Republicans Have LaTourette's Syndrome

Via National Journal Via Kevin Drum

“It’s the continuing dumbing down of the Republican Party, and we are going to be seen, more and more, as a bunch of extremists that can’t even get the majority of our own people to support the policies we’re putting forward,” [Rep. Steven LaTourette] said. “If you’re not a governing majority, you’re not going to be a majority very long.”

When I saw "Tourtette" I really thought the comment was about right wing Republican Tourette's syndrome.

Jennifer Rubin Surpasses Herself

She reported on Boehner's genius yesterday

Headline (not written by her) "Republicans Put Obama in a Box".  Uh Ms Rubin it would take 218 House Republicans to do anything and they didn't.

via Zandar who wrote

If there are still any doubters out there that President Obama is about to crush the GOP fiscal cliffslope position like a bug underneath a small moon, please factor in Jennifer Rubin’s assessment that he’s been checkmated by Orange Julius. 

My interest in Rubin's column focuses on the line

" Poor Senate Dems will actually have to vote on something."  

Uh the Senate passed a  bill which extended tax cuts on income under $250,000.   They have voted on a plan B(in contrast to the house which just adjourned).   Also Sen McConnell introduced Obama's full proposal as a bill, then filibustered it.

The question of whether Senate Democrats have voted on something is not a matter of opinion.  In the same column, Rubin asserts that 53 Senate Democrats voted for Boehner's plan B.  This is also false  -- she is claiming that a different bill is essentially the same and IIRC assuming that raising taxes on income over  $1,000,000,000 is the same as raising taxes on income over $250,000.  

But to claim that Senate Democrats have voter for a Boehner's plan B and to hope that they "will actually have to vote on something" in the same column is extraordinary even for  Rubin.

I try not to make predicitons, but I can't help predicting that she will write a column about how Boehner is a fool not mentioning this column about how he is a genius.    He will be in distinguished compay, but, sadly, doesn't own a car elevator or a dancing horse.

Why cant conservatives spell ?

Yes it is the height of absurdity for me to comment on anyone else's spelling but here is a screen capture from

https://petitions.whitehouse.gov/petitions

Against gun control and the apostrophe.  I have no guess whether "limiting" should be "which would limit" or "which limits" for the petitioner's intended meaning to be communicated in grammatically correct English.

Note that I support the first amendment write to petittion the governmnt for redres of greevanses with personal choise in spellling and grammer


Or to be constructive sign here

Just when I thought it was safe to get back in the money box

Matt Yglesias has a post with an irresistible title and subtitle

"Can Shinzo Abe Save Japan?

The candidate with a plan to cure what ails rich economies."

But then the post turns out to be about monetary policy.


I have a rule that I don't read Yglesias's posts on monetary policy as they cause me to become rude.  But he tricked me this time and here is my comment.



Ben Bernanke too has declared a policy of unlimited quantitative easing and increased inflation (new target only 2.5% but that's higher than current inflation).  The declaration (which was a surprise) had essentially no effect on prices for medium term treasuries, TIPS or the breakeven.

I was wondering when you would comment, since you have confidently asserted again and again that if only the FOMC did what it just did, expected inflation would jump and then GDP growth would increase.

However, instead of noting the utter total failure of your past predictions (and the perfect confirmation of mine) you just boldly make new predictions.

Face fact,  like conventional monetary policy (in the US the Federal Funds rate) forward guidance is pedal to the metal.   It's long past time for you to start climbing down.

On Menzie Chinn and Modern Macro

Menzie Chinn reports on a discussion with Heritage Foundation economists.  I focus on one sentence and flip out as usual.

My comment.


I'm going to take them at their word and pretend they consider a modern intertemporal model as in  "Heritage Foundation economists, like most academic macroeconomists, have put away the old Keynesian model in favor of modern alternatives."  Now I ask why ? The old Keynesian model has proven extremely useful in forecasting over the past, well 74 years.  In contrast the modern alternatives have failed and failed and failed.

Newer is not necessarily better.  For years I have been asking my fellow macro economists for evidence that adding intertemporal maximization to macro has had any empirically useful implications.

I have yet to get an answer.  See http://nyti.ms/U2CWxQ

http://www.angrybearblog.com/2012/03/new-keynesian-vs-keynes-challenge-ii.html

Basically I get the demonstrably false claim that old Keynesians believed that an expectations un augmented phillips curve illustrated a long term trade off http://bit.ly/TDqz9R

The Heritage economists make elementary errors, but academic macroeconomists who don't make those errors (definitely including Robert Waldmann) have failed to demonstrate scientific progress beyond the old Keynesian model.  We have nicer math and extremely powerful intellectual fashion, but no actual evidence of progress.

Easy as Pi

http://www.youtube.com/watch?v=VWGGTb5pY2U

Athony Weiner's worst Indiscretion

Former Congressman Anthony Weiner will forever be remembered as the Twitter Twit who didn't understand that when you go to someone's profile and Twitter invites you to "Tweet to @name" you are being invited to send a tweet which begins with @name to your entire stream (in his case including an obsessive looking for evidence that he was screwing around) and not direct messaging @name.

