In the College garden the other day.
Daily Archives: May 8, 2018
The problem with welfare states
Interesting WashPo essay by Megan McArdle
Notably, almost all the foreign programs that American social democrats envy were enacted during Europe’s long post-war economic and demographic boom. That meant that the initial cost of these systems was fairly low — young people don’t need much in the way of health care or pensions, and economies at full employment don’t spend a lot on unemployment insurance or job retraining. As incomes soared, it was comparatively easy for government to skim some of the surplus for their new social insurance schemes, because even as their taxes went up, workers still got to take more money home every week. Governments ran into problems when the boom stopped, of course, but by then, political sentiment had cemented those programs in place.
What was easy in 1960 looks herculean as 2020 approaches. Economic growth has slowed, and populations are aging, which raises the cost of any proposed program and requires you to fund heavy losses on someone to fund it, either workers in those industries, or taxpayers. As psychologists tell us, people are “loss averse” — they care much more about losing something they have than about equivalent potential gains. Given the mammoth cost of socializing the U.S. economy now, and the huge number of people who face substantial losses, I’d argue that we should probably change “herculean” to “impossible.”
The dysfunctional republic…
…and how the US became one. This from Dana Milbank in the Washington Post:
Political scientists have observed that American politics has deteriorated into an unstable combination of weak parties and strong partisanship — dry brush for the likes of Trump and Blankenship to ignite. The 2002 McCain-Feingold campaign-finance reform restricted party fundraising, and the Citizens United Supreme Court ruling in 2010 essentially destroyed parties by giving everybody else freedom to spend unlimited sums to buy politicians. The moderating influence of parties was replaced by the radicalizing influence of dark money.
Related to this, partisanship in Washington escalated, aggravated by partisan redistricting that puts almost all House members in safe seats where the only threat comes from primaries. Primary voters tend to favor extreme candidates — who, once in Congress, turn politics into warfare.
Quote of the day
”Nothing important comes with instructions,”
James Richardson
How about an Angry Founders Club?
Lovely rant by Dave Winer:
We should start an “Angry Founders of the Internet” social club to discuss what the fuck happened and how can we tell people about the magic that underlies the crapware that the bigco’s are shoveling at us. It really is beautiful and amazing in there. Think of it this way. It’s easier to take the Interstate highway everywhere, but if you do that, you miss the charming B&Bs, the dramatic beaches, restaurants, jazz clubs. The thrill of riding a bike, hiking the Appalachian Trail, skiing. All that intellectually unperpins this.
I’m not a ‘founder’ — though I count some of them among my friends. But I sympathise with Dave. The technology remains as magical as ever. It’s the corporate capture of it that rankles — plus the passivity and gullibility of so many of our fellow-humans.
A simplistic theory of political polarisation
From Bryan Caplan
Leftists are anti-market. On an emotional level, they’re critical of market outcomes. No matter how good market outcomes are, they can’t bear to say, “Markets have done a great job, who could ask for more?”
Rightists are anti-leftist. On an emotional level, they’re critical of leftists. No matter how much they agree with leftists on an issue, they can’t bear to say, “The left is totally right, it would be churlish to criticize them.”
Caplan explicitly calls it a simplistic theory, and it is. But it’s not bad as a first approximation — as George Hawley suggests:
If out-group hostility is more important to party identification than support for particular policies or ideologies, we may not actually place very many ideological demands on our parties. Defeating our enemies may be more important than advancing specific liberal or conservative agendas. According to Groenendyk: “If partisans’ identities are increasingly anchored to hatred of the outparty than affection for their inparty, electoral dynamics are likely much more fluid than many accounts suggest. Thus, insurgent candidates with questionable ideological credentials (e.g., Donald Trump) may be more appealing than one might expect in the age of ideologically sorted parties.”
The intellectual benefits of bullet trains
From “The Role of Transportation Speed in Facilitating High Skilled Teamwork”
High skilled workers gain from face to face interactions. If the skilled can move at higher speeds, then knowledge diffusion and idea spillovers are likely to reach greater distances. This paper uses the construction of China’s high speed rail (HSR) network as a natural experiment to test this claim. HSR connects major cities, that feature the nation’s best universities, to secondary cities. Since bullet trains reduce cross-city commute times, they reduce the cost of face-to-face interactions between skilled workers who work in different cities. Using a data base listing research paper publication and citations, we document a complementarity effect between knowledge production and the transportation network. Co-authors’ productivity rises and more new co-author pairs emerge when secondary cities are connected by bullet train to China’s major cities.
Which attracted this comment from someone using the handle “Pedantic Blithering Idiot”:
In the famous paraphrasing of Max Planck- science advances funeral by funeral. To overturn old ideas it is often necessary for new ideas to have an incubation period among a relatively isolated group of highly talented people. If all the universities of the world were to relocate to Amsterdam the initial effect might be positive but it seems probable that a kind of group-think consensus would form up around old ideas and stagnate. (Is that finally happening in Silicon Valley?) The balance between concentration and dispersal of talent is complex involving many factors on a case by case basis. Many have tried to recreate the Silicon Valley success in some form or another, no one quite succeeds as well. In cultures where there is more conformity, where the nail that stands out gets hammered down, the tendencies toward group-think stagnation is likely to be greater which would suggest advising a balance favoring dispersal- small clumps of isolated groups, might work better for scientific advancement. In the short run I’d expect an increase in technical expertise as China finishes playing catch-up in technology (if it hasn’t already) and distributes technical knowledge more thoroughly throughout it’s regions, but it wouldn’t surprise me terribly if the long term effect of high-speed rail in China is negative for science production, and then for innovation and patents.
HT to Tyler Cowen