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We had to destroy the village in order to save it . . .
I genuinely don't get this comment. I mean, I understand that there are people who think it is immoral that the educated should earn substantially more than people who clean houses. But it seems to me that the obvious solution to this dilemma, until you have effected the radical political change you believe will rectify this situation globally, is to give away all of your salary in excess of the wage of the average housecleaner. Ideally, you would donate it either to people who clean houses, or to some organization you believe will improve their earning prospects.
If you are not going to take the obvious route (and apparently no one is), then I really do not see how you could believe that the best way to help housecleaners is to refuse to hire them. In my universe, decreasing the demand for a good or service drives the price of that good or service down, making whoever supplies it worse off. How often do you meet private contractors who are grateful not to be offered work? If you think housecleaners get paid too little, then you should be hiring as many as you can afford, in order to increase the local demand for unskilled labor, not shunning them. And if you think I'm wrong, why not ask your friendly local independant cleaning lady what she thinks?
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Clean conscience
I understand this guilt; I've wrestled with it myself. But it's logically all wrong. Why shouldn't we pay people to clean our houses? I don't get all vaporish because I pay people to cook my food or wash my clothes, two jobs that were the province of the lady of the house-or if she was very lucky, her hired servants-until very recently in human history. I've never had a boyfriend say to me, "Well, I should be able to install those shelves, so darn it, I'm not going to debase myself and the handyman by turning my solemn duty as a homeowner into a mere market transaction." I've known lots of men who felt that they ought to be able to do traditional manly tasks like fixing an engine or keeping the lawn a beautiful, even emerald green. But I've never met one who felt that these jobs were some sort of sacred trust that could not be farmed out to a hireling without demeaning both employer and employee.
Paying a cleaning lady to clean your house is good for the cleaning lady. She wouldn't take the job if it weren't better than her next best alternative. And it's good for you, since presumably you have something to do that you value more highly than the money it costs you to pay her. It's probably also good for your family, since that's one less fight you have to have about whose turn it is to scrub the toilet. That's the awesome beauty of trade: everyone wins.
In an ideal universe, your cleaning lady would be too rich and highly skilled to be willing to work cleaning houses, unless she is some kind of freak who just really gets off on mopping floors. (And if she is, mind sending her my way?) In the actual world, however, she isn't, and if you didn't hire her, she'd be even worse off than she is now. Every time you hire a cleaning lady, you marginally increase demand for same, helping to raise wages some small fraction. You get a clean house and a poverty reduction program. What's not to love, here?
Moreover, the idea that cleaning houses is somehow degrading is the product of exactly the kind of pernicious class bias that people who feel guilty about hiring cleaning ladies are usually trying to fight in other areas. The job of cleaning houses has become tainted by association with the people who do it, the poor and unskilled. But there is nothing inherently undignified or unworthy about either the work, or the people who do it. Nor, for that matter, in any other job, provided employer and employee treat each other with respect.
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Music Sunday
I have, as of yesterday's eMusic download fest, 2,406 songs in iTunes. And as I finished downloading, it occurred to me, with a small wow, that I really like almost all of the music I have right now. The lone benefit of losing all my CD's in the move to Chicago, and then my MP3s in two separate hard drive crashes, is that I have no dross--no embarassing choices left over from my adolescence, no random songs downloaded while writing the annual GSB follies. Also, because the collection is relatively small, there's nothing of which I could say "I really like that, but I haven't listened to it in a while."
As the collection grows, obviously that will change. And it will, for I'm now a backup obsessive. I will never again lose more than a few days worth of music.
So discussion question of the day, for this fine, lazy Sunday: how many songs do you have in your iTunes*? And is it too many, too few, or just right?
* Or other MP3 player--or CD collection, if you're still living in the paleolithic.
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If you look long into the abyss . . .
"There is a fine line between genius and insanity" said Oscar Levant. "I have erased that line."
Now we may know why.
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Who subsidizes who?
Peter Jackson accuses me of ignorance for my position on mass transit subsidies, arguing that the subsidy to mass transit is higher than the subsidy to roads per passenger mile. But the numbers he provides are not quite relevant to my point.
For one thing, they cover only federal subsidy. Yes, I know you've heard so much about the highway bills, but the states spend money on highways too--quite a lot of money.
For another, unless the analysts controlled for it, which I can't tell, the subsidies will have been massively skewed by the great inflation of the 1960's and 1970's, because mass transit investments cluster late in the transportation bill cycles.
Thirdly, subsidy-per-passenger-mile-travelled is not necessarily the right metric to use. The whole point that environmentalists and urban planners make about roads is that they encourage people to move farther out, which means they spend more time on the road, which inflates this metric compared to people who live in closer, denser housing. That would be fine if they were only imposing costs on themselves, but of course, the decision to live farther away also imposes costs on others, in congestion and in pollution. If the proportions of state and federal transportation funds that were spent on highways and mass transit had been reversed, the relationship of subsidy to passenger mile might also be reversed.