But that was nothing compared to the error which I made too (OK I've made the Tweet to error too but not showing my tighty whities.  ).  He wrote that Medicare buy in (people age 55-64 can get Medicare if they pay the full expected cost of insuring them) was better than the public option somewhere where Joe Lieberman could read it.  He too is not on Atrios's e-mail list (Duncan Black specifically and 100% seriously warned all his blogger friends to not absolutely no way write anything good about buy in where Lieberman might read it).   Now I don't feel personally responsible for Lieberman single handedly blocking the reform, since I am sure that he (like the crazy guy who screen captured the photo of Weiner's Weiner) doesn't read this blog.

Now it was probably inevitable that Lieberman would hear that lefties actually prefer Medicare buy in to the public option, but Weiner being a very loud very partisan very un Lieberman was the worst possible messenger.

I just learn that Steve Benen, like Duncan Black knew that there was a huge risk in letting Lieberman know that we support something, since then he will automatically oppose it and just think this years best Chirstmas present will be the adjournment of the last Congress with Lieberman.

But my point is ooops I did it again.  The current debate on the fiscal cliff includes the Republican proposal to raise the Medicare age.  This is an impressive proposal as it is the worst proposed policy reform since AIDS to families with dependent children (I think I won't type the name of the guy who thought that was a funny joke).   There is no doubt that Republicans insist on this mainly because they know that Obama hates the idea.

But I can't help thinking of a counter proposal to raise the age to get Medicare plan A plus plan B  for a premium which covers 25% of the cost to 67 year but allow people 65 nd 66 to buy in to Medicare paying full average cost plus 1% to be saved in the Plan A trust fund.  If Republicans really cared about the deficit (and chickens had lips) they would prefer this, since by construction it lowers the deficit.  If they really wanted to strengthen Medicare (and pigs fly) they would prefer this because it improves the Plan A actuarial balance.  They will have trouble explaning why they are against this proposal.

The idea is that if it passes, the line can't be held at 65.  Why not make even more money for the plan A trust fund  by selling Medicare to 64 year olds or even 63 year olds and .. Single payer !

Proposing switching from just giving (with 25% of cost premiums for plan B) to selling for a profit to 65 and 66 year olds is terrible politics. The proposal will be Liebermaned and will outrage the elderly.  Here I'm sure the best proposal is keep things as they are and see if the PPACA reforms save Medicare.  No benefit cuts. No concessions.  This is the hill on which Democrats should make their stand -- the Republicans will die trying to storm it.

But the idea of trying to sneak buy in back in is irresistible to me.  Good thing almost no one reads this blog.

OK  the the photo you've been waiting for.

Double Reverse Coat Tails

Ed Kilgore reports that someone at U Minnesota argues that Republican governors didn't help Romney with their reverse coat tails.  I am honestly surprised at the sign of the alternative hypothesis against which the no reverse tails hypothesis is not rejected.  I comment



If it isn't one thing it's the other.  The problem with data is that it's hard for them to average to exactly zero.

I heard a reverse coat tails hypothesis in 2011.  The idea was that the recognized horribleness of Walker, Scott and Kasich would help Obama.  Ooops the evidence against the 2010 vintage reverse coat tails hypothesis is evidence in favor of the 2011 reverse coat tails hypothesis.  Really my honest guess was that the allegedly unsupported hypothesis would be that Obama would do surprisingly well in states which elected Republican extremist governors in 2010.

In any case, the method of looking at who won states with close vote totals makes no sense.  The states to look at are chosen based on the same variable which is averaged.  I promise statisticians consider this, sorry to use technical terms, a major boo boo.

Rather the Obama vote should be compared to a predicted vote based on Obama 2008 vote and, say, the change in unemployment in the state January through October 2012 (that is what are called fundamentals by political scientists and Nate Silver, by which I mean the number Nate Silver calculated cause do you really think anyone else is going to do much better?).  Look at this Obama surprise by change in party of governor 2008 to 2012 so shifting D to R in many states (including NJ and VA switching in 2009) and R to D in none IIRC.

Well now I should just do it.  Really Obama 2012 - Obama share 2008 on Republican Gov 2012 minus Republican Gov 2008 (note I've dropped the rest of the fundamentals).  Oh crap, that's something I should just do rather than talk about doing it.

Oh hell will be half vast.

Nationwide HuffPo 2012 minus Wikipedia 2008 Obama's share declined 4
          Obamashare12 - 08
Florida     - 1 % Scott nega coat tails = -3%
Iowa        - 1%  Branstead negatails -3%
Indiana     - 6%  Deaver tail 2%
Maine       - 2%  LaMontaine Lameness -2%
New J     + 0.6%  Christie -4.6% -- which side was he on?        
Ohio        -1    Kasich Kost Romney -3%
Penn        -2.5  Corbett Cost Romney 1.5%
Virginia    -1.5  McDonnell ??? negatail -2.5
Wisconsin   -3.4  Walker V Ryan's hope ? about average

It sure seems to me that the nega coat tail hypothesis is supported by the data.  Obama's vote share declined less in all the states where I remember a Republican gov winning in 2009 or 2010 except for Indiana.

