You call this a hobby?

2025-11-092025-11-12 PNRJ book reviews, critique of neoclassical economics, politics, public policy campaign, democracy, Democrat, donation, ecoterrorism, Eitan Hersch, grassroots, LGBT, Nazi, open borders, politics, Republican, slacktivism, trans, Tufts, vegetarian, voters, voting

Nov 9 JDN 2460989

A review of Politics is for Power by Eitan Hersch

This week, there was an election. It’s a minor midterm election—since it’s an odd-numbered year, many places don’t even have any candidates on the ballot—and as a result, turnout will surely be low. Eitan Hersch has written a book about why that’s a bad thing, and how it is symptomatic of greater problems in our civic culture as a whole.

Buried somewhere in this book, possible to find through committed, concerted effort, there is a book that could have had a large positive effect on our political system, our civic discourse, and our society as a whole. Sadly, Dr. Hersch buried it so well that most people will never find it.

In particular, he starts the book—not even on the first page, but on the cover—by actively alienating his core audience with what seems to be the very utmost effort he can muster.

Yes, even the subtitle is condescending and alienating:

How to Move Beyond Political Hobbyism, Take Action, and Make Real Change

And of course it’s not just there; on page after page he drives the dagger deeper and twists it as hard as he can, repeating the accusation over and over:

This is just a hobby for you. It doesn’t really mean anything.

Today’s hobbyists possess the negative qualities of the amateurs—hyperemotional engagement, obsession with national politics, an insatiable appetite for debate—and none of the amateur’s positive qualities—the neighborhood meetings, the concrete goals, the leadership.

– p.9

You hear that? You’re worse than an amateur. This is on page 9. Page 9.

[…] Much of the time we spend on politics is best described as an inward-focused leisure activity for people who like politics.

We may not easily concede that we are doing politics for fun.[…]

-p. 14

See? You may say it’s not really just for fun, but you’re lying. You’re failing to concede the truth.

To the political hobbyist, news is a form of entertainment and needs to be fun.

-p.19

You hear me? This is fun for you. You’re enjoying this. You’re doing it for yourself.

The real explanation for the dynamics of voter turnout is that we treat politics like a game and follow the spectacle. Turnout is high in presidential elections compared to other US elections in the same way that football viewership is high when the Super Bowl is on. Many people who do not like football or even know the rules of the game end up at a Super Bowl party. They’re there for the commercials, the guacamole, and to be part of a cultural moment. That’s why turnout is high in presidential elections. Without the spectacle, even people who say they care about voting don’t show up.

-p. 48

This is all a game. It’s not real. You don’t really care.

I could go on; he keeps repeating this message—this insult, this accusation—throughout the book. He tells you, over and over, that if you are not already participating in politics in the very particular way he wants you to (and he may even be right that it would be better!), you are a selfish liar, and you are treating what should be vitally important as just meaningless entertainment.

This made it honestly quite painful to get through the book. Several times, I was tempted to just give up and put it back on the shelf. But I’m glad I didn’t, because there are valuable insights about effective grassroots political activism buried within this barrage of personal accusations.

I guess Hersch must not see this as a personal accusation; at one point, he acknowledges that people might find it insulting, but (1) doesn’t seem to care and (2) makes no effort to inquire as to why we might feel that way; in fact, he manages to twist the knife just a little deeper in that very same passage:

For the non-self-identifying junkies, the term political hobbyist can be insulting. Given how important politics is, it doesn’t feel good to call one’s political activity a hobby. The term is also insulting, I have learned, to real hobbyists, who see hobbies as activities with much more depth than the online bickering or addictive news consumption I’m calling a hobby.

-p. 88

You think calling it a “hobby” is insulting? Yeah, well, it’s worse than that, so ha!

But let me tell you something about my own experience of politics. (Actually, one of Hersch’s central messages is that sharing personal experiences is one of the most powerful political tools I know.)

How do most people I know feel about politics, since, oh, say… November 2016?

ABSOLUTE HORROR AND DESPAIR.

For every queer person I know, every trans person, every immigrant, every woman, every person of color, and for plenty of White cishet liberal guys too, the election of President Donald Trump was traumatic. It felt like a physical injury. People who had recovered from depression were thrust back into it. People felt physically nauseated. And especially for immigrants and trans people, people literally feared for their lives and were right to do so.

WHATEVER THIS IS, IT IS NOT A HOBBY.

I’ve had to talk people down from psychotic episodes and suicidal ideation because of this, and you have the fucking audacity to tell me that we’re doing this for fun!?

If someone feared for their life because their team lost the Super Bowl, we would rightfully recognize that as an utterly pathological response. But I know a whole bunch of folks on student visas that are constantly afraid of being kidnapped and taken away by masked men with guns, because that is a thing that has actually happened to other people who were in this country on student visas. I know a whole bunch of trans folks who are afraid of assaulted or even killed for using the wrong bathroom, because that is a thing that actually happens to trans people in this country.

I wish I could tell these people—many of them dear friends of mine—that they are wrong to fear, that they are safe, that everything will be all right. But as long as Donald Trump is in power and the Republicans in Congress and the right-wing Supreme Court continue to enable him, I can’t tell them that, because I would be lying; the danger is real. All I can do is tell them that it is probably not as great a danger as they fear, and that if there is any way I can help them, I am willing to do so.

Indeed, politics for me and those closest to me is so obviously so much not a hobby that repeatedly insisting that I admit that it is starts to feel like gaslighting. I feel like I’m in a struggle session or something: “Admit you are a hobbyist! Repent!”

I don’t know; maybe there are people for whom politics is just a hobby. Maybe the privileged cishet White kids at Tufts that Dr. Hersch lectures to are genuinely so removed from the consequences of public policy that they can engage with politics at their leisure and for their own entertainment. (A lot of the studies he cites are specifically about undergrads; I know this is a thing in pretty much all social science… but maybe undergrads are in fact not a very representative sample of political behavior?) But even so, some of the international students in those lecture halls (11% of Tufts undergrads and 17% of Tufts grads) probably feel pretty differently, I have to imagine.

In fact, maybe genuine political hobbyism is a widespread phenomenon, and its existence explains a lot of otherwise really baffling things about the behavior of our electorate (like how the same districts could vote for both Donald Trump and Alexandria Ocasio-Cortez). I don’t find that especially plausible given my own experience, but I’m an economist, not a political scientist, so I do feel like I should offer some deference to the experts on this matter. (And I’m well aware that my own social network is nothing like a representative sample of the American electorate.)

But I can say this for sure:

The target audience of this book is not doing this as a hobby.

Someone who picks up a book by a political scientist hoping for guidance as to how to make their own political engagement more effective is not someone who thinks this is all a game. They are not someone who is engaging with politics as a fun leisure activity. They are someone who cares. They are someone who thinks this stuff matters.

By construction, the person who reads this book to learn about how to make change wants to make change.

So maybe you should acknowledge that at some point in your 200 pages of text? Maybe after spending all these words talking about how having empathy is such an important trait in political activism, you should have some empathy for your audience?

Hersch does have some useful advice to give, buried in all this.

His core message is basically that we need more grassroots activism: Small groups of committed people, acting in their communities. Not regular canvassing, which he acknowledges as terrible (and as well he should; I’ve done it, and it is), but deep canvassing, which also involves going door to door but is really a fundamentally different process.

Actually, he seems to love grassroots organizing so much that he’s weirdly nostalgic for the old days of party bosses. Several times, he acknowledges that these party bosses were corrupt, racist, and utterly unaccountable, but after every such acknowledgment he always follows it up with some variation on “but at least they got things done”.

He’s honestly weirdly dismissive of other forms of engagement, though. Like, I expected him to be dismissive of “slacktivism” (though I am not), if for no other reason than the usual generational curmudgeonry. But he’s also weirdly dismissive of donations and even… honestly… voting? He doesn’t even seem interested in encouraging people to vote more. He doesn’t seem to think that get-out-the-vote campaigns are valuable.

I guess as a political scientist, he’s probably very familiar with the phenomenon of “low information voters”, who frequently swing elections despite being either clueless or actively misled. And okay, maybe turning out those people isn’t all that useful, at least if it’s not coupled with also educating them and correcting their misconceptions. But surely it’s not hobbyism to vote? Surely doing the one most important thing in a democratic system isn’t treating this like a game?

In his section on donations, he takes two tacks against them:

The first is to say that rich donors who pay $10,000 a plate for fancy dinners really just want access to politicians for photo ops. I don’t think that’s right, but the truth is admittedly not much better: I think they want access to politicians to buy influence. This is “political engagement” in some sense—you’re acting to exert power—but it’s corrupt, and it’s the source of an enormous amount of damage to our society—indeed to our planet itself. But I think Hersch has to deny that the goal is influence, because that would in fact be “politics for power”, and in order to remain fiercely non-partisan throughout (which, honestly, probably is a good strategic move), he carefully avoids ever saying that anyone exerting political power is bad.

Actually the closest he gets to admitting his own political beliefs (surprise, the Massachusetts social science professor is a center-left liberal!) comes in a passage where he bemoans the fact that… uh… Democrats… aren’t… corrupt enough? If you don’t believe me, read it for yourself:

The hobbyist motivation among wealthy donors is also problematic for a reason that doesn’t have a parallel in the nonprofit world: Partisan asymmetry. Unlike Democratic donors, Republican donors typically support politicians whose policy priorities align with a wealthy person’s financial interests. The donors can view donations as an investment. When Schaffner and I asked max-out donors why they made their contribution, many more Republicans than Democrats said that a very or extremely important reason for their gift was that the politician could affect the donor’s own industry (37 percent of Republicans versus 22 percent of Democrats).

This asymmetry puts Democrats at a disadvantage. Not motivated by their own bottom line, Democratic donors instead have to be motivated by ideology, issues, or even by the entertainment value that a donation provides.

-p.80

Yes, God forbid they be motivated by issues or ideology. That would involve caring about other people. Clearly only naked self-interest and the profit motive could ever be a good reason for political engagement! (Quick question: You haven’t been, uh, reading a lot of… neoclassical economists lately, have you? Why? Oh, no reason.) Oh why can’t Democrats just be more like Republicans, and use their appallingly vast hoards of money to make sure that we cut social services and deregulate everything until the polluted oceans flood the world!?

The second is to say that the much broader population who makes small donations of $25 or $50 is “ideologically extreme” compared to the rest of the population, which is true, but seems to me utterly unsurprising. The further the world is from how you’d like to see it, the greater the value is to you of changing the world, and therefore the more you should be willing to invest into making that change—or even into a small probability of possibly making that change. If you think things are basically okay, why would you pay money to try to make them different? (I guess maybe you’d try to pay money to keep them the same? But even so-called “conservatives” never actually seem to campaign on that.)

I also don’t really see “ideologically extreme” as inherently a bad thing.

Sure, some extremists are very bad: Nazis are extreme and bad (weird that this seems controversial these days), Islamists are extreme and bad, Christian nationalists are extreme and bad, tankie leftists are extreme and bad.