If they are driving in the city, they also impose significant externalities on me, making it more difficult and dangerous to navigate the roads on my bike, without paying any compensating taxes for the use of the streets. The problem is especially acute in Washington because, unlike New York, most of the "businesses" people work for are nonprofits that don't pay taxes, and people rarely come into the city to shop or go to dinner. Guess whose income taxes pay for what isn't covered by the sales tax on your garage fees and lunch? That's why the streets in DC are so ghastly; they benefit mostly the people who don't pay for them.
But even if federal subsidy per passenger mile were the right metric, it wouldn't be appropriate to Washington DC. The federal subsidy for mass transit goes to a large number of systems that cover a very small percentage of their costs through fares. The WMATA, on the other hand, gets over half its revenue from fares, and drags most of its passengers from far-flung locations, and gets most of its operating budget from state and local governments (again, my taxes) so whatever that figure is nationally, for DC it is much, much smaller. I mean, I agree that Buffalo's subway system is a ridiculous boondoggle, but that doesn't really have much to do with the WMATA.
Finally, the most worrying "subsidy" is obviously the fact that cars dump a huge amount of carbon into the air; carbon which best estimates think is a) warming the planet and b) may possibly have other nasty effects such as changing the Ph of the oceans. Almost half of all of the United States' gigantic carbon emissions come from transportation uses, and most of those transportation uses are not long-haul trucking, which uses relatively carbon-efficient diesel. This negative externality indicates that car usage is radically mispriced.
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Price controls
I think James Joyner is absolutely right here:
I’m now commuting into D.C. on a near-weekdaily basis. According to GoogleMaps, the office is 13.5 miles from the house. I can usually drive there in 45-60 minutes during off-peak hours, although it can sometimes take much longer if there’s an accident. I can park in the garage next to my office for the day for $12. Conversely, I can drive 15-20 minutes to a Metro station, pay $4 to park, wait as long as 15 minutes for a train, pay another $2.65 to get two blocks from the office 35-50 minutes later, followed by a 5-10 minute walk to the office.
So, in order to save $2.70 (plus a nominal amount of gasoline), it would cost me 30-75 minutes each day for the round trip, plus the privacy and autonomy I enjoy in my own vehicle. Given that I earn enough that $3 is poor compensation indeed for that much of my time, I drive unless there’s a really good reason not to.
And they’re about to raise the rates for Metro fares and parking, further skewing the calculus in the direction of “drive.”
The massive subsidy provided to drivers in the form of free roads is obviously producing highly inefficient outcomes, which is why DC feels like a prison from which it is impossible to escape unless one wants to spend four hours on the Beltway. We clearly need to institute comprehensive road tolls combined with a congestion pricing scheme. Plus, of course, a carbon tax to compensate for the negative externalities drivers are imposing on those of us who use primarily mass transit.
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Race and medicine
This is very interesting. In 1950, black and white life expectancy at birth were very different: a white baby born that year could expect to live an average of 68.2 years, versus just 60.2 years for a black baby. But there was no significant difference between blacks and whites at retirement: at the age of 65, both could expect to live about another 13.9 years.
For the rest of the century, life expectancy at birth narrows considerably; the difference between groups is now five years, and falling. But the gap at retirement widens. White 65 year olds now get an extra 1.8 years compared to their black countrymen; at 75, the gap is a smaller, but still significant, 8 1/2 months.
It's tempting to blame this on disparity in health care access, and I wouldn't be exactly surprised to find that this is part of the case. But the subtler problem is that because Europeans are the major market, most drugs are designed for Europeans; and it turns out that there are races, at least as far as medicine is concerned. Blacks are more prone to diseases like diabetes and hypertension, and they tend to get more difficult to treat forms of some diseases such as artery blockage. While some of the medical differences are due to poverty, education, and possibly to racial disparities in treatment, many of the differences persist even when things like income and education are controlled for.
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Women's work
Ogged blogs about the Hope Solo situation. For those following along at home, the US soccer team made a slightly bizarre decision to switch goalies against Brazil in the Women's World Cup, after which they got crushed. Hope Solo, who was replaced by Briana Scurry, then went public claiming she'da made those saves. Whereupon, apparently, the team ditched her.
Now, I don't know how the rest of the world works, but while criticizing teammates is frowned up on men's sports in the US, people still do it all the time, but no one gets banished for it. They take some shots at each other, they might even fight in practice, and then they go out and play. I'm probably supposed to be valuing the different model of women's sports in which team unity is even more important than fielding the best team, but to my mind, this just makes the women seem weak and unprepared for serious competition. And it's worth noting that "team chemistry" is generally bunk as far as game performance is concerned: many, many championship teams in various sports have hated each other's guts, and there are teams with great chemistry that go nowhere. But when a team with good chemistry wins, it's easy to say that they're winning because they're all buddies.
