Politicians say the dumbest things...

Obviously liberals were never going to like Sarah Palin. She's a feisty, devout Christian who hates reproductive rights almost as much as she hates polar bears. And looking a lot like Tina Fey only makes it easier to parody her:



But then again, she hasn't done herself any favors. Compare this SNL skit to the transcript from her actual interview with Katie Couric, which was cited in a scathing piece by Fareed Zakaria:

COURIC: Why isn't it better, Governor Palin, to spend $700 billion helping middle-class families who are struggling with health care, housing, gas and groceries; allow them to spend more and put more money into the economy instead of helping these big financial institutions that played a role in creating this mess?

PALIN: That's why I say I, like every American I'm speaking with, were ill about this position that we have been put in where it is the taxpayers looking to bail out. But ultimately, what the bailout does is help those who are concerned about the health-care reform that is needed to help shore up our economy, helping the--it's got to be all about job creation, too, shoring up our economy and putting it back on the right track. So health-care reform and reducing taxes and reining in spending has got to accompany tax reductions and tax relief for Americans. And trade, we've got to see trade as opportunity, not as a competitive, scary thing. But one in five jobs being created in the trade sector today, we've got to look at that as more opportunity. All those things under the umbrella of job creation. This bailout is a part of that.

Wow. And this was after weeks of prepping from senior McCain advisors and consultants. You're better off asking Paris Hilton for policy analysis.

Unfortunately for Palin, the right-wing is also starting to notice her, let's say, "shortcomings". Writing in the conservative National Review, Kathleen Parker says:

"Palin’s narrative is fun, inspiring and all-American in that frontier way we seem to admire. When Palin first emerged as John McCain’s running mate, I confess I was delighted. She was the antithesis and nemesis of the hirsute, Birkenstock-wearing sisterhood — a refreshing feminist of a different order who personified the modern successful working mother...

It was fun while it lasted.

Palin’s recent interviews with Charles Gibson, Sean Hannity, and now Katie Couric have all revealed an attractive, earnest, confident candidate. Who Is Clearly Out Of Her League...

If BS were currency, Palin could bail out Wall Street herself."

But before we're too hard on Palin (and trust me, no one has less respect for her intellect than me) Paul Krugman reminds us that John McCain isn't exactly a great mind himself, especially when it comes to the economy:

"We’ve known for a long time, of course, that Mr. McCain doesn’t know much about economics — he’s said so himself, although he’s also denied having said it. That wouldn’t matter too much if he had good taste in advisers — but he doesn’t."

This, of course, is the same John McCain who once said interest rates should always be set at 0%. So when McCain and Palin get together, it's not exactly a MENSA meeting.

In the interest of fairness, however, Don Boudreaux provides a uniquely libertarian perspective on the issue:

"Mr. Zakaria is incorrect to suppose that these traits separate Gov. Palin from other candidates for high political office. Calls by Senators McCain and Obama for cracking down on "speculators" are full of classic and wrongheaded catchphrases, as is Sen. Obama's vocal skepticism about free trade. Gov. Palin is merely less skilled in passing off inanities and claptrap as profundities."

This is true on some level. But Governor Palin is working really hard to distinguish herself.

Do As Me Says, Not as Me Does

Michael Moore's documentary, Slacker Uprising, calls on college students (the "slackers") to mobilize, vote, and encourage others to do likewise. The main thrust of the message is against the wars that the Bush neoconservative administration led the country into.


Thomas Friedman wrote a year ago that

college students are "so much less radical and politically engaged than they need to be". "Generation Quiet", he calls us. "When I think of the huge budget deficit, Social Security deficit and ecological deficit that our generation is leaving this generation, if they are not spitting mad, well, then they’re just not paying attention."

Al Gore called on young people to protest the construction of dirty coal plants this week because "the world has lost ground to the global climate crisis".

"If you're a young person looking at the future of this planet and looking at what is being done right now, and not done, I believe we have reached the stage where it is time for civil disobedience."

Three baby boomer liberals with the same message to my generation: it is your responsibility to fix what we broke.

These are not messages of inspiration to create the world we envision; rather, pleas to undo the war, debt, and environmental destruction the "Me Generation" has done with their opportunity to bring to fruition their dreams of peace, prosperity, and flower power.

Moore wants to enlist anyone to vote regardless how educated they are about the issues; Friedman calls on us to get fuming mad and demonize those we disagree with; Gore pushes us to protest in an antiquated manner proven infective in 1999 and 2003.

Push us to action in your own way by leaving a comment about where Generation Y should start fixing GenMe's mistakes.

If you are going to vote put your money where your mouth is!

The Great Schlep

Does your grandma think Obama is a Muslim intent on destroying Israel? Sarah Silverman has some advice:


The Great Schlep from The Great Schlep on Vimeo.

This is paid for by the Jewish Council for Education and Research.

Invest in Africa

Harvard economist Dani Rodrik discusses a new development tool that targets small and mid-sized businesses in Africa:

"Our Center for International Development launched its new Empowerment Lab with a conference yesterday, and one of the most interesting new social entrepreneurship initiatives I learned about is something called MyC4.com. This is a web-based platform that allows you to look up a list of African entrepreneurs who need funding for their projects (described briefly on the site) and to offer them loans. You bid a certain interest rate, which is accepted as long as it is below the maximum the entrepreneur is willing to accept and as long as others have not bid below you. You can lend as little as 5 euros. The average interest rate accepted is 12.8 percent per year, and I am told that the rate of default has been so far in the low single digits."

