Ballance all time winner.

Jonathan Martin at Politico (via Steve Benen who reads Politico so I don't have to).

Millionaire businessman Rick Scott's surprise win in the Florida Republican gubernatorial primary Tuesday left both parties scrambling over how to cope with a candidate who possesses both glaring flaws and considerable assets.

I understand that Politico can't say Republicans have a problem, but how many Florida Democrats are distressed that they have to run against the worlds greatest welfare cheat ever. Ok it was medicare not medicaid so you better not call it welfare especially not in Florida, but don't you think "Rick Scott should have kept his hands off your medicare" might be a pretty good slogan.

Scott does, of course, have considerable assets -- financial assets that is.

I wonder what Mark Rubio feels about sharing the ticket with a criminal. I expect him to be asked that question pretty much 24/7 by Crist and Meek.

More generally, I almost hope that the media narrative will be Republican primary voters have gone completely crazy. Not gonna happen (it is true but unBallanced) but a guy can dream.

Grey Lady Taking Bong Hits ?

I take a break from dumping on the www.washingtonpost.com headline and abstract guy or gal to note that the www.nytimes.com abstract writer seems to have abstracted from the case of Florida

Murkowski Is Locked in a Tight Senate Race in Alaska By DAMIEN CAVE 51 minutes ago
The race between Senator Lisa Murkowski and a challenger is still too close to call, but in other races, established politicians easily prevailed.

That would include established politician Rick Scott who has never held public office. Josh Marshall proposes the herbal explanation here.

Trying to be less sophomoric, I was struck by the following sentence in the actual article

She is battling for re-election in a political season in which another Senate incumbent, Arlen Specter of Pennsylvania, lost a primary after switching party affiliation to Democratic from Republican, setting off fears that a tide of anti-incumbency would spell doom for sitting lawmakers.

Why didn't Cave write "raising hopes that a tide of anti-incumbency ..." ? He could even have reported without slant by writing "raising the possibility that ..." or "causing some to predict that ...". It almost seems that he views the world as an establishment insider. Nah couldn't be.

Greenwald Vs Goldberg vs Plutonium 240

I have been enjoying Glenn Greenwald's proof beyond reasonable doubt that one should never ever trust Jeffrey Goldberg. This reminds me of my 2 rules of blogging

1. Never argue with Glenn Greenwald
2. If you are really pissed with Glenn Greenwald, consult rule number 1.

I want to amplify on one point made by Jonathan Scwatz in the post cited by Greenwald.

Schwarz claims that, before the Israeli bombing of the Osirik reactor Iraq didn't have an active nuclear weapons development program. He cites as supporting evidence the claim by Harvard Prof. Richard Wilson that the reactor would not have been useful for such a program. I recall Wilson's article and, in particular, the words "Plutonium" and "isotopes."

Wilson's claim is that the reactor made the wrong mixture of isotopes of plutonium, so making a bomb with spent fuel would be about as difficult as making a bomb starting with unenriched Uranium. I thought the point was that the reactor was a preassurized light water reactor not a graphite mediated reactor. Now I know a bit more.

update 2: This post is not of purely historical interest. The newly fueled Iranian Bushehr reactor is a light water reactor (via Juan Cole) I believe it is generally agreed that light water reactors are not useful for making atomic bombs as argued below.

Off at Wikipedia there is the claim "Spent civilian power reactor fuel typically has under 70% Pu-239 and around 26% Pu-240, the rest being made up of other plutonium isotopes, making it extremely difficult but not impossible to use it for manufacturing nuclear weapons[citation needed]."

Well a Wikipedia article with [citation needed] sure isn't proof beyond reasonable doubt. However, this is an engineering question and journalists feel confident in their ability to judge it better than engineers and physicists.

Schwarz also cites the testimony of everyone in a position to know. yet somehow it is an accepted truthiness that Saddam Hussein was using the reactor to develope a bomb.

update: Welcome DeLong readers. I didn't expect anyone to read this post, but, since it is getting some visits, I will amplify. I think the key issue is the moderator for the reactor.

Some review: One of the challenges is making a nuclear reactor is that Uranium 238 absorbs neutrons and doesn't fission (it turns into Plutonium 239 instead). Uranium 238 absorbs only high energy neutrons, so reactors contain something called a moderater to slow neutrons down -- water, heavy water, graphite or molten sodium.