Would this be surprising ? Could there be worse advertisement for the Republican party ?

Quote of the day

I’m old enough to remember when Republicans insisted that anyone who said they wanted to cut Medicare was a demagogue, because I’m more than three weeks old.

I comment on Ed Kilgore commenting on Josh Barro

Always click the link

Even the conservative Josh Barro.  I am surprised every day which he continues to self identify as a conservative. If there is any difference between his proram and Obama's it must not have made your cut.

In particular other conservatives are about as enthusiastic about "aggressive government-managed health care cost containment" as they are about tax and transfer based redistribution.  Note Cantor said if Obama was serious about the fiscal cliff negotiations he would put Obamacare and, in particular, re neutering of the Independent Payments Advisory Board on the table.

Since the 1970s, liberals have been obsessed with avoiding and eliminating poverty traps and broadening the tax base (I won't remind you of my old ground ax related to Welfare Reform but just note that I also get irritated with Ezra Klein and Matt Yglesias when they casually assert that base broadening and rate lowering would increase efficiency http://bit.ly/Wz4E3q
 http://bit.ly/U6Oaxg http://bit.ly/SzHVEL

See also that Klein did the work and learned that his earlier casual claim is not supported by the evidence.  What are the policy disagreements between Conservative Josh Barro and liberal Matty Yglesias and Ed Kilgore ?

Barro quoted out of context and out of order


"For example, they could focus on [skip] making sure the tax base is broad so progressivity can be achieved with relatively low tax rates."

"Lower taxes [skip] might raise GDP growth"

"The main problem with this position is the lack of evidence to support it"

OK the promised Klein quote
http://bloom.bg/11rleGL

"In 1997, Alan Auerbach  and Joel Slemrod  conducted an exhaustive survey of studies conducted after the 1986 tax reform. The results were mostly disappointing.

[skip]

 what about moving the growth needle?
“At the bottom of the hierarchy is the response of real activities chosen by individuals or firms.” On this, the authors concluded, the evidence is “mixed.” Oh."

Bottom line Barro's ideas for conservative is to support poverty trap reducing transfers like the EITC  and the making work pay tax credit.  Oh and reform like the 1986 tax reform which is universally agreed to have been wonderful on the basis of "mixed" evidence of any effects on real activities.

How about Asking Them

Menzie Chinn who has access to a sample of at least one Asian American wrote some good speculation (his word)  on  why 70% Asian Americans polled in exit polls said they voted for Obama.

I commented.



Oddly the speculation on Asian Americans doesn't seem to have involved much polling.

I know of only one poll which focused on Asian Americans and so had a decent sized Asian American sample (800).  I don't have the numbers (hell I probably can't find the link -- use the google http://bit.ly/Rnklhn). Headline "National Asian American Election Eve Poll Shows Immigration Reform & Health Care Drive Fastest-Growing Minority Group to the Polls"  Actual number

* Most important issues. The vast majority of Asian American voters (58%) said that fixing the economy and creating more jobs was the most important issue that politicians should address. Health care and education reform were each cited by 20% of Asian American voters as the most important issue, followed by civil rights/immigration issues (13%).

[skip]

* Health care. 60% of Asian American voters supported the federal government's role in ensuring access to health insurance, compared to 23% who believe that people should secure their own health insurance.

Here I think the issue is that Asian Americans support a scientific approach in the abstract, but that a larger minority of them than non-Asian Americans have taken the scientific approach of finding out what the hell the Obamacare bill says.

Obamacare was a key issue in the campaign. The bill is unpopular and most provisions are popular.  There is no reason to be surprised that extremely highly educated people split for Obama.  This doesn't explain the Asian American vote, but I tend to suspect it is more important than believes about 1,000,000 BC.

The link between caring about education and obtaining a lot of it is (not quite) too obvious to note.  The link between slashing government employment and weakening the education system is obvious to anyone who has a passing knowledge of the fraction of public employess who teach (one of Romney's worse gaffes was to correctly note that "more government employment" and "more teachers, police officers and firement" are pretty much the same thing -- Republicans win by convincing the voters that the typical government employee is a  federal bureaucrat writing memos and attending meetings.

I'm going to write it right here.  I have a BA in biology and I would have voted for mr monkey trial William Jennings Bryant himself if I had been alive and over 18 at the three times.  Also I am an atheist but would vote for 99.999 % of Christians if the alternative were Ayn Rand.  

The speculation without data is especially striking in the case of Murray who just assumes that Asian Americans must agree with him on the issues he cares about, because everyone must, because it's obvious (in spite of the stubborn refusal of the data to do what he predicted).

Posner is head shoulders torso and belly button above Murray, but I suspect a bit of pundit's fallacy there too.  He sure doesn't like Republican war on science and imagines Asian Americans are all scientists (also the ivory tower -- the Asian Americans he knows include a lot of colleagues who share his aim of studying legal precedent using the tools of social science).

