argue as some have that workers may be involved here as well (the heart of leftist protectionist arguments). So, why have most lefty blogs been silent on this, and I am posting on this at least partly because this blog is listed in this article as being one that has never had a post about this issue, accurately as near as I can tell, so this is the first such post. I cannot speak for others here, but why have I not personally so posted in the past on this wicked evil big government protectionist protector of giant corporations?
Well, I had not paid much attention to it, frankly, and the main reason is simply that I have never thought it was much of a big deal. I have sympathy with libertarians and conservatives when they point to the many government programs that engage in questionable activities and that also cost taxpayers a lot of money, think agricultural price support programs (although conservative politicians from agricultural states will rush to support them, and even supposedly "clean" centrists and liberals, such as the late William Proxmire of Wisconsin who when asked why he was attacking wasteful programs but supporting dairy import quotas replied that, "After all, I am the senior senator from the state of Wisconsin"). But, not only is Ex-Im not costing a lot of money, it is making a profit. In this regard it looks like the much-derided TARP, which I also find myself having trouble getting too worked up about. Maybe the financial system would have been just fine without TARP and we would not have fallen into another Great Depression, but even if it had no positive effect, at least it did not cost any money in the end.
Also, in the case of its biggest beneficiary, Boeing, we are not talking about a free market. It is part of an effective duopoly with Airbus. And the subsidies and support from governments that Airbus gets for trade support far exceed the penny ante amounts that having slightly lower interest rates for some of its borrowing provides for Boeing. (General Electric arguably operates in a more competitive environment). The amounts involved are piddling, in the millions, not billions, per year, although supposedly without Ex-Im Boeing might have lost a $1.1 billion deal with South Africa.
But there is a bigger issue here that nobody has talked about, not the authors of the articles, and not even any of the conservative or libertarian critics of Ex-Im, and for that matter, not even Dean Baker or any of the leftier critics either. That is that both Boeing and General Electric have received much greater subsidies that do come out of the taxpayers' pockets from another source in the US government, the DOD. Boeing is the second largest defense contracter in the US, receiving on the order of roughly $18 billion in contracts annually, with General Electric a good deal further behind, but also receiving several billions in contracts annually as well. Now it may be that people ignore this because they are presumably providing services, even though we know such contracts have very nice profit margins padded into them. Conservatives may love this, but good libertarians should be down on DOD subsidies as should good lefties like Dean Baker. This is the real subsidy the US government gives these behemoths that helps them in trade wars, not the penny ante dribblings that they get from the money-making, if indefensible, Export-Import Bank.
I shall take all these people getting all bent out over Ex-Im, both the bloggers and these authors, more seriously when they point out these massive subsidies from the DOD. But, I am not going to hold my breath over this.
Barkley Rosser
While some commenters at MR attempt to criticize the methodology of the authors, it looks to me like they are basically correct. Dean Baker is one of the lefty bloggers to post multiple times to criticize the Export-Import Bank as a protectionist subsidizer of big corporate interests, most notably Boeing and General Electric. OTOH, many righty bloggers have complained about its rechartering frequently, with Donald Boudreaux at Cafe Hayek leading the pack with 72 such posts, followed by Daniel Mitchell at International Liberty at 43. For the authors this apparently shows some kind of hypocrisy by statist protectionists on the left, even though the only blogger identified as supporting the Ex-Im Bank outright is Barry Ritholtz, a professional financial adviser whom I have not yet heard of presenting talks in URPE sessions at conferences.
For the record, I agree with Dean Baker about the Ex-Im Bank. It does not deserve to exist, and it clearly exists solely to help out some big corporate interests, even if one wants to argue as some have that workers may be involved here as well (the heart of leftist protectionist arguments). So, why have most lefty blogs been silent on this, and I am posting on this at least partly because this blog is listed in this article as being one that has never had a post about this issue, accurately as near as I can tell, so this is the first such post. I cannot speak for others here, but why have I not personally so posted in the past on this wicked evil big government protectionist protector of giant corporations?
Well, I had not paid much attention to it, frankly, and the main reason is simply that I have never thought it was much of a big deal. I have sympathy with libertarians and conservatives when they point to the many government programs that engage in questionable activities and that also cost taxpayers a lot of money, think agricultural price support programs (although conservative politicians from agricultural states will rush to support them, and even supposedly "clean" centrists and liberals, such as the late William Proxmire of Wisconsin who when asked why he was attacking wasteful programs but supporting dairy import quotas replied that, "After all, I am the senior senator from the state of Wisconsin"). But, not only is Ex-Im not costing a lot of money, it is making a profit. In this regard it looks like the much-derided TARP, which I also find myself having trouble getting too worked up about. Maybe the financial system would have been just fine without TARP and we would not have fallen into another Great Depression, but even if it had no positive effect, at least it did not cost any money in the end.