Check it out. The company describes themselves as a:

"hybrid between Grameen Bank, Wikipedia, MySpace and eBay, MYC4 offers an opportunity to invest money and knowledge in Africa’s future by providing a forum for exchange of advice and knowledge with the purpose of growing and supporting entrepreneurism in Africa."

It's an interesting concept, particularly targeting small and mid-sized businesses rather than micro-businesses. In this sense, they are trying to overcome the lack of financial depth in most of Africa. Large businesses can get loans from international banks. Micro-borrowers can get loans from NGOs and other micro-credit providers. But small and mid-sized entrepreneurs don't have a real banking system to provide capital for investment.

Many people will balk at the existence of any interest rate for what is ostensibly a development project. However, the interest rate ensures that there will be a consistent supply of money and that the money will go to projects with the best chance of success. Also, people tend to forget that micro-credit also uses interest rates, often in the 30-40% range to compensate for the risk of default.

Plus, with a repayment rate of over 90%, it's a safer place to put your money than mortgage-backed securities.

Correction: "I really can do math" edition

I recently re-read my post "Thomas Friedman on Alternative Energy" and realized I made a careless mistake. Obama proposed $150 billion for alternative energy over 10 years, which equals $15 billion per year, not $1.5 billion, as I erroneously stated.

The point remains the same, though. $15 billion is good, but it is dwarfed by the private money out there to fund alternative energy research, if the incentives were right. Of course, it doesn't have to be either/or. We can have government AND private money funding the goal of sustainable alternative energies.

Anyway, mea culpa.

All men are mortal. Socretes is a man. Therefore, Obama supports terrorism*

*I can't think of anything wrong with the logic in this title.



Maybe campaign consultants should check out this link.

A tragedy, yes, but one we can avoid

One of the largest environmental challenges we face is declining fish stocks. According to an article published in the journal Science, if trends don't change there will be virtually no fish left to catch in 50 years.

There are many reasons for this. A growing global middle class means more people demanding seafood. And advances in sonar and other fish-catching technology mean that humans can catch fish much faster than they can reproduce.

But one factor that gets less attention is the absence of property rights in our fisheries. New research suggests that Individual Transferable Quotas--a form of property rights for competing fishermen--can help the Earth avert a global aquatic meltdown:

Whichever way they analysed the data, they found that ITQs halted the collapse of fisheries (and according to one analysis even reversed the trend). The overall finding was that fisheries that were managed with ITQs were half as likely to collapse as those that were not.

The problem with global fisheries can be described as a "Tragedy of the Commons". The argument, first made Garrett Hardin in 1968, rests on a metaphor of herders sharing a common field where they are each allowed to let their cattle graze:

In Hardin's view it is in each herder’s interest to put as many cows as possible onto the land even if the commons is damaged as a result. The herder receives all the benefits from the additional cows but the damage to the commons is shared by the entire group. If all herders make this individually rational decision, however, the commons is destroyed and all herders suffer.

So while no fisherman wants to see the fish stocks depleted, no individual has the incentive to cut back on the amount they personally catch. Giving fishermen a quota share in the fishery, however, provides an incentive to maintain long-term sustainability. The benefits are clear:

After a decade of using ITQs in the halibut fishery, the average fishing season now lasts for eight months. The number of search-and-rescue missions that are launched is down by more than 70% and deaths by 15%. And fish can be sold at the most lucrative time of year—and fresh, so that they fetch a better price.

In a report on this fishery, Dan Flavey, a fisherman himself, says some of his colleagues have even pushed for the quota to be reduced by 40%. “Most fishermen will now support cuts in quota because they feel guaranteed that in the future, when the stocks recover, they would be the ones to benefit,” he says.

While there are numerous practical hurdles to overcome, much of the resistance to ITQs is psychological. The notion of privatizing the oceans (or any other commonly held environmental resource) is viscerally jarring. And yet the logic behind the tragedy of the commons and ITQ's is so intuitive and the benefits so clear. Given the dire state of our oceans, I think this is something we need to try. If for no other reason, I'd like my grandchildren to know what sushi tastes like.

Leading the blind

This morning on my way into work, I discovered that even if you can see it's difficult to lead the blind.

A man with a seeing-eye dog and a woman with a cane struggled to enter a subway station one block behind them, and I found myself at a loss of words trying to give directions. Needless to say: pointing did not help. After a painful amount of narrating, I was still unable to articulate distance in a way that wasn't reliant on the ability to see - landmarks and the phrase "halfway up the block" were meaningless to my companions.

After I led them to the station through the crowds of people exiting the Manhattan mall, I retrospectively cursed myself for the number of times I'd said "sight-laden" phrases such as, "Which train are you looking to catch?," "Let's watch for the light to turn red." and "You'll see the door on your right."

It was a awkward experience for me, one that pointed out the flaws in my own vocabulary and the fact that our language evolves to suit our average daily interactions, leaving us occasionally unprepared when faced with the need to approach things with a fresh pair of eyes.