Kevin Drum has an outstanding post on lead there.  I have a mediocre comment there and here.

When I finished the Steinglass quotes I was saying "lead lead lead" to myself.  But your post precedes this comment.   I agree both with your specific hypothesis and with the general argument that if the same thing happening all over suggests surprising simplicity not surprising complexity.  

I think that Steinglass did an OK job*, but has the problem of too much respect for conventional wisdom.  He notes that there seems to be something wrong with the conventional stories for New York and Boston, but then concludes that there is a deep puzzle and not just an odd failure for people to confront their hypotheses with any data except that which prompted them to form it (oh hell or for New Yorkers  to  really deep down believe that there are human beings outside of their city if they are New Yorkers).  

I think there are reasons why the lead hypothesis doesn't get the respect that your wonderful graphs show it deserves.  It is deeply offensively materialistic reducing human behavior to biology and chemicals.  This is a common problem with hypotheses which fit the facts (see also anti depressants do indeed work).   It's also painful to believe that so many people died and suffered because of something so almost exactly useless as putting lead in gasoline.

Anyway to add something, there is another common factor for Boston and New York and now that you oddly don't mention it Los Angeles.  William Bratton http://en.wikipedia.org/wiki/William_J._Bratton

(who I see is Sir William Bratton in countries which allow titles of nobility since Elisabeth II made him a Commander of the British Empire). I might add it is also odd that you don't mention the fact that one of the things he did in Boston, New York and LA was to uh use computers to allocate resources  and provide incentives (called CrimeStat).  Not really odd for a computer dude from the LA area.  Yes Bratton doesn't explain DC, Canada, Britain, Finland or the 1920s crime wave so your allocation of valuable pixels makes perfect sense.  I am typing about him, because pixels down in the comment thread are not so precious.

*Re-reading I do have to qualify the "OK job" attempt to be polite.  First he just guesses what results of experiments which weren't performed might have been.  It isn't really OK to discuss the proper analysis of made up data.   Also the only way that a study can show that something doesn't reduce crime is to provide statistically significant evidence that it increases crime.  The proposed interpretation of a hypothetical study in which an intervention did not have a statistically significant effect would be an incorrect interpretation of such a result.  Steinglass expresses skepticism about the experimental method and statistics.  He does so by imagining hypotheticial experiments and suggesting that statistical analysis must include the gross elementary error of rejecting the alternative hypothesis.  I think OK may have been a bit generous.

Why Isn't Colorado Red ?

First I think this would be a great title for the sequel to "What's the Matter with Kansas" (WTMWK below) this one explaining how the Democrats manage to win elections.

However the text I would write if I weren't so lazy would be an explanation about how the joke in the title is just a joke.  The joke for the linguistically handicapped is that "Colorado" is Spanish for "red" and the Republicans seem to have a problem with communication with Spanish surnamed Americans.

Having confidently predicted victory in 2012, Republicans are now explaining their debate WTMWK with the WTMWK argument (or maybe its mirror image). They claim that most Americans agree with them on most of the issues, and they lost because single issue voters voted for the Democrats.  The candidate single issues are abortion, the contraceptive mandate and amnesty for undocumented aliens.  The idea is that the sluts and the Spi - uh - anish surnamed Americans voted based on their gonads or their skin color.

The problem is that the argument is not just switched from Kansas to Colorado, but also from true to false.  The WTMWK argument was that most US adults agree with the Democrats on the central point where the parties differ -- tax cuts for the rich vs social insurance.  A majority wants higher taxes on the rich and a huge majority opposes entitlement reform.  This makes the Republicans' electoral performance surprisingly good.

Republicans are not reality based and evidently have decided that all issues polling is skewed.  They insist on two obvious falsehoods:  That there program isn't to cut Social Security and Medicare so we can cut taxes on the rich and that their program is not rejected and detested by the majority of US adults.

So they have decided that they lost single women because of positions related to sex (hey at least I didn't type sexual positions).   In fact abortion is one of the issues with a relatively small gender gap.   Women are much less likely to support war than men and much more willing to risk some of their money going to those people compared rather than risking starvation in the USA.

Republicans are convinced that they lost hispanics because they oppose a path to citizenship for undocumented aliens.  This is an issue on which the opinions of hispanic Americans are relatively similar to those of US adults over all.

I just googled "hispanic polling" roughly the first link which wasn't obviously just about who will be elected president in 2012 sent me (with a couple more clicks) to this pdf

Here I saw that Hispanic respondents opposed repealing Obamacare 61 % to 25%.  Also a big big 12% support the Republican proposal to reduce the deficit without tax increases.  These data are not consistent with the view that all Republicans have to do is drop their opposition to comprehensive immigration reform.  Of course there is a more direct question

30 If the Republican party took a leadership role in supporting comprehensive immigration reform, with an eventual pathway to citizenship for undocumented immigrants, and Republicans worked to ensure it would pass would this make you

More likely to vote Republican 31%
Less likely to vote Republican  11 %
Have no effect on my vote       48%

Notice the hypothesis in the question goes way beyond the possible with Republicans pushing for reform not just tacitly accepting it.  Note the 11% who claim to oppose reform so much that this would actually make them less likely to vote for Republicans, but especially note the 48% who say it would make no difference.