I'm of two minds about this. In general, I'm not a big fan of the sorority-girl, we-all-have-to-be-each-others-best-friends atmosphere that large groups of women tend to assume. Plus, the manager seems to be exploiting the phenomenon in order to save his job after an apparently awful decision. So I'm not exactly ready to applaud anyone who caters to either the stereotype that women can't function unless they're all holding each other's hands and singing, or the reality that groups of women generally do demand a level of comity and conformity that can be incredibly brutal on anyone who is too outspoken or otherwise violates the group norms.
But the reality is that groups of women do act like this, and if I were the coach, I'd not be nearly so sanguine that this group will work well with a goalie who basically publicly accused her teammates of losing a game she could have won had she been allowed to play. Maybe I'm just hypersensitive to these group dynamics after too many years at all-girl's camps and all-female sports teams, but I don't think so. Perhaps those things really don't matter on men's teams; obviously I've never played on one. But they certainly did on all the girls teams I've played on, and the dynamic has been markedly present in the female dominated workplaces I've been in. The job of the manager is not to advance the cause of feminism; it's to win soccer games.
On the third hand, it's also to advance the cause of women's soccer, which is probably not best done by acting as if the female players are all fourteen year old girls debating who gets to join the homecoming dance committee. So I just don't know.
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Demographic shift
This is a really interesting post on the ways that population shift has made our government structures obsolete:
- The ratio of small-state to large-state populations has increased. In 1790, Virginia had 12.5 times the population of Delaware. Today, California has 70 times the population of Wyoming. In 1790, Senators representing 14.7% of the population could sustain a filibuster under today's rules; today, that figure is 9.9%. I'm fine with the somewhat countermajoritarian nature of the Senate, but it's clear that things have gotten a little bit out of hand.
. . .
- Travel is much faster, but the country is much larger. As recently as the 1960s, DC airports didn't have direct flights to much of the country. The common practice of Congress was to stay in the District for seven months, then stay in their home state or district and meet with constituents for five months. Today, most members fly home every weekend, even during session. This puts tremendous strain on Western members, who must endure six hour flights while their colleagues in New York can catch an hourly shuttle that gets them home in 45 minutes. At this point, it seems fair to consider moving the capitol, or at least having an auxiliary capitol that might be used every other year. The population center of the US is currently in central Missouri and continues to march West, so either moving the capitol to Kansas City, or putting a secondary capitol in Denver should do the trick.
Somewhat separately, there is now tremendous pressure to be in one's home district all the time. When combined with the crush of fundraising, this limits the time that members have to collaborate with one another. We ought to make Constitutional provisions to ensure that members have the time and space to meet, rather than rely on staff at all times.
- The population has grown-a lot. The House has not kept up. The constitution mandates a state can have no more than one member of the House for each 30,000 residents. In the initial apportionment of the House, Pennsylvania received one for each 55,000 residents. Today each member represents about 700,000 residents. With a district sized to 1790 standards, a candidate could canvass the entire population in one Friedman Unit, meaning that every member would theoretically be vulnerable to a low-cost challenger. In addition, the effectiveness of TV advertising would drop to zero in most urban areas. Though, a figure that low would have other problems. California alone would have 650 members; Wyoming would have 9; the House as a whole would have 5454 members, which is clearly unworkable. In general, European countries have around one member per 100,000 residents; Japan, one per 265,000 residents; Russia, one per 320,000 residents. We ought to think about whether it's possible to have a much larger House with smaller congressional districts, with the hope that members will be more responsive to a smaller population and unable to win elections merely by blanketing the airwaves.
The problem is, of course, that the forces mitigating against any of these sorts of changes seem fairly well entrenched. So I'm not sure what good it does to talk about.
It is, however, a very good argument for federalism--devolving power down to the level of the states wherever possible. That makes legislators much more directly responsive to their constituents. Unfortunately, few people seem to really like that idea, since it means that a lot of the time, legislators in places other than the one in which you live will respond to the demands of their constituents in ways of which you disapprove.
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The American Century
From "Fashionable Food: Seven Decades of Food Fads":
American housewives took to the mechanical refrigerator as fast as their finances would allow. By 1937 more than two million American households had new refrigerators, and by the mid-1950's over 80 percent of the population did. (In contrast, only 8 perfect of English households had refrigerators by 1956.)
I'm trying, and failing, to imagine my life if I had to shop for food every day, or keep charge of a tiny, moldy, inconsistent icebox. I doubt it would include much writing, for starters. Little things like this constantly remind me just how rich we are compared to even the very recent past.
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Go Yankees! Ish!
The press release from Yankees.com reads "Yankees clinch wild-card spot." I suppose that's one way to look at it.
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I'm sure you're right
Yesterday, I sat through a friend's fifteen minute disquisition on comic-book trends, delivered as if I, too, regularly read the things. Though he later apologized, I genuinely enjoyed it; there's something interesting about sitting through someone else's abstruse technical discussions. It's a little window into a world that is normally totally invisible to your view.
Today, I enjoyed the same phenomenon reading another friend blog about cricket:
The best one may say for Twenty20 is that it may prove a gateway to an appreciation of real cricket for some fans; much more likely, however, is that it will further erode the viability of test match cricket which is already in trouble everywhere outside England and Australia.