I'd put a shout out here to my sightless fellow commuters, who mentioned their preference for Mac computers in casual conversation as we waited for the light, but sadly I don't know how accessible Blogger is to the vision impaired.

Internet accessibility standards for the disabled have been set by Section 508 of the Rehabilitation Act, World Wide Web Consortium and the Americans with Disabilities Act, however these regulations do not require every company to adhere to them yet. We'll have to wait and see for all Internet software to catch up.

Blood, gore and trade barriers

For those who like horror films, there are two new ones coming out. One is about a group of people quarantined in an apartment building where a virus is spreading, causing the infected to turn into vicious cannibals. The other is about a group of people fighting against an evil force that has descended upon their city, seeking to dominate the globe.

The second film, which opens tomorrow, is called Battle in Seattle. It chronicles the experience of different groups (protesters, riot police, city officials) caught up in the 1999 protests of the World Trade Organization meeting in Seattle. Initial reviews are generally positive, and the cast includes Ray Liotta, Charlize Theron, Andre Benjamin and Woody Harrelson.

Having not yet seen the film, I can't make specific criticisms or comments. I do, however, question the use of person narratives from a large-scale protest to provide insight into complex and abstract issues. The film's director, Stuart Townsend, is personally sympathetic to the protesters' cause. He spells out the conflict in stark terms:

"It's the faceless bureaucrats — they're the problem... It's the lobbyists and the corporations that rape the environment."

San Francisco-based NGO Global Exchange provides a good list of the most commonly cited critiques of the WTO. The WTO provides rebuttals to many of these arguments on its own website.

I think there's a lot of confusion about the WTO, it's history and purpose. The WTO is generally portrayed as an autonomous, unelected bureaucracy, when it's really a member-state organization like the UN. WTO representatives are not, themselves, elected (neither are UN ambassadors), but they are appointed by government leaders. Their policy-positions reflect the positions of their respective governments.

The WTO is also often accused of amplifying the power of large countries over global commerce. In actuality, WTO amplifies the power of small countries. This is because by joining the WTO, all countries, large and small, are committing themselves to a set of rules and responsibilities (again, not unlike the UN). Large countries have much more power to break their trade agreements with small countries (for example, put an illegal tariff on goods from the smaller country). The WTO provides an institutional mechanism so that small countries can seek damages from large countries when they break the rules.

Additionally, the claim that the WTO gives more power to corporations is a bit misleading. As I've said before, corporations only support "free-market competition" when it's in their interest. In reality, politically-connected corporations are the ones that benefit most from trade restrictions. They are the ones who get to avoid facing foreign competitors, yielding higher prices and lower quality goods for consumers.

The world faces many challenges too large for any one nation to solve. That is why we have global institutions, which allow for member states to agree on a set of rules and guidelines. But these institutions are really just the sum of their parts. If you want to change their priorities, you need to change the priorities of the member states.

My purpose in writing this is not to denigrate the concerns of the global justice movement - equitable labor standards, environmental protection, and human rights. I do, however, think that too many people have been seduced by a caricature of international trade that vastly overstates the costs and vastly understates the benefits. Trade is not zero-sum; we can all benefit at the same time.

Shoring up the all important Ph.D economist demographic

Dilbert creator, Scott Adams surveyed 500 members of the American Economic Association on their views about John McCain and Barack Obama. The group prefers Obama to McCain 66% to 28% (60% to 33% for just Independents). Interestingly, 48% of the sample are registered Democrats, dispelling the stereotype of economists as hard-core conservatives.

Here's the PowerPoint presentation with detailed survey breakdowns. Looking issue-by-issue, Obama is seen as having better plans for health care and education, while McCain is seen as being better on trade.

It's possible that these people are still sore from McCain's "economist-bashing" on the campaign trail, but as the party identification breakdown shows, economists do tend to vote Democratic.

Unfortunately for Obama, he's not doing quite as well with "hockey moms".

Is Mao "Hipster Cool"?

Riding to work this morning, I saw a girl on the subway holding a shoulder bag emblazoned with the image of Mao Zedong. I doubt anyone else on the train thought much of it. Walking around parts of New York City, it's not unusual to see chic references to Communist heroes like Mao, Che Guevara or (somewhat less precisely "Communist") Hugo Chavez, particularly among the ultra-cool hipster crowd. And there are plenty of these products available for purchase.

What should we make of this? Of all the historical figures one could idolize, Mao is low down on the list. His "Great Leap Forward" (which collectivized agricultural production), decimated Chinese agricultural production, leading to the largest famine in human history and the starvation of tens of millions of people. And his "Cultural Revolution" caused further economic ruin, and ushered a frightening period of repression that still grips the country. He's not exactly Gandhi.

Economist Bryan Caplan has been particularly outspoken about the strange idealization of Communism by parts of the Western left-wing. According to Caplan there is a "double standard" that treats Communism more kindly than Fascism:

In my judgment, the main reason for the double standard is that, even today, people believe that the Communists had better intentions than the Nazis...

Perhaps the parallel is hard to see precisely because, even in the West, anti-capitalist propaganda has successfully dehumanized the bourgeoisie, landlords, money-lenders, and "the rich." So when we hear Communists chant "Death to the bourgeoisie," we don't feel the same way we do when we hear Nazis chant "Death to the Jews."