This is not what one would get if one polled people who generally agree with the Republican party but voted Democratic because of a single issue.

Most Hispanic Americans disagree with Republicans on most of the big issues.  I have linked to only one poll, but everyone who is willing to look at polls knows this.

The Republicans are delusional.  Colorado is purple not red, because there isn't a solid majority of Coloradans who want a sink or swim society or who trust that the wealth will finally start trickling down.

In particular the vast majority of hispanic Americans reject the Republican ideology.  Republicans can't save themselves from Demographic change by focusing on special interests. If current trends continue, there will be a majority which thinks their approach is inconsistent with the common good, the interests of the nation as a whole, the evidence, common sense, human dignity, decency and ponies.

Note I am not predicting current trends continue.  But I sure am hoping.

Fear Bearing Greeks Gifts

Could it really be a coincidence that decades before Very Serious Germans (and Germans can be very very serious) presented their theory of the current European crisis "It's all Greek to me" was an idiom for "I don't understand it at all" ?

Economists and Immigration

Ah something I know something about -- immigrants with postgraduate degrees.

Katherine Geier wrote on the topic.

So why, then, don’t we see more of this type of immigration here? A simple application of the principle of cui bono gives you your answer. Highly educated elites after all, are the people making these policies. You are not likely to see, for example, many economics professors running around arguing themselves out of a job — even though I am sure virtually all of them are highly replaceable.

I totally lose it in comments.


I'm going to start seriously and get silly.  Seriously when you write "income inequality" you mean "income inequality in the USA".  Allowing high skilled immigration to the USA would cause increased inequality within their countries of emigration and increased inequality across nations, since the USA is still the richest large country.

Notably higher education in most countries is even more highly subsidized than it is in the USA (I'm not saying too highly subsidized -- I think the USA should subsidize more to equalize opportunity and to increase the supply of highly educated people which would reduce inequality in the USA and world wide). The popular proposal is to take advantage of education provided at the expense of foreign taxpayers.  This is entirely in keeping with US public opinion generally -- the one program US adults most want to cut is foreign aid.  But that doesn't make it morally right.

I support free immigration which means I support free immigration of MDs too (as a matter of respecting the human right of people to live where they please and out of opposition for hereditary privilege including exclusive US citizenship). But I am disturbed by complete indifference to the interests of anyone outside of the USA.


"You are not likely to see, for example, many economics professors running around arguing themselves out of a job —" but one is typing this comment.  To be exact, I argue that it is a mistake to employ me, not argue in a way which puts my hold on my tenured job at risk.

I teach labor economics in Rome. I just gave a lecture on migration and wages (I didn't have anything non obvious to say).  I note that Italy is very very open to immigration by economics professors.  So, for that matter, is the USA (ever heard the phrase "brain drain").  Visas and such are a minor issue.  The faculties of elite Universities in the USA include many immigrants.

Baker is talking about professional licencing which is different, but US economists are perfectly willing to compete with people born overseas.

Consider this list of top young US economists -- recpients of the John Bates Clark medal "The John Bates Clark Medal is awarded by the American Economic Association to "that American economist under the age of forty who is adjudged to have made a significant contribution to economic thought and knowledge"" Note the word "American" in the title.  Of the past 11 recipients, 5 were born outside of the USA (4 outside of the Americas): David Card (Canada), Andrei Shleifer (then USSR -- in particular Russia), Daron Acemoglu (Turkey), Emanuel Saez (France) and Esther Duflo (France).  Shleifer was not a highly educated immigrant -- he didn't have a high school diploma when he immigrated at age 15 in 1976.

This is not a field which exclude immigrants.  Your observation that US economists do not argue that they should have to compete with immigrants is valid for the simple reason that it goes without saying being the current and unquestioned policy.

I beat "Beat the Press"

Everything is possible and I think that Dean Baker just lost a debate with a Washington Post reporter.

Post reporter Zachary A. Goldfarb  wrote

The two economists compared what happened in U.S. counties where people had amassed huge debts with those where people had borrowed little. It had long been thought that when property values declined in value, homeowners would spend less because they would feel less wealthy.
But Mian and Sufi’s research showed something more specific and powerful at work: People who owed huge debts when their home values declined cut back dramatically on buying cars, appliances, furniture and groceries. The more they owed, the less they spent. People with little debt hardly slowed spending at all.

among other things.  The link is his.

Dean Baker wrote

The housing wealth effect is one of the oldest and most widely accepted concepts in economics. It is generally estimated people spend between 5 and 7 cents each year per dollar of housing wealth. This means that the collapse of the bubble would be expected to cost the economy between $400 billion and $560 billion in annual demand. 

among other things  Again the link is his.