This is not merely a question of money, but ones of technique, discipline and mental fortitude. One day cricket alters the way batsmen and bowlers approach the game. How many batsmen now have the patience, let alone the technique required, to bat all day on a difficult wicket? Precious few. How many bowlers, used to being smashed off a length in hit-and-run cricket, now possess the ability to stick to line and length? Precious few.
It may be silly to think there was once a golden age - Cardus after all mourned the pre-1914 game even as he was writing about Bradman and Hammond and Woolley and Headley and all the rest - but skills once considered integral to the game are disappearing and part of the blame for that must be apportioned to the proliferation of one-day cricket.
Right ho.
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Tax hatred has a long pedigree
Returning a bit to the topic of supply-side economics, there seems to be a general feeling among my progressive/liberal friends that the main reason America has such a hard time raising taxes to cover the new spending programs they want is that Republicans have been ceaselessly demonizing taxes for the last thirty years, while spreading vicious lies about supply-side economics that have instilled a new and pernicious tax hatred among American voters. This is basically the narrative of The Big Con: we used to have this terrific economy with low inequality and a growing government share of national income, with everyone except a few rich malcontents happy, then this giant Republican conspiracy to make us all hate taxes came along and lured us off the Yellow Brick Road and onto the Road to Perdition.
This seems an odd belief to hold in a nation that was basically founded in a tax revolt. A modestly comprehensive perusal of pre-1970 literature reveals that Americans seem to have hated taxes all along. And why wouldn't they? Taxes don't need any special conspiracy to make you hate them, at least if you are among the majority of people who would rather have more money in your pocket than less.
I think a better explanation for the shift in public sentiment about government spending that took place in the 1970's would point out two things: first, that the government in the late 1960's and early 1970's was doing a really spectacularly bad job of running the economy. Richard Nixon was probably the worst economic disaster as president since Andrew Jackson, and Lyndon Johnson and Gerald Ford weren't any particular prizes either. The economic history of the 1970's sowed very well justified fears about state intervention in the economy, and it's probably no coincidence that we're getting more support for government programs only as the memories of 40 years ago begin to fade.
But perhaps even more importantly, it's not clear that 1980-2007 are the anomalies in American public sentiment about taxes. On the contrary, I think I can make a better case that 1945-1970 was the oddity. While incomes were growing rapidly, and inflation wasn't, the American public was willing to accept a higher tax burden because even after taxes, they felt a lot richer. As soon as productivity growth slowed (and therefore growth in real incomes), people started to feel the pinch of a growing tax burden, particularly since inflation was pushing them into tax brackets originally meant for "the rich".
Supply side nonsense is nonsense, and I think it's a pretty good explanation of the budget deficits of the early 1980s. But I don't think it's a very good explanation of the generalized tendency of the American public to demand low spending and even lower taxes. As you'll see if you look at the historical data, America has run deficits most years since 1940, and really sizeable ones since the mid-1970s. The only reason the Bush deficits so dominate our current debt is that inflation has eroded the value of the earlier debts, not that he's unusually profligate.
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Department of Economic Illiteracy
I know, I link Ryan Avent all the time. Well, you'll just have to put up with it, because this is too good to pass up. He finds the Baltimore Sun saying:
The $3.9 billion figure is especially imposing because it is expressed in 2007 dollars. By the end of the planning period in 2035, inflation could add billions to the final total.
And do you realize that while the sandwich I had for lunch cost me $6.50, I could have bought it for 30¢ in 1913! How can I afford it? I'll starve to death?
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Alan Greenspan gets Kleined
I have to give Alan Greenspan props for doing this. The host is hostile, economically quasi-literate, allows the other guest to act as co-interrogator, interrupts him every time he says anything sensible in a desperate attempt to stop the flow of information, and beats Greenspan with weird & untrue "facts" (the Iraq war has cost trillions) that have nothing to do with his job as chairman of the Federal Reserve. My favorite moment is when Naomi Klein accuses Greenspan of having pursued a crisis of faith in capitalism through his income-inequality producing policies of privatisation, deregulation, and free trade, which is a terrific twofer: not only have none of these things been convincingly linked to income inequality; but also, none of them have anything to do with Alan Greenspan's job at the Federal Reserve Nonetheless, Greenspan a) doesn't point out that she's completely ignorant b) keeps his temper and c) tries to actually explain the problems of income inequality. I doubt I'd be so well behaved.
Update Now listening to Naomi Klein on Latin America. It is impossible to overstate how little she knows about Latin American economic history. One could glean a more accurate and comprehensive view of Latin American economic conditions by renting Evita.
Update II NOOOOOOOOOOOOOOOOOOOOO!!!! She just defended import substitution!
Update III Then, when Greenspan says "What works better?" she claims she's just talking about not socialism, but mixed economies, which would be compelling if it were a good description of pre-Pinochet Chile, the original topic of conversation. Also very, very hard to get import substitution going without central planning.