Also, in the case of its biggest beneficiary, Boeing, we are not talking about a free market. It is part of an effective duopoly with Airbus. And the subsidies and support from governments that Airbus gets for trade support far exceed the penny ante amounts that having slightly lower interest rates for some of its borrowing provides for Boeing. (General Electric arguably operates in a more competitive environment). The amounts involved are piddling, in the millions, not billions, per year, although supposedly without Ex-Im Boeing might have lost a $1.1 billion deal with South Africa.
But there is a bigger issue here that nobody has talked about, not the authors of the articles, and not even any of the conservative or libertarian critics of Ex-Im, and for that matter, not even Dean Baker or any of the leftier critics either. That is that both Boeing and General Electric have received much greater subsidies that do come out of the taxpayers' pockets from another source in the US government, the DOD. Boeing is the second largest defense contracter in the US, receiving on the order of roughly $18 billion in contracts annually, with General Electric a good deal further behind, but also receiving several billions in contracts annually as well. Now it may be that people ignore this because they are presumably providing services, even though we know such contracts have very nice profit margins padded into them. Conservatives may love this, but good libertarians should be down on DOD subsidies as should good lefties like Dean Baker. This is the real subsidy the US government gives these behemoths that helps them in trade wars, not the penny ante dribblings that they get from the money-making, if indefensible, Export-Import Bank.
I shall take all these people getting all bent out over Ex-Im, both the bloggers and these authors, more seriously when they point out these massive subsidies from the DOD. But, I am not going to hold my breath over this.
Barkley Rosser
Sorry, David Ignatius, We Never Had Syria to "Hand Over to Putin"
Today the usually perspicacious David Ignatius in the Washington Post declares in a column labeled "Don't hand Syria over to Putin," that"simply acceding to Moscow...would be significant mistake." Funny thing is that he follows up this statement with the probably accurate observation that "the Russians can't defeat the Islamic State." But, escalation by Russia to bomb in Syria (as the US has been doing for some time) might "may fuel the Sunni insurgency even more." Maybe, but the more serious problem here is that the US has not "had" Syria ever.
The hard fact is that Russia has "had Syria" for a long time, far more than the US ever has, basically ever since the Ba'ath Party came to power in a military coup more than half a century ago over the immediate successors of the French rule after WW II, although, of course, prior to 1991, it was the Soviet Union that "had" Syria, not Russia. But we know that there has been a lot of continuity in terms of global interests from the old Soviet Union to the modern Russia in many places. The Soviets and then Russians also supported Saddam in Iraq and his branch of the Ba'ath Party, Arab nationalist socialist in its ideological orientation, even as those two branches and the Assads and Saddam became enemies of each other. Indeed, in Putin's speech to the UN General Assembly, he complained about the US overthrow of Saddam noting that what has followed has been chaos, along with the beginning of Daesh/ISIS/ISIL/IS, the collapse of pro-Russian Libyan regime into chaos (with the division into its historically distinct eastern and western parts as I frequently forecast here on Econospeak), and the mess in Yemen.
So, Putin has been very traditional in his approach to many parts of the globe. In this regard, he has focused on military bases, especially naval ones. One can argue that Russia as a major land power should not be so focused on its navy, but this is an old concern, dating at least to Peter the Great three centuries ago when he grabbed the land from Sweden that he build Saint Petersburg on to provide a naval "Window to the West"(with this emphasized by the fact that the radial roads of the city emanate from its Admiralty Building). A little noted aspect of Putin's seizure of Crimea is that its naval base at Sevastopol is located there, and although generally Ukraine had been "reasonable" continuing to allow Russia to hold it and use it, Putin simply got tired of having to worry about unfriendly governments in Kyiv giving him a hard time about it.
So, the fact that few note as they bark about this awful cave by Obama is that Russia has its only naval base in the Mediterranean Sea in Syria at Tartus, a base dating well back into the Soviet period. The US has never had a military base in Syria and has pretty much always been opposed to the Assad regime, both the current one and that of his even nastier dad. Putin also seems to be establishing an air base in Latakia in the heart of Assad Alawite territory in the northwest of Syria near the Russian naval base, possibly laying the groundwork for defending its base even if Assad loses power in Damascus to whomever.