Some reactors are used to make plutonium 239 for bombs. These reactors are graphite mediated or heavy water mediated. One of them is in Yongbon in North Korea. The agreed framework for preventing the use of Yongbon for bomb making (negotiated by, among others, Clinton and Kim Jong Il and unilaterally repudiated by Bush) was to replace the Yonbon reactor with a light water mediated reactor built at foreign expense and to supply N. Korea with fuel oil while this reactor was being built. It was generally agreed (even by the Bush administration) that this would end the problem of using Plutonium from spent fuel to make bombs.

The Bush administration repudiated the agreement because, they argued, that N. Korea had just shifted to enriching Uranium to make bombs. Then they changed their intelligence analysis and decided that N Korea was not able to enrich uranium and not even trying. Notably it is very hard to enrich Uranium and, so, it is currently agreed that it is very hard to make a bomb if all you have is a light water mediated nuclear reactor and not a graphite mediated or heavy water nuclear reactor. The Bush administration did not challenge this claim made by the Clinton administration. I can neither present nor imagine stronger evidence that this is an agreed scientific fact.

The Osirak reactor was light water mediated.

It is an agreed truthy that, if it had not been bombed, it would have produced spent fuel which would have been used to make a bomb.

Note the name "Osirak" (I probably misspelled it as Osirik above somewhere). Wikipedia asked me if I was looking for "osiris" the Egyptian god who notably was killed and resurrected (the pieces were tied together -- he was the first mummy). Frenche nuclear scientists can resist puns and called their heavy water reactor "Osiris" because spent fuel could be reprocessed to new fuel (or bombs).

I suspect a bit of bait and switch in which a bomb seeking Iraqi dictator asked for a reactor just like the Osiris reactor and the Frenche supplied the similarly named but light water mediated Osirak reactor. Then Menachem Begin, fell for the trick too and had it bombed.

Notably, Begin was advised by scientists and engineers who knew all about making bombs from spent reactor fuel (from the Dimona heavy water moderated reactor). He is also the person who said "Abu Nidal Abu Shmidal a terrorist is a terrorist" and invaded Lebanon to retaliate for killings by terrorists based in Libya. Also he was behind in the polls and there was an election scheduled for two weeks later (which he won).

I'm betting that the day after the Delaware primaries Independence Hall Tea Party PAC President Don Adams will be saying "missed it by that much."

Leading with my chin, I commented on Matthew Yglesias's blog that some popular soak the rich policies made up " the soundest policy agenda in the world." Turning his snark to it lowest level (don't be to hard on fools no one has heard of) Matthew Yglesias worries about squeezing Medicare too much and adds that his policy agenda includes a carbon tax and a reduced military budget.

So what would I add to get to a really sound policy agenda ignoring politics entirely ?

1. Carbon tax check
2. Cut the defence budget (in half or maybe by a factor of 4) check

and

3. Increase centralised (education department) funding for K-12, introduce national curriculum guidelies, and implement high stakes but not stupid testing. The USA has amazing inequality in learning far surpassing other developed countries. This causes inequality and reduces class mobility and something ought to be done about it (but won't).


4. let prisoners go. The USA has a huge immense incarcerating rate causing immense suffering (and costing a lot). Some of this is due to absurd policies like three strikes and you're out. Much of it is due to overestimates of the additional deterrent effect of severe punishment (or more likely desire for revenge sincerely perceived as belief in deterrence). More is due to a crazy war on drugs. It is possible to have less crime and less punishment. Don't ask me how, ask Mark Kleiman.

5. reform welfare reform. Welfare reform is considered to be a great success, because everyone decided the question was closed by 2000. Some said it was hard to tell what was welfare reform and what was the late 80s boom. It isn't hard anymore. More than all of it was the boom. The severe poverty rate is much higher than it was at the trough of the 74-75 recession. People are suffering, because a majority just refuses to accept the facts.

6. Increase the foreign aid budget 10 fold (that would bring it up to 1.2% of GDP). We can spare the money. We don't have to make the mistakes foreign aiders made in the past. Does it make sense to choose between treating AIDS (which reduces transmission) and treating TB ?