Caplan certainly presents the strongest version of this argument. People who sport such apparel aren't doing so in support of totalitarian rule or purges of enemies of the state. Rather, almost 20 years since the fall of the Soviet Union, Soviet and Communist imagery has decomposed into an amorphous alternative to capitalism. Images of Mao or the Soviet hammer and sickle symbolize a desire for an economy based on grassroots, commonly owned resources, and away from private property and other institutions that are viewed as leading to inequality in society. Whether or not you agree with their messages, it is quite unlikely that these references are meant to promote all of the horrors of Communist rule in the 20th century.

Then again, what if someone justified wearing a swastika on their arm by saying they were merely advocating a society where the trains run on time?

Any thoughts?

It's the part she was born to play...

Forget Lehman Brothers, it's the witches who should be worried

Last week in the Financial Times, Tim Hartford wrote about the link between witch trials and tough economic times:

"Emily Oster, an economist at the University of Chicago, has tried to gather systematic data on the link between witch trials and the weather. The results look striking: between 1520 and 1770, colder decades go hand-in-hand with more trials. The link may be simply that witches were often blamed for bad weather. Or there may be a less direct link: people tend to lash out in tough times. There is some evidence, for instance, that lynching was more common in the American south when land prices and cotton prices were depressed.

Such deaths are, sadly, not a historical footnote. In Meatu, Tanzania, half of all reported murders are “witch-killings”. Such murders have been documented elsewhere in Africa, in Bolivia and in rural India. The difference between the historical executions and modern attacks are that a Tanzanian “witch” typically dies at the hands of her own family. The machete is the weapon of choice."

Economists typically assume that individuals are "rational"-- that is, they base their decisions on costs and benefits. Hartford, the author of "The Logic of Life" does a particularly good job of showing the rational basis for even the strangest behaviors.

What's interesting is that before the "little ice age" in the mid-16th and 17th centuries, witch trials were not common in Europe. In fact, Hartford points out that the medieval Catholic Church dismissed the idea that witches had supernatural powers (one of the few times it sided with the forces of rationality).

So why would people target witches during economic downturns? The Tanzania example provides some clues:

"Edward Miguel, an economist at the University of California, Berkeley, and co-author of Economic Gangsters, a book about the economics of crime, corruption and war, has studied the Tanzanian situation. He argues that there is a direct economic motive for the attacks. Tough times in a Tanzanian household may well result in starvation, and the elderly – especially women – are at risk of being sacrificed to free resources.

As evidence, Miguel points out that victims of witch attacks in Meatu district – almost all old women – tend to be from the poorest households. The murders are much more common during years of drought or flood."

The upshot is that understanding the "rational" basis for seemingly crazy behaviors helps us figure out how to solve problems:

"A grass-roots alternative has emerged in another Tanzanian district, Ulanga, where traditional healers “cure” elderly women of witchcraft by shaving their bodies and smearing their pates with “anti-witchcraft paste”. Miguel does not think it’s a coincidence that the healers also provide the women with food and shelter during famines, in expectation of payments from their families in better times. Spiritual ceremony meets social insurance: it is a solution, of sorts."

Individuals may harm others for no apparent reason. But groups usually require some sort of push. Rather than dismissing witch trials as "crazy" of "culture-driven", we can look to see if there is some logical basis for them. As the US sits on the brink of a financial meltdown, we may want to take a few minutes to think about who we might lash out against as times get tough. Any bets?

SUVs and the Chicken Wars

People tend to focus on market failures and negative externalities when talking about carbon emissions. But we often forget the public policy decisions that got us to where we are today.

An editorial in today's New York Times tells the story of a forgotten trade war with Europe that started with a tariff on US chicken exports. In response, the US placed a 25% retaliatory tariff on German light trucks and kept the tariff after the trade war ended. The Times explains:

The chicken war ended, but the tariff survived. It explains a lot about why Detroit chose to stake its future on S.U.V.’s.

At the time, Detroit was not even dreaming of urban light trucks. But over the ensuing decades, they proved instrumental in the battle to fend off Japan’s hypercompetitive automakers. American carmakers retooled but still couldn’t come up with cars that Americans liked more. And they had Washington running defense: negotiating voluntary export restraints with Tokyo and pressing Japan to make the yen rise against the dollar...

Years of cheap gas (unleaded didn’t breach $2 a gallon until 2004) helped a lot — as did government tax breaks and looser rules on fuel efficiency and tailpipe emissions. Perhaps most important, Washington used the chicken tariff to wall off the light-truck market, giving American automakers a protected and profitable niche to exploit...

The downside of this is evident today. Light trucks account for 57 percent of sales at General Motors; 62 percent of Ford’s; 72 percent of Chrysler’s. It’s not a good place to be with gas at $3.50 a gallon.

Now, for American automakers and for the global climate, the chickens are coming home to roost (sorry, but I can't believe they didn't make that joke in the editorial. A little too on the beak?).

This story illustrates two important principles: (1) trade protection can, in the long-run, produce weak domestic industry that never manages to become competitive; and (2) public policy is subject to the law of unintended consequences.