Now the big difference between the US and Russia now is indeed over Assad, who has without question been brutal, dropping barrel bombs on civilians and previously using chemical weapons. Of course lots of people are angry with Obama did not bomb Assad for doing the latter after he declared a "red line"on that issue. That in fact he worked with Putin to get Assad to get rid of his chemical weapons (or at least the worst of them) is barely noticed by any of these complainers. So, when Putin argues that Assad is all there is to stand against Daesh, Obama may be taking this seriously in private, if not in public.
So, Obama's critics, including a pack of VSPs, are full of the claim that Obama should have supported earlier and more fully a "moderate" third force. But, he did support these people pretty substantially, and all they have done is lose every battle they have fought and have a bad record of handing over their weapons (given by the US) to either al Qaeda-related al Nusra or to Daesh itself. But VSPs, including Hillary Clinton, say things would have been great if we had done more, but I think Obama's skepticism on this was and has been proven right.
I note one more point. Russia has a more immediate concern about Daesh than does the US. Chechens have joined Daesh, and while I do not approve of how Putin crushed the revolt in Chechnya, it is also true that Chechen Islamists have carried out major terrorist attacks in Russia. Russian citizens are not supporting Russian troops going to Syria, but the hard fact is that Daesh is a more serious immediate threat to Russia on its homeland than it is to the US on its homeland. Given what has happened after the removal of Saddam and Qaddafi in their nations, one can appreciate that Putin has a strong desire to "prop up Assad," and even more given their long presence in Syria with their naval base in Tartus. The general ignoring of this fact by such generally "realist" observers like Ignatius is somewhat disturbing (and, yes, the situation in Syria is plain awful, but anybody putting forth an easy or straightforward "solution" obviously has not figured out just how complicated and messed up the situation there is).
Barkley Rosser
The hard fact is that Russia has "had Syria" for a long time, far more than the US ever has, basically ever since the Ba'ath Party came to power in a military coup more than half a century ago over the immediate successors of the French rule after WW II, although, of course, prior to 1991, it was the Soviet Union that "had" Syria, not Russia. But we know that there has been a lot of continuity in terms of global interests from the old Soviet Union to the modern Russia in many places. The Soviets and then Russians also supported Saddam in Iraq and his branch of the Ba'ath Party, Arab nationalist socialist in its ideological orientation, even as those two branches and the Assads and Saddam became enemies of each other. Indeed, in Putin's speech to the UN General Assembly, he complained about the US overthrow of Saddam noting that what has followed has been chaos, along with the beginning of Daesh/ISIS/ISIL/IS, the collapse of pro-Russian Libyan regime into chaos (with the division into its historically distinct eastern and western parts as I frequently forecast here on Econospeak), and the mess in Yemen.
So, Putin has been very traditional in his approach to many parts of the globe. In this regard, he has focused on military bases, especially naval ones. One can argue that Russia as a major land power should not be so focused on its navy, but this is an old concern, dating at least to Peter the Great three centuries ago when he grabbed the land from Sweden that he build Saint Petersburg on to provide a naval "Window to the West"(with this emphasized by the fact that the radial roads of the city emanate from its Admiralty Building). A little noted aspect of Putin's seizure of Crimea is that its naval base at Sevastopol is located there, and although generally Ukraine had been "reasonable" continuing to allow Russia to hold it and use it, Putin simply got tired of having to worry about unfriendly governments in Kyiv giving him a hard time about it.
So, the fact that few note as they bark about this awful cave by Obama is that Russia has its only naval base in the Mediterranean Sea in Syria at Tartus, a base dating well back into the Soviet period. The US has never had a military base in Syria and has pretty much always been opposed to the Assad regime, both the current one and that of his even nastier dad. Putin also seems to be establishing an air base in Latakia in the heart of Assad Alawite territory in the northwest of Syria near the Russian naval base, possibly laying the groundwork for defending its base even if Assad loses power in Damascus to whomever.
Now the big difference between the US and Russia now is indeed over Assad, who has without question been brutal, dropping barrel bombs on civilians and previously using chemical weapons. Of course lots of people are angry with Obama did not bomb Assad for doing the latter after he declared a "red line"on that issue. That in fact he worked with Putin to get Assad to get rid of his chemical weapons (or at least the worst of them) is barely noticed by any of these complainers. So, when Putin argues that Assad is all there is to stand against Daesh, Obama may be taking this seriously in private, if not in public.
So, Obama's critics, including a pack of VSPs, are full of the claim that Obama should have supported earlier and more fully a "moderate" third force. But, he did support these people pretty substantially, and all they have done is lose every battle they have fought and have a bad record of handing over their weapons (given by the US) to either al Qaeda-related al Nusra or to Daesh itself. But VSPs, including Hillary Clinton, say things would have been great if we had done more, but I think Obama's skepticism on this was and has been proven right.
