A New Era of Social Change...? You have not outgrown your imagination. Don't allow anyone who has lost imagination tell you that you don't live in interesting times. You have heard the chimes at midnight, and the times you will soon see are exciting indeed. "Sabine Herold" -- her picture shown above -- is the name of a social revolution now sweeping France. Margaret Thatcher? Joan of Arc? She's both. Her speeches call for fundamental political change first in France, then possibly in all of Europe. This is freely adapted from this google translation of Sabine Herold's Sunday June 15 speech depicted above: My dear friends, My name is Sabine Herold. How many of us are here today! More than I could have hoped a month ago, when strikes were everywhere and the media was predicting a total national shutdown. Our message has moved through France like a jetliner's vapor trail! A Million French Citizens realized in less than two weeks that things had changed, that we will never again be impotent hostages. We are united to recall the values of our Republic to those who ridicule these values: Freedom, Equality, Fraternity. Three words which summarize the Rights of Man against modern tyranny and privilege. What remains of our Republic's grand mission? Who can believe France is now a country of Freedom? How can "freedom" allow your professor to deny you a final grade? Can we call it "freedom" when our trains and airplanes are regularly and endlessly paralysed? Who can believe France is a country of Equality? When the State maintains indecent pension privileges just for public employees and those of large public companies, where is the Equality? Why should the public sector enjoy privileged retirement benefits denied to comparable workers in the private sector? Dear friends, I invite you from now on to enter in active resistance against undeserved privilege, to defend principles we cherish together. For the return of Freedom, for Equality, for Fraternity -- we will continue to fight! More from ChicagoBoyz, negative stuff here, and we will soon be hearing more about this, I assure you.

Link posted by Steve Antler : 1:00 PM

What does it take to define a nation? My inexperience in matters European is criticized by correspondent "Paul." Informed by the history of New Europe, he writes my faith in the falling dollar's restorative powers is completely misplaced: ...I do not believe in the benefit of weak currencies. History shows that weak currencies have been associated with weak countries, and that this combination rarely resulted in anything good. I am for a strong dollar. As an alternative, we could consider adopting the Euro. (If nobody has yet advanced this idea, remember you heard it first from me.) This would eliminate any exchange advantages or disadvantages when trading with the EU, and we could then measure the results in purely competitive terms (price, quality, and service). Frankly, I laughed this off. "Clearly the guy doesn't understand export prices," I thought dismissively. But monetary union is an old idea that just won't die. It may be the next big thing. Consider what Bartley is saying in today's WSJ: ...if the euro can replace the franc, mark and lira, why can't a new world currency merge the dollar, euro and yen? The euro's recent recovery against the dollar almost certainly establishes its credibility as a permanent currency. While major eurozone economies remain troubled, practically no one so far is blaming the European Central Bank. This suggests success for the grandest reform of all, a supra-national central bank. The ECB Executive Board and Governing Council could yet become political targets, of course, especially if much-discussed deflation actually sets in. But even with strikes in Germany and France, few politicians seek a way out in a little more inflation or currency depreciation; few complain about the loss of "monetary sovereignty." World money, with a world central bank, seems a next logical step. How are we to think about this? Try this approach. What is the essence the concept "nation?" If we had to list all the features of "nation," what would be left if we discarded everything that could be taken away? Culture, language, history, all that stuff can get thrown out -- just two and only two features remain on the list. The first is simple border -- an enforcible physical boundary. The second is currency -- an enforcible economic border. So what must be discussed, it seems to me, is whether monetary union is genuinely "rational" or part of the irrational and highly suspect elitist European political movement that's come to be called transnational progressivism. If this makes me sound like the old wacko John Birch Society guys who ranted against the U.N. and the dangers of upcoming world government -- well, I guess I'll just have to live with it.

Link posted by Steve Antler : 10:36 AM

It's getting old... I think the German titles are getting a little used up, but this one should have been named something like "Warum hassen sie uns?" Thanks to our European Correspondent at SadlyNo, we can say the answer (die Antwort) is: UPDATE: Consider these opening words (How many times have you heard them or similar?) from Mort Zuckerman's latest: Did you know that the United States is the only industrialized nation that still doesn't provide its senior citizens with comprehensive insurance coverage for prescription drugs? The above tax-freedom-day chart as well as this (link via BB in context of upcoming post) suggest Europe has to provide its seniors comprehensive insurance coverage because taxes are so high they can't afford to buy it!

Link posted by Steve Antler : 8:27 AM

Energy Lots of great stuff at Capital Spectator, especially the continuing saga of American energy: Readers of the Capital Spectator are familiar with our repeated essays on the prospects of a looming natural gas shortage. Inspired by research from Simmons & Company, an energy-oriented investment bank, we've said for some time now that natural gas supply might be constrained relative to the future path of demand...If natural gas promises to be another thorn in the side of the U.S. economy, at least the process won't be mysterious. A generation of denial and ill-advised energy legislation on the subject of crude oil is the legacy of the last several decades. Will it be the same for natural gas going forward? Or, have we—Congress, in particular—learned anything about the intersection of energy and markets in the last 30 years? I woke up the other night all worried by this -- Nuclear generation for electricity has to be done on a centralized basis. But natural gas can flow right to the home/factory to be used right there for heat/cooling/etc. Why are we using any natural gas to make electricity?

Link posted by Steve Antler : 8:14 AM

Sunday, June 29, 2003

Here it is I finally found a link to the National Do Not Call Registry. Don't you think the point is, if you don't register, you'll get more calls because everyone else did register? But then again maybe all the telemarketers can decipher the handwriting on the wall and will go out of business and you'll get fewer calls anyway, even if you don't register, meaning you get the benefit anyway? I just can't decide... You may want to consult Arnold Kling on the subject.

Link posted by Steve Antler : 3:48 PM

In Memoriam PunditWatch On FOX NEWS SUNDAY, guests are Joe Biden and Jon Kyl. Biden called for 30-60k more troops in Iraq, preferably NATO troops. Exact quote: “– NATO, NATO, NATO…We’ll be in Baghdad for a decade.” Kyle: "Saudi money has facilitated Wahbbi infiltration of US schools, Mosques, prison clergy, even military clergy." Bill Kristol, during panel: “Supreme Court has put us on the path of ceasing to distinguish in our public life, in our public law, between heterosexuality and homosexuality in any way...{I]t is entirely possible that five years from now marriage will be privatized in the sense that it will be a strictly private contractual arrangement – a contract that the state recognizes – and anything deeper will move to the private, religious sphere -- and this may not be such a bad thing.” ABC THIS WEEK: Bill Frist joins the call for more troops in Iraq: "We need to involve the world, the globe, because we’re talking about freedom around the world." George Will predicts: "It took about three month to ratify the 18-yr-old vote amendment. Enshrining heterosexual marriage in the Constitution will go just as fast." George Will on Gray Davis: "California recall law institutionalizes buyer’s remorse…any Republican replacement will wind up taking over a train wreck. MEET THE PRESS: Rudman and Metzl on the upcoming Report of the Independent Task force on Emergency Responders. And, finally, Fun with Carville and Matalin: Carville: This administration has two answers, one domestic, one foreign: tax cuts and belligerence. Our new poll shows 40% of Americans want a “significantly different foreign policy direction than this Admin is taking.” Matalin: Security is more important than popularity around the world. Your poll seems to show 60% of the American public is on our side, by the way. Russert's pop quiz: What will be the defining issue in the next election? Carville :”Opportunity for everyone, not just top 1%." Matalin: "National, economic, homeland, and next-generation security."