Baker's main point is that low consumption by underwater home owners is not a plausible explanation of the sluggish recovery.  However, he also confidently asserts that the housing wealth effect is linear based on google it.  I think that he has decided that new empirical research is irrelevant, because he already knew how economies work.

My comment.



In the comment I define your disagreement with post reporter  Zachary A. Goldfarb as a disagreement about whether reduced but still positive home equity causes a reduction of consumption on the order of between 5 and 7 cents each year per dollar of housing wealth or on the order of zero.

That is, I won't address you valid points that the recovery of consumption was roughly normal while the recovery of house construction was not.

Notably Goldfarb cites empirical estimates based on micro data.  He claims there is a significant change in the slope of the home equity effect on consumption at home equity equals zero.  To say he is wrong, you must convince me that the 5 to 7 % estimate is valid for a sample containing only homeowners with positive equity.

An estimate with aggregate data just does not address the claim in the article which you criticize.

Notably, in this case the Washington Post cites specific research by named economists.  You, in contrast, cite what all macroeconomists know.

I am shocked to find that I call this one for The Washington Post.  Your conclusion may be correct, but your reasoning is based on the assumption that all functions are linear.  I don't like to be square, but that's not true.

Update: Baker notes that the old empirical estimates of a 5 to 7% effect are based almost entirely on households with positive home equity as there were very few households with negative home equity in the USA until recently.  I thought of that but neglected to update this post before being called on the dumbness from laziness.  I insist I am lazier than I am dumb.

Obama is two Conservatives' dream Candidate

At Frum forum Justin Green extensively quotes Jeb Golonkin on how conservativism could be much better if conservatives made specific policy proposals.  Sad but true, almost all of the proposals have been signed into law by Barack Obama.  This is not a rare event.  While many conservatives stick to slogans, some try to come up with constructive alterantives to the stimulus (ARRA) and Obamacare (PPACA).  I don't remember where to link but the phenomenon of 'Obamacare is horrible and we should replae it with Obamacare isquite common.

My comment with all of Golonkin's proposal in bold and then my comment.

The problem is that Obama has been there and done that.  Golonkin's innovative conservative proposals are mostly existing liberal policies.

Somewhere along the way, we conservatives stopped innovating and stopped explaining, preferring instead to fall back to “small government is better.” Well, maybe it is and maybe it is not. But the notion that government is always useless simply does not ring true in a world where people look to the government to provide Medicare, a national defense, FEMA relief, and public education. This being the case, we would do well to start probing for specific policy solutions that affect people in concrete ways. What is the government doing that is hurting small businesses today? What is the government not doing that it could be that could help small businesses? 

It is not now organizing health insurance exchanges to remove big businesses advantage in insuring employees, because big business work forces are automatically large pools of policy holders helping big but not small businesses interacting with health insurers avoid the adverse selection death spiral.  It would also be nice, above and beyond the call of eliminating a market failure, to offer them subsidies.  See 'healthcare fiasco'.

What about student debt? 

How about ceasing to pay banks huge amounts of money to handle simple paper work and divide the savings between reducing the federal deficit and reducing the amount students have to pay on their debt.  See 'healthcare fiasco'

Can we use student loan forgiveness as a way to incentivize bright young people to enter particular fields? We need more primary care physicians if we are going to make this healthcare fiasco work. No one wants to be a primary care physician because primary care physicians get paid less than specialists, which makes it harder for them to pay off their medical school debts. But could we change the way the government reimburses primary care? And couldn’t we partially forgive student loans if borrowers agree to enter into primary care in particular markets for a certain number of years? 

See 'healthcare fiasco' and click http://bit.ly/Y6ObIP (warning a *.doc will download)

So far all of the bright innovating conservative ideas are provisions of the 'healthcare fiasco'.  Some are not current policy because they are scheduled to start in January 2014, but mr 'specifics specifics specifics' didn't let that little detail prevent him from arguing that a bill which is largely not yet being applied and of which he demonstrates astonishing ignorance is a 'fiasco'.  

What about tax policy: why are we not on the cutting edge of hyper-targeted tax cuts that we can show, with numbers, turbocharge the economy? 

A wish is not a plan.  Wishing that conservatives can show, with numbers, that there are tax cuts that turbocharge the economy doesn't make it possible.  There are many conservative academic economists who have looked very hard for proof that some sort of tax cuts turbocharge the economy.  They haven't shown this, because it is not true.  yes many conservatives consider numbers foreign alien and un-American (especially arabic numbers).  However there are also conservatives who love numbers and are statistical and mathematical geniuses.  The reason they haven't shown with numbers how wonderful tax cuts can be is that it is impossible to show something false with numbers.  The high respect of 'numbers' is for their power as tools for convincing people.  Golonkin doesn't need to look at any numbers to be sure it is possible to show with numbers that some tax cuts are great.  This is not the way anyone who knows what data are talks about it.  Conservatives, including Golonkin, have the very serious problem of thinking they know the answer before looking at the evidence.