7. No aid to rich farmers -- that means no price supports, so the program should be aid to farmers with dependent children (back when I was young and naive I expected farmers would be less self righteous if they were given cash but they are not at all embarrassed).

8. Single payer public health insurance. Still sound policy even if it is way off any practical agenda. Seriously what about trying for Medicare buy in ?

9. Merge NASA and the NSF (that is close NASA and give its budget to the NSF). If a space progect is sound science, space grant applicants should be able to make the case on purely scientific grounds.

10. Stop wasting money on missile defences which work as well as North Korean missiles.

11. Outsource the war in Afghanistan to Afghans. We are spending many times their GDP. Surely we can find warlords willing to do it for less.

12. Eliminate all tariffs on imports. Anyone who hates inequality should hate them.

13. Eliminate all restrictions on immigration.

14. Be practical.

I like Karen Tumulty but she really has to stop quoting people without noting their vested interests. She ends her latest article by quoting then paraphrasing Grover Norquist criticizing critics of 51park (aka Cordoba house).

Norquist said "The support for criticizing a mosque is half a mile wide and an inch deep," conservative activist Grover Norquist warned. "And at the end of the process, the only people who will remember it are the people who feel threatened by this -- not just Muslims, but Sikhs, Jews, Hindus, Buddhists and Mormons."

Tumulty goes on to paraphrase him in her own voice. I'd like to think that Norquist is right on this one. He is coincidentally on the side of freedom and justice this time. However, as usual, he is advocating for someone who gave him money. If a registered lobbyist says something pleasing to a (former ?) client, that affiliation should be noted.

Actually I'll go further. I think that journalists should be the natural enemies of lobbyists. I think a reasonable rule of sound journalism is that lobbyists should not be quoted -- ever. What can readers possibly gain from amplification of the influence of lobbyists ?

Jonathan Chait has a great post noting that in the early 19th century it was illegal to build synagogues in many states. He compares this to the Cordoba House controversy. Excellent point. He does express surprise about something which is not at all surprising writing

"even after the signing of the Constitution, First Amendment protections didn't stop cities from preventing the construction of Jewish housesof worship"

I will pass over the fact that, when it was signed, the Constitution was just the skins of 3 dead sheep. It only became a constitution when it was ratified. Then the bill of rights was a twinkle in Samuel Adam's eye. The bill of rights only saw the light of day two years after the signing of the Constitution.

A more important point is that the first amendment in no way guaranteed freedom of religion. It only prevented "congress" from restricting freedom of religion. Only state constitutions offered any protection of freedom of religion from state legislatures. The first amendment begins "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof;..." so it restriced congress only and left state legislatures to ban synagogues, mosques or churches as they saw fit.

The US Constitution only established freedom of religion (all by itself without help from state constitutions) when the 14th amendment was ratifies. The key claus

"All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws."
Notice that the "priviledges and immunities" are those of citizens. As far as I can tell (which isn't far) repeal of the first sentence (as proposed by Sen Graham) would make it possible to, say, declare that Jews aren't citizens and don't have the priviledge of building houses of worship. It seems to me that a state law which offered jews and gentiles equal protection from synagogues would be consistent with the text as re-written.

I never cease to be amazed at how often web-literate people write about the constitution without checking the text which is easily available.

Shorter Robert Waldmann

Jonathan Chait wrote "I focused entirely on the rationale for war, which I still think was solid, and failed to think very hard about the likely outcome of of an American occupation of Iraq."

So the rationale is different from the likely outcome ?

What does that mean ? What could that mean ?

I can understand, if not accept, the logic of absolute pacifism whatever the consequences but supporting a war whatever the consequences is insane. Chait is sane. He couldn't have meant what he plainly wrote. What could he have had in mind ? How could those words come to be written ?

Those aren't rhetorical questions. I ask for information.

Jonathan Chait is Great.

I love his blog and read it regularly. Don't missinterpert the fact that all my comments here are critical.

That said, Jonathan Chait manages the very difficult task of being unfair to David Frum. Frum says that liberals think the President should be able to legislate for four years. Chait passes over the irony of a Bush White House staffer claiming that liberals, liberals think the President should be able to over-rule congress as Bush regularly did (that is he broke the law and committed crimes). He quotes Frum claiming that it's Obama's fault that Republicans filibuster everything.