Link posted by Steve Antler : 1:09 PM

Can't we do better? Is the entire matter really as petty, personal, self-satisfied, and unimportant as this?

Link posted by Steve Antler : 10:11 AM

Kleinere Besteuerung wohlhabenderer Individuen? Details! We demand more details! UPDATE: Thanks to SadlyNo, here are the details:

Link posted by Steve Antler : 8:51 AM

Sad Story from my Neighborhood

Link posted by Steve Antler : 7:23 AM

Over There We posted these numbers on June 24, in connection with the Boskin "antibonds" story. ====================================================== ------------------------------------------------------------------------------------------ GOVERNMENT DEBT AND PENSION LIABILITIES AS PERCENT OF GDP (1990) ===net conventional debt=======net pension liabilities CANADA===52================121 GERMANY==22================157 ITALY====100================259 UK=======27================156 US=======35=================90 ----------------------------------------------------------------------------------------------- Source: Essays on Pension Reform, Max Alier PhD Thesis, University of California LA, 1997; quoted in R.E.A. Farmer, Macroeconomics, South-Western, 2002, p. 162. ===================================================== And now, the NYT has discovered certain inherent contradictions in the European welfare state: But more important in Germany, as in the rest of Europe, is the rapid growth in the numbers of the elderly. In 1950, 30 percent of the German population was under 20 and only about 2 percent was over 80. By 2050, under-20's are expected to be only 16 percent, while the over-80's are estimated to reach about 12 percent...The solution being recommended by the pension reform commission is to reduce the pension amount from 70 percent of the average national salary to less than 60 percent...That is a large drop in a country where 80 percent of pension income comes from the state, but few experts see any hope that this reduction can be avoided. So the next time John Kerry starts droning "the US is the only major industrial country that bla bla yadda..." and "...in Europe they bla bla bla..." ask him whether he shouldn't maybe reexamine his views on the European welfare state?

Link posted by Steve Antler : 6:45 AM

"If we really sold that many can openers they have to be buying more tuna!" The mysterious Tania sends us this link to Salon -- Cave on Liebowitz, who says the numbers just don't add up properly: The problem is that the number of downloads appears to be larger than the total number of CDs purchased. Worldwide annual downloads, according to estimates from places like Webnoize, would indicate that the number of downloads -- if you assume there are 10 songs on a CD -- is something like five times the total number of CDs sold in the U.S. in a year, and one-and-a-half times the worldwide sales. That's so large that you have to say: Look, if downloads are substitutes [for CDs] in any significant way, we should see really big declines -- unless there's something else going on. The reason I gave in the paper is that maybe people aren't shifting their music [from MP3s to CDs]. But I've also seen some recent numbers on households that have CD writers, and it's something approaching 30 percent. We should see an impact. There's a 5 percent decline in CD sales this year, but that's what you might expect in a recession. So we're still not seeing much. And what I'm beginning to suggest now is that perhaps people aren't going to replace the purchase of CDs with these MP3s

Link posted by Steve Antler : 6:09 AM

Saturday, June 28, 2003

Just in case you missed this... Check out Shelby Steele in today's WSJ: A remarkable feature of this opinion is the way it ignores the vast array of contradictions and unintended consequences that attach to affirmative action--a few of which are its racial divisiveness, its stigmatization of blacks as inferior, its facilitation of identity politics, its encouragement of a victim-focused identity in minorities, its reverse discrimination against whites and Asians, its preference for precisely the least needy minorities, its damage to the principle of excellence, its fostering of a parasitic diversity industry, its cynical refusal to allow the best and brightest minorities to compete openly with their white and Asian counterparts, its flouting of the Constitution's equal protection clause, and of course its utter failure to close the academic gap between whites and blacks. Because the decision should be considered in the broadest possible context, now would be a good time to check out John Fonte's theory of postdemocratic transnational progressivism, especially if you missed it the first time around.

Link posted by Steve Antler : 10:22 AM

More on "Klassenkampf über alles anderes" Ask yourself which prices have been rising and which have been falling in the past decade? Computers, televisions, autos -- prices here are more or less stable. Insurance, tuition, medical/dental -- prices here are on the move up. Two things account for the contrast. First, computers and autos are easier to trade internationally than insurance or medical/dental. Yes, there is an internationail market for virtually everything now, but some markets are better-organized than others, and the international market for services is always tough compared with hard, shippable/storable goods. More competition (especially international competition) means lower prices. Second, with economic growth there is always an upward price bias for services as compared with all other goods, because productivity gains in the service sector take place very slowly (or possibly not at all). The classic example is the barber: yes, you can make him more efficient in some ways, but you can't create time and there are a limited number of working hours in a day. Per workday hour, today's barber can probably give the same number of haircuts as could his counterpart back in the middle ages. What does this mean? As time goes by and techology moves forward, even though we get "better" at producing everything, we get relatively better at producing hard goods in the non-service sector than services. Services get more expensive compared with everything else, in other words. This is why some prices are rising and others are falling -- why health care is so expensive, but an HDTV can be found for $500, and why, in an earlier era, appliances replaced butlers and maids. It constitutes part of the explanation of why prescription drugs and new diagnosticss are coming to be such an important part of health care. And, one suspects, under everything it constitutes the rationale for 29 CFR Part 41, the Department of Labor's proposed changes in overtime definitions for certain service sector workers. In highly industrialized economies there is a kind of inherent Klassenkampf between hard goods and services including government. The proposed new regulations are, therefore, perfectly consistent with an administration trying to bring the size of government under control. "Bloated government" is only one part of the general problem of a continually "bloating" service sector. UPDATE: Quick-and-dirty verification: Source:Economagic ADDITIONAL UPDATE: The data graphed above may support the argument "too much." I selected the index of employment costs in goods producing industries excluding sales expenses. ("Sales" is a "service," right, so exclude it? No?) I'm not sure how kosher it is to simply exclude sales for the goods producing but not the service sector. (I was, effectively, treating all goods-sector sales as"out-sourced" to the service sector since that part of the activity is service. This may be okay but I want to think about it more.) To keep everything on the up-and-up, here's a plot of goods producing and service sectors with sales included on both sides. Source: Economagic Less dramatic, but the data do in fact verify the "service bloat" thesis. We can see this if we plot the services employment cost index against the goods producing industries employment cost index: Okay, there you have it. Slightly negative intercept, slope slightly greater than one. Service sector employment costs do rise faster than those in the goods producing sector.