We shouldn't take this to mean that all government action is negated by unintended consequences. But it should make us weary of quick policy solutions to complicated problems. It should also make us more vigilant to fight inertia in the policy system. It was easy to put the light-truck tariff in place; it was very difficult to get rid of it.

Maybe we should teach policymakers the same thing they teach med students: "first, do no harm".

Why we shouldn't worry about the Earth being swallowed up by a Black Hole created by the Large Hadron Collider

I don't know if you were worried about this possibility, but my Mom has been. Fortunately, according to Brian Greene (and the rest of the physics community), you shouldn't be:

"Now for the possibility that's generated the fuss.

Recent work in string theory has suggested that the collider might produce black holes, providing physicists with a spectacular opportunity to study them in a laboratory.

The common conception is that black holes are fantastically massive astrophysical bodies with enormous gravitational fields. But in reality, a black hole can have any mass. Take an orange and squeeze it to a sufficiently small size (about a billionth of a billionth of a billionth of a meter across) and you'd have a black hole — with the mass of an orange.

Physicists have realized that the collider's proton-proton collisions might momentarily pack so much energy into such a small volume that exceedingly tiny black holes may form — black holes even lighter than the one theoretically created by the orange, but black holes nevertheless.

Why might one worry that this would be a problem? Because black holes have a reputation for rapacity. If a black hole is produced under Geneva, might it swallow Switzerland and continue on a ravenous rampage until the earth is devoured?

It's a reasonable question with a definite answer: no.

Work that made Stephen Hawking famous establishes that tiny black holes would disintegrate in a minuscule fraction of a second, long enough for physicists to reap the benefits of having produced them, but short enough to avoid their wreacking any havoc.

Even so, some have worried further that maybe Dr. Hawking was wrong and such black holes don't disintegrate. Are we willing to bet the fate of the planet on an untested insight? And that question takes us to the crux of the matter: the collisions at the Large Hadron Collider have never before occurred under laboratory settings, but they've been taking place throughout the universe — even here on earth — for billions of years.

Cosmic rays — particles wafting through space — constantly rain down on the earth, the other planets and the wealth of stars scattered throughout the galaxy, with energies far in excess of those attainable by the Large Hadron Collider. And since these more powerful collisions haven't resulted in astrophysical calamities, the collider's comparatively tame collisions most assuredly won't either."

So if you weren't worried about this, don't start. If you were, consider this a gift: the world isn't going to be crushed into an infentessimly small point of mass!

Finding the Good in Walmart

Here's the abstract from a provocative new paper by Charles Courtemanche and Art Carden (HT Marginal Revolution):

We estimate the impacts of Wal-Mart and warehouse club retailers on height-adjusted body weight and overweight and obesity status, finding robust evidence that non-grocery selling Wal-Marts reduce weight while grocery-selling Wal-Marts and warehouse clubs either reduce weight or have no effect. The effects appear strongest for women, minorities, urban residents, and the poor. We then examine the effects of these retailers on exercise, food and alcohol consumption, smoking, and eating out at restaurants in order to explain the results for weight. Most notably, the evidence suggests that all three types of stores increase consumption of fruits and vegetables while reducing consumption of foods high in fat. This is consistent with the thesis that Wal-Mart increases real incomes through its policy of "Every Day Low Prices," making healthy food more affordable, as opposed to the thesis that cheap food prices make us eat more.

The paper is gated, so I haven't read it yet. While we can't talk about the empirical design of the paper, we can look at the basic model. Normally we assume that as the price of something goes down, people buy more of it; as a result, Walmart's low prices on groceries should induce people to buy more, increasing obesity among customers. However in the US, virtually everyone can afford more food than they need. The real issue is food quality. The cheapest foods are highly processed, calorie dense and nutrient poor. Anyone who has been in a Whole Foods recently knows that organic food is a luxury of the affluent.

Where Walmart comes in is in lowering the prices of produce and other nutrient-rich, healthy foods. The benefit to low-income consumers is the ability to eat like a someone on Manhattan's Upper West Side. Since the obesity epidemic is heavily concentrated among low-income individuals, providing healthy foods at low-cost is crucial.

Yes Walmart's labor practices are deplorable, but it is not universally evil.

Thomas Friedman on Alternative Energy

Here's Thomas Friedman talking about his new book and his views on global warming (here's the link from Environmental Economics):





I like that Friedman makes the following points:

1. According to the best information, Global Warming is real and requires action
2. This is a problem that can't simply be solved by government throwing money at it.
3. The price of gas does not reflect the environmental impact of carbon emissions

The issue with number 2 has to do with both incentives and scale. As far as incentives go, government spending is subject to political considerations, rather than efficiency or efficacy. Government mandates and subsidies for corn-based ethanol, for example, have more to do with the political power of the argibusiness lobby than the potential for ethanol to replace petroleum. And we've all seen how that's worked out.

Beyond incentives, there's the issue of scale. Obama, for example promises to invest $150 billion of government money over the next ten years in alternative energy research. That's a good start, but it's only $1.5 billion per year. Exxon-Mobile alone invested $80 billion in oil exploration between 2002 and 2006, or $20 billion per year. There's plenty of private money out there for alternative energy research, if only there was an incentive to invest it...