Also I fear that Golonkin believes his hyper targeted tax cut proposal is pro market.  It is, in fact, based on his conviction that policy makers (provided they are conservative) can guess better than the market and wisely subsidize particular activities. The pro market position is that tax rates should not be targeted but rather that the playing field should be level.

Why are we not demanding that the government rebuild our cratering infrastructure rather than using taxpayer dollars to invest in projects it hopes will succeed (Solyndra)? 

Yes how about spending more on infrastructure ?  Nothing like the ARRA but spending on infrastructure.  How did Golonkin manage to avoid the phrase 'shovel ready' ?  He is now calling for the ARRA.  Also he doesn't recognize that hyper targeted tax cuts are using taxpayer dollars to invest in etc.  It doesn't matter if the money is called a tax cut or a subsidy or even the market value of a CDS (loan guarantee) as in the case of Solyndra.  The policy he advocates and the policy he mocks are implementations of the exact same reasoning]

Why are we not pushing pay for performance in the healthcare system AND in our education system? 

Pay for performance in the healthcare system.  See 'healthcare fiasco' and click
http://www.lifehealthpro.com/2011/04/29/ppaca-hhs-starts-medicare-performance-payment-syst
pay for performance in education recall the ARRA and google 'race to the top'

Workfare?

[Workfare was introduced under Reagan and tightened later.  This is the system before the welfare reform of 1996.  It was learned that it costs more to give them money and make them work so states backslid and it never amounted to much.  It is an experiment that all agree failed.

Some of these ideas are useless, some of them might have legs, but the point is: specifics, specifics, specifics.

So we see what happens when a conservative tries to think of constructive policy proposals.  There is the wish that conservative claims be 'shown with numbers' plus Obama policy after Obama policy after Obama policy.  

I think Golonkin should spend more time and effort on understanding the enemy. He might discover that the enemy is not the enemy but rather what he dreams conservatism might one day become.

The shocking thing is that this pathetic display of ignorance is described as "particularly fine work" by non movement conservative Mark Adomanis in Forbes in a post entitled "Epistemic Closure in Action ..."

Golonkin is not the example of epistemic closure.  He is considered a "particularly fine" example of how some conservatives are working to overcome epistemic closure.  The detail that the conservative in question has new conservatives ideas which are almost all either in the PPACA or the ARRA and that he doesn't know this, does not make the Galonkin essay an example of epistemic closure.  

Rather it is an example of how some conservatives are trying to overcome it and understand liberals before denouncing us.  

I am tempted to type "pathetic" but I don't pity them, I fear them. They are very numerous and their blind ideological arrogance makes them dangerous.

Guys and Polls

What do Damon Runyon and David Brooks have in common ?

"nothing between human beings is more than three to one." Attributed to Damon Runyon by Robert Solow, American Economic Review, 1985

 If there is one thing we know, is that even experts with fancy computer models are terrible at predicting human behavior."  David Brooks

The problem, the reason that Runyon was joking and Brooks is a joke, are the the words "nothing" and "terrible."  It can safely be predicted that Damon Runyon will not correct David Brooks, first because he is dead and second because he has better things to do with this time.

Brooks's argument is an example of an fallacy which is more common than any other fallacy or any valid method of reasoning -- the false dichotomy.  He notes that there are some things which we can't predict and concludes that we can't predict anything. 

 I think there is a not quite so general errors made by those who weren't totally delusional,  but were determined to argue that Romney's chances were well over those calculated by Nate Silver. First the natural guess that if we can't make predictions about something which is relatively simple, then we can't make predictions about something more complicated.  So since we can't place meaningful probabilities on many statements about what a single person might do, we certainly can't predict what an electorate will do.   This seems to sound sensible to many people, but it is totally false.  We can't place meaningful probabilities what an electorate will do in the sense of what each and every elector will do (including sneeze).  We can place meaningful probabilities on how people ill vote on average.  Note that Brooks's argument is not specific to 2012.  He also claims it would have been nonsense on October 31 1972 to say Nixon's chances were definitely over 90%.  Brooks is rejecting thermodynamics as well as critiquing Silver.  The logic of his argument applies to molecules too.

To be honest, I think that there is something else Runyon and Brooks have in common.  Neither really believed what he wrote.  Brooks is sane and not stupid.  He can understand as well as I can that his conclusion is much too strong.  I am very confident that the problem is that he considers his job to be to make reasonable sounding arguments, in which he gives the naive the impression that he is just trying to understand a topic, and then conclude that what Republicans say is true.   

As noted above individual humans can be unpredictable.  The false dichotomy fallacy might tempt us to conclude that all individual humans are unpredictable.  However, David Brooks is predictable.

Greed is Good. For Your Competitors

Kevin Drum has a very good post describing how terrible a manager Romney is as demonstrated by his shambolic campaign.  The key result is that the huge amount of money raised by Romney seems to have gone in large part into the pockets of his top campaign aids.

I think this is bound to be a weakness of organizations which rely on greed and not ideology, esprit de corps or a sense of mission to motivate their employees.  This is not a new hope (I read it in Plato's "Republic" and I doubt the idea was new then).