But vegetarians—especially vegans—are also “ideologically extreme”, but quite frankly we are objectively correct, and maybe don’t even go far enough (I only hope that future generations will forgive me for my cheese). Everyone knows that animals can suffer, and everyone who is at all informed knows that factory farms make them suffer severely. The “moderate” view that all this horrible suffering is justifiable in the name of cheap ground beef and chicken nuggets is a fundamentally immoral one. (Maybe I could countenance a view that free-range humane meat farming is acceptable, but even that is far removed from our current political center.)

Trans activism is in some sense “ideologically extreme”—and frequently characterized as such—but it basically amounts to saying that the human rights of free expression, bodily autonomy, and even just personal safety outweigh other people’s narrow, blinkered beliefs about sex and gender. Okay, maybe we can make some sort of compromise on trans kids in sports (because why should I care about sports?), and I’m okay with gender-neutral bathrooms instead of letting trans women in women’s rooms (because gender-neutral bathrooms give more privacy and safety anyway!), and the evidence on the effects of puberty blockers and hormones is complicated (which is why it should be decided by doctors and scientists, not by legislators!), but in our current state, trans people die to murder and suicide at incredibly alarming rates. The only “moderate” position here is to demand, at minimum, enforced laws against discrimination and hate crimes. (Also, calling someone by the name and pronouns they ask you to costs you basically nothing. Failing to do that is not a brave ideological stand; it’s just you being rude and obnoxious. Indeed, since it can trigger dysphoria, it’s basically like finding out someone’s an arachnophobe and immediately putting a spider in their hair.)

Open borders is regarded as so “ideologically extreme” that even the progressive Democrats won’t touch it, despite the fact that I literally am not aware of a single ethical philosopher in the 21^st century who believes that our current system of immigration control is morally justifiable. Even the ones who favor “closed borders” in principle are almost unanimous that our current system is cruel and racist. The Lifeboat Theory is ridiculous; allowing immigrants in wouldn’t kill us, it would just maybe—maybe—make us a little worse off. Their lives may be at stake, but ours are not. We are not keeping people out of a lifeboat so it doesn’t sink; we are keeping them out of a luxury cruise liner so it doesn’t get dirty and crowded.

Indeed, even so-called “eco-terrorists”, who are not just ideologically extreme but behaviorally extreme as well, don’t even really seem that bad. They are really mostly eco-vandals; they destroy property, they don’t kill people. There is some risk to life and limb involved in tree spiking or blowing up a pipeline, but the goal is clearly not to terrorize people; it’s to get them to stop doing a particular thing—a particular thing that they in fact probably should stop doing. I guess I understand why this behavior has to be illegal and punished as such; but morally, I’m not even sure it’s wrong. We may not be able to name or even precisely count the children saved who would have died if that pipeline had been allowed to continue pumping oil and thus spewing carbon emissions, but that doesn’t make them any less real.

So really, if anything, the problem is not “extremism” in some abstract sense, but particular beliefs and ideologies, some of which are not even regarded as extreme. A stronger vegan lobby would not be harmful to America, however “extreme” they might be, and a strong Republican lobby, however “mainstream” it is perceived to be, is rapidly destroying our nation on a number of different levels.

Indeed, in parts of the book, it almost seems like Hersch is advocating in some Nietzschean sense for power for its own sake. I don’t think that’s really his intention; I think he means to empower the currently disempowered, for the betterment of society as a whole. But his unwillingness to condemn rich Republicans who donate the maximum allowed in order to get their own industry deregulated is at least… problematic, as both political activists and social scientists are wont to say.

I’m honestly not even sure that empowering the disempowered is what we need right now. I think a lot of the disempowered are also terribly misinformed, and empowering them might actually make things worse. In fact, I think the problem with the political effect of social media isn’t that it has failed to represent the choices of the electorate, but that it has represented them all too well and most people are really, really bad—just, absolutely, shockingly, appallingly bad—at making good political choices. They have wildly wrong beliefs about really basic policy questions, and often think that politicians’ platforms are completely different from what they actually are. I don’t go quite as far as this article by Dan Williams in Conspicuous Cognition, but it makes some really good points I can’t ignore. Democracy is currently failing to represent the interests of a great many Americans, but a disturbingly large proportion of this failure must be blamed on a certain—all too large—segment of the American populace itself.

I wish this book had been better.

More grassroots organizing does seem like a good thing! And there is some advice in this book about how to do it better—though in my opinion, not nearly enough. A lot of what Hersch wants to see happen would require tremendous coordination between huge numbers of people, which almost seems like saying “politics would be better if enough people were better about politics”. What I wanted to hear more about was what I can do; if voting and donating and protesting and blogging isn’t enough, what should I be doing? How do I make it actually work? It feels like Hersch spent so long trying to berate me for being a “hobbyist” that he forgot to tell me what he actually thinks I should be doing.

I am fully prepared to believe that online petitions and social media posts don’t accomplish much politically. (Indeed, I am fully prepared to believe that blogging doesn’t accomplish much politically.) I am open to hearing what other options are available, and eager for guidance about how to have the most effective impact.

But could you please, please not spend half the conversation repeatedly accusing me of not caring!?

Toward a positive vision of the future

2025-06-222025-06-16 PNRJ current events, ethics, inequality, politics, tribal paradigm animal welfare, capitalism, climate change, Democrat, doctors, healthcare, housing, ICE, Iran, Israel, LGBT, Mitt Romney, Obamacare, Republican, Russia, segregation, sports, taxes, trans, Trump, Ukraine, wildfire

Jun 22 JDN 2460849

Things look pretty bleak right now. Wildfires rage across Canada, polluting the air across North America. Russia is still at war with Ukraine, and Israel seems to be trying to start a war with Iran. ICE continues sending agents without badges to kidnap people in unmarked vehicles and sending them to undisclosed locations. Climate change is getting worse, and US policy is pivoting from subsidizing renewables back to subsidizing fossil fuels. And Trump, now revealed to be a literal fascist, is still President.

But things can get better.

I can’t guarantee that they will, nor can I say when; but there is still hope that a better future is possible.

It has been very difficult to assemble a strong coalition against the increasingly extreme far-right in this country (epitomized by Trump). This seems odd, when most Americans hold relatively centrist views. Yes, more Americans identify as conservative than as liberal, but Trump isn’t a conservative; he’s a radical far-right fascist. Trump recently gave a speech endorsing ethnic cleansing, for goodness’ sake! I’m liberal, but I’d definitely vote for a conservative like Mitt Romney rather than a Stalinist! So why are “conservatives” voting for a fascist?

But setting aside the question of why people voted for Trump, we still have the question of why the left has not been able to assemble a strong coalition against him.

I think part of the problem is that the left really has two coalitions within it: The center left, who were relatively happy with the status quo before Trump and want to go back to that; and the far left, who were utterly unhappy with that status quo and want radical change. So while we all agree that Trump is awful, we don’t really agree on what he’s supposed to be replaced with.

It’s of course possible to be in between, and indeed I would say that I am. While clearly things were better under Obama and Biden than they have been under Trump, there were still a lot of major problems in this country that should have been priorities for national policy but weren’t:

Above all, climate change—the Democrats at least try to do something against it, but not nearly enough. Our carbon emissions are declining, but it’s very unclear if we’ll actually hit our targets. The way we have been going, we’re in for a lot more hurricanes and wildfires and droughts.
Housing affordability is still an absolute crisis; half of renters spend more than the targeted 30% of their income on housing, and a fourth spend more than 50%.Homelessness is now at a record high.
Healthcare is still far too expensive in this country; we continue to spend far more than other First World countries without getting meaningfully better care.
While rights and protections for LGB people have substantially improved in the last 30 years, rights and protections for trans people continue to lag behind.
Racial segregation in housing remains the de facto norm, even though it is de jure illegal.
Livestock remain exempted from the Animal Welfare Act and in 2002 laboratory rats and mice were excluded as well, meaning that cruel or negligent treatment which would be illegal for cats and dogs is still allowed on livestock and lab rats.
Income and wealth inequality in this country remains staggeringly high, and the super-rich continue to gain wealth at a terrifying rate.
Our voting system is terrible—literally the worst possible system that can technically still be considered democracy.

This list is by no means exhaustive, but these are the issues that seem most salient to me.

2 and 3 both clearly showed up in my Index of Necessary Expenditure; these costs were the primary reason why raising a family of 4 was unaffordable on a median household income.

So it isn’t right to say that I was completely happy with how things were going before. But I still think of myself as center left, because I don’t believe we need to tear everything down and start over.

I have relatively simple recommendations that would go a long way toward solving all 8 of these problems:

Climate change could be greatly mitigated if we’d just tax carbon already, or implement a cap-and-trade system like California’s nationwide. If that’s too politically unpalatable, subsidize nuclear power, fusion research, and renewables instead. That’s way worse from a budget perspective, but for some reason Americans are just fanatically opposed to higher gas prices.

Housing affordability is politically thorny, but economically quite simple: Build more housing. Whatever we have to do to make that happen, we should do it. Maybe this involves changes to zoning or other regulations. Maybe it involves subsidies to developers. Maybe it involves deploying eminent domain to build public housing. Maybe it involves using government funds to build housing and then offering it for sale on the market. But whatever we do, we need more housing.

Healthcare costs are a trickier one; Obamacare helped, but wasn’t enough. I think what I would like to see next is an option to buy into Medicare; before you are old enough to get it for free, you can pay a premium to be covered by it. Because Medicare is much more efficient than private insurance, you could pay a lower premium and get better coverage, so a lot of people would likely switch (which is of course exactly why insurance companies would fight the policy at every turn). Even putting everyone on Medicare might not be enough; to really bring costs down, we may need to seriously address the fact that US doctors, particularly specialists, are just radically higher-paid than any other doctors in the world. Is an American doctor who gets $269,000 per year really 88% better than a French doctor who gets $143,000?

The policies we need for LGBT rights are mostly no-brainers.

Okay, I can admit to some reasonable nuance when it comes to trans women in pro sports (the statistical advantages they have over cis women are not as clear-cut as many people think, but they do seem to exist; average athletic performance for trans women seems to be somewhere in between the average for cis men and the average for cis women), but that’s really not a very important issue. Like, seriously, why do we care so much about pro sports? Either let people play sports according to their self-identified gender, or make the two options “cis women” and “other” and let trans people play the latter. And you can do the same thing with school sports, or you can eliminate them entirely because they are a stupid waste of academic resources; but either way this should not be considered a top priority policy question. (If parents want their kids to play sports, they can form their own leagues; the school shouldn’t be paying for it. Winning games is not one of the goals of an academic institution. If you want kids to get more exercise, give them more recess and reform the physical education system so it isn’t so miserable for the kids who need it most.)