That's where number 3 comes in. While the political debate has focused on the price of gas being too high, many economists and environmentalists think that the real problem is that the price of gas is to low. As the price of a commodity goes up, people use less of it, try to make more of it, and try to find a cheaper alternative. Probably the best way to make this happen is to place a tax on carbon emissions, so that the environmental impact of using fossil fuels is reflected in the price.

Politically this is a no-go. American families are hurting from inflation and what may or may not be a recession. A candidate promising higher gas prices probably would get less votes than a Mike Gravel/Dennis Kucinich ticket. However Ted Gayer, writing in the American, makes the case more palatable for voters:

The harmful effect on labor supply can be at least partially offset by using the revenues collected from the pollution tax to reduce inefficient taxes. For example, the revenues can be used to lower marginal income tax rates, or perhaps to lower the deficit (which amounts to a future income tax reduction). Economists don’t like to see benefits go to waste, which is why Mankiw’s Pigou Club Manifesto highlights the pro-growth tax component of “an increased reliance on gas taxes over income taxes.”

Revenue from a Carbon Tax could also be used to offset a reduction in payroll taxes. That way we create a disincentive to pollute and an incentive to work. This is good for the environment and good for the economy, and could be enormously popular if properly sold. Any candidate interested?

Should we "drill, baby, drill"?

While the current political debate focuses a great deal on particular policy choices, we don't (in my opinion) spend enough time thinking about how we should make those choices. What are the acceptable costs and benefits associated with various decisions?

In July, a Gallup Poll on energy prices found that:

"57 percent of Americans would support drilling in the nation's coastal and wilderness areas that are currently closed to exploration—if it helped reduce gasoline prices and if the drilling were conducted under strict environmental safeguards." [emphasis added]

A similar poll from June found that 67% of Americans favored offshore drilling (not including wildlife areas) and 64% believed that it was at least somewhat likely that drilling would decrease gas prices.

A new study takes a look at drilling in ANWR and addresses the gas price issue:

"Domestic oil prices are determined in a world market and would be unaffected by the relatively small annual flows from ANWR. Moreover, the quantity of oil in ANWR, 7.06 BBO, is merely 0.55 percent of the proven reserves worldwide... Analysts also recognize that even if ANWR's supplies were large enough to affect world prices, the Organization of Petroleum Exporting Countries (OPEC) would countermand the increase in production and thereby negate any price effects... It is also clear, with ANWR accounting for a maximum of 3.2 percent of domestic consumption in 2025, that something other than drilling in the Refuge will be necessary to substantially reduce out dependence on foreign oil."

Ben Muse summarizes the study's other interesting findings:

"Kotchen and Burger estimated that the oil had a value of $374 billion (writing in July 2007, they assumed a long-term price of $53/barrel), but that it would cost $123 billion to extract and market. The net return of $254 billion is divided consists of industry rents of $90 billion, Alaska tax revenues of $37 billion, and Federal tax revenues of $124 billion...

Welfare benefits to U.S. oil consumers? There aren't any, except in their role of taxpayers. That's because development would have little impact on oil prices (or energy independence)...

Job creation? Some in Alaska, but with full employment there would be no net job creation; jobs created on the North Slope would be taken from other industries and places.

There would also be costs. The costs of actually exploiting and bringing the oil to market have been accounted for above - those benefits are net of production costs. However, there would also be significant environmental costs..."

While we can't directly measure how much intrinsic value the median voter places on ANWR or other areas that may be opened to drilling, we can directly consider both the total benefits and their distribution. The real winners will be the oil companies that win drilling rights and the Alaskan State and Federal governments. So from the perspective of voters, the benefits are not that great.

Despite arguments to the contrary (and my usual support for these arguments) the polling data suggests that voters have a rational decision making model on the drilling issue: open restricted areas to drilling only if there is a net benefit to consumers and if there are appropriate environmental safeguards. The question is whether politicians and media sources will provide the facts and or if voters have the incentive to seek them out.

Then again, it looks like these people have already made up their minds...

Searching for a Devil Through "Science"

The Jersey Devil hunters are a motley crew of investigators who "explore that dark piney chasm between fact and legend, acting upon what most of us, at one time or another, have thought: something's out there" (nytimes article).



Cryptozoology is the study and/or search for animals that fall outside of traditional zoological classification: windigos, chupacabras, tatzelworms, and Jersey Devils, for example.

Forced out of the traditional field of zoology, cryptozoologists have had to blaze new trails in their pursuit of knowledge.

In The Structure of Scientific Revolutions, Thomas Kuhn states:

those unwilling or unable to accommodate their work to [current science paradigms] must proceed in isolation or attach themselves to some other group. (19)

When seeking out a scientific "puzzle" to solve (i.e. proving the existence of the Jersey Devil) scientific communities use criterion based on the current paradigm within their field. "To a great extent these are the only problems that the community will admit as scientific." (Kuhn, 37).

So if there are a group of dedicated cryptozoologists who are dedicated to rigorous investigation, community collaboration (through journals and peer review of work), and are building upon an inherited understanding of the world chronicled by a previous generation of investigators, does that make the work of cryptozoologists "scientific", "psuedoscientific", or just plan "wonky"?

Chase the elusive definition of science with us by adding your thoughts in the comments section.