[M]any of the liberal blogs seem to take the view that once a president wins an election, his duty to persuade the country somehow adjourns for the next four years. That is not true, and it should not be true. If a president can mobilize the country behind an idea, it’s amazing how the filibusters will fade away.

Chait correctly notes that it is impossible to mobilize the country around the idea that, say Peter Diamond ought to be confirmed. The people won't push the Senate to do many of the things that the Senate has to do (one way or the other) because they are deeply obscure and most people haven't even heard of the issue.

Frum knows this. He is pretending that Obama's only trouble is with major initiatives which lack public support. This is exactly backwards. Obama got health care reform (plurality opposed). He didn't get cap and trade (plurality in favor) or Peter Diamond (majority huh ? Who's Peter Diamond ?). Frum knows that the country can't work if Republicans block everything unless the country is mobilized behind it.

However, Chait can't help overstating Frum's position when making fun of it. He wrote "So, I assume that the Senate is obstructing Peter Diamond's nomination to the Federal Reserve because the public is massively opposed to his ideas about monetary policy?" Frum never said the filibuster only works when the country is mobilized in favor of the filibuster. He said it won't work if the public is mobilized against it. Given the manifest absurdity of Frum's argument, Chait absolutely didn't have to distort it. He just does that out of habit.

Also -- Chait reconsiders the Iraq war. Basically he says Joe Klein has over-reactedand turned excessively dovish. An arguable position. However, then Chait presents a use of "rationale" which is totally irrational -- absurd -- something he would never take seriously except when he feels the need to argue that dirty fucking hippies were not totally exactly utterly right in spite of the fact that our predictions were correct and his were totally wrong. Chait wrote

Among other things, I focused entirely on the rationale for war, which I still think was solid, and failed to think very hard about the likely outcome of an American occupation of Iraq.

So the rationale for doing something is separate from the likely outcome ?!?!? What the hell could that possibly mean ? Chait evidently considers it reasonable to decide what to do based on benefit analysis not cost-benefit analysis. How could any semi-rational person use the word "rationale" the way Chait uses it ? In all his other posts, he acts as a consequentialist considering it best to consider the effects of a policy before advocating it. Yes somehow the platonic idea of the invasion of Iraq is sound in spite of the consequences.

This is deeply pathological. It is also unrelated to his main point.

Oh in the same post he suggests that Klein would have avoided fighting the Germans in WWII neglecting the fact that the Germans declared war on us.

Again incorrect history (as has been pointed out on the web) which is not needed for his main point. Why does Chait add nonsense to a rock solid case (against Frum) and an arguable case (against Klein) ? I recall my last post on Chait which noted that he misquoted Beinart in an aside in a post where he admitted that Beinart was partly right. There is an insane level of combativeness here, which I don't understand. I have never actually met anyone more intellectually combative than me (Michele Boldrin managed a solid tie) and I can't imagine what Chait is like in person.

What is Happening In Italian Politics ?

This will be a long post as it is not easy to explain how Italian politics got this way to foreigners. First I will discuss recent developments. Later I will discuss the characters in the commedia and history.

Until this week, Silvio Berlusconi was, on paper, a very powerful Prime minister with a large majority consisting of only two parties – the racist regionalist Lega Nord and the PDL a new party formed from the ex-post fascists and Forza Italia (yaaaay Italy) founded by Berlusconi. The PDL doesn’t exist any more. Berlusconi just expelled the cofounder – Gianfranco Fini last general secretary of an openly neofascist party and now President of the Camera de deputati (lower house of Parliament from now on “Camera”). This is not a return to the past as Berlusconi has kept more than half of the ex-neo-fascists. At the moment, Fini, however, has enough followers in the Camera to give the opposition a majority if he wants. On paper a no confidence motion should pass.

So what will happen next ? Well first everyone will go to the beach. It’s August, Parliament doesn’t meet in August. The breakup was scheduled to give a month of contrasting confident predictions before there is any actual vote. There will be a lot of conflicting press releases.

So what will happen in September ? One possibility is that Berlusconi will be able to win the support of enough members of Parliament to have a new small majority. He has announced the creation of 6 new positions of undersecretary with the obvious aim of offering them to MPs from tiny parties and MPs who have already switched party since being elected. The resulting struggle in parliament will be difficult for Berlusconi. It doesn’t help that to play against the referee and Fini can use his office to make the schedule as inconvenient as possible for Berlusconi. Since the laws on which they disagree serve no purpose except to protect Berlusconi and friends from judicial investigations, Fini should enjoy heated debate.