I note one more point. Russia has a more immediate concern about Daesh than does the US. Chechens have joined Daesh, and while I do not approve of how Putin crushed the revolt in Chechnya, it is also true that Chechen Islamists have carried out major terrorist attacks in Russia. Russian citizens are not supporting Russian troops going to Syria, but the hard fact is that Daesh is a more serious immediate threat to Russia on its homeland than it is to the US on its homeland. Given what has happened after the removal of Saddam and Qaddafi in their nations, one can appreciate that Putin has a strong desire to "prop up Assad," and even more given their long presence in Syria with their naval base in Tartus. The general ignoring of this fact by such generally "realist" observers like Ignatius is somewhat disturbing (and, yes, the situation in Syria is plain awful, but anybody putting forth an easy or straightforward "solution" obviously has not figured out just how complicated and messed up the situation there is).
Barkley Rosser
Unstandard Deviations
"But the burden of whiteness is this: You can live in the world of myth and be taken seriously." Ta-Nehisi Coates
"It was only by reading – and checking – the actual data in The Bell Curve... the undisputed data..." -- Andrew SullivanTa-Nehisi Coates is a Genius!
In a discussion over at Angry Bear of Coates's recent Atlantic piece on mass incarceration, one of the commenters raised the spectre of the I.Q. gap between Whites and Blacks, which is allegedly 15 I.Q. points or roughly "one standard deviation" from the norm of the reference White population.
Where does this ubiquitous "15 I.Q points" come from? Arthur Jensen, in his 1969 Harvard Educational Review article, “How Much Can We Boost I.Q. and Scholastic Achievement?” cited a 1966 (first edition, 1958) book by Audrey Shuey, The Testing of Negro Intelligence:
Negroes test about 1 standard deviation (15 I.Q. points) below the average of the white population in I.Q. and this finding is fairly uniform across the 81 tests of intellectual ability used in the studies reviewed by Shuey.So who, then, was "Shuey"?
Dr. Audrey M. Shuey was Chairman of the Department of Psychology in the Randolph-Macon College for Women, at Lynchburg, Virginia. Dr. Shuey's mentor at Columbia University was Henry E. Garrett, a militant segregationist and hereditarian who also contributed a foreword to her book. In his 1958 review of the first edition of The Testing of Negro Intelligence, Horace Mann Bond wrote:
Never before has the literature of psychology witnessed so determined an effort to establish, as a fact, the proposition that there are "native differences between Negroes and whites as determined by intelligence tests."
By the interesting device of discarding all "interpretations, criticisms, comments," and even conclusions in individual studies, and taking the statistical tables reporting differential scores as the only, bona-fide, "results," Dr. Shuey arrives at what she calls a "remarkable consistency in test results, whether they pertain to school or pre-school children, to high school or college students, to drafts of World War I or World War II, to the gifted or the mentally deficient, to the delinquent or criminal." This "remarkable consistency" becomes the foundation of her concluding inferences that "point, to the presence of some native differences between Negroes and whites as determined by intelligence tests."Another reviewer, Ina C. Brown, concluded her review of the book with the observation:
The book really adds up to much ado about nothing. No informed person questions the fact that on the average Whites perform better than Negroes on the tests or that northerners perform better than southerners or urban subjects better than rural subjects. It is the why that is important and Dr. Shuey’s brushing aside the interpretations of most of the recent testers in favor of her own conclusions adds nothing to our knowledge.
One can, however, predict wide use of the book by White Citizens’ Councils and others who are in search of material which they can interpret as “scientific” support for their point of view.The prediction that White Citizens' Councils would widely use the book was either prescient or simply well informed. Publication of the book was funded by Wickliffe Draper's Pioneer Fund, which sponsored free distribution of the book throughout the South, assisted by the Citizens' Councils. After Shuey's death, two other Pioneer Fund grantees, R. Travis Osborne and Frank McGurk, published a follow-up volume to include data from 1966 to 1982.
Now about that "actual data" Andrew Sullivan claimed to have "checked" and found "undisputed." Bullhockey. The following chart summarizes the allegedly "undisputed" data about race and I.Q. relied upon by Murray and Herrnstein in The Bell Curve. Note the sources: Shuey, Osborne and McGurk, Jensen. Why not list the sponsors, too: Pioneer Fund... White Citizens' Council... Wickliffe Draper... Henry Garrett?