But there is absolutely no reason not to let people use whatever pronouns and bathrooms they want; indeed, there doesn’t really seem to be a compelling reason to gender-segregate bathrooms in the first place, and removing that segregation would most benefit women, who often have to wait much longer in line for the bathroom. (The argument that this somehow protects women never made sense to me; if a man wants to assault women in the bathroom, what’s to stop him from just going into the women’s bathroom? It’s not like there’s a magic field that prevents men from entering. He’s already planning on committing a crime, so it doesn’t seem like he’s very liable to held back by social norms. It’s worthwhile to try to find ways to prevent sexual assault, but segregating bathrooms does little or nothing toward that goal—and indeed, trans-inclusive bathrooms do not statistically correlate with higher rates of sexual assault.) But okay, fine, if you insist on having the segregation, at least require gender-neutral bathrooms as well. This is really not that difficult; it’s pretty clearly bigotry driving this, not serious policy concerns.

Not exempting any vertebrate animals from anti-cruelty legislation is an incredibly simple thing to do, obviously morally better, and the only reason we’re not doing it is that it would hurt agribusinesses and make meat more expensive. There is literally zero question what the morally right thing to do here is; the question is only how to get people to actually do that morally right thing.

Finally, how do we fix income inequality? Some people—including some economists—treat this as a very complicated, difficult question, but I don’t think it is. I think the really simple, obvious answer is actually the correct one: Tax rich people more, and use the proceeds to help poor people. We should be taxing the rich a lot more; I want something like the revenue-maximizing rate, estimated at about 70%. (And an even higher rate like the 90% we had in the 1950s is not out of the question.) These funds could either provide services like education and healthcare, or they could simply be direct cash transfers. But one way or another, the simplest, most effective way to reduce inequality is to tax the rich and help the poor. A lot of economists fear that this would hurt the overall economy, but particularly if these rates are really targeted at the super-rich (the top 0.01%), I don’t see how they could, because all those billions of dollars are very clearly monopoly rents rather than genuine productivity. If anything, making it harder to amass monopoly rents should make the economy more efficient. And taking say 90% of the roughly 10% return just the top 400 billionaires make on their staggering wealth would give us an additional $480 billion per year.

Fixing our voting system is also quite straightforward. Ranked-choice voting would be a huge improvement, and has already been implemented successfully in several states. Even better would be range voting, but so far very few places have been bold enough to actually try it. But even ranked-choice voting would remove most of the terrible incentives that plurality voting creates, and likely allow us to move beyond the two-party system into a much more representative multiparty system.

None of this requires overthrowing the entire system or dismantling capitalism.

That is, we can have a positive vision of the future that doesn’t require revolution or radical change.

Unfortunately, there’s still a very good chance we’ll do none of it.

The Republicans passed a terrible budget

2025-05-042025-04-28 PNRJ current events, inequality, politics, public policy budget, current policy baseline, debt, deficit, Democrat, federal budget, House of Representatives, national debt, Republican, Trump

May 4 JDN 2460800

On April 10, the US House of Representatives passed a truly terrible budget bill. It passed on an almost entirely partisan vote—214 Democrats against, 216 Republicans for, 2 Republicans against. So I think it’s quite fair to say that the Republicans passed this budget—not a single Democrat voted for it, and only 2 Republicans voted against it.

So what’s so bad about it?

Well, first of all, in order to avoid showing just how much it will balloon the national debt, the new budget operates on different accounting rules than normal, using what’s called “current policy baseline” instead of the standard method of assuming that policies will end after 10 years.

In addition to retaining $3.8 trillion in tax cuts that were supposed to expire, this budget will cut taxes by $1.5 trillion over 10 years, with the vast majority of those cuts going to the top 1%—thus the real increase in the deficit is a staggering $5.3 trillion over 10 years. This is absolutely not what we need, given that unemployment is actually pretty good right now and we still have a deficit of $1.8 trillion per year. (Yes, really.) That kind of deficit is good in response to a severe recession—I was all in favor of it during COVID, and it worked. But when the economy is good, you’re supposed to balance the budget, and they haven’t.

The richest 1% stand to gain about 4% more income from these tax cuts (which adds up to about $240 billion per year), while the combination of tax cuts and spending cuts would most likely reduce the income of 40% of the population.

They aren’t even cutting spending to offset these tax cuts. This budget only includes a paltry $4 billion in spending cuts—less than 0.1% of the budget. (I mean, sure, $4 billion is a lot of money for a person; but for a whole country as rich and large as ours? It’s a rounding error.) And then it includes $521 billion in spending increases, over 100 times as much.

They are talking about making more cuts, but they’ve been cagey as to where, probably because the only plausible ways to save this much money are the military, Medicaid, Medicare, or Social Security. Obviously Republicans will never cut the military, but the other three programs are also enormously popular, even in deep-red states. It would be not only very harmful to millions of people to cut these programs—it would also be harmful to the Republicans’ re-election chances. They could also get some savings by cutting income security programs like SNAP and TANF, which would probably be less unpopular—but it would also cause enormous suffering.

This new budget is estimated to add some $6.9 trillion to the national debt over 10 years—and even more after that, if the policies actually continue.

I am not exactly a “deficit hawk”; I don’t think the budget should always be balanced. But this is not the time to be increasing the deficit. When times are good, we should balance the budget, so that when we have to go into debt during bad times, we can afford to do so.

And bad times are probably on the horizon, since Trump’s tariff policy is already such a disaster. So are we going to borrow even more then? While bond yields are rising? We’re going to end up spending most of our budget on debt payments! And all this injection of money into the system won’t be good for inflation either (and on top of the tariffs!).

The only sensible thing to do right now is raise taxes on the rich. We need that revenue. We can’t just keep going deeper into debt. And the rich are the ones who would be least harmed by raising taxes—indeed, if you focused the hikes on billionaires, they would barely feel anything at all.

But the Republicans don’t care about what’s in the interest of ordinary Americans. They only care about the interests of the rich. And that’s why they passed this budget.

Please, don’t let Trump win this

2024-10-202024-10-13 PNRJ core principles, current events, ethics, politics Democrat, Donald Trump, election, FiveThirtyEight, Kamala Harris, poll, range voting, Republican, voting, voting system

Oct 20 JDN 2460604

It’s almost time for the Presidential election in the United States. Right now, the race is too close to call; as of writing this post, FiveThirtyEight gives Harris a 53% chance of winning, and Trump a 46% chance.

It should not be this close. It should never have been this close. We have already seen what Trump is like in office, and it should have made absolutely no one happy. He is authoritarian, corrupt, incompetent, and narcissistic, and lately he’s starting to show signs of cognitive decline. He is a convicted felon and was involved in an attempted insurrection. His heavy-handed trade tariffs would surely cause severe economic damage both here and abroad, and above all, he wants to roll back rights for millions of Americans.

Almost anyone would be better than Trump. Harris would be obviously, dramatically better in almost every way. Yet somehow Trump is still doing well in the polls, and could absolutely still win this.

Please, do everything you can to stop that from happening.

Donate. Volunteer. Get out the vote. And above all, vote.

Part of the problem is our two-party system, which comes ultimately from our plurality voting system. As RangeVoting.org has remarked, our current system is basically the worst possible system that can still be considered democratic. Range voting would be clearly the best system, but failing that, at least we could have approval voting, or some kind of ranked-choice system. Only voting for a single candidate causes huge, fundamental flaws in representation, especially when it comes to candidate cloning: Multiple similar candidates that people like can lose to a single candidate that people dislike, because the vote gets split between them.

In fact, that’s almost certainly what happened with Trump: The only reason he won the primary the first time was that he had a small group of ardent supporters, while all the other candidates were similar and so got the mainstream Republican vote split between them. (Though it looks like the second time around he’d still win even if all the other similar candidates were consolidated—which frankly horrifies me.)

But it isn’t just our voting system. The really terrifying thing about Trump is how popular he is among Republicans. Democrats hate him, but Republicans love him. I have tried talking with Republican family members about what they like about Trump, and they struggle to give me a sensible answer. It’s not his personality or his competence (how could it be?). For the most part, it wasn’t even particular policies he supports. It was just this weird free-floating belief that he was a good President and would be again.

There was one major exception to that: Single-issue voters who want to ban abortion. For these people, the only thing that matters is that Trump appointed the Supreme Court justices who overturned Roe v. Wade. I don’t know what to say to such people, since it seems so obvious to me that (1) a total abortion ban is too extreme, even if you want to reduce the abortion rate, (2) there are so many other issues that matter aside from abortion; you can’t simply ignore them all, (3) several other Republican candidates are equally committed to banning abortion but not nearly as corrupt or incompetent, and (4) the Supreme Court has already been appointed; there’s nothing more for Trump to do in that department that he hasn’t already done. But I guess there is at least something resembling a coherent policy preference here, if a baffling one.

Others also talked about his ideas on trade and immigration, but they didn’t seem to have a coherent idea of what a sensible trade or immigration policy looks like. They imagined that it was a reasonable thing to simply tariff all imports massively or expel all immigrants, despite the former being economically absurd and the latter being a human rights violation (and also an economic disaster). I guess that also counts as a policy preference, but it’s not simply baffling; it’s horrifying. I don’t know what to say to these people either.

But maybe that’s a terror I need to come to terms with: Some people don’t like Trump in spite of his terrible policy ideas; they like him because of them. They want a world where rights are rolled back for minorities and LGBT people and (above all) immigrants. They want a world where global trade is shut down and replaced by autarky. They imagine that these changes will somehow benefit them, even when all the evidence suggests that it would do nothing of the sort.

I have never feared Trump himself nearly so much as I fear the people of a country that could elect him. And should we re-elect him, I will fear the people of this country even more.

Please, don’t let that happen.

The Butlerian Jihad is looking better all the time

2024-03-242024-03-24 PNRJ book reviews, cognitive science, computer science, core principles, critique of neoclassical economics, inequality, politics, public policy, tribal paradigm abundance, Action Potential, artificial general intelligence, artificial intelligence, Blue Brain, brain emulation, Butlerian Jihad, conservative, Democrat, Dune, economic growth, egalitarianism, Elon Musk, farmer, forager, humanism, insecure affluence, Keynes, liberal, Massachusetts, Millennial, Mississippi, Moore's Law, narcissism, Nigeria, Norway, poverty, psychopathy, Republican, Robin Hanson, scarcity, transhuman, transhumanism, Zoomer

Mar 24 JDN 2460395

A review of The Age of Em by Robin Hanson

In the Dune series, the Butlerian Jihad was a holy war against artificial intelligence that resulted in a millenias-long taboo against all forms of intelligent machines. It was effectively a way to tell a story about the distant future without basically everything being about robots or cyborgs.

After reading Robin Hanson’s book, I’m starting to think that maybe we should actually do it.

Thus it is written: “Thou shalt not make a machine in the likeness of a human mind.”

Hanson says he’s trying to reserve judgment and present objective predictions without evaluation, but it becomes very clear throughout that this is the future he wants, as well as—or perhaps even instead of—the world he expects.

In many ways, it feels like he has done his very best to imagine a world of true neoclassical rational agents in perfect competition, a sort of sandbox for the toys he’s always wanted to play with. Throughout he very much takes the approach of a neoclassical economist, making heroic assumptions and then following them to their logical conclusions, without ever seriously asking whether those assumptions actually make any sense.