Link posted by Steve Antler : 9:02 AM

Remember the market and hemlines? Bill Hobbs has information on new version of the renowned relationship between stock prices and the length of ladies' skirts. More than this I can't say. And by the way, talk about clearing out and leaving more room in the ecological niche! Glenn Reynolds goes on vacation, and all of a sudden Hobbs finds something in his tip jar? Gimme a break!

Link posted by Steve Antler : 7:19 AM

Friday, June 27, 2003

Kindischer Klassenkampf We can only hope the next election addresses the childish left-Democratic politic of class struggle typified by the last post. The notion that changing overtime rules "would create, in effect, a massive subsidy to employers paid for by their employees" operates at something like a sixth grade level of economic sophistication. The world is reduced to workers (good) and employers (bad) who get everything the workers don't (Marx). Real world distribution is complicated and subtle, full of direct, indirect, and even-more-indirect effects. Prices, market shares, costs-of-living, aggregate job opportunities, relative positions of poorer versus more affluent workers, and international trade flows are just a few of the important variables influenced with changes in taxation or regulation. The overtime wages of workers in service industries constitute part of the cost of living of workers in all other industries -- one of the reasons American hourly labor costs are highest in the world. Theoretically, at least, holding the line on labor costs in service industries expands job opportunities for workers in goods-producing industries by making them more internationally competitive. Sure, the impact is small and subtle. But recognizing that which is small and subtle is one aspect of being a grownup. Sooner or later Republicans must address these and similar complexities with more than the counter-slogan "class warfare." I suspect they must start identifying Klassenkampf as what it essentially is: stupid, and childish.

Link posted by Steve Antler : 12:42 PM

Klassenkampf über alles anderes Matt Bivens at The Nation provides us with this daily outrage: Nurses, tech workers, military reservists, cooks, fire fighters and dental hygienists are among millions of people who -- if the White House has its way -- could find themselves working overtime hours minus the overtime pay, as early as this September. That's according to a study, released today by the D.C.-based Economic Policy Institute, of the Bush Administration's plan to rewrite the overtime rules. A co-author of EPI's report -- Eliminating the Right to Overtime Pay -- says the White House plan "would create, in effect, a massive subsidy to employers paid for by their employees." America's largest union, the AFL-CIO, echoes that: "These overtime pay cuts are like a giant new tax on working families by a president who, at the same time, works hard to give tax breaks to millionaires." Go to the original article for links to everything except pertinent information like this: Source: Morimoto, Hirata, Kato: "Global Disinflation", fig. 14 (Thanks to BB -- more on Global Disinflation to come. See post above for small, subtle relationship between wages in manufacturing and service industries.)

Link posted by Steve Antler : 11:52 AM

Tempers flare when temperatures rise? DeLong: "Andrew Sullivan is simply and totally clueless about what America is." Sullivan: "Brad DeLong is sometimes a classic example of the arrogant liberal...Am I being touchy...or is there a soupcon of nativist hostility [as well]? Do we add a touch of homophobia to the nativism?"

Link posted by Steve Antler : 10:33 AM

On the Street We've arrived at a wise, focused, and knowing anger, Says Victor Davis Hanson: The American Street is in a strangely revolutionary — read "fed-up" — mood. It is growing distant from Europe. It is angry with the Arab world especially, and it is tired with South Korea — and most whiny nations that either take billions of dollars in direct American aid or ankle-bite under the aegis of American arms. The result is something new and unexpected. The Street's anger is seeping upwards, right through the heavy, stagnant, and dumb layer of press and media. Now things must change rapidly as leaders from left and right learn what their followers now know: The general public at last understands this post-Cold War teenager syndrome — that perpetual dependency creates envy and jealousy. After all, we would find it strange if our own American teenagers were to wear German T-shirts, play French music, and watch Belgian videos as they painted anti-European graffiti on our walls and their parents in New York sued Chirac or Kohl for European criminal neglect in the Balkans. Our own senators and representatives do not engage in German bashing while the Luftwaffe has 100 jets parked outside of Washington protecting our eastern seaboard. It all reminds me of a Greek hotelier — replete with American Ray-bans and Eminem blaring in his portable CD player — this week who snapped at me that Americans were all over the globe sticking their noses in the business of innocent others like poor Mr. Milosevic — but lamentably not as tourists coming to Greece as in the past. There is common ground between liberals and conservatives to start downsizing from places like Saudi Arabia, Germany, South Korea, Turkey, and as much of Western Europe as possible. The former either fear the label of imperialism or, as in the case of the Gulf, don't like us propping up corrupt governments. The latter are more hard-headed, and see only increasing costs — political, monetary, psychological — with decreasing benefits. History is happening, read the whole thing. UPDATE: Hanson's concern re. systematic immigration is voiced in the last part of the article. You might also wish to look at this commentary, sent in by Dagmar.

Link posted by Steve Antler : 10:05 AM

Kudlow's Got It! The first appearance of the next big thing appears in Kudlow this morning. He's said similar things before: Most supply-siders disagree, but Alan Greenspan & Co. should turn the money spigots wide open that day — more than they have thus far in this reflation cycle. I'm talking about shock-and-awe level accommodation from the Fed. and even more recently: ...in order to wean themselves off funds-rate targeting — which tends to destabilize the economy more often than not — the central bank could announce that henceforth it would conduct open-market operations through the purchase or sale of Treasury notes and bonds. but what I like in the new Kudlow is his move towards the old, rough, post-Keynesian language of the 1980's money critics: ...Arthur Laffer and Robert Mundell...argued for monetary restraint as a cure for inflation and significantly lower tax rates to produce an economic recovery. This supply-side mix is just as important today. The cure for deflation is monetary expansion...This week's action by the Fed seems to suggest that they will not be raising their target interest rate for a long time. This should mean that open market operations will keep the money spigots wide open. If so, this is very good news. and this should help us accept the important new idea -- the "I" word isn't always a profanity. AUTHOR'S MESSAGE: What the goods-producing sector now needs (from the vantage point of small Midwestern manufacturers, at least) is the crazy unpredictability of early-onset mild inflation.