I speculate and gloat in a comment which I cut and pasted below.

My theory  (which I also read at Brad DeLong's blog) is that the Romney campaign was basically a scam* and people eager to lead it were basically grifters whose main aim is always getting their hands on money.   I think it is demonstrated that the campaign was based on lies.  A problem with lying as a strategy is that the team of liars will lie to each other.  

This theory leads to optimism.  If people who believe in a cause are much more efficient than cynics who are in it for money or even just winning for the sake of winning, then the truth will tend to come out.  If efforts to distort the debate using money are weakened by the self interested behavior of people who are willing to lie for money, then they will be less damaging.

The problem is that candidates who are not compulsively honest had efficient campaigns.  The Romney team was no less honest than Karl Rove and the Bush campaigns weren't undermined by self dealing.  Bush was not uh reliably honest but he had extremely loyal aids (I am thinking of Harriet Miers and Karen Hughes.  Bill Clinton is not always honest and willing to do extreme things to win elections (such as having Ricky Ray Rector killed) yet he inspires great loyalty (including I fear someone who will angrily reply to me in comments -- nah not to worry no one will read a comment this long).  Why even Richard Nixon himself had extremely loyal aids.

My guess is that Romney has a very particular problem with equating self dealing with brilliance and good management.  The case for Romney was that he had acquired a lot of money demonstrating ability so we should hire him as our President.  My guess is that he was sincere about this.  So I guess he decided that people who had done very well for themselves in politics were smart and hired them.  

I think the point about how success in private equity and managing a firm are different is very important.  My sense is that Romney 's core competency was separating counterparties (including the other people who worked at Bain) from their money.  Such an approach can make people rich, but that skill isn't socially useful and has nothing to do with managing in the pre 80s sense of the word.

The recent performance of the US economy sure suggests that a lot of US businesses weren't run the way you imagine businesses are run.  I must resist temptation to speculate (again) that most businesses are mostly run for the benefit of top management.  You've worked for a for profit firm and find the Obama campaign familiar and the Romney campaign strange.   But some are and their managers are superstars because they have obtained great wealth.  The greed is good error (that is the illusion that the greedy are useful employees -- I am talking about top bosses who don't know how to get what they want and not about right and wrong) saved us from a Romney presidency.  But it also helped cause the great recession.

* I am honestly trying to be polite here.  I personally think the Republican party is a scam, but I don't have to make so broad and harsh a claim.

How did Republicans Win the House with less than half the votes ?

I think this is the best post I have read so far on the topic.  Just go read it before reading my comment below.

Of course I have my usual comments.


Thank you for your excellent post based on good shoe leather (OK leather ear to the phone) reporting.  I should also thank the political scientists who have been doing their job while I pretend to do it commenting on blogs (I'm supposed to be an economist).

But (of course there is a but) in those comments I have been stressing that bipartisan and court-drawn maps systematically cause Republicans to win a larger fraction of seats than votes.  The reason is that a bipartisan and court (except sometimes the Supremes) principal is that the House should look like the country and not like the White plus some brown and no black at all Senate.  There is an absolutely deliberate effort to create majority minority districts.  Those districts are overwhelmingly Democratic districts.  The intent isn't partisan, but the effect is to cause Republicans to be over represented.  I add that I support the effort to make the House look like the country and not like the Senate.


Also, while I see why incumbency helps the party with more seats I do not at all find an eplanation for why it explains the gap between popular vote and seats won.  The advantages of incumbency discussed in the post should cause the party with more incumbents to get more votes, yet they are discussed as if they affect seats won but not vote totals.  To explain the gap, one has to argue that incumbents generally win by narrow margins or lose by wide margins.

Here I think the problem may be with the reported vote totals.  Some states don't report votes in races where there is only one candidate on the ballot.  Incumbents often get on the order of 99% of votes or more.  That's a lot of wasted votes which would cause the party of incumbents to have a lot of votes per seat won.  But only if they are counted.

Even if the votes are counted, they may be few.  Some people (definitely including me) are irritated when invited to vote for the only candidate on the ballot (if I wanted to live in the USSR I would have moved there back when it existed).  For decades I chose Michael Capuano over write in, but I'm sure lots of other people left the oval empty out of irritation (this year I actually got to vote in a contested congressional election for the first time since hmmm voting for O'Neill over Abt in 1982 IIRC).  I think some correction for races with only one candidate on the ballot is needed.

Finally I don't get this bit about fewer people in red districts.  What geographic boundaries are being considered ?  I can see how the requirement that each state have 1 representative could in theory create a small population at large district.  However, I think it doesn't as even Wyoming is not an unusually small district.  I don't see why representation of low population states would be rounded up more often than down.  If the boundaries are, say, county boundaries, then current redistricting does not respect them (I vote in the same county and a different district).  I tend to suspect that the random districting which respects geographic boundaries doesn't correspond to anything but a silly modelling assumption.

Polite conclusion about how this is a great post and political scientists are awesome.