Berlusconi’s aim is to get the President of the Republic to call early elections. It is reasonably likely that he and his remaining allies would win such elections. Fini’s new mini-party “Futuro e …" I have to check uhm … does not have any name recognition, and the number of Berlusconi haters willing to vote for an ex post neo-fascist is tiny. The issue will be whether the Parliament should serve Berlusconi’s personal interests. This has been the issue for decades and Berlusconi has won more elections than he has lost. I have no idea why people vote for his parties – I have never heard anyone admit to have done so. It’s just a fact that with a clear choice between Berlusconi and the law and the constitution, about half of Italians choose Berlusconi.

Berlusconi’s problem is that the President of the Republic is not quite like the Queen of England. He is supposed to be non-partisan, but is not expected to obey the Prime Minister. In particular, The President is supposed to call early elections only if it is absolutely impossible to find a majority in Parliament. The current President, Giorgio Napolitano is a terminally moderate mild mannered ex-communist. He has quarreled less with Berlusconi than either of the other Presidents who had to deal with him as Prime minister, but he sure won’t deviate a bit from the Constitution to help Berlusconi.

Berlusconi, being Berlusconi, is likely to demand early elections and demand that he be caretaker prime minister during the campaign (this is what he did the last time he lost his majority in Parliament, although he also said the Parliament didn’t have the authority to fire him, because the constitution was rendered obsolete by a law passed in Parliament – I promise you I am not exaggerating or removing necessary context). Berlusconi is not capable of pretending to respect the constitution or the principle of division of power. In his struggle to get to an early election, he will make it absolutely clear that no Italian who gives a damn about the constitution, division of power, the Democratic tradition or elementary logic could possibly vote for him. However, this has been absolutely clear for decades and he often wins elections.

My guess is that sooner or later, Berlusconi will get angry and resign – demanding that he be made caretaker prime minister and that there be early elections. Since he still has a majority in the Senate, he will be able to make it impossible for anyone else to be Prime minister. My guess is that he gets his early elections and the issues are how much contempt for constitutional democracy will he show while demanding them (probably lots) and how many Italians share that contempt (not an absolute majority but probably a plurality).

Some politicians in the center left, including Bersani the general secretary of the Democratic Party (which makes the US Democratic party seem to be well organized) and Massimo d’Alema (a former prime minister) have made it clear that they will attempt to patch together a new majority in order to avoid an election. This would require an agreement with the xenophobic, regionalist extremist Lega Nord whose leader just responded to a reporter’s question on the constitutional reform by showing his middle finger. The proposed deal is to have a short lived majority which will change the electoral law back to a proportional system so there will never be a strong majority in Parliament and leaders of little parties with almost no support (or regional support like the Lega) will be able to block everything again. I’m pretty sure that very few Italians find this effort less disgusting than I do and it makes me feel sick. I will discuss why the hell these people are discussing obscene deals in public after I regain my composure (in my next post).

So why did Fini do it ? Technically, Berlusconi broke with Fini expelling his followers from their joint party. However, this was clearly inevitable for months as Fini openly criticized Berlusconi. Elisabetta Addis argues that the issue is who will lead the right after Berlusconi dies (note no hope that his political career will end before his life). Slavishly following Berlusconi works fine (for those who can stand the humiliation) while he is alive, but is not the way to position oneself as a leader. Fini has shown some dignity and spine (also respect for his constitutional role but I’d guess that the center right voters are willing to forgive that). However, the pile of ex allies of Berlusconi on the ash heap of Italian politics is very high (Dini, Mastella, Pievetti, Casini (more or less)).

My personal guess is that it is very very hard for anyone with any self respect to deal with Berlusconi. Berlusconi doesn’t hide the fact that he considers himself the boss. He demands that everyone repeat his absurd lies about how he is not a crook, and it’s just that investigating magistrates all over Italy are out to get him.