Where everybody knows your name

Andrew Gelman (Stats Professor at Columbia University) provides the following graphs of state population size and governor approval rating:


These charts show that governors in small states tend to be more popular than those in large states. He offers several explanations for this trend:

• In a large state, there will be more ambitious politicians on the other side, eager to knock off the incumbent governor;
  
• Small states often have part-time legislatures and thus the governor is involved in less political conflict;
  
• Small states (notably Alaska) tend to get more funds per capita from the federal government, and it’s easier to be popular when you can disburse more funds;
  
• Large states tend to be more heterogeneous and so it’s harder to keep all the voters happy.

Tyler Cowen offers an additional theory:

I have an additional hypothesis. People from small states, especially atypical small states, sometimes have an inferiority complex vis-a-vis the other states or regions. Taking pride in their politicians is one way of compensating for that. Furthermore there is often less to do in underpopulated states and is not pride sometimes a substitute for action? New Yorkers are not in fact so proud of the Metropolitan Opera, but in parts of Wisconsin the Green Bay Packers are king.

I think this is a pretty good list. I would, however, highlight the point about small states receiving more federal money per capita, giving governors more resources to please their constituents. This is certainly worth mentioning as Alaska ranked #1 in pork barrel spending, receiving more federal money per capita than any other state. Combine that with no income, property or sales tax (the state's budget is heavily subsidized by $11 billion in oil taxes and royalties) and it's not so hard to keep people happy. As economist Chris Edwards said of Alaska, "It's like Dubai. It gets enormous royalties and taxes and fees of various types from oil...''

Then again, maybe small states just have better values than large ones...

Defining 'hockey mom'

To answer Dan's recent question about a definition for hockey mom, I consulted my two favorite modern linguistic specialists: Wikipedia and UrbanDictionary.

I'm afraid both have beat us to the punch by indirectly defining the term. Thanks to some recent editing - "hockey mom" auto-redirects Wikipedia visitors to soccer mom entry and already notes Republican VP nominee Sarah Palin's reference. Labeling it as a blue-collar variety of the suburban soccer mom.

UrbanDictionary does Wikipedia one better. It has no entry for hockey mom but instead defines a hockey milf, as a "hot hockey mom." This suggests the terms is already well-known in our society and already ready for more iterations.

Why we should measure things

I work as a Data Analyst, so maybe I'm biased. But I think we should use measurement and statistics so that we can improve our understanding of the world. Plus, you can catch people making funny mistakes.

Giuliani at the Republican Convention:

"Of great concern to me, during those same four days in Denver, they rarely mentioned the attacks of September 11, 2001. They are in a state of denial about the biggest threat that faces this country. And if you deny it and you don't deal with it, you can't face it."

According to an analysis of transcripts from both conventions, Obama/Biden used the phrase "September 11th" three times, while McCain/Palin used it once. Giuliani also used the phrase once in the context above, as did Joe Lieberman (an Independent speaking at the Republican convention).

But then again, if we actually pay attention to what our leaders say, the terrorists have already won.

Where can I find "real Americans"?

Paul Krugman gets it right:

"please, can we get over the idea that small towns in the heartland are the “real America”? A long time ago I complained when Bush said he went to Crawford to be with “real Americans”: I asked, “And what are those of us who live in New Jersey — chopped liver?”

Today’s America is an overwhelmingly urban/suburban nation, in which a majority of the population lives in metropolitan areas with more than a million people. It’s ethnically and culturally diverse. Mercer County — which is a lot more than Princeton, which I admit is a bit unreal — IS what America looks like today. And a fine nation it is."

Last I checked, 79% of Americans live in urban areas (the census data is here and the technical definition of "urban" is here). And yet no candidate (not in this election, not ever) has substantive urban policies, only rural ones.

On a related note, what is a "hockey mom"? Looking at the census data I couldn't find that category.

Why not just have them mud-wrestle?

So much for the hope that the economic advisors would bring some civility and reason to the policy debate.

Jason Furman (Obama's advisor) and Douglas Holtz-Eakin (McCain's advisor) squared-off on CNBC yesterday. It was nothing more than 10-minutes of political pot-shots. You wouldn't know it from watching, but these are normally smart, reasonable guys.

Arnold Kling comments on their "debate".

Forcing Youself to Vote

I promised a random Australian to vote for Obama in exchange for $10 I needed to pay the customs taxes to leave Cuba.

Woodrow Wilson (the only US President who was also a political scientist) analyzed the significance of nonvoters in US elections. He concluded that "ultimate participation is more important than constant participation" ergo "the vote is in reality a check on those who govern" ("The Pragmatic Electorate," American Political Science Review (Feb 1930), p. 32).

For Wilson, each citizen need not participate in every single little election, only when they were adequately ticked off at the current administration to voice their concerns. More so than a patriotic and civic duty, Wilson saw that voters tended to turn out when their own personal interests were effected.

With the full cast selected, we head into the final act of this year's election. Chances are you have formed an opinion for whom you would like to vote for and are just eagerly waiting for the big day.

Even if you have your good intentions, bumper stickers, "I Heart Voting" button, eye sore lawn billboards, and all the other electoral process paraphernalia that is inevitably discarded like a post-sex-scandal politician, you may not actually vote.