To his credit, Hanson does not buy into the hype that AGI will be successful any day now. He predicts that we will achieve the ability to fully emulate human brains and thus create a sort of black-box AGI that behaves very much like a human within about 100 years. Given how the Blue Brain Project has progressed (much slower than its own hype machine told us it would—and let it be noted that I predicted this from the very beginning), I think this is a fairly plausible time estimate. He refers to a mind emulated in this way as an “em”; I have mixed feelings about the term, but I suppose we did need some word for that, and it certainly has conciseness on its side.

Hanson believes that a true understanding of artificial intelligence will only come later, and the sort of AGI that can be taken apart and reprogrammed for specific goals won’t exist for at least a century after that. Both of these sober, reasonable predictions are deeply refreshing in a field that’s been full of people saying “any day now” for the last fifty years.

But Hanson’s reasonableness just about ends there.

In The Age of Em, government is exactly as strong as Hanson needs it to be. Somehow it simultaneously ensures a low crime rate among a population that doubles every few months while also having no means of preventing that population growth. Somehow ensures that there is no labor collusion and corporations never break the law, but without imposing any regulations that might reduce efficiency in any way.

All of this begins to make more sense when you realize that Hanson’s true goal here is to imagine a world where neoclassical economics is actually true.

He realized it didn’t work on humans, so instead of giving up the theory, he gave up the humans.

Hanson predicts that ems will casually make short-term temporary copies of themselves called “spurs”, designed to perform a particular task and then get erased. I guess maybe he would, but I for one would not so cavalierly create another person and then make their existence dedicated to doing a single job before they die. The fact that I created this person, and they are very much like me, seem like reasons to care more about their well-being, not less! You’re asking me to enslave and murder my own child. (Honestly, the fact that Robin Hanson thinks ems will do this all the time says more about Robin Hanson than anything else.) Any remotely sane society of ems would ban the deletion of another em under any but the most extreme circumstances, and indeed treat it as tantamount to murder.

Hanson predicts that we will only copy the minds of a few hundred people. This is surely true at some point—the technology will take time to develop, and we’ll have to start somewhere. But I don’t see why we’d stop there, when we could continue to copy millions or billions of people; and his choices of who would be emulated, while not wildly implausible, are utterly terrifying.

He predicts that we’d emulate genius scientists and engineers; okay, fair enough, that seems right. I doubt that the benefits of doing so will be as high as many people imagine, because scientific progress actually depends a lot more on the combined efforts of millions of scientists than on rare sparks of brilliance by lone geniuses; but those people are definitely very smart, and having more of them around could be a good thing. I can also see people wanting to do this, and thus investing in making it happen.

He also predicts that we’d emulate billionaires. Now, as a prediction, I have to admit that this is actually fairly plausible; billionaires are precisely the sort of people who are rich enough to pay to be emulated and narcissistic enough to want to. But where Hanson really goes off the deep end here is that he sees this as a good thing. He seems to honestly believe that billionaires are so rich because they are so brilliant and productive. He thinks that a million copies of Elon Musks would produce a million hectobillionaires—when in reality it would produce a million squabbling narcissists, who at best had to split the same $200 billion wealth between them, and might very well end up with less because they squander it.

Hanson has a long section on trying to predict the personalities of ems. Frankly this could just have been dropped entirely; it adds almost nothing to the book, and the book is much too long. But the really striking thing to me about that section is what isn’t there. He goes through a long list of studies that found weak correlations between various personality traits like extroversion or openness and wealth—mostly comparing something like the 20^th percentile to the 80^th percentile—and then draws sweeping conclusions about what ems will be like, under the assumption that ems are all drawn from people in the 99.99999^th percentile. (Yes, upper-middle-class people are, on average, more intelligent and more conscientious than lower-middle-class people. But do we even have any particular reason to think that the personalities of people who make $150,000 are relevant to understanding the behavior of people who make $15 billion?) But he completely glosses over the very strong correlations that specifically apply to people in that very top super-rich class: They’re almost all narcissists and/or psychopaths.

Hanson predicts a world where each em is copied many, many times—millions, billions, even trillions of times, and also in which the very richest ems are capable of buying parallel processing time that lets them accelerate their own thought processes to a million times faster than a normal human. (Is that even possible? Does consciousness work like that? Who knows!?) The world that Hanson is predicting is thus one where all the normal people get outnumbered and overpowered by psychopaths.

Basically this is the most abjectly dystopian cyberpunk hellscape imaginable. And he talks about it the whole time as if it were good.

It’s like he played the game Action Potential and thought, “This sounds great! I’d love to live there!” I mean, why wouldn’t you want to owe a life-debt on your own body and have to work 120-hour weeks for a trillion-dollar corporation just to make the payments on it?

Basically, Hanson doesn’t understand how wealth is actually acquired. He is educated as an economist, yet his understanding of capitalism basically amounts to believing in magic. He thinks that competitive markets just somehow perfectly automatically allocate wealth to whoever is most productive, and thus concludes that whoever is wealthy now must just be that productive.

I can see no other way to explain his wildly implausible predictions that the em economy will double every month or two. A huge swath of the book depends upon this assumption, but he waits until halfway through the book to even try to defend it, and then does an astonishingly bad job of doing so. (Honestly, even if you buy his own arguments—which I don’t—they seem to predict that population would grow with Moore’s Law—doubling every couple of years, not every couple of months.)

Whereas Keynes predicted based on sound economic principles that economic growth would more or less proceed apace and got his answer spot-on, Hanson predicts that for mysterious, unexplained reasons economic growth will suddenly increase by two orders of magnitude—and I’m pretty sure he’s going to be wildly wrong.

Hanson also predicts that ems will be on average poorer than we are, based on some sort of perfect-competition argument that doesn’t actually seem to mesh at all with his predictions of spectacularly rapid economic and technological growth. I think the best way to make sense of this is to assume that it means the trend toward insecure affluence will continue: Ems will have an objectively high standard of living in terms of what they own, what games they play, where they travel, and what they eat and drink (in simulation), but they will constantly be struggling to keep up with the rent on their homes—or even their own bodies. This is a world where (the very finest simulation of) Dom Perignon is $7 a bottle and wages are $980 an hour—but monthly rent is $284,000.

Early in the book Hanson argues that this life of poverty and scarcity will lead to more conservative values, on the grounds that people who are poorer now seem to be more conservative, and this has something to do with farmers versus foragers. Hanson’s explanation of all this is baffling; I will quote it at length, just so it’s clear I’m not misrepresenting it:

The other main (and independent) axis of value variation ranges between poor and rich societies. Poor societies place more value on conformity, security, and traditional values such as marriage, heterosexuality, religion, patriotism, hard work, and trust in authority. In contrast, rich societies place more value on individualism, self-direction, tolerance, pleasure, nature, leisure, and trust. When the values of individuals within a society vary on the same axis, we call this a left/liberal (rich) versus right/conservative (poor) axis.

Foragers tend to have values more like those of rich/liberal people today, while subsistence farmers tend to have values more like those of poor/conservative people today. As industry has made us richer, we have on average moved from conservative/farmer values to liberal/forager values. This value movement can make sense if cultural evolution used the social pressures farmers faced, such as conformity and religion, to induce humans, who evolved to find forager behaviors natural, to instead act like farmers. As we become rich, we don’t as strongly fear the threats behind these social pressures. This connection may result in part from disease; rich people are healthier, and healthier societies fear less.

The alternate theory that we have instead learned that rich forager values are more true predicts that values should have followed a random walk over time, and be mostly common across space. It also predicts the variance of value changes tracking the rate at which relevant information appears. But in fact industrial-era value changes have tracked the wealth of each society in much more steady and consistent fashion. And on this theory, why did foragers ever acquire farmer values?

[…]

In the scenario described in this book, many strange-to-forager behaviors are required, and median per-person (i.e. per-em) incomes return to near-subsistence levels. This suggests that the em era may reverse the recent forager-like trend toward more liberality; ems may have more farmer-like values.
The Age of Em, p. 26-27

There’s a lot to unpack here, but maybe it’s better to burn the whole suitcase.

First of all, it’s not entirely clear that this is really a single axis of variation, that foragers and farmers differ from each other in the same way as liberals and conservatives. There’s some truth to that at least—both foragers and liberals tend to be more generous, both farmers and conservatives tend to enforce stricter gender norms. But there are also clear ways that liberal values radically deviate from forager values: Forager societies are extremely xenophobic, and typically very hostile to innovation, inequality, or any attempts at self-aggrandizement (a phenomenon called “fierce egalitarianism“). San Francisco epitomizes rich, liberal values, but it would be utterly alien and probably regarded as evil by anyone from the Yanomamo.

Second, there is absolutely no reason to predict any kind of random walk. That’s just nonsense. Would you predict that scientific knowledge is a random walk, with each new era’s knowledge just a random deviation from the last’s? Maybe next century we’ll return to geocentrism, or phrenology will be back in vogue? On the theory that liberal values (or at least some liberal values) are objectively correct, we would expect them to advance as knowledge does—improving over time, and improving faster in places that have better institutions for research, education, and free expression. And indeed, this is precisely the pattern we have observed. (Those places are also richer, but that isn’t terribly surprising either!)

Third, while poorer regions are indeed more conservative, poorer people within a region actually tend to be more liberal. Nigeria is poorer and more conservative than Norway, and Mississippi is poorer and more conservative than Massachusetts. But higher-income households in the United States are more likely to vote Republican. I think this is particularly true of people living under insecure affluence: We see the abundance of wealth around us, and don’t understand why we can’t learn to share it better. We’re tired of fighting over scraps while the billionaires claim more and more. Millennials and Zoomers absolutely epitomize insecure affluence, and we also absolutely epitomize liberalism. So, if indeed ems live a life of insecure affluence, we should expect them to be like Zoomers: “Trans liberation now!” and “Eat the rich!” (Or should I say, “Delete the rich!”)

And really, doesn’t that make more sense? Isn’t that the trend our society has been on, for at least the last century? We’ve been moving toward more and more acceptance of women and minorities, more and more deviation from norms, more and more concern for individual rights and autonomy, more and more resistance to authority and inequality.

The funny thing is, that world sounds a lot better than the one Hanson is predicting.

A world of left-wing ems would probably run things a lot better than Hanson imagines: Instead of copying the same hundred psychopaths over and over until we fill the planet, have no room for anything else, and all struggle to make enough money just to stay alive, we could moderate our population to a more sustainable level, preserve diversity and individuality, and work toward living in greater harmony with each other and the natural world. We could take this economic and technological abundance and share it and enjoy it, instead of killing ourselves and each other to make more of it for no apparent reason.

The one good argument Hanson makes here is expressed in a single sentence: “And on this theory, why did foragers ever acquire farmer values?” That actually is a good question; why did we give up on leisure and egalitarianism when we transitioned from foraging to agriculture?

I think scarcity probably is relevant here: As food became scarcer, maybe because of climate change, people were forced into an agricultural lifestyle just to have enough to eat. Early agricultural societies were also typically authoritarian and violent. Under those conditions, people couldn’t be so generous and open-minded; they were surrounded by threats and on the verge of starvation.