Update IV Now he has to explain the difference between Indonesian-style crony capitalism, and America purchasing war planes from Lockheed Martin. She does not try to reconcile her view that America purchasing equipment from private suppliers=crony capitalism, with her previously stated faith in mixed economies.
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A picture and a thousand words
Amazing, disturbing piece on the Little Rock nine from Vanity fair. The sadness of that girl's subsequent life, in stark contrast to the usual story we get--music swelling to a crescendo as the nine march past the guards, and then fade to black--is awful to bear.
Update I just deleted all the comments on this thread. Normally, I'd leave notes, but I assume everyone involved knows exactly why they were deleted. Frankly, I don't even know what to begin to say to the people who turned a discussion of Jim Crow into a rant about how black people are Destroying Our Schools.
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Wal-Mart giveth, and Wal-Mart taketh away
Wal-Mart is selling more and more incredibly cheap generic drugs, now including $9 a pop for generic tri-cyclic birth control pills. Their prices are cheaper than the prices I got through my old health insurance. (Haven't filled anything up on the new insurance yet.)
At teh same time, they take a huge beating for the wages they pay their workers, and the alleged stinginess of their health care plans. But these two things are flip sides of the same coin: they can afford to provide cheap drugs in part because they have a flexible and inexpensive labor force.
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Gas prices up, but not as much as oil prices
The Economist had a chart a few days ago showing that oil prices have roughly doubled since early 2005, when I was writing stories about the scary possibility of $60 a barrel oil.
But here's another interesting chart from the Energy Information Administration:
The doubling of oil prices has increased the retail price of gasoline by less than 50% since early 2005. This helps explain why demand diminution has so far been less than economists were expecting.
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Rock the vote
John Quiggin asks why Americans vote on a Tuesday. Two answers:
1) There are sizeable religious groups in the United States forbidden to vote on both weekend days, as Quiggin suggests; I presume there are muslims also forbidden to vote on Friday, but don't know enough about muslim theology to be sure.
2) Public employees get the mid-week voting day off. They are a lobbying block against change to weekends.
As with any political question, when the question is "Why don't we . . . ?" The answer is usually that don'ting is in the interest of one or more groups.
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Verizon accepts NARAL's text messages after all
So Verizon has rescinded its refusal to give NARAL one of those short-form text message numbers for broadcasts. This case didn't strike me as a cause for indignation so much as a cause for total bewilderment. What on earth was Verizon thinking? How could this possibly offend their pro-life subscribers, who can not receive NARAL's text messages by the simple expedient of not signing up for them? Do even those pro-life subscribers want a cell phone service that deigns to decide to whose text messages they may or may not subscribe?
Given that the other big networks had already signed up NARAL, this sort of thing seems very likely to drive away any subscribers who want the service, while gleaning absolutely no support from pro-life subscribers who presumably will never try to subscribe to NARAL's text messages, and thus will never learn to their immense satisfaction that their cell-phone provider does not permit such smut to be transmitted over its networks.
Personally, I don't particularly care for NARAL, and I'm certainly not planning to waste my text messages on them. But when my Verizon contract is up, I'll be looking for a provider that doesn't think it can make those sorts of decisions for me. And I'm pretty sure that my mother, who has never gotten a text message in her life, but who focuses her charity on Planned Parenthood, will be even more avid to make the switch.
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A map of the econoblogs
Neat.
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What if they held a communications blackout and nobody came?
Kerry Howley on the situation in Burma:
There has been a lot of talk about how this month's protests are distinct from those of 1988 because “the world is watching,” the Internet changed everything, and the junta can no longer contain information. That’s true to some extent, and it’s breathtaking to see video of Yangon on CNN.
But while the world may be watching, I doubt most Burmese are. The country’s communications infrastructure is incredibly limited. . . .
The flip side of this is a system of informal information networks that will be incredibly hard for the junta to shut down. It's getting more difficult for outside news agencies to obtain information as the regime cuts phone lines, but most Burmese people don't rely on those lines anyway.
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From whom, to whom?
Another random thought on workers and bargaining power: one of the reasons that I think that progressives assume that workers as a class have less bargaining power than employers is that workers with bargaining power generally use it to extract high salaries, whereupon they pass out of the class "worker" and into the class "wealthy".
Progressives don't simply want workers, as a group, to have as much bargaining power as employers; they also want that power to be distributed much more equally within the group. In that reading, one might argue that some significant portion of union redistribution is not from "employers" to "workers" but from "workers with bargaining power" to "workers with less highly demanded skill sets". Though I imagine that progressives would dispute that view.
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Question of the day
Here's the question I've been pondering as I watched the strike unfold at GM. Many progressives argue that unions are a necessary counterweight to the bargaining power of employers. I tend to think that power is generally about equally balanced between workers and companies--some workers have a lot of bargaining power, and some a little, but I don't see the power as being particularly asymmetrically distributed between workers as a class and employers as a class. But that's not how progressives feel, and I doubt we'll change each other's minds.