Undisputed data? Virtually every aspect of the race and I.Q. data cited by Murray and Herrnstein -- along with its hereditarian interpretation -- has been not only disputed but refuted. Voluminously.
The only aspect left "undisputed" is that there are differences in I.Q. scores. But by itself that "fact" is trivial and meaningless. It is like saying a dollar is worth 100 cents because each cent is worth one-hundredth of a dollar. The logic is circular.
How could Sullivan have "checked" the data in The Bell Curve and yet be unaware of the extensive critiques of the data by such authorities as Stephen Jay Gould, Richard Lewontin or Leon Kamin?
Undisputed data? Seriously? A better description for "the actual data in The Bell Curve" and the way in which it was presented would be fraudulent. In his 1995 review of the book, Michael Nunley called it "too smooth to be true":
Their fraud begins in their introduction with a series of astonishing assertions. They list a number of propositions they claim form the very foundation of their book, but for which they tell us they are not going to provide any evidence. These include such notions as that there is such a thing as general cognitive ability; that IQ is the most accurate measure of it; and that IQ tests are not biased against any social, economic, ethnic, or racial groups. They are excused from providing any evidence for these assertions because, as they put it, these statements are "beyond significant technical dispute." This struck me as odd because, you see, I’m an anthropologist with an interest in cross-cultural studies of cognition. And if I were trying to think of things that might be considered "beyond technical dispute" from cross-cultural studies in anthropology, they would be that human cognition is far too complex to be captured on a simple linear scale; that IQ measures only a very narrow band of all kinds of cognitive achievement; and that tests of cognitive achievement cannot avoid being culturally biased by the content, materials, and style of testing used.In an afterword to the 2010 edition of The Bell Curve, Charles Murray dismissed -- with a few well placed "never minds" -- criticism by Charles Lane and Leon Kamin of the book's extensive dependence on "tainted sources":
Never mind that The Bell Curve draws its evidence from more than a thousand scholars... Never mind that the relationship between the founder of the Pioneer Fund and today's Pioneer Fund is roughly analogous to that between Henry Ford and today's Ford Foundation.It is, of course, impossible to refute a "never mind" that declines to substantiate the evidence for the claims that it sarcastically asserts will be ignored anyway.
Never mind that more than 995 of Murray's "more than a thousand scholars" are irrelevant to the five studies cited in The Bell Curve's analysis of differences between Black and White cognitive test scores, three of which come from books and articles by Pioneer Fund sponsored authors.
Never mind that Murray offered no rationale or evidence for his spurious analogy between the Ford Foundation and the Pioneer Fund.
Never mind that Murray's "refutation" of the charge that the book relied on "tainted sources" was a non sequitur and a red herring. Murray's coy "never minds" are, to use Nunley's description, "too smooth to be true":
When I first sat down to read Herrnstein and Murray’s book The Bell Curve (1994), I was predisposed to be skeptical of certain positions I’d heard it was promoting, but I was nevertheless expecting it to be an honest attempt to make a case for a wrongheaded but sincerely held scientific position. But when I read the text of The Bell Curve, including its footnotes, which were stuck at the back of the book, forcing me to page back and then forward again every paragraph or two, with all the book’s references buried well back in the footnotes, and when I then tracked down and read some of the references to see what they actually said and what other scholars had said about them, I became convinced that The Bell Curve is something quite different from my initial expectation. I believe this book is a fraud, that its authors must have known it was a fraud when they were writing it, and that Charles Murray must still know it’s a fraud as he goes around defending it. By “fraud,” I mean a deliberate, self-conscious misrepresentation of the evidence. After careful reading, I cannot believe its authors were not acutely aware of what they were including and what they were leaving out, and of how they were distorting the material they did include. The book is, moreover, a very good fraud, a very cleverly constructed one. There aren’t enough "o"s in “smooth” to describe it.Ta-Nehisi Coates is a Genius.
Coates's Atlantic feature story on mass incarceration commences with a discussion of Daniel Patrick Moynihan's 1965 report, "The Negro Family: The Case for National Action." Toward the end of his account of the Moynihan report, Coates mentions that "William Ryan, the psychologist who first articulated the concept of 'blaming the victim,' accused Moynihan’s report of doing just that."
Toward the end of his article, Coates returns to Moynihan and briefly alludes to his 'ominous" citation of "a 'rather pronounced revival -- in impeccably respectable circles -- of the proposition that there is a difference in genetic potential' between the two races." Moynihan noted the proposition in March 1969 report to Nixon regarding Arthur Jensen's Harvard Educational Review article.
Impeccably respectable circles.
Undisputed data.
Fraud.
Subscribe to:
Posts (Atom)