It is important that Berlusconi has been trying to use the parliament to protect himself and his friends from the latest judicial investigations of their many crimes (I note I am writing this in Italy so it would be libel if I could not prove my accusation. However, I would have no problem proving that Berlusconi has committed many crimes just by referring to official sentences many of which conclude he is not to be declared guilty because of the statue of limitations, an amnesty, or the fact that he had earlier parliaments change the laws he broke after he broke them. Please please sue me Silvio).

The President of the Camera (and the President of the Senate) are supposed to defend the constitutional prerogatives of those legislative bodies. Berlusconi spits on constitutional prerogatives and makes it hard for Presidents of houses of Parliament to avoid totally humiliating themselves or breaking with him. Notably the last time Berlusconi lost a majority in Parliament, the then President of the Camera Irene Pivetti was an early leader of the back bench and presidium revolt.

The Presidents of the Camera or the Senate who have not broken with Berlusconi are incredibly spineless shameless worms even by the standards of followers of Berlusconi (dear judge, I mean that metaphorically and don’t claim that I can actually prove they are helminths, although in the case of Scongnamiglio I’d be willing to try).

John Quiggin's Zombie Economics is Walking the Earth Hungry for Your Brain.

Buy it. Read it.

Clive Crook rewrites recent fiscal history.

I don't have much (useful) to add to this excellent Henry Farrel post on Clive Crook's hippy punching. Crook argues that Obama would be more popular if he had broken with the left. He wrote

He should have chosen centrism unreservedly – as many voters believed he had promised during his election campaign. Then he could have championed, as opposed to meekly accepting, centrist bills that maintained the role of private insurance in healthcare and a stimulus that included big tax cuts.

To compare the non-debate about including large tax cuts in the stimulus, with the public option debate is totally incorrect. Obama supported the public option and lost. Obama proposed tax cuts and won. IIRC, the tax cuts were almost exactly 80% of what Obama proposed (reduced from 500 per individual per year and 1000 per couple to 400 and 800). Far from meekly accepting the tax cuts, Obama proposed larger tax cuts and meekly accepted the reduction in the size of the tax cuts.

This is not some dark secret. The proposal of larger tax cuts was an offical public act.

Now Crook might think that Obama would be more popular if he had opposed the highly popular public option. I can't imagine any actual reasoning behind such a view, but, at least, he doesn't make a plainly false assertion on a simple matter of fact which is in the public record.

Crook also wrote on "Had he owned and campaigned for those centrist outcomes ..."
Crook is ranting. He thinks that Obama could have "owned" the tax cuts. In a poll 12 % of US adults correctly answered that under the Obama administration taxes have been cut for most US taxpayers. 12% ! Convincing people whose taxes were cut that there taxes were cut is a step prior to "owning" those cuts. Obama has been working on this for months. I note 1710 hits for "tax cuts" at www.whitehouse.gov. It should go without saying that you can't always own what you want.

Clive Crook is clearly blinded by ideology. He is not reality based.

I'm 12 hours late with this. I am in Silver Spring Maryland and about 12 hours ago, there was a very mild but noticeable earthquake. I was awake (it was 5 AM here). I waited to get the news flash reporting that it was a 3.5 with epicenter in Gaithersburg not a powerful quake far away. Then I went to sleep.

Washington Post Headline Writer part VII

post moved here

Robert's List of Reasonable and Reasonably Honest Conservatives fourth Update

Recall to avoid offending too many people, I restricted my list to bloggers, pundits and politicians. I count people who call themselves libertarians. I don't to list personal friends (friends -- I like to keep them).


Greg Mankiw
Tyler Cowen
Alex Tabbarock
,strike>Jim Henley (not really a conservative. I was cheating)
Bruce Bartlett
Eugene Volokh (not reasonable re appropriate punishment of an Iranian murderer)
David Brooks (not always honest)
Reihan Salaam
Arnold Kling (not really reasonable but very honest)
Richard Lugar
Charles Hagel
Olympia Snowe (not really conservative or honest but I'm getting desperate)
Mark McClellan
Scott McClellan (not really et. but gets extra points for near honesty in a press secretary)
Richard Clarke (oh you don't think he's conservative -- read "Against all Enemies")

Andrew Samwick
Julian Sanchez
Daniel Larison.

Conor Friedersdorf (I don't know if he is reasonable and I don't even really know that he is conservative but this sure is funny).