What I find difficult to argue with is that few of the progressives I know ever seem to think that there are any situations where workers have too much power. Even in situations such as the New York City transit strike, where the workers clearly have an enormous amount of employer over their employer both as a bargaining unit and as a voting bloc, progressives always side with the union.
So here's the question of the day for my liberal commenters: can workers acquire too much power? Is there any situation in which you have thought, or can even imagine thinking, that union power might have to be dialed back?
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Miss Daisy, driving
Another thing I'm learning, as I research this article, is that old people are extraordinarily bad drivers; per mile travelled, a driver over 75 is more dangerous than a driver 15-24. By 2030, it's thought that seniors will be responsible for 25% of all auto accidents.
So one has to wonder, how come the AARP has its own discount insurance plan? It's as if The Hartford, which offers it, had found a vast pool of bad drivers, and decided to offer them a bonus for signing on. The program offers no insurance penalty for the first accident, which must be welcome news to seniors, since apparently they generally don't decide to get off the road until they've had at least a couple of fender-benders.
I presume it must be a combination of volume, and desireable demographics. Anyone have any ideas?
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Why do GM workers insist on job guarantees?
Free Exchange asks:
The problem that unions tend to to face, in America and in Europe, is that successful attempts to improve the viability of a business lead to growth but also to employment shifts. A company may survive and generate better outcomes and wages for its workforce, but only if there is freedom to adjust the size and composition of that workforce. Since workers primarily benefit from employer concessions only to the extent that they're still employees, this encourages unions to ask for growth-constraining benefits that ensure either continued employment or handsome benefits for those forced to leave the company.
This state of affairs leads many economists to lament the existence of unions generally, since they tend to constrain economic growth, but it's important to note that union members are simply insuring against the potential loss of benefits they'd face if shunted out of their particular firm or industry and into another part of the economy. It stands to reason, then, that the package of benefits sought by unions might be less damaging to growth in situations where unions are fewer, larger, and more encompassing. In that case, a worker forced out of a firm for the sake of efficiency would stand a better chance of landing in an industry or firm with equally good worker benefits.
If that's the case, though, and larger unions are more amenable to growth-friendly corporate policies, then why not extend worker benefits to include all workers? If job loss carries with it the risk of benefit loss, leading workers to fight job-loss in growth inhibiting ways, why not eliminate that risk by providing those benefits at a national level? If concerns about health insurance and pension plans are encouraging workers to ask for employment protections, it seems sensible to provide them to all, so that displacement from any job into any other job will not result in benefit loss and give unions reasons to ask for job security (or fight openness to global markets).
Obviously, such programs must be paid for and would probably necessitate tax increases, which come with their own economic distortions. But it may be time to acknowledge that such trade-offs are necessary.
The problem is that while theoretically, such protections could smooth the growth losses this way, in practice, there's little evidence that they do so. Europe seems to have permanently lower growth, and higher unemployment, despite generous public pensions and health insurance. Indeed, the union fight at GM was over a group of people that already have gold-plated government health insurance: retirees over the age of 65. Nonetheless, the union struck.
Members of the UAW want job guarantees because outside a GM plant their skills will never, ever return anything close to what they make inside one. According to the Freep, wages and benefits for the average UAW worker run about $73. At a standard 40-hour workweek, that's the equivalent of a roughly $100,000 a year salary for someone with a high school education who takes no entrepreneurial risk. Where else is that kind of deal available? Is it any wonder that the membership wants to fight to keep that? Slash the health benefits and pensions in half and it would still be an extraordinarily good deal for workers whose earning power on the open market is probably more in the $20 an hour range.
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The priest-gods
In the process of interviewing health care economists for the article I'm writing, David Cutler of Harvard told me that education and health care are the two segments of the economy where measurement of outcomes is hardest. It's unsurprising, then, he told me, that payment schemes in those two systems are so haphazard.
But even when there is good evidence, the systems don't use it. One of the most extreme examples is back surgery. The evidence seems to be completely overwhelming that back surgery is a terrible idea for back pain in all but a small minority of cases. Yet we do a phenomenal amount of back surgery. I presume that the surgeons performing this surgery are not venally crippling their patients in order to charge them exorbitant amounts of money. So why do they do something that shows so little evidence of improving the lives of their patients? And why do insurance companies and government programs pay for it?
The uncharitable explanation I have received is that doctors are incredibly good at detail and memorization and pattern recognition, and generally very bad at abstract analysis; they are also, because med school is so hard to get into, usually very arrogant.
The charitable (well, more charitable, anyways) explanation is that doctors are like the rest of us: they have an unreasonable belief that they are above average. (80% of people think that they are better-than-average drivers). And so even though they recognize that back surgery doesn't work on average, they think that they can beat the odds. They also naturally resist anything, like evidence-based medicine, that routinizes their jobs and cuts down on discretion. And we let them because medicine is important--so important that we can't stand thinking about the catastrophic possible errors, and so we prefer to turn our care over to priest-gods to whom we impute improbable, nay inhuman, wisdom.