I guess if Hanson is right that the em world is also one of poverty and insecurity, we might go back to those sort of values, borne of desperation. But I don’t see any reason to think we’d give up all of our liberal values. I would predict that ems will still be feminist, for instance; in fact, Hanson himself admits that since VR avatars would let us change gender presentation at will, gender would almost certainly become more fluid in a world of ems. Far from valuing heterosexuality more highly (as conservatives do, a “farmer value” according to Hanson), I suspect that ems will have no further use for that construct, because reproduction will be done by manufacturing, not sex, and it’ll be so easy to swap your body into a different one that hardly anyone will even keep the same gender their whole life. They’ll think it’s quaint that we used to identify so strongly with our own animal sexual dimorphism.

But maybe it is true that the scarcity induced by a hyper-competitive em world would make people more selfish, less generous, less trusting, more obsessed with work. Then let’s not do that! We don’t have to build that world! This isn’t a foregone conclusion!

There are many other paths yet available to us.

Indeed, perhaps the simplest would be to just ban artificial intelligence, at least until we can get a better handle on what we’re doing—and perhaps until we can institute the kind of radical economic changes necessary to wrest control of the world away from the handful of psychopaths currently trying their best to run it into the ground.

I admit, it would kind of suck to not get any of the benefits of AI, like self-driving cars, safer airplanes, faster medical research, more efficient industry, and better video games. It would especially suck if we did go full-on Butlerian Jihad and ban anything more complicated than a pocket calculator. (Our lifestyle might have to go back to what it was in—gasp! The 1950s!)

But I don’t think it would suck nearly as much as the world Robin Hanson thinks is in store for us if we continue on our current path.

So I certainly hope he’s wrong about all this.

Fortunately, I think he probably is.

Trump is finally being impeached

2019-10-062019-09-29 PNRJ current events, ethics, public policy ., Bernie Sanders, Congress, deceit, Democrat, Donald Trump, Hillary Clinton, impeachment, lying, Mike Pence, politics, Politifact, Republican, Senate

Post 310 Oct 6 JDN 2458763

Given that there have been efforts to impeach Trump since before he took office (which is totally unprecedented, by the way; while several others have committed crimes and been impeached while in office, no other US President has gone into office with widespread suspicion of mass criminal activity), it seems odd that it has taken this long to finally actually start formal impeachment hearings.

Why did it take so long? We needed two things to happen: One, absolutely overwhelming evidence of absolutely flagrant crimes, and two, a Democratic majority in the House of Representatives.

This is how divided America has become. If the Republicans were really a mainstream center-right party as they purport to be, they would have supported impeachment just as much as the Democrats, we would have impeached Trump in 2017, and he would have been removed from office by 2018. But in fact they are nothing of the sort. The Republicans no longer believe in democracy. The Democrats are a mainstream center-right party, and the Republicans are far-right White-nationalist crypto-fascists (and less ‘crypto-‘ all the time). After seeing how they reacted to his tax evasion, foreign bribes, national security leaks, human rights violations, obstruction of justice, and overall ubiquitous corruption and incompetence, by this point it’s clear that there is almost nothing that Trump could do which would make either the voter base or the politicians of the Republican Party turn against him—he may literally be correct that he could commit a murder in broad daylight on Fifth Avenue. Maybe if he raised taxes on billionaires or expressed support for Roe v. Wade they would finally revolt.

Even as it stands, there is good reason to fear that the Republican-majority Senate will not confirm the impeachment and remove Trump from office. The political fallout from such a failed impeachment is highly uncertain. So far, markets are taking it in stride; it may even turn out to be good for the economy. (Then again, a good economy may be good for Trump in 2020!) But at this point the evidence is so damning that if we don’t impeach now, we may never impeach again; if this isn’t enough, nothing is. (The Washington Examiner said that months ago, and may already have been right; but the case is even stronger now.)

So, the most likely scenario is that the impeachment goes through the House, but fails in the Senate. The good news is that if the Republicans do block the impeachment, they’ll be publicly admitting that even charges this serious and this substantiated mean nothing to them. Anyone watching who is still on the fence about them will see how corrupt they have become.

After that, this is probably what will happen: The impeachment will be big news for a month or two, then be largely ignored. Trump will probably try to make himself a martyr, talking even louder about ‘witch hunts’. He will lose popularity with a few voters, but his base will continue to support him through thick and thin. (Astonishingly, almost nothing really seems to move his overall approval rating.) The economy will be largely unaffected, or maybe slightly improve. And then we’ll find out in the 2020 election whether the Democrats can mobilize enough opposition to Trump, and—just as importantly—enough support for whoever wins the primaries, to actually win this time around.

If by some miracle enough Republicans find a moral conscience and vote to remove Trump from office, this means that until 2020 we will have President Mike Pence. In a sane world, that in itself would sound like a worst-case scenario; he’s basically a less-sleazy Ted Cruz. He is misogynistic, homophobic, and fanatically religious. He is also a partisan ideologue who toes the party line on basically every issue. Some have even argued that Pence is worse than Trump, because he represents the same ideology but with more subtlety and competence.

But subtlety and competence are important. Indeed, I would much rather have an intelligent, rational, competent ideologue managing our government, leading our military, and controlling our nuclear launch codes than an idiotic, narcissistic, impulsive one. Pence at least can be trusted to be consistent in his actions and diplomatic in his words—two things which Trump has absolutely never been.

Indeed, Pence’s ideological consistency has benefits; unlike Trump, he reliably supports free trade and his fiscal conservatism actually seems genuine for once. Consistency in itself has value: Life is much easier, and the economy is much stronger, when the rules of the game remain the same rather than randomly lurching from one extreme to another.

Pence is also not the pathological liar that Trump is. Yes, Pence has lied many times (only 22% of his statements were evaluated by PolitiFact as “Mostly True” or “True”, and 30% were “False” or “Pants on Fire”). But Trump lies constantly. A mere 14% of Trump’s statements were evaluated by Trump as “Mostly True” or “True”, while 48% were “False” or “Pants on Fire”. For Bernie Sanders, 49% were “Mostly True” or better, and only 11% were “False”, with no “Pants on Fire” at all; for Hillary Clinton, 49% were “Mostly True” or better, and only 10% were “False”, with 3% “Pants on Fire”. People have tried to keep running tallies of Trump’s lies, but it’s a tall order: The Washington Post records over 12,000 lies since he took office less than three years ago. Four thousand lies a year. More than ten every single day. Most people commit lies of omission or say ‘white lies’ several times per day (depending on who you ask, I’ve seen everything from an average of 2 times per day to an average of 100 times per day), but that’s not what we’re talking about here. These are consequential, outright statements of fact that aren’t true. And these are not literally everything he has said that wasn’t true; they are only public lies with relevance to policy or his own personal record. Indeed, Trump lies recklessly, stupidly, pointlessly, nonsensically. He seems like a pathological liar, or someone with dementia who is confabulating to try to fill gaps in his memory. (Indeed, a lot of his behavior is consistent with dementia, and similar to how Reagan acted in the early days of his Alzheimer’s.) At least if Pence takes office, we’ll be able to believe some of what he says.

Of course, Pence won’t be much better on some of the most important issues, such as climate change. When asked how important he thinks climate change is and what should be done about it, Pence always gives mealy-mouthed, evasive responses—but at least he doesn’t make up stories about windmills getting special permits to kill endangered birds.

I admit, choosing Pence over Trump feels like choosing to get shot in the leg instead of the face—but that’s really not a difficult choice, is it?

“Polarization” is not symmetric

2016-02-062016-02-06 PNRJ public policy Bernie Sanders, Democrat, Donald Trump, FDR, Hillary Clinton, polarization, politics, Republican, Ted Cruz

I titled the previous post using the word “polarization”, because that’s the simplest word we have for this phenomenon; but its connotations really aren’t right. “Polarization” suggests that both sides have gotten more extreme, and as a result they are now more fiercely in conflict. In fact what has happened is that Democrats have more or less stayed where they were, while Republicans have veered off into insane far-right crypto-fascist crazyland.

If you don’t believe my graph from ThinkProgress, take it from The Washington Post.

Even when pollsters try to spin it so that maybe the Democrats have also polarized, the dimensions upon which Democrats have gotten “more extreme” are not being bigoted toward women, racial minorities, immigrants, and gay people. So while the Republicans have in fact gotten more extreme, Democrats have simply gotten less bigoted.

Yes, I suppose you can technically say that this means we’ve gotten “more extremely liberal on social issues”; but we live in a world in which “liberal on social issues” means “you don’t hate and oppress people based on who they are”. Democrats did not take on some crazy far-left social view like, I don’t know, legalizing marriage between humans and dogs. They just stopped being quite so racist, sexist, and homophobic.

It’s on issues where there is no obvious moral imperative that it makes sense to talk about whether someone has become more extreme to the left or the right.

Many economic issues are of this character; one could certainly go too far left economically if one were to talk about nationalizing the auto industry (because it worked so well in East Germany!) or repossessing and redistributing all farmland (what could possibly go wrong?). But Bernie Sanders’ “radical socialism” sounds a lot like FDR’s New Deal—which worked quite well, and is largely responsible for the rise of the American middle class.

Meanwhile, Donald Trump’s economic policy proposals (if you can even call them that) are so radical and so ad hoc that they would turn back the clock on decades of economic development and international trade. He wants to wage a trade war with China that would throw the US into recession and send millions of people in China back into poverty. And that’s not even including the human rights violations required to implement the 11 million deportations of immigrants that Trump has been clamoring for since day one.

Or how about national defense? There is room for reasonable disagreement here, and there definitely is a vein of naive leftist pacifism that tells us to simply stay out of it when other countries are invaded by terrorists or commit genocide.

FDR’s view on national defense can be found in his “Day of Infamy” speech after Pearl Harbor

The attack yesterday on the Hawaiian Islands has caused severe damage to American naval and military forces. I regret to tell you that very many American lives have been lost. In addition, American ships have been reported torpedoed on the high seas between San Francisco and Honolulu.

Yesterday the Japanese Government also launched an attack against Malaya.
Last night Japanese forces attacked Hong Kong.
Last night Japanese forces attacked Guam.
Last night Japanese forces attacked the Philippine Islands.
Last night the Japanese attacked Wake Island.
And this morning the Japanese attacked Midway Island.

Japan has therefore undertaken a surprise offensive extending throughout the Pacific area. The facts of yesterday and today speak for themselves. The people of the United States have already formed their opinions and well understand the implications to the very life and safety of our nation.

As Commander-in-Chief of the Army and Navy I have directed that all measures be taken for our defense, that always will our whole nation remember the character of the onslaught against us.

No matter how long it may take us to overcome this premeditated invasion, the American people, in their righteous might, will win through to absolute victory.

When Hillary Clinton lived through a similar event—9/11—this was her response:

We will also stand united behind our President as he and his advisors plan the necessary actions to demonstrate America’s resolve and commitment. Not only to seek out an exact punishment on the perpetrators, but to make very clear that not only those who harbor terrorists, but those who in any way aid or comfort them whatsoever will now face the wrath of our country. And I hope that that message has gotten through to everywhere it needs to be heard. You are either with America in our time of need or you are not.