On a bet and with 7 minutes to spare, I post a model which has a business cycle due to inter-industry wage differentials. Aside from that the model is a standard Ramsey Cass Koopmans growth model without grown.

This is a Gauss program. It shows a dynamically stable steady state so eqilibrium is indeterminate. That is, a sunspot can affect real variables.

Over the cycle, employment, consumption and investment are positively correlated. There is a procyclical real wage even though technology is constant.

It's reasonably likely that if I try to translate this program from Gauss into English, I will find that I didn't program what I meant to program, so I will have to invent a new story to argue that it is what I meant. But it does have fun dynamics.

All parameter values are extremely unrealistic.

This is a model. Any similarities to actual business cycles in a real world economy are purely coincidental.


/* business cycles due to inter-industry wage differentials ?
Now with elastic labor supply. u=ln(c) -L, L supply based on average wage.
the lo function is to be viewed with extreme suspicion*/

bet = 2;
alpha1 = 0.69;
alpha2 = 0.7;
delta = 0.05;
sigma = 1;
rho = 0.05;
eps = 0.000001;

k1=1;
k = 2;



gam = bet*alpha2*(1-alpha1)/(alpha1*(1-alpha2));

/*three useful functions. lo is employment in the capital goods sector, kdot is growth of total capital
and l2 is employment in the consumption goods sector*/

theta = 1/(1-alpha2*(1-sigma));

fn l2(k1,k) = alpha2*(((bet*k1+gam*(k-k1))/(k1+gam*(k-k1)))^theta)*(k-k1)^(1-sigma*theta);
fn lo(k1,k) = l2(k1,k)*k1/((k-k1)*gam);


fn kdot(k1,k) = (lo(k1,k))^alpha1*k1^(1-alpha1)-delta*k;




/*find steady state*/

eta = ((rho+delta)/(1-alpha1))^(1/alpha1); /*l1ss/k1ss */
zeta = (rho+alpha1*delta)/(delta*(1-alpha1)); /*k2ss/k1ss */

k2ss = (((bet+gam*zeta)/(1+gam*zeta))^(1/sigma))*(eta*gam/alpha2)^(-1/(sigma*theta));
k1ss = k2ss/zeta;
kss = k1ss*(1+zeta);

"r u ok ?"

(lo(k1ss,kss)/k1ss)-eta "=0?";




/*I will do everything in ldot numerically as it is a hassle*/

fn dllodk1(k1,k) = (lo(k1+eps,k)-lo(k1,k))/(lo(k1,k)*eps);
fn dllodk(k1,k) = (lo(k1,k+eps)-lo(k1,k))/(lo(k1,k)*eps);
fn dll2dk1(k1,k) = (l2(k1+eps,k)-l2(k1,k))/(l2(k1,k)*eps);
fn dll2dk(k1,k) = (l2(k1,k+eps)-l2(k1,k))/(l2(k1,k)*eps);


"dllodk1 dllodk at steady state"
dllodk1(k1ss,kss) dllodk(k1ss,kss);



fn den(k1,k) =
(alpha2-alpha1)*((1/k1)-dllodk1(k1,k)) + sigma*(1-alpha2)/(k-k1)-sigma*alpha2*dll2dk1(k1,k);



fn num(k1,k) = delta+rho -
(1-alpha1)*(lo(k1,k)/k1)^alpha1+
((sigma*(1-alpha2)/(k-k1))-alpha2*sigma*dll2dk(k1,k)+(alpha2-alpha1)*dllodk(k1,k))*kdot(k1,k);

fn k1dot(k1,k) = num(k1,k)/den(k1,k);



/*check steady state k1dot and kdot should be 0*/
"k1dot" k1dot(k1ss,kss) "kdot" kdot(k1ss,kss);



/*make derivative matrix*/
dm=zeros(2,2);

dm[1,1] = k1dot(k1ss+eps,kss)/eps;
dm[1,2] = k1dot(k1ss,kss+eps)/eps;
dm[2,1] = kdot(k1ss+eps,kss)/eps;
dm[2,2] = kdot(k1ss,kss+eps)/eps;

"dm";
dm;

"det dm" det(dm);



"eigenvalues";
eig(dm);

"denominator in steady state" den(k1ss,kss);