I have my reason to actually vote. Here's a great way to make sure you vote (that is, if it is something you feel you aught to do):

• Shove $20 into an envelope addressed to your least favorite political party or non-profit organization.
  
• Exchange envelopes with a friend who has done the same.
  
• On Election Day, if you vote, you get your envelope back. If not, the envelope is dropped into the mail.
  

Let us know if this idea works for you? What other methods can you ensure that you will actually vote?

Apparently you really can't get something for nothing

It appears that France is ending its decade-long experiment with 35-hour work week. This law, enacted in 1998, capped work weeks at 35-hours, requiring overtime pay for additional hours.

The theory behind this law was simple: capping worker hours would necessitate more workers to complete the same amount of work, thus creating more jobs. After all, if you cut your work week from 39 hours to 35 hours, someone has to make up those extra 4 hours, right? It is also appealing to policy-makers, since it suggests that you can increase employment for free.

Unfortunately, it's not that simple. This argument is known to economists as the lump of labor fallacy. As Charles Wheelen explains:

"Like most bad economic ideas that persist over time, the notion of a "lump of labor" has a certain intuitive appeal. The French policy assumes that the amount of work to be done in a modern economy is fixed, like a pie, and that cutting that work into smaller pieces -- fewer hours per week -- will provide slices for more people. If you've got six pieces of maple pecan pie to feed 12 people at Thanksgiving, then just cut each slice in half, right?

Not exactly. Requiring 39 hours of pay for 35 hours on the job makes workers more expensive relative to what they produce -- not unlike raising the minimum wage in the U.S. If workers become more expensive, firms will hire fewer of them, not more. French unemployment remains near 10%, roughly twice the rate in the U.S."

So which theory is borne out? Fortunately, since the law was phased in over time, it created a kind of "natural experiment". While large firms had to adopt the law immediately, smaller firms were given a few years as a grace period. According to Marcello M. Estevão of the IMF and Filipa Sá of MIT, comparing the experiences of the two groups shows that the law did not boost employment. While employment after the law increased throughout France, it did so in both large and small firms, suggesting that any increase in employment was do to factors other than the 35-hour mandate.

Most aspects of the economy are not zero-sum; if one worker gains a job, it does not have to come at the expense of another worker. Employment and living standards are based on productivity, which allows us to get more out of the resources we have. The number of jobs is not fixed and we shouldn't treat it as such.

What they don't know can't hurt them

Dean Baker highlights an overlooked story about testing for Mad Cow disease. Apparently:

The Department of Agriculture banned a small meat packer from testing its cattle for Mad Cow disease. It seems that the problem is that the big meat packers don't want the expense of testing their cattle, but they also don't want this small meat packer getting a competitive advantage from being able to certify that its beef as been tested and shown to be free of Mad Cow disease.

People often conflate "pro-business" with "free-market", but these are really two different things. The Bush administration has certainly been "pro-business": reducing environmental standards on industry, protecting American steel manufacturers with a tariff, offering no-bid contracts to American businesses in Iraq. But it is rarely "free-market".

This is a case where one meat packer wants to differentiate its product based on quality. Since it is a small producer, it may not be able to compete with larger producers based on price. However, by allowing competition, the government can expand--more accurately, not prevent--consumer choice. For anyone who is concerned about Mad Cow disease, they have the option of paying for more strictly tested beef. For others, there would still be a cheaper alternative.

The additional benefit is that other producers would likely be compelled to increase their testing regimens to compete with this small producer. By allowing businesses to compete, we end up with higher quality, safer products, at a lower cost.

Certainly government agencies should play a role in verifying claims made by producers. But it shouldn't prevent a company from making a factual statement about one of its products.

"Pro-business" allows powerful interest groups to lobby the government for protection and favors. "Free-market" makes these interests compete to provide better, safer products for consumers.

What's a feminist to do?

By now the news of John McCain's nomination of Sarah Palin for his running mate is well known and the Republican camp is touting it as an enlightened pick that furthers the cause of the feminist movement. I've hear several right-wing pundits declare that although Palin is pro-life and a former beauty queen, as the mother of five and a female governor, she is a role model on par with Hillary Clinton for the "average female voter."

So far, I have seen no record that Palin's history of leadership has supported women in America. Particularly not to the extent that Clinton's investments in Head Start, healthcare, prenatal care and sexual health education supported women for nearly two decades. Palin's views on the choice movement alone suggest she is intolerant of the rights of women who disagree with her views on reproduction and morality. In fact this nomination has also been criticized as an insult to women.

What I have seen in the media is in-depth coverage of Palin's personal life. Reports that her 17-year old daughter is expecting and will marry the father of her unborn child surfaced today. The choices that teens make about their sexuality and their fertility are often debated (I'm recalling the media circus that Jaime Lynn Spears faced recently) in American culture. However, speculation around how Palin handles her own daughter's pregnancy has no place in speculation on how she will lead and advise our country's political policy. One would hope that faced with this public scrutiny she would understand the need for privacy and personal choice in reproductive matters.

More importantly, this is a chance for pro-choice feminists to use the incident as a platform to judge Palin not as a mother or a soon-to be grandmother, but respect her right to choose and advice her own daughter privately --judging her own her own record as a politician, which up until now is fairly unimpressive.