We also stand united behind our resolve — as this resolution so clearly states — to recover and rebuild in the aftermath of these tragic acts. You know, New York was not an accidental choice for these madmen, these terrorists, and these instruments of evil. They deliberately chose to strike at a city, which is a global city — it is the city of the Twenty First century, it epitomizes who we are as Americans. And so this in a very real sense was an attack on America, on our values, on our power, and on who we are as a people. And I know — because I know America — that America will stand behind New York. That America will offer whatever resources, aid, comfort, support that New Yorkers and New York require. Because the greatest rebuke we can offer to those who attack our way of life is to demonstrate clearly that we are not cowed in any way whatsoever.

Sounds pretty similar to me.

Now, compare Eisenhower’s statements on the military to Ted Cruz’s.

First Eisenhower, his famous “Cross of Iron” speech

The best would be this: a life of perpetual fear and tension; a burden of arms draining the wealth and the labor of all peoples; a wasting of strength that defies the American system or the Soviet system or any system to achieve true abundance and happiness for the peoples of this earth.

Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed.

This world in arms in not spending money alone.

It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children.

The cost of one modern heavy bomber is this: a modern brick school in more than 30 cities.

It is two electric power plants, each serving a town of 60,000 population.

It is two fine, fully equipped hospitals.

It is some 50 miles of concrete highway.

We pay for a single fighter with a half million bushels of wheat.

We pay for a single destroyer with new homes that could have housed more than 8,000 people.

This, I repeat, is the best way of life to be found on the road the world has been taking.

This is not a way of life at all, in any true sense. Under the cloud of threatening war, it is humanity hanging from a cross of iron.

That is the most brilliant exposition of the opportunity cost of military spending I’ve ever heard. Let me remind you that Eisenhower was a Republican and a five-star general (we don’t even have those anymore; we stop at four stars except in major wars). He was not a naive pacifist, but a soldier who understood the real cost of war.

Now, Ted Cruz, in his political campaign videos:

Instead we will have a President who will make clear we will utterly destroy ISIS.We will carpet bomb them into oblivion. I don’t know if sand can glow in the dark, but we’re gonna find out. And we’re gonna make abundantly clear to any militant on the face of the planet, that if you go and join ISIS, if you wage jihad and declare war on America, you are signing your death warrant.

Under President Obama and Secretary Clinton the world is more dangerous, and America is less safe. If I’m elected to serve as commander-in-chief, we won’t cower in the face of evil. America will lead. We will rebuild our military, we will kill the terrorists, and every Islamic militant will know, if you wage jihad against us, you’re signing your death warrant.
And under no circumstances will I ever apologize for America.

In later debates Cruz tried to soften this a bit, but it ended up making him sound like he doesn’t understand what words mean. He tried to redefine “carpet bombing” to mean “precision missile strikes” (but of course, precision missile strikes are what we’re already doing). He tried to walk back the “sand can glow in the dark” line, but it’s pretty clear that the only way that line makes sense is if you intend to deploy nuclear weapons. (I’m pretty sure he didn’t mean bioluminescent phytoplankton.) He gave a speech declaring his desire to commit mass murder, and is now trying to Humpty Dumpty his way out of the outrage it provoked.

This is how far the Republican Party has fallen.

Medicaid expansion and the human cost of political polarization

2016-02-032016-02-03 PNRJ current events, public policy Bernie Sanders, Democrat, Donald Trump, governors, healthcare, ISIS, Medicaid, Medicaid expansion, medicine, politics, public health, public policy, Republican, state legislatures, terrorism

JDN 2457422

As of this writing, there are still 22 of our 50 US states that have refused to expand Medicaid under the Affordable Care Act. Several other states (including Michigan) expanded Medicaid, but on an intentionally slowed timetable. The way the law was written, these people are not eligible for subsidized private insurance (because it was assumed they’d be on Medicaid!), so there are almost 3 million people without health insurance because of the refused expansions.

Why? Would expanding Medicaid on the original timetable be too arduous to accomplish? If so, explain why 13 states managed to do it on time.

Would expanding Medicaid be expensive, and put a strain on state budgets? No, the federal government will pay 90% of the cost until 2020. Some states claim that even the 10% is unbearable, but when you figure in the reduced strain on emergency rooms and public health, expanding Medicaid would most likely save state money, especially with the 90% federal funding.

To really understand why so many states are digging in their heels, I’ve made you a little table. It includes three pieces of information about each state: The first column is whether it accepted Medicaid immediately (“Yes”), accepted it with delays or conditions, or hasn’t officially accepted it yet but is negotiating to do so (“Maybe”), or refused it completely (“No”). The second column is the political party of the state governor. The third column is the majority political party of the state legislatures (“D” for Democrat, “R” for Republican, “I” for Independent, or “M” for mixed if one house has one majority and the other house has the other).

State	Medicaid?	Governor	Legislature
Alabama	No	R	R
Alaska	Maybe	I	R
Arizona	Yes	R	R
Arkansas	Maybe	R	R
California	Yes	D	D
Colorado	Yes	D	M
Connecticut	Yes	D	D
Delaware	Yes	D	D
Florida	No	R	R
Georgia	No	R	R
Hawaii	Yes	D	D
Idaho	No	R	R
Illinois	Yes	R	D
Indiana	Maybe	R	R
Iowa	Maybe	R	M
Kansas	No	R	R
Kentucky	Yes	R	M
Lousiana	Maybe	D	R
Maine	No	R	M
Maryland	Yes	R	D
Massachusetts	Yes	R	D
Michigan	Maybe	R	R
Minnesota	No	D	M
Mississippi	No	R	R
Missouri	No	D	M
Montana	Maybe	D	M
Nebraska	No	R	R
Nevada	Yes	R	R
New Hampshire	Maybe	D	R
New Jersey	Yes	R	D
New Mexico	Yes	R	M
New York	Yes	D	D
North Carolina	No	R	R
North Dakota	Yes	R	R
Ohio	Yes	R	R
Oklahoma	No	R	R
Oregon	Yes	D	D
Pennsylvania	Maybe	D	R
Rhode Island	Yes	D	D
South Carolina	No	R	R
South Dakota	Maybe	R	R
Tennessee	No	R	R
Texas	No	R	R
Utah	No	R	R
Vermont	Yes	D	D
Virginia	Maybe	D	R
Washington	Yes	D	D
West Virginia	Yes	D	R
Wisconsin	No	R	R
Wyoming	Maybe	R	R

I have taken the liberty of some color-coding.

The states highlighted in red are states that refused the Medicaid expansion which have Republican governors and Republican majorities in both legislatures; that’s Alabama, Florida, Georgia, Idaho, Kansas, Mississippi, Nebraska, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Utah, and Wisconsin.

The states highlighted in purple are states that refused the Medicaid expansion which have mixed party representation between Democrats and Republicans; that’s Maine, Minnesota, and Missouri.

And I would have highlighted in blue the states that refused the Medicaid expansion which have Democrat governors and Democrat majorities in both legislatures—but there aren’t any.

There were Republican-led states which said “Yes” (Arizona, Nevada, North Dakota, and Ohio). There were Republican-led states which said “Maybe” (Arkansas, Indiana, Michigan, South Dakota, and Wyoming).

Mixed states were across the board, some saying “Yes” (Colorado, Illinois, Kentucky, Maryland, Massachusetts, New Jersey, New Mexico, and West Virginia), some saying “Maybe” (Alaska, Iowa, Lousiana, Montana, New Hampshire, Pennsylvania, and Virginia), and a few saying “No” (Maine, Minnesota, and Missouri).

But every single Democrat-led state said “Yes”. California, Connecticut, Delaware, Hawaii, New York, Oregon, Rhode Island, Vermont, and Washington. There aren’t even any Democrat-led states that said “Maybe”.

Perhaps it is simplest to summarize this in another table. Each row is a party configuration (“Democrat, Republican”, or “mixed”); the column is a Medicaid decision (“Yes”, “Maybe”, or “No”); in each cell is the count of how many states that fit that description:

	Yes	Maybe	No
Democrat	9	0	0
Republican	4	5	14
Mixed	8	7	3

Shall I do a chi-square test? Sure, why not? A chi-square test of independence produces a p-value of 0.00001. This is not a coincidence. Being a Republican-led state is strongly correlated with rejecting the Medicaid expansion.

Indeed, because the elected officials were there first, I can say that there is Granger causality from being a Republican-led state to rejecting the Medicaid expansion. Based on the fact that mixed states were much less likely to reject Medicaid than Republican states, I could even estimate a dose-response curve on how having more Republicans makes you more likely to reject Medicaid.

Republicans did this, is basically what I’m getting at here.

Obamacare itself was legitimately controversial (though the Republicans never quite seemed to grasp that they needed a counterproposal for their argument to make sense), but once it was passed, accepting the Medicaid expansion should have been a no-brainer. The federal government is giving you money in order to give healthcare to poor people. It will not be expensive for your state budget; in fact it will probably save you money in the long run. It will help thousands or millions of your constituents. Its impact on the federal budget is negligible.

But no, 14 Republican-led states couldn’t let themselves get caught implementing a Democrat’s policy, especially if it would actually work. If it failed catastrophically, they could say “See? We told you so.” But if it succeeded, they’d have to admit that their opponents sometimes have good ideas. (You know, just like the Democrats did, when they copied most of Mitt Romney’s healthcare system.)

As a result of their stubbornness, almost 3 million Americans don’t have healthcare. Some of those people will die as a result—economists estimate about 7,000 people, to be precise. Hundreds of thousands more will suffer. All needlessly.

When 3,000 people are killed in a terrorist attack, Republicans clamor to kill millions in response with carpet bombing and nuclear weapons.

But when 7,000 people will die without healthcare, Republicans say we can’t afford it.

Free trade, fair trade, or what?

2015-09-052015-09-05 PNRJ core principles, critique of neoclassical economics, development economics, public policy Adam Smith, Ayn Rand, comparative advantage, creative destruction, Democrat, fair trade, forced labor, free trade, gains from trade, globalization, HSBC, human rights, IKEA, iPad, Kohlberg, Korea, Krugman, loss aversion, politics, poverty, protectionism, Republican, Schumpeter, sweatshops, trade, trade policy

JDN 2457271 EDT 11:34.

As I mentioned in an earlier post, almost all economists are opposed to protectionism. In a survey of 264 AEA economists, 87% opposed tariffs to protect US workers against foreign competition.

(By the way, 58% said they usually vote Democrat and only 23% said they usually vote Republican. Given that economists are overwhelmingly middle-age rich White males—only 12% of tenured faculty economists are women and the median income of economists is over $90,000—that’s saying something. Dare I suggest it’s saying that Democrat economic policy is usually better?)

There are a large number of published research papers showing large positive effects of free trade agreements, such as this paper, and this paper, and this paper, and this paper. It’s hard to find any good papers showing any significant negative effects. This is probably why the consensus is so strong; the empirical evidence is overwhelming.

Yet protectionism is very popular among the general public. The majority of both Democrat and Republican voters believe that free trade agreements have harmed the United States. For decades, protectionism has always been the politically popular answer.