Link posted by Steve Antler : 8:37 AM

Yet Another Logical Final Outcome? One party is businesslike, able to dispassionately weigh opposing interests and alternate viewpoints. The other demonizes “all things business” -- including, most of all, their opponent's businesslike approach. One party reminds you of that stuffy old 1950’s school principal you either knew or first learned about in films like “Back to the Future.” The other reminds you of his most discipline-challenged students – you know, the ones who thought the funniest thing in the world was a fart? One party uncomfortably but steadily houses disparate beliefs, quietly moving its coalition forward as if to prove the impossible -- rule-of-law Democracy can work. The other, constantly challenging and changing rules through litigation or angry manipulation of parliamentary procedure, carries forward a never-ending crusade for what it defines as justice. In short, we have the boring grown-ups and the fun kids. And what, we ask, is the logical-historical outcome? Uh, I don't believe it! The outcome is predicted by -- I NEVER would have guessed! -- the very same Paul Krugman HIMSELF! And what does he say will happen? The result is ONE PARTY RULE!!!!! AAARGH!!!! Noooooooooooo !!!!!!!!!!!!!!! UPDATE: And please, once you regain your composure don't forget to check out Luskin's Krugman Truth Squad report on this!

Link posted by Steve Antler : 7:26 AM

Thursday, June 26, 2003

A Logical, Final Struggle? Earlier this week I attended a lecture by Ronald Coase. The audience was small, the lecture informal, and the topics wide-ranging. His description of early policy justifications for a fully regulated BBC was riveting. It left me feeling I had never really known the true meaning of the word "elitism." If broadcasting is left to the whims of the marketplace, said these pioneers of regulation, the public might get what it wants rather than what it ought to have. One can't help connecting this to current Democratic discomfort with talk radio and Fox News. Also, one can't help thinking that this story shows the logical outcome of the British regulatory model. UPDATE: Kikuchiyo News reports: The BBC is being accused of bias by top folks in the labor government. The fiasco began with reporting on Iraq WMD, but on the World Tonight program today it seems like a general brawl in breaking out. UPDATE II: This report, pointed to by Andrew Sullivan, seems definitive: We consider that this report shows conclusively that the BBC’s claim to provide impartial news coverage is unsustainable. Our two earlier reports... showed that the BBC’s coverage of the Middle East was infected by an apparent widespread antipathy towards Israel. However those reports were based almost exclusively upon a comparison of the media treatment of the Israelis and Palestinians. This current study, which compares treatment of Israelis with that of coalition forces, suggests that the partiality of the BBC’s reporting quite possibly infects its coverage of all politically sensitive issues...The British public continues to pay for this partial and inaccurate news service through the licence fee. We wonder whether it is healthy for Britain’s democracy that such huge public funds should be provided to what is an essentially monopolistic and unaccountable body. The BBC cannot provide impartial news coverage. It has no legitimate call on public funds when they are used simply to promote the BBC’s own prejudices. Same source points us to this as well.

Link posted by Steve Antler : 10:06 PM

The Pros Observe the Dems Bartlett continues in the great neo-Marxist Edsall tradition -- from the McGovern reforms onward, analyzing the Democrats from the ground up, on the gritty foundation of the base's organizations and interests, not its ideology. Bartlett's prediction? It's almost certainly Dean: We will know better in a few days when MoveOn.org announces the winner of its online primary, which started on June 24 and runs for 48 hours. I expect Dean to win handily, which will give his campaign a big boost by anointing him as the official choice of the Democratic party’s left-wing base. Being collectivists by nature, I think this will put a lot of pressure on movement leftists now supporting other candidates to get on board with Dean...Consequently, I believe that Gov. Dean’s chances of getting the Democratic nomination are good and getting better by the day. Professional political handicappers disagree, but I think they are looking at the wrong things. They think that things like fundraising and general-election electability will ultimately determine the nomination. But what Gov. Dean may lack in these areas he more than makes up in the intensity and loyalty of his supporters. As in 1964, I think this may end up being the determining factor. This misses not a beat -- with the exception of an offputting subtlety we saw Sunday morning when Dean angily declared Russert's tax numbers false. On this one, check out Andrew Sullivan : I know from observing [Howard Dean] and debating him once that he's an intemperate, arrogant bully...It's a trait bad doctors have. They are used to being in such controlling positions vis-a-vis their patients that it goes to their heads. Good doctors resist such an obvious temptation. Okay, let's put this all together and think about it. How much does being an intemperate, arrogant bully decrease Dean's chances of winning the Democratic nomination? Gee, I'm not exactly sure. Um, lemme see now...

Link posted by Steve Antler : 8:49 PM

NYT helps you keep tabs on the very very rich Everything you wanted to know about the 400 top taxpayers but were afraid to ask? Nearly: The data, in a report that the I.R.S. released last night, shows that the average income of the 400 wealthiest taxpayers was almost $174 million in 2000. That was nearly quadruple the $46.8 million average in 1992. The minimum income to qualify for the list was $86.8 million in 2000, more than triple the minimum income of $24.4 million of the 400 wealthiest taxpayers in 1992. Okay...Well, my own quick dirty calculation says if we expropriate the whole lot it puts the rest of us ahead by about $350 per annum, give or take a few bucks. (Not enough to buy a race horse, but it might help a bit.) Thanks to our correspondent we now have a link to the data and the following somewhat more-sophisticated points: (1) The data end at 2000, so we're seeing the footprints of Clinton-era policies and bubble-generated wealth. Later data will probably show a relative downward movement of this income category. (2) Data sets like this tell us only about income categories, not about people. All income classes are constantly gaining and losing individuals. The category "very rich" is particularly volatile in this regard.

Link posted by Steve Antler : 7:25 PM

In memoriam deludificor Here's Edward Said on the tragic death of the heroic and dignified Rachel Corrie. More info here and here.

Link posted by Steve Antler : 1:15 PM

Sounds like good news to me The unemployment rate is a lagging indicator (see "Existential Horror." --Friday June 13-- below), but new jobless claims, which USA Today reports is falling, is concurrent or maybe even leading. For this reason the USA Today Economic Survey's forecast of a falling unemployment rate is consistent with current data.

Link posted by Steve Antler : 10:33 AM

Lemme see if I got this right... The White House is backing a bill to get cheaper health insurance to small businesses who can't afford it but it's being opposed by AFL-CIO and the National Governors Association in a coalition led by Blue Cross Blue Shield Association which is running a Washington vacation sweepstakes contest giving families a free trip to Washington so they can lobby against the bill. Okay?