"kss k1ss";
kss k1ss;

k1 = k1ss;
k = kss+150000*eps;

tser = (k|k1)';



"simulate";
step = 0.1;
ii=0;
"employment wage invest cons";
do while ii <100;
ii=ii+1;
k2 = k-k1;
l1 = lo(k1,k);
ltwo = l2(k1,k);

l = l1+ltwo;
w = (l1*bet + ltwo)*alpha2*((k2/ltwo)^(1-alpha2))/(l1+ltwo);
invest = (l1^alpha1)*k1^(1-alpha1);
c = (ltwo^alpha2)*k2^(1-alpha2);
l w invest c;

k1 = k1+step*k1dot(k1,k);
k = k+step*kdot(k1,k);
kk1 = (k|k1)';
tser = tser|kk1;
endo;

Teach a cook how to govern (in Italian)

Sin and the Business Cycle

Many people feel the need to describe suffering as the wages of sin. This includes the suffering of people without wages. So there are moralistic theories of the business cycle. I think that much work remains to be done in this field. The liquidationist view (google Andrew Mellon, Joseph Schumpeter and Friedrich von Hayek) ascribes recessions to Greed and Pride.

Straw man real business cycle theorists and maybe Casey Mulligan ascribe them to epidemics of sloth.

But what about anger, gluttony, envy and lust ? It seems to me that the moralistic modellers of the business cycle aren't even half done as they have only 3 of 7 deadly sins covered.

OK gluttony is easy if it is considered to be over-consumption in general and not food specific. One can say we are in recession because spendthrifty consumers spent beyond their means, are up to their chins in debt and must deleverage. Then the liquidationist logic is that if this isn't painful enough, they will just borrow again as soon as they can.

Envy has been managed. It is very obscure and unpublished, but Andrei Shleifer's first attempt to translate Schumpeter's story of the businenss cycle into math was based on fads. More generally, one can get over-consumption from keeping up with the Joneses. It doesn't matter why people went deep in debt, what matters is they are at their credit limit and jonesing.

Anger almost goes without saying. The liquidationist will not note this, but everyone else should be able to see that a large part of the business cycle is due to them. They get angry at sinful excess and smite the economy with tight money and fiscal austerity.

Hmm now lust. That is a tricky one. I think I have to turn to Andrei again and quote him (I think this is word for word)

"We have a new model of the business cycle. It starts with optimistic expectations and a rapid expansion, then there is a supply shock, followed by a period of involuntary unemployment." -- Andrei Shleifer 1983.

Needs work.

QOTD

One thing I have never fully understood is why conservatives, who believe that all the smart people in the world will go on strike if we raise the marginal tax rate by 1%, think that there is endless supply of geniuses ready to devote their lives to pointless, low-paying suicide missions.

Dear Mr McNeely

Welcome to the blogosphere. If you think it is nasty, petty, and pointless, I can provide some evidence which would tend to confirm your suspicions.

I suspect that you are under continental European influence. The clause

"One response is to simply minimize the problem" is not written completely in English.


In English to "minimize" something is to make it as small as possible. YOu use it as an exact translation of the Italian verb "minimizzare" which is correctly translated into English as "to downplay." That is you use a verb which means "to make it as small as possible" to mean "to claim it is small already." The distinction between assertions and reality is useful. It is worth being able to point out that hope is not a plan and that saying it is so does not make it so.

I will concede for the sake of argument that continental European languages are perfectly fine instruments of thought and communication, but a dogs lunch of English and (I suspect) French is a barrier to effective communication.


So to minimize the problem of cheating one would use "oversight measures." The English word for suggesting that a problem is small is "to downplay."

Your use "to minimize" as a translation of the Italian verb "minimizzare" which is a false friend. It means "to downplay" not "to minimize." This is just plain ordinary Italian and does not imply that Italians don't distinguish between claims of fact and facts. It doesn't mean that Italians have no idea what honesty is or that they don't believe in objective reality.

However, through misstranlation, this perfectly ordinary continental European verb becomes a jargon term and means of undermining the received view of language and truth. This is simply because sloppy translations are incorrect and English words are used with a meaning different from their standard English, because they sound like foreign words which do not translate the English word.

I don't speak French, but I strongly suspect that the incorrect use of "to minimize" comes from mistranslated French not mistranslated English.