To be fair, it’s actually possible to think that free trade harms the US but still support free trade; actually there are some economists who argue that free trade has harmed the US, but has benefited other countries like China and India so much more that it is worth it, making free trade an act of global altruism and good will (for the opposite view, here’s a pretty good article about how “free trade” in principle is often mercantilism in practice, and by no means altruistic). As Krugman talks about, there is some evidence that income inequality in the First World has been exacerbated by globalization—but it’s clearly not the primary reason for rising inequality.

What’s going on here? Are economists ignoring the negative impacts of free trade because it doesn’t fit their elegant mathematical models? Is the general public ignorant of how trade actually works? Does the way free trade works, or its interaction with human psychology, inherently obscure its benefits while emphasizing its harms?

Yes. All of the above.

One of the central mistakes of neoclassical economics is the tendency to over-aggregate. Instead of looking at the impact on individuals, it’s much easier to look at the impact on aggregated abstractions like trade flows and GDP. To some extent this is inevitable—there are simply too many people in the world to keep track of them all. But we need to be aware of what welose when we aggregate, and we need to test the robustness of our theories by applying different models of aggregation (such as comparing “how does this affect Americans” with “how does this affect the First World middle class”).

It is absolutely unambiguous that free trade increases trade flows and GDP, and for small countries these benefits can be mind-bogglingly huge. A key part of the amazing success story of economic development that is Korea is that they dramatically increased their openness to global trade.

The reason for this is absolutely fundamental to economics, and in grasping it in 1776 Adam Smith basically founded the field: Voluntary trade benefits both parties.

As most economists would put it today, comparative advantage leads to Pareto-improving gains from trade. Or as I’d tend to put it, more succinctly yet just as thoroughly based in modern game theory: Trade is nonzero-sum.

When you sell a product to someone, it is because the money they’re offering you is worth more to you than the product—and because the product is worth more to them than the money. You each lose something you value less and gain something you value more—so you are both better off.

This mutual benefit occurs whether you are individuals, corporations, or nations. It’s a fundamental principle of economics that underlies the operation of markets at every scale.

This is what I think most people don’t understand when they say they want to “stop sending jobs overseas”. If by that all you mean is ensuring that there aren’t incentives to offshore and outsource, that’s quite reasonable. Even some degree of incentive to keep businesses in the US might make sense, to avoid a race-to-the-bottom in global wages. But I get the sense that it is more than this, that people have a general notion that jobs are zero-sum and if we hire a million people in China that means a million people must lose their jobs in the US. This is not simply wrong, it is fundamentally wrong; it misses the entire point of economics. If there is one core principle that defines economics, I think it would be that the universe is nonzero-sum; gains for some can also be gains for others. There is not a fixed amount of stuff in the world that we distribute; we can make more stuff. Handled properly, a trade that results in a million people hired in China can mean an extra million people hired in the US.

Once you introduce a competitive market, things get more complicated, because there aren’t just winners—there are also losers. When you have competitors, someone can buy from them instead of you, and the two of them benefit, but you are harmed. By the standard methods of calculating benefits and harms (which admittedly leave much to be desired), we can show quite clearly that in general, on average, the benefits outweigh the harms.

But of course we don’t live “in general, on average”. Despite the overwhelming, unambiguous benefit to the economy as a whole, there is some evidence that free trade can produce a good deal of harm to specific individuals.

Suppose you live in the US and your job is to assemble iPads. You’re good at it, you like it, it pays pretty well. But now Apple says that they want to “reduce labor costs” (they are in fact doing nothing of the sort; to really reduce labor costs in a deep economic sense you’d have to make work easier, more productive, or more fun—the wage and the cost are fundamentally different things), so they outsource production to Foxconn in China, who pay wages 1/30 of what you were being paid.

The net result of this change to the economy as a whole is almost certainly positive—the price of iPads goes down, we all get to have iPads. (There’s a meme going around claiming that the price of an iPad would be almost $15,000 if it were made in the US; no, it would cost about $1000 even if our productivity were no higher and Apple could keep their current profit margin intact, both of which are clearly overestimates. But since it’s currently selling for about $500, that’s still a big difference.) Apple makes more profits, which is why they did it—and we do have to count that in our GDP. Most importantly, workers in China get employed in safe, high-skill jobs instead of working in coal mines, subsistence farming, or turning to drugs and prostitution. More stuff, more profits, better jobs for some of the world’s poorest workers. These are all good things, and overall they outweigh the harm of you losing your job.

Well, from a global perspective, anyway. I doubt they outweigh the harm from your perspective. You still lost a good job; you’re now unemployed, and may have skills so specific that they can’t be transferred to anything else. You’ll need to retrain, which means going back to school or else finding one of those rare far-sighted companies that actually trains their workers. Since the social welfare system in the US is such a quagmire of nonsensical programs, you may be ineligible for support, or eligible in theory and unable to actually get it in practice. (Recently I got a notice from Medicaid that I need to prove again that my income is sufficiently low. Apparently it’s because I got hired at a temporary web development gig, which paid me a whopping $700 over a few weeks—why, that’s almost the per-capita GDP of Ghana, so clearly I am a high-roller who doesn’t need help affording health insurance. I wonder how much they spend sending out these notices.)

If we had a basic income—I know I harp on this a lot, but seriously, it solves almost every economic problem you can think of—losing your job wouldn’t make you feel so desperate, and owning a share in GDP would mean that the rising tide actually would lift all boats. This might make free trade more popular.

But even with ideal policies (which we certainly do not have), the fact remains that human beings are loss-averse. We care more about losses than we do about gains. The pain you feel from losing $100 is about the same as the joy you feel from gaining $200. The pain you feel from losing your job is about twice as intense as the joy you feel from finding a new one.

Because of loss aversion, the constant churn of innovation and change, the “creative destruction” that Schumpeter considered the defining advantage of capitalism—well, it hurts. The constant change and uncertainty is painful, and we want to run away from it.

But the truth is, we can’t. There’s no way to stop the change in the global economy, and most of our attempts to insulate ourselves from it only end up hurting us more. This, I think, is the fundamental reason why protectionism is popular among the general public but not economists: The general public sees protectionism as a way of holding onto the past, while economists recognize that it is simply a way of damaging the future. That constant churning of people gaining and losing jobs isn’t a bug, it’s a feature—it’s the reason that capitalism is so efficient in the first place.

There are a few ways we can reduce the pain of this churning, but we need to focus on that—reducing the pain—rather than trying to stop the churning itself. We should provide social welfare programs that allow people to survive while they are unemployed. We should use active labor market policies to train new workers and match them with good jobs. We may even want to provide some sort of subsidy or incentive to companies that don’t outsource—a small one, to make sure they don’t do so needlessly, but not a large one, so they’ll still do it when it’s actually necessary.

But the one thing we must not do is stop creating jobs overseas. And yes, that is what we are doing, creating jobs. We are not sending jobs that already exist, we are creating new ones. In the short run we also destroy some jobs here, but if we do it right we can replace them—and usually we do okay.

If we stop creating jobs in India and China and around the world, millions of people will starve.

Yes, it is as stark as that. Millions of lives depend upon continued open trade. We in the United States are a manufacturing, technological and agricultural superpower—we could wall ourselves off from the world and only see a few percentage points shaved off of GDP. But a country like Nicaragua or Ghana or Vietnam doesn’t have that option; if they cut off trade, people start dying.

This is actually the main reason why our trade agreements are often so unfair; we are in by far the stronger bargaining position, so we can make them cut their tariffs on textiles even as we maintain our subsidies on agriculture. We are Mr. Bumble dishing out gruel and they are Oliver Twist begging for another bite.

We can’t afford to stop free trade. We can’t even afford to significantly slow it down. A global economy is the best hope we have for global peace and global prosperity.

That is not to say that we should leave trade completely unregulated; trade policy can and should be used to enforce human rights standards. That enormous asymmetry in bargaining power doesn’t have to be used to maximize profits; it can be used to advance human rights.

This is not as simple as saying we should never trade with nations that have bad human rights records, by the way. First of all that would require we cut off Saudi Arabia and China, which is totally unrealistic and would impoverish millions of people; second it doesn’t actually solve the problem. Instead we should use sanctions, tariffs, and trade agreements to provide incentives to improve human rights, rewarding governments that do and punishing governments that don’t. We could have a sliding tariff that decreases every time you show improvement in human rights standards. Think of it like behavioral reinforcement; reward good behavior and you’ll get more of it.

We do need to have sweatshops—but as Krugman has come around to realizing, we can make sweatshops safer. We can put pressure on other countries to treat their workers better, pay them more—and actually make the global economy more efficient, because right now their wages are held down below the efficient level by the power that corporations wield over them. We should not demand that they pay the same they would here in the First World—that’s totally unrealistic, given the difference in productivity—but we should demand that they pay what their workers actually deserve.

Similar incentives should apply to individual corporations, which these days are as powerful as some governments. For example, as part of a zero-tolerance program against forced labor, any company caught using or outsourcing to forced labor should have its profits garnished for damages and the executives who made the decision imprisoned. Sometimes #Scandinaviaisnotbetter; IKEA was involved in such outsourcing during the Cold War, and it is currently being litigated just how much they knew and what they could have done about it. If they knew and did nothing, some IKEA executive should be going to prison. If that seems extreme, let me remind you what they did: They used slaves.

My standard for penalizing human rights violations, whether by corporations or governments, is basically like this: Follow the decision-making up the chain of command, stopping only when the next-higher executive can clearly show to the preponderance of evidence that they were kept out of the loop. If no executive can provide sufficient evidence, the highest-ranking executive at the time the crime was committed will be held responsible. If you don’t want to be held responsible for crimes committed by people who work for you, it’s your responsibility to bring them to justice. Negligence in oversight will not be exonerating because you didn’t know; it will be incriminating because you should have. When your bank is caught laundering money for terrorists and drug lords, it isn’t enough to have your chief of compliance resign; he should be imprisoned—and if his superiors knew about it, so should they.

In fact maybe the focus should be on corporations, because we have the legal authority to do that. When dealing with other countries, there are United Nations rules and simply the de facto power of large trade flows and national standing armies. With Saudi Arabia or China, there’s a very real chance that they’ll simply tell us where we can shove it; but if we get that same kind of response from HSBC or Goldman Sachs (which, actually, we did), we can start taking out handcuffs (that, we did not do—but I think we should have).

We can also use consumer pressure to change the behavior of corporations, such as Fair Trade. There’s some debate about just how effective these things are, but the comparison that is often made between Fair Trade and tariffs is ridiculous; this is a change in consumer behavior, not a change in government policy. There is absolutely no loss of freedom. Choosing not to buy something does not constitute coercion against someone else. Maybe there are more efficient ways to spend money (like donating it directly to the best global development charities), but if you start going down that road you quickly turn into Peter Singer and start saying that wearing nicer shoes means you’re committing murder. By all means, let’s empirically study different methods of fighting poverty and focus on the ones that work best; but there’s a perverse smugness to criticisms of Fair Trade that says to me this isn’t actually about that at all. Instead, I think most people who criticize Fair Trade don’t support the idea of altruism at all—they’re far-right Randian libertarians who honestly believe that selfishness is the highest form of human morality. (It is in fact the second-lowest, according to Kohlberg.) Maybe it will turn out that Fair Trade is actually ineffective at fighting poverty, but it’s clear that an unregulated free market isn’t good at that either. Those aren’t the only options, and the best way to find out which methods work is to give them a try. Consumer pressure clearly can work in some cases, and it’s a low-cost zero-regulation solution. They say the road to Hell is paved with good intentions—but would you rather we have bad intentions instead?