Link posted by Steve Antler : 7:31 AM

Wednesday, June 25, 2003

Data alert... Now that I've finally figured out uploads, we'll begin migrating earlier graphics linked to elsewhere. Here's my more-or-less accidental conversion to the supply side doctrine. It seems pretty clear there are, historically, three distinct unemployment trends in the post WW II U.S. economy. The second was initiated by the Kennedy tax cut, the third by Regan. Pretty basic, sure, but also pretty dramatic. This speaks also to the increasingly "jobless" recovery. While we are on an unemployment-rate upswing -- and a pretty bad one at that -- there is absolutely no reason to believe the twenty year trend downward trend has ended. Source: data from Economagic, linear trends from EconoPundit

Link posted by Steve Antler : 8:39 PM

Yeah, yeah -- and by the way I was wrong about Marx too... John Podewils writes: Regarding the percent of GDP the US spends on defense, beware of linking to sources where the answer can be found! According to the CBO (Historical Budget Data - Table 8) we spent 3.4% in 2002 and OMB reports the same for 2002. I am no expert on government statistics, so maybe there is something I am missing or maybe you think that the Iraq and other War on Terror costs will increase this substantially, but it looks like the number is in the mid-3.5% range. Perhaps the constant scare-mongering and lies told by reporters like Ivins and Krugman are seeping into your subconscious :). Great stuff on the deferred taxes issue. I hope it is as positive a development as it looks.

Link posted by Steve Antler : 4:14 PM

Higher fuel prices? Lynne Kiesling explains why natural gas prices are high, why supply is likely to remain tight in the short run, and why our clear air is overpriced : This focus on natural gas as the way to achieve air quality improvements without dramatically increasing power generation costs has had an unfortunate, and likely unforeseen and unintended, consequence of reducing the resiliency of natural gas markets. Regulatory mandates have constrained us away from being able to apply the lessons of portfolio diversification to our energy choices, and our inability to diversify our fuel input portfolios makes for markets that do not adapt to unanticipated and changing conditions. This is a very high price to attach to the environmental amenities of improved air quality, air quality that could conceivably have been achieved through other means had the regulations not so specifically stipulated natural gas as the fuel input. Okay, but I am still waiting for her answer to this question: even if it takes more than a gallon of ethanol to produce one gallon of ethanol, does if really matter so long as we grow the doggone stuff?

Link posted by Steve Antler : 2:38 PM

Architecture of Doom? The most striking analysis of National Socialism to date is Peter Cohen's Undergångens arkitektur (English: Architecture of Doom). Once seen, this documentary comes back to unsettle time and again. Naziism, it shows, was neither a political, economic, philisophical, ethical, nor scientific set of ideas. Rather, it was a simple aesthetic masquerading as one or more of these. Normally, ideological cross-dressing is more interesting than disturbing. We can recognize and even affectionately tolerate Marxism's or modern environmentalism's confounding science with ethics, for example. But an encounter with aesthetics masquerading as ethics has no good side. It leaves you feeling genuinely unclean in the full biblical sense of the word. Those seeing the Cohen film will testify to the experience. And now, a wider audience has access to the same same feeling as they read of Clarence Thomas' dissenting Michigan opinion: Diversity is the religion of academia. It is in diversity that they place their faith and the hopes. But it is an empty faith, largely because most elite academics have no interest in the kinds of diversity that matter most. Justice Clarence Thomas, the courts [sic] lone African American, clearly understood this in his dissent. He argued that the University of Michigan is not really interested in the educational benefits of diversity, but is instead pursuing an "aesthetic" of racial mixing. Read Gabe Neville's guest commentary for more. UPDATE: What is Maureen Dowd talking about? Does she maybe not know what "aesthetics" means?

Link posted by Steve Antler : 1:01 PM

And the significance is?... Those who know tell me the Boskin Report is not as new as I seem to think. To most of us the Report's conclusions are extremely surprising, however, so one can't help but wonder what this particular report says to current policy. First, judging from various blogosphere discussions nobody is going to yield anything on Social Security/Medicare, and rightly so in my opinion. Face it -- discovering an unexpected bonus doesn't tell you what to do with it, nor does it change yours or others' definitions/preferences. Second the Boskin/Bush surplus -- or discovery, or whatever you call it -- cannot help but be a victory for American capitalism's supporters and a defeat for its critics. For half a century boomers' relationship to Social Security has weighed like an incubus on economic policy discussions. Critics debited neither Security's Ponzi structure nor the population bulge for the upcoming "crisis." Rather, they placed direct or indirect blame on American market capitalism itself. The system caused us to spend too much and save too little. Or we were selfish, unwilling to devote sufficent resources to future eldercare. And of course we listened not to the wise advocates of government, of centralized organization and planning, but to the false prophets on the side of irrational markets and greedy corporatism. And there was an even more esoteric plane of criticism, the neo-Marxist critique. This school told us "the system," never able to generate enough economic "surplus" for us to buy back what we have produced, must ultimately fail -- as evidenced for example by the upcoming, obvious, and widely known internal contradiction of the Social Security crunch, which will leave our future elders homeless and starving in the street. And now we learn these critics warned of yet another false quagmire. American capitalism, we now know, has already produced the "economic surplus" needed to solve the Social Security crisis. And so long as things remain more-or-less as they are today, during the next forty years American capitalism will produce enough additional economic surplus to solve the "national debt" and "Medicare" crises as well. Once again: finding the Boskin/Bush surplus doesn't tell us what to do with it. As Business Week sums it up: Until now [this problem] has been portrayed as an intergenerational conflict between young, working taxpayers and old, retired beneficiaries of government transfer payments. Boskin demonstrates that there may also be a conflict among retired boomers with differing levels of savings. Upper-crust boomers will control a large share of the nation's wealth. If that wealth is taxed as it's supposed to be under current law, there may not be a serious problem covering the costs of Social Security and Medicare, whose stability is crucial for middle- and lower-income retirees. Yet wealthy boomers may fight to have tax rates cut in order to keep more of their retirement savings. The political fight over redistribution will continue, in other words, with an outcome presently unclear. What is clear right now, however, is that the system worked. You cannot redistribute something unless you have it. And "it" is precisely what Boskin demonstrates we do -- and will -- "have." Click here for January 2003 Draft of Report.

Link posted by Steve Antler : 8:39 AM

There is no bigger story I can't think of anything more important (or more interesting) than the media's and blogosphere's apparent disinterest in the most important economic story of the year. (Scroll down for info on the Boskin Report and its earthshaking economic implications.) UPDATE: AT LAST!!!! Coming up in the June 30 Business Week: [The current Federal] budget forecast is incomplete and perhaps overly pessimistic because it doesn't take adequate account of the growing wealth -- and future tax payments -- of America's Investor Class. Ordinary Americans and their employers are socking away huge sums in tax-deferred accounts such as Individual Retirement Accounts, 401(k)s, and traditional pensions. The total in such accounts is roughly $11 trillion today, with hundreds of billions in new contributions pouring in every year. Under current law, retirees will pay ordinary income taxes as they withdraw money from these accounts. Surprisingly, official long-term budget estimates ignore most of these projected tax receipts -- and the amounts are simply staggering. (Emphasis added.)

Link posted by Steve Antler : 6:09 AM

Tuesday, June 24, 2003

Exclusive! Bruce Bartlett has sent us the Treasury numbers used by Tim Russert in the Sunday Dean Interview/ambush. (See below, "Treasury Fights Back...") He indicates these are not yet available on the web, so consider this an exclusive. We combined the two Word files sent us and converted them to graphics and text in a single HTML document. (Big file, give it time to load!) Example 2 constitutes the dramatic two-child family numbers Howard Dean insisted must be invalid. To Bruce: THANKS AGAIN!!!

Link posted by Steve Antler : 8:10 AM

Boskin: "As the already accrued deferred taxes are like a negative internal national debt, a modern physicist might call them antibonds" In explaining this table, the Boskin Report says: Simple calculation yields a weighted-average (weighted by balances in each bracket) effective marginal tax rate of 27.7%. This produces total deferred taxes at year-end 2000 of $3.24 trillion, by happenstance almost exactly equal to the publicly held national debt at year-end 2000. Assuming that the slight reduction in taxes was roughly offset by real bracket creep, the total for year-end 2001 would still amount to $3.2 trillion, roughly equal to the debt held by the public, and substantially larger when the holdings of the Federal Reserve are excluded. If the aggregate balance fell to our conservatively estimated $10.3 trillion at year end 2002, consistent with a 20% stock market decline, the total deferred taxes would still amount to about $2.9 trillion, slightly less than the roughly $3.5 trillion debt held by the public, slightly more than the $2.8 trillion national debt held outside the government. "Antibonds?" Yeah, I like the sound of it. (Scroll down for more posts on this important story.) UPDATE: Here's a quiclk-and-dirty comparison I happened to have on my desk -- old, but I doubt the numbers have changed much. Combined with the Boskin antibonds, this may explain why the dollar just won't fall as quickly as predicted by Krugman and other doomsayers. ------------------------------------------------------------------------------------------ GOVERNMENT DEBT AND PENSION LIABILITIES AS PERCENT OF GDP (1990) ===net conventional debt=======net pension liabilities CANADA===52================121 GERMANY==22================157 ITALY====100================259 UK=======27================156 US=======35=================90 ----------------------------------------------------------------------------------------------- Source: Essays on Pension Reform, Max Alier PhD Thesis, University of California LA, 1997; quoted in R.E.A. Farmer, Macroeconomics, South-Western, 2002, p. 162. All this pertains to the pretentions of the Europhiles, especially the Social Democratic left wing of the Democratic Party, who expect a Euro-Japanese flight from the dollar. Fact 1: as a percent of GDP the upcoming US liabilities are comparatively modest. Fact 2: while we await word from anyone with more info or data, I think it is safe to assume nowhere is there anything like the accumulation of U.S. Boskonian antibonds as an asset to possibly offset these future liabilities. The presence of this asset and the comparatively modest extent of U.S. upcoming obligations may explain the dollar's current durability.

Link posted by Steve Antler : 7:33 AM

The Fault of the French Drezner continues to identify the source of every major global economic disruption. Hint: this chart is useful.

Link posted by Steve Antler : 6:42 AM

Tale of Three States, Since we happen to be talking a lot about California and Tennessee, and since I happen to be a Chicago guy, I thought it would be interesting to post this chart comparing unemployment rates in the three states during the past decade. (As you can see from the chart, Tennnessee comes off looking, ahem, uh, pretty good by comparison.) This is really easy to do using Economagic, which has extensive data for all the states and great charting options. Try it.

Link posted by Steve Antler : 3:44 AM

U.S. as one big California Good fact-packed discussion of the national power grid, alternatives to large scale generation, alternate technologies, etc, etc. Like the NYT autta be.

Link posted by Steve Antler : 3:16 AM

Latest from "Dr. K" It's sad to see a talented, competent economist reduced to wetting his pants in hatred. even people who aren't partisan Republicans shy away from confronting the administration's dishonest case for war, because they don't want to face the implications...After all, suppose that a politician -- or a journalist -- admits to himself that Mr. Bush bamboozled the nation into war. Well, launching a war on false pretenses is, to say the least, a breach of trust. So if you admit to yourself that such a thing happened, you have a moral obligation to demand accountability -- and to do so in the face not only of a powerful, ruthless political machine but in the face of a country not yet ready to believe that its leaders have exploited 9/11 for political gain. It's a scary prospect...Yet if we can't find people willing to take the risk -- to face the truth and act on it -- what will happen to our democracy? Will this sad guy ever regain the ability to see opponents are thoughtful people with whom he happens to disagree, rather than evil, superhuman monsters? I don't know. I have only one question: "Bamboozled?" What's with the "bamboozled?"

Link posted by Steve Antler : 2:49 AM

Monday, June 23, 2003

The Boskin/Bush Surplus If you don't know what the newly found Boskin/Bush surplus is, you need to go to Asymmetrical Information for the economic scoop of the decade. From WSJ (not available online, quoted at Asymmetrical): The doom and gloom red-ink budgetary forecasts of recent years have overlooked some astoundingly good news for the government: pensions, IRAs and other tax-deferred accounts should generate some $12 trillion in taxes by 2040. This mind-boggling pot-of-gold is larger, at a minimum, than the sum of the 75-year actuarial deficits in either Social Security or Medicare, according to Stanford economist Michael Boskin , who has written a pioneering paper on the subject for the National Bureau of Economic Research. We could end up with enough to offset both shortfalls, he says. (Emphasis added.) Check out these two "smoking gun" graphics from the Report. Here's the January draft of the Boskin Report.

Link posted by Steve Antler : 4:13 PM

Patrick R. Sullivan and Jim Glass have been talking Says Sullivan: Jim and I have been kicking this around via e-mail. He'd been listening to New York talk radio while taking his kids to summer camp in Connecticutt, and he was hearing nothing but complaints about the taxes people just found out they had to pay on their upcoming 401K withdrawals. I sent him this: > > From Boskin's paper: > > > > "...the deferred taxes add a major new element with a strong interest in > > lower tax rates, at least on their withdrawals, to the future political > > economy of budget policy." To which Jim responded: > They'll say this: Capital gains in tax-deferred account should be taxed on > withdrawal at 15% (or whatever) just like other capital gains. The amount > taxed at ordinary income rates on withdrawal should equal only the pre-tax > contribution amount (the deducted amount for an IRA or pre-tax amount > going into a 401(k), etc.). > > In principle they're right, it makes perfect sense, and it would still give > the gov't a lot of money. The problem is that for the last 20 years since > these accounts first became popular nobody has been keeping any records > for any of this, so it's impossible for all the money in them to date. > > Anyway, if they want to keep the Boskin Boon from being spent decades in > advance, the way the projected Social Security surplus of 1981 was > consumed by the Congress of 1939, they'll have to save the income taxes collected > on tax deferred accounts and invest them in real assets, either through private > accounts or some real national savings fund -- starting right now. > > Accounting-wise there is ready precedent for this, in that the income taxes > collected on Social Secrurity retirement benefits don't go to the Treasury > for general spending but are sent back to the SS Administration -- imposing > the income tax on benefits was really a carefully disguised means-tested > benefit reduction. > > Political argument wise, there's been plenty of rehearsal in recent years of > the argument that funds like these to be used to finance future benefits > should be really saved. > > This could get interesting in time. I agree.

Link posted by Steve Antler : 12:21 PM

Move over to make some more room in the blogosphere... Bill Hobbs has a prediction backed up by lots of articles and facts: Given how blogs affect Google searches, corporate execubloggers may soon be joining the blogosphere in droves, seeking to counteract negative word-of-mouse and enhance positive mentions online. (emphasis added) Corporate execubloggers? Whoa!

Link posted by Steve Antler : 11:14 AM

The fault, dear Brutus... USA Today's analysis: not the economy, nor the tax cut, but rather the states are to blame for their own problems. [O]ne thing has remained constant throughout the crisis: State spending keeps growing...It went up 6.3% for the fiscal year that ended June 30, 2002, and it's on track to rise about 5% in the 12 months that end June 30. The number of people on Medicaid, which pays for health care and nursing homes for the poor, remains at a near-record 40 million. That number is up 30% since 1998, the result of efforts to sign up people who qualify. And despite anecdotal reports of layoffs — Oregon furloughed 130 state troopers, for example — state governments have added 74,000 workers (an increase of 1.5%) in the past two years while the private sector has registered a net loss of 2.6 million jobs (a decline of 2.4%). By almost any measure, state governments have suffered less than businesses and taxpayers during the economic downturn. Even so, nearly every state is struggling to balance its books. It of course should be added they're placing increasingly heavy demands on the same business and taxpayers who've "suffered less." UPDATE: Bill Hobbs identifies the USA Today study as being based on pro-tax publication. He also notes the irony of the illustration -- which can be interpreted in several ways, none of them good.

Link posted by Steve Antler : 10:30 AM

Explosives in Burbank? Is this related to the Burbank Airport Story? The Kuwaiti newspaper Al-Watan published a communiqué today allegedly authored by Al-Qa'ida's chief of training Abu Muhammad Al-Ablaj, which refers to an impending attack by the organization. The communiqué stated that Al-Qa'ida's chief of training Abu Muhammad Al-Ablaj said Osama bin Laden is about to direct a "fatal blow" to the "head of the international media serpent that serves the American whims and interests." He added that the upcoming phases against the U.S. will "cut off the wings of the American eagle, slice its arteries, and finally butcher it the Islamic way." If the two stories are related, it shows why MEMRI belongs in the same column as all the numerical data sources! UPDATE: The Burbank Airport story is a hoax. And the Memri story? Who knows?

Link posted by Steve Antler : 9:01 AM

More from WAPO/Mike Allen Says the article: The Bush administration yesterday released a highly selective analysis of the cost to families of rolling back scheduled tax cuts, an early sign of the White House's plan to brand Democrats as tax raisers...Peter R. Orszag, a senior fellow in economics at the Brookings Institution, said the document "gives a misleading impression of the overall effect of the tax cuts." Just 27 million of the nation's roughly 140 million households consist of married couples with children, he said. Brookings figures show that under the most recent law, 81 percent of households would save $1,000 or less. Isn't it "highly selective" if you don't say this results from the extreme progressivity of the US income tax?

Link posted by Steve Antler : 7:55 AM

Blogger Economic Simulation -- a First? Will any reader(s) familiar with Ray Fair's simulation model please get in touch with me? The Bush/Boskin surplus needs -- no, begs -- to be plugged into a data set and the model needs to be run. This is easy for someone who's done it before. I've fooled around with the model offline using e-views. Online seems lots easier and quicker, but I've never tried. (And, uh, tonight and tomorrow I teach...) Maybe this will be a first for the blogosphere? Blognews plugged into blogmodel creating new Blogsimulations based on fast-breaking blogdata? Come on, let's make history together!!!!

Link posted by Steve Antler : 6:45 AM

A New Source of "Certainty?" I am wondering how financial markets will react to the news of the Bush surplus? What follows is pure speculation but hey, we're talking financial markets, right? Speculation is appropriate behavior! Boskin's numbers are overwhelming. Three trillion is already-accrued, and the rest appears more locked-in than any hypothetical projection generated by this- or that-forecasting model. In short: these numbers are far more certain than any of the projections we're used to. When word gets out, will this be a new source of security and certainty that will enable financial markets to take off? (If, of course, that's what they want but are afraid to do.)

Link posted by Steve Antler : 6:28 AM

Treasury Fights Back... Did it take them this long on purpose, or was it somehow part of the plan? (Clinton would have arranged town meetings and interviews with fifty families long ago.) Anyway, here's where Tim Russert got the numbers to ambush Howard Dean on Meet the Press yesterday: The Bush administration yesterday released a highly selective analysis of the cost to families of rolling back scheduled tax cuts, an early sign of the White House's plan to brand Democrats as tax raisers throughout their race for the presidential nomination...The seven-page analysis, by the Treasury Department's Office of Tax Analysis, asserts that repealing the tax cuts enacted in 2001 and last month would mean a tax hike of $1,933 for a married couple with two children and an income of $40,000. Their taxes would go from $45 to $1,978, for an increase of 4,296 percent, the study said..."If you are advocating repealing the 2001 and 2003 tax cuts, you are advocating a significant tax increase on the American people," said Rob Nichols, the Treasury Department's chief spokesman. "You're talking about raising taxes on roughly 100 million households." Looking for link to the original "seven page analysis."

Link posted by Steve Antler : 5:36 AM

Sometimes real life sounds like the X-Men... Here is D-squared's blog.

Link posted by Steve Antler : 5:25 AM

Back to the 50's WAPO: WASHINGTON (Reuters) - The U.S. Federal Reserve, seeking to rev up a slow recovery while keeping price deflation at bay, is universally expected to cut interest rates to 1958 lows this week. The sole mystery surrounds whether the 13th in a long line of rate reductions, expected to be announced on Wednesday, will be a quarter or bolder half percentage point. Speculation about the size of the cut has intensified as economists look beyond next week's decision to a new era of Fed policymaking with exceptionally low rates.

Link posted by Steve Antler : 5:20 AM

Monday, Monday...can't trust that day.... Here's the economic calendar. I'd put the link on the sidebar, but this is just too much fun.

Link posted by Steve Antler : 5:13 AM

Sunday, June 22, 2003

Further Note In my enthusiasm I referred (metaphorically of course!) to Social Security as being "fully funded" under the new circumstances of the recently discovered Bush/Boskin surplus. (See earlier posts for details.) "Watch your language!" (or words to that effect) says our good friend Patrick R. Sullivan: First, SS is not fully funded even if Boskin is correct that tax revenues will be larger in the future due to withdrawals from 401Ks and IRAs being subject to INCOME AXES. Nor does Boskin's discovery change the "special bonds" in the SS trust fund into real assets. They are still both an asset and a liability of the U.S. government, and by definition net to zero. In order to redeem the special bonds and use the proceeds to pay promised benefits, the government will need more than the historical (roughly since the end of WII) take of 17-19% of GDP. I don't think that will happen. What Boskin seems to be suggesting--I've only skimmed his 131 page paper--is that high income retirees will in effect be paying their own SS benefits to themselves. The government takes away part of their nest egg every year and returns it via a SS check. Seems kinda silly, and inefficient. The two major reasons for changing SS into some kind of investment vehicle still stand; 1) doing so will increase the capital stock available to American labor, and 2)increase the labor force supporting U.S. retirees by investing in foreign countries where there are plenty of people to work. Even Paul Krugman has admitted that it would be better not to have a pay-as-you-go system, but his argument against switching to one relies on a hilariously inept "transition costs", which ignores what he teaches his sophomores about sunk costs. Additionally from Sullivan: in my Sunday Jun 22 08:16:19 AM post I credited David Thompson with a comment actually written by Daniel Davies, who goes by the blog handle "d squared." Okay, ...we'll fix it tomorrow.

Link posted by Steve Antler : 8:55 PM

Patrick R. Sullivan writes: Regarding the Boskin paper, if he is correct then the so called "transition cost" of reforming [Social Security] to an investment (or privatized) system evaporates. We could easily finance Milton Friedman's plan... I can hardly for Paul Krugman to jump on the bandwagon.

Link posted by Steve Antler : 8:35 PM

In Memoriam PunditWatch ABC’s This Week Nothing new from Lugar, Hegel, and Biden except for this tidbit: according to Lugar, one of the most serious intelligence problems was that most of our agents were killed. Even though Joe Klein tried to get himself worked up using the words: “arrogant,” “unilateral,” and “infidel,” among the round table participants WMD fatigue has started to set in. George Will floated two interesting new ideas: (1) Blix and the UN must share much of the intelligence-failure blame if WMD are never found; (2) the Bush Preemption Doctrine presupposes reliable intelligence, which means if WMD aren’t found, the doctrine itself fails for the foreseeable future. George Will on why Kerry supported Clinton admin but not Bush Iraq policy: "What did John Kerry not know and when did he stop not knowing it?" Meet the Press Russert opens with a great ambush. Howard Dean agrees he’s for repeal of the entire Bush tax cut. Russert puts Treasury Dept. numbers on the screen: repeal the tax cut and a married couple (two kids, $40,000 income) go from $45 to $1,933 federal income tax. This actually works out to over 4,000% increase. Dean doesn’t believe the numbers. Bush admin “not been candid about impacts of this tax cut.” Second ambush: Dean: “I don’t like the balanced budget amendment but I’m tempted.” Russert puts up graphic of 1995 Dean statement calling for cutting Social Security, moving retirement to age to 70, cutting defense, Medicare, and veteran’s pensions. Dean: doesn’t remember saying any of that. Finally: some of his democratic opponents need a “backbone transplant,” but he’s afraid to say who. ("Backbone transplant" -- kinda ironic language given the way he avoided service in Vietnam. And by the way, as someone who in terms of Army pre-induction physicals has been there and done that, I have two questions for Mr. Dean: (1) was it really your induction physical, or just your wimpy pre-induction physical, and (2) did you or did you not bring a note from your home physician?) Face the Nation Can’t help it, don’t watch the show, half hour is only long enough for rapid gut-based judgments anyway. Just look at George Allen and compare him with Terry McAuliffe. If you don’t know better, Allen’s maybe a lawyer, a businessman, maybe even a school principal. McAuliffe? He’s a polician or a politician’s advisor. The Republicans are the ones with a life. They believe in the economic system so their alternatives are, say, to be in business, or to be lawyers, accountants, shoe salesmen, or whatever. To many Republicans, a life in "public service" is very much a second-best alternative, which is why they seem duller than the Dems. The Dems are the guys who believe in Government. Like Sowell points out, they’re the intellectual heirs of the French Democratic philosophers, the French Revolution, the Utopian Socialists, Tom Paine and Jefferson, the guys who believe man can be perfected if institutions are perfected. They’re sharper and more focused than the Republicans because they are exactly where they want to be. Like Bill and Hillary and unlike any Republican leader, they can’t imagine being anywhere else. Fox News Sunday Says Charles Krauthammer: Democrats are now living in the year 1972 -- and Howard Dean is their new George McGovern.

Link posted by Steve Antler : 10:24 AM

It starts to make more sense Great discussion on scoop of the decade (see below) at EconLog. Example from David Thompson: Revenues of this sort are typically not projected because of the fundamental "principle of annuality" which lies at the heart of government accounting. A private company which had future expected revenues of this sort would capitalise them, because a private company takes the current state of laws as given. But the government has to recognise that when these people retire, they will do so under the 2038 tax code, not the present one. Therefore, it is not regarded as prudent to capitalise them today for the purpose of government accounts. I'm not saying that they should be ignored or that Boskin's work isn't valuable (it is), just explaining how they came to be ignored... The point about "the transition problem" has always been that it's actually the *entire* problem. Any revenue-raising measure which "solves the transition problem" to privatised accounts can also be used to make Social Security solvent, since the two problems are the same...My position has always been that Social Security isn't insolvent and doesn't need fixing, hence my [praise] for Boskin demonstrating this fact. If you have an ideological reason why you want to move to a privatised system, then go ahead and make that case; I promise not to bring up the transition problem so long as you don't base your argument on Social Security "being bust" or "providing a negative rate of return". Once again: if you haven't seen it, do NOT miss the Social Security/Medicare/Public Debt scoop-of-the-decade below! Considering the current political mood of the country, maybe we should we start calling this the Bush Surplus?

Link posted by Steve Antler : 8:16 AM

Reading the Housing Tarot Cards All former-Marxist quantitative economists (and those little guys who hang around them because they're so popular) keep looking for the "upcoming crash." This is why I keep eyse open for evidence of a housing bubble, even maybe a small slump. There's this from Reuters, and (even more dramatic) there's this from the American Bankruptcy Institute. (Great name, no?) No harm in checking these out, but draw no final conclusions until you see the Social Security/Medicare/Public Debt scoop-of-the-decade below -- posted Friday but still not widely known!

Link posted by Steve Antler : 6:36 AM

In Memoriam PunditWatch... I'll be doing a rundown of all the Sunday morning talk shows, courtesy of DirecTV and Microsoft UTV PVR (whose two satellite tuners and massive hard drive watch TV for you while you toast bread!). Be patient, this takes time. And if you haven't seen it, do NOT miss the Social Security/Medicare/Public Debt scoop-of-the-decade below!

Link posted by Steve Antler : 5:21 AM