Alex Tabarrok points out another example of this operating in education:
What we need to save inner-city schools, and poor schools everywhere, is a method that works when the teachers aren't heroes. Even better if the method works when teachers are ordinary people, poorly paid and ill-motivated - i.e. the system we have today.
In Super Crunchers, Ian Ayres argues that just such a method exists. Overall, Super Crunchers is a light but entertaining account of how large amounts of data and cheap computing power are improving forecasting and decision making in social science, government and business. I enjoyed the book. Chapter 7, however, was a real highlight.
Ayres argues that large experimental studies have shown that the teaching method which works best is Direct Instruction (here and here are two non-academic discussions which summarizes much of the same academic evidence discussed in Ayres). In Direct Instruction the teacher follows a script, a carefully designed and evaluated script. As Ayres notes this is key:
DI is scalable. Its success isn't contingent on the personality of some uber-teacher....You don't need to be a genius to be an effective DI teacher. DI can be implemented in dozens upon dozens of classrooms with just ordinary teachers. You just need to be able to follow the script.
Contrary to what you might think, the data also show that DI does not impede creativity or self-esteem. The education establishment, however, hates DI because it is a threat to the power and prestige of teaching, they prefer the model of teacher as hero. As Ayres says "The education establishment is wedded to its pet theories regardless of what the evidence says." As a result they have fought it tooth and nail so that "Direct Instruction, the oldest and most validated program, has captured only a little more than 1 percent of the grade-school market."
It's borderline criminal that even where evidence is available, we don't hold our teachers and doctors to the same standards of performance as would operate in a normal business.
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Power to the people
Ezra says, of the Bush administration on climate change:
In reply, the innovation will accelerate when it needs to accelerate, which is when carbon-intensive technologies grow economically unfeasible. That's why we need some sort of cap or tax: Because that's the only policy capable of sufficiently supercharging and incentivizing innovation. And China and India aren't going to take any action till we do, and will need our help, and the technology we produce, to wean themselves off coal.
That last is a very, very important point--so important that I think it should be driving our greenhouse gas policy, both on the public and the private side. A carbon tax is an excellent place to start. But more broadly, it means we should focus less on making incremental refinements in energy efficiency, and much more on improving alternative energy sources. Incremental energy efficiency refinements are generally intensive in both human and financial capital, which often makes them unattractive to developing countries, even though they save fuel costs. What we need to find is a cost-effective alternative to coal and oil.
Unfortunately, that sounds a lot like "what we need to find is the holy grail". But a hefty carbon tax, combined with a serious effort to remove the obstacles to nuclear, would be a very welcome start.
The best part is, Republicans should also be able to get behind this agenda, since one of the major obstacles to nuclear is a man named Harry Reid.
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Give me liberty, hold the death
Bruce Bartlett writes that he's just nominated Petrov for the Milton Friedman prize. Excellent idea--go forth and do thou likewise.
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Voulez vous cafe avec moi?
Jacob Grier has more thoughts on DC coffee culture. He also plugs Big Bear Cafe, where I went for the first time on Monday, and I second the motion; it's got the best cup of coffee I've had since I moved to DC.
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Losing weight the Castro way
1. Step one: impose a strict socialist regime.
2. Step two: Cling to said regime long after communism has failed in the rest of the world. The resulting economic collapse will force everyone to drastically reduce their caloric intake, and increase their activity level.
2. Step three: there is no step three.
It does have the virtue of simplicity. But given the side effect profile, I think I'd rather stick with Fen-Phen.
(via Ron Bailey)
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Spasebo, Stanislav Petrov
From Eliezer Yudkowsky:
On September 26th, 1983, Lieutenant Colonel Stanislav Yevgrafovich Petrov was the officer on duty when the warning system reported a US missile launch. Petrov kept calm, suspecting a computer error.
Then the system reported another US missile launch.
And another, and another, and another.
What had actually happened, investigators later determined, was sunlight on high-altitude clouds aligning with the satellite view on a US missile base.
In the command post there were beeping signals, flashing lights, and officers screaming at people to remain calm. According to several accounts I've read, there was a large flashing screen from the automated computer system saying simply "START" (presumably in Russian). Afterward, when investigators asked Petrov why he hadn't written everything down in the logbook, Petrov replied,"Because I had a phone in one hand and the intercom in the other, and I don't have a third hand."
The policy of the Soviet Union called for launch on warning. The Soviet Union's land radar could not detect missiles over the horizon, and waiting for positive identification would limit the response time to minutes. Petrov's report would be relayed to his military superiors, who would decide whether to start a nuclear war.
Petrov decided that, all else being equal, he would prefer not to destroy the world. He sent messages declaring the launch detection a false alarm, based solely on his personal belief that the US did not seem likely to start an attack using only five missiles.
Petrov was first congratulated, then extensively interrogated, then reprimanded for failing to follow procedure. He resigned in poor health from the military several months later. According to Wikipedia, he is spending his retirement in relative poverty in the town of Fryazino, on a pension of $200/month. In 2004, the Association of World Citizens gave Petrov a trophy and $1000. There is also a movie scheduled for release in 2008, entitled The Red Button and the Man Who Saved the World.
Maybe someday, the names of people who decide not to start nuclear wars will be as well known as the name of Britney Spears. Looking forward to such a time, when humankind has grown a little wiser, let us celebrate, in this moment, Petrov Day.
Call me crass and money-grubbing, but why isn't there an honorarium fund one could donate to? It seems like the world ought to be able to do a bit better than $200 a month.
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Back to health care blogging
This first sentence is just here for all the bloggers who want to read the first sentence of the post and then go write an angry rebuttal of my claim that poor Americans should have to torture puppies in order to be eligible for Bandaids.
The rest of the post will be for people who want to, well, read the rest of my post.
Continue reading "Back to health care blogging" »
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Lifestyle question of the day
Now that I am forced to use a Mac, is there any point in switching to an airport router? I'm about fed up with my Linksys.
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Why does DC have so few amenities?
Mr Brian Beutler says:
I cannot possibly fathom why D.C. lacks the number of book stores, record stores, coffee shops, night clubs, 24-hour restaurants, etc., etc. that you’d expect based on it’s relatively large population of wealthy, single young people. I love my D.C., but I’ve also found that San Francisco, Seattle, Philadelphia, New York City, Boston, and Chicago all have way, way more urban perks than Washington does.
To which Ryan Avent, DC development blogger extraordinaire, responds:
Now one potential explanation, and I very much could be wrong, is that Ezra and Brian generally confine their experiences to a limited area within D.C., and that area is one which has not had all that long to develop. That is, if you take into account other neighborhoods up Wisconsin and Connecticut Avenues that bloggers may not visit much, then you get more of these kinds of businesses. Another explanation is that some of the businesses you’d expect to find in D.C. are instead in Arlington (or Silver Spring or Alexandria). But I think the main issue is that the District has not been all that dense, residentially, for all that long (or rather it was, then it wasn’t, and now it is again). Many of the dense areas of the city were hardest hit by population loss during the city’s long downturn; much of the population that stayed lived in detached, single-family homes away from today’s popular core. Plus, since housing supply is slow to catch up to the number of people who now want to live in the core, housing isn’t cheap and shops skew toward a wealthier crowd.
Too, I think there's occasionally sample bias in what you visit when you don't live in a place. I love Philadelphia, and am pleased as punch about the comeback it's staged; it's a much different, much better place to live then it was when I arrived for my freshman year at Penn to find the campus plastered with warnings about the fatal shooting that had taken place a block from my dorm the previous night.
However, most of Philadelphia is like most of DC: vast stretches of row houses and other low-density housing served by precious little in the way of services, government or otherwise. A few years ago when I visited a friend living in one of the many ungentrified sections of South Philly, I was appalled to realize that the place* still had no public garbage cans, with the result that people walking on the street had turned any open receptacle, from washtubs to flower pots, into makeshift substitutes.
If you're visiting, however, unless you have really, really, poor friends you don't see that part. (The person I was visiting had was sharing an enormous two bedroom apartment that cost a little north of $400 a month.) You see the fun, crowded bits. But those bits are about the same size as, or perhaps a little smaller than, Adams Morgan/Dupont/Georgetown.
Obviously, that doesn't account for all the difference between DC and other places; they really are better economically developed than we are. But I think sample bias accounts for some of the invidious comparison. When I was visiting DC, I always had a great time going out, and always went to a different bar or club. I didn't realize that when I moved here, I would be going to those same six spots over and over and over again.
* This stretch of South Philly, I mean; not the whole city
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Apology
It has come to my attention that I neglected to use the BCC feature on the mass email I just sent out asking people to change their address books. Rather than abuse peoples' mailboxes again, I'm posting my apology here.
I am scum. However, luckily you're all very nice people and you should be friends with each other. I feel a facebook group coming on . . .
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Do everything you can, doctor
During a conversation last night with a Scottish friend, it came up that he cannot recall ever having had a blood test.
This may be the primary argument against preventative medicine saving money. Yes, you save a little when you catch conditions early. But think how much money you save by never giving healthy young people tons of blood tests and other largely unnecessary diagnostic procedures.
And how much good do the broad-spectrum general blood tests do people our age? I've had conditions caught very early by blood tests. Luckily this has allowed me, in consultation with my doctor, to . . . wait for symptoms to appear.
Moreover, overall, it's not clear that the health benefits of catching things early through comprehensive screeening outweigh the health costs of superfluous treatment of conditions that weren't bothering the patient all that much. I'm more than fine with spending a great deal of money on screening if it improves peoples' health, but it's not clear to me that this is the case.
Why does American medicine do so many blood tests, X-Rays, EKGs, and so forth? You can't blame it all on lawsuits; my doctor didn't test me for hyperthyroidism because she was afraid of the malpractice suit that would result from my losing too much weight and getting heart palpitations |