By these two methods we could send a clear message to multinational corporations that if they want to do business in the US—and trust me, they do—they have to meet certain standards of human rights. This in turn will make those corporations put pressure on their suppliers, all the way down the supply chain, to uphold the standards lest they lose their contracts. With some companies upholding labor standards in Third World countries, others will be forced to, as workers refuse to work for companies that don’t. This could make life better for many millions of people.

But this whole plan only works on one condition: We need to have trade.

Why the Republican candidates like flat income tax—and we really, really don’t

2015-05-17 PNRJ critique of neoclassical economics, public policy basic income, Bernie Sanders, capital, Democrat, elections, flat tax, halo effect, Hillary Clinton, investment, IRS, just world, land tax, Miles Kimball, Mitt Romney, monetary policy, money, poverty, profit, progressive, Republican, saving, tax code, tax reform, taxation, taxes, wealth

JDN 2456160 EDT 13:55.

The Republican Party is scrambling to find viable Presidential candidates for next year’s election. The Democrats only have two major contenders: Hillary Clinton looks like the front-runner (and will obviously have the most funding), but Bernie Sanders is doing surprisingly well, and is particularly refreshing because he is running purely on his principles and ideas. He has no significant connections, no family dynasty (unlike Jeb Bush and, again, Hillary Clinton) and not a huge amount of wealth (Bernie’s net wealth is about $500,000, making him comfortably upper-middle class; compare to Hillary’s $21.5 million and her husband’s $80 million); but he has ideas that resonate with people. Bernie Sanders is what politics is supposed to be. Clinton’s campaign will certainly raise more than his; but he has already raised over $4 million, and if he makes it to about $10 million studies suggest that additional spending above that point is largely negligible. He actually has a decent chance of winning, and if he did it would be a very good sign for the future of America.

But the Republican field is a good deal more contentious, and the 19 candidates currently running have been scrambling to prove that they are the most right-wing in order to impress far-right primary voters. (When the general election comes around, whoever wins will of course pivot back toward the center, changing from, say, outright fascism to something more like reactionism or neo-feudalism. If you were hoping they’d pivot so far back as to actually be sensible center-right capitalists, think again; Hillary Clinton is the only one who will take that role, and they’ll go out of their way to disagree with her in every way they possibly can, much as they’ve done with Obama.) One of the ways that Republicans are hoping to prove their right-wing credentials is by proposing a flat income tax and eliminating the IRS.

Unlike most of their proposals, I can see why many people think this actually sounds like a good idea. It would certainly dramatically reduce bureaucracy, and that’s obviously worthwhile since excess bureaucracy is pure deadweight loss. (A surprising number of economists seem to forget that government does other things besides create excess bureaucracy, but I must admit it does in fact create excess bureaucracy.)

Though if they actually made the flat tax rate 20% or even—I can’t believe this is seriously being proposed—10%, there is no way the federal government would have enough revenue. The only options would be (1) massive increases in national debt (2) total collapse of government services—including their beloved military, mind you, or (3) directly linking the Federal Reserve quantitative easing program to fiscal policy and funding the deficit with printed money. Of these, 3 might not actually be that bad (it would probably trigger some inflation, but actually we could use that right now), but it’s extremely unlikely to happen, particularly under Republicans. In reality, after getting a taste of 2, we’d clearly end up with 1. And then they’d be complaining about the debt and clamor for more spending cuts, more spending cuts, ever more spending cuts, but there would simply be no way to run a functioning government on 10% of GDP in anything like our current system. Maybe you could do it on 20%—maybe—but we currently spend more like 35%, and that’s already a very low amount of spending for a First World country. The UK is more typical at 47%, while Germany is a bit low at 44%; Sweden spends 52% and France spends a whopping 57%. Anyone who suggests we cut government spending from 35% to 20% needs to explain which 3/7 of government services are going to immediately disappear—not to mention which 3/7 of government employees are going to be immediately laid off.

And then they want to add investment deductions; in general investment deductions are a good thing, as long as you tie them to actual investments in genuinely useful things like factories and computer servers. (Or better yet, schools, research labs, or maglev lines, but private companies almost never invest in that sort of thing, so the deduction wouldn’t apply.) The kernel of truth in the otherwise ridiculous argument that we should never tax capital is that taxing real investment would definitely be harmful in the long run. As I discussed with Miles Kimball (a cognitive economist at Michigan and fellow econ-blogger I hope to work with at some point), we could minimize the distortionary effects of corporate taxes by establishing a strong deduction for real investment, and this would allow us to redistribute some of this enormous wealth inequality without dramatically harming economic growth.

But if you deduct things that aren’t actually investments—like stock speculation and derivatives arbitrage—then you reduce your revenue dramatically and don’t actually incentivize genuinely useful investments. This is the problem with our current system, in which GE can pay no corporate income tax on $108 billion in annual profit—and you know they weren’t using all that for genuinely productive investment activities. But then, if you create a strong enforcement system for ensuring it is real investment, you need bureaucracy—which is exactly what the flat tax was claimed to remove. At the very least, the idea of eliminating the IRS remains ridiculous if you have any significant deductions.

Thus, the benefits of a flat income tax are minimal if not outright illusory; and the costs, oh, the costs are horrible. In order to have remotely reasonable amounts of revenue, you’d need to dramatically raise taxes on the majority of people, while significantly lowering them on the rich. You would create a direct transfer of wealth from the poor to the rich, increasing our already enormous income inequality and driving millions of people into poverty.

Thus, it would be difficult to more clearly demonstrate that you care only about the interests of the top 1% than to propose a flat income tax. I guess Mitt Romney’s 47% rant actually takes the cake on that one though (Yes, all those freeloading… soldiers… and children… and old people?).

Many Republicans are insisting that a flat tax would create a surge of economic growth, but that’s simply not how macroeconomics works. If you steeply raise taxes on the majority of people while cutting them on the rich, you’ll see consumer spending plummet and the entire economy will be driven into recession. Rich people simply don’t spend their money in the same way as the rest of us, and the functioning of the economy depends upon a continuous flow of spending. There is a standard neoclassical economic argument about how reducing spending and increasing saving would lead to increased investment and greater prosperity—but that model basically assumes that we have a fixed amount of stuff we’re either using up or making more stuff with, which is simply not how money works; as James Kroeger cogently explains on his blog “Nontrivial Pursuits”, money is created as it is needed; investment isn’t determined by people saving what they don’t spend. Indeed, increased consumption generally leads to increased investment, because our economy is currently limited by demand, not supply. We could build a lot more stuff, if only people could afford to buy it.

And that’s not even considering the labor incentives; as I already talked about in my previous post on progressive taxation, there are two incentives involved when you increase someone’s hourly wage. On the one hand, they get paid more for each hour, which is a reason to work; that’s the substitution effect. But on the other hand, they have more money in general, which is a reason they don’t need to work; that’s the income effect. Broadly speaking, the substitution effect dominates at low incomes (about $20,000 or less), the income effect dominates at high incomes (about $100,000 or more), and the two effects cancel out at moderate incomes. Since a tax on your income hits you in much the same way as a reduction in your wage, this means that raising taxes on the poor makes them work less, while raising taxes on the rich makes them work more. But if you go from our currently slightly-progressive system to a flat system, you raise taxes on the poor and cut them on the rich, which would mean that the poor would work less, and the rich would also work less! This would reduce economic output even further. If you want to maximize the incentive to work, you want progressive taxes, not flat taxes.

Flat taxes sound appealing because they are so simple; even the basic formula for our current tax rates is complicated, and we combine it with hundreds of pages of deductions and credits—not to mention tens of thousands of pages of case law!—making it a huge morass of bureaucracy that barely anyone really understands and corporate lawyers can easily exploit. I’m all in favor of getting rid of that; but you don’t need a flat tax to do that. You can fit the formula for a progressive tax on a single page—indeed, on a single line: r = 1 – I^-p

That’s it. It’s simple enough to be plugged into any calculator that is capable of exponents, not to mention efficiently implemented in Microsoft Excel (more efficiently than our current system in fact).

Combined with that simple formula, you could list all of the sensible deductions on a couple of additional pages (business investments and educational expenses, mostly—poverty should be addressed by a basic income, not by tax deductions on things like heating and housing, which are actually indirect corporate subsidies), along with a land tax (one line: $3000 per hectare), a basic income (one more line: $8,000 per adult and $4,000 per child), and some additional excise taxes on goods with negative externalities (like alcohol, tobacco, oil, coal, and lead), with a line for each; then you can provide a supplementary manual of maybe 50 pages explaining the detailed rules for applying each of those deductions in unusual cases. The entire tax code should be readable by an ordinary person in a single sitting no longer than a few hours. That means no more than 100 pages and no more than a 7th-grade reading level.

Why do I say this? Isn’t that a ridiculous standard? No, it is a Constitutional imperative. It is a fundamental violation of your liberty to tax you according to rules you cannot reasonably understand—indeed, bordering on Kafkaesque. While this isn’t taxation without representation—we do vote for representatives, after all—it is something very much like it; what good is the ability to change rules if you don’t even understand the rules in the first place? Nor would it be all that difficult: You first deduct these things from your income, then plug the result into this formula.

So yes, I absolutely agree with the basic principle of tax reform. The tax code should be scrapped and recreated from scratch, and the final product should be a primary form of only a few pages combined with a supplementary manual of no more than 100 pages. But you don’t need a flat tax to do that, and indeed for many other reasons a flat tax is a terrible idea, particularly if the suggested rate is 10% or 15%, less than half what we actually spend. The real question is why so many Republican candidates think that this will appeal to their voter base—and why they could actually be right about that.

Part of it is the entirely justified outrage at the complexity of our current tax system, and the appealing simplicity of a flat tax. Part of it is the long history of American hatred of taxes; we were founded upon resisting taxes, and we’ve been resisting taxes ever since. In some ways this is healthy; taxes per se are not a good thing, they are a bad thing, a necessary evil.

But those two things alone cannot explain why anyone would advocate raising taxes on the poorest half of the population while dramatically cutting them on the top 1%. If you are opposed to taxes in general, you’d cut them on everyone; and if you recognize the necessity of taxation, you’d be trying to find ways to minimize the harm while ensuring sufficient tax revenue, which in general means progressive taxation.

To understand why they would be pushing so hard for flat taxes, I think we need to say that many Republicans, particularly those in positions of power, honestly do think that rich people are better than poor people and we should always give more to the rich and less to the poor. (Maybe it’s partly halo effect, in which good begets good and bad begets bad? Or maybe just world theory, the ingrained belief that the world is as it ought to be?)

Romney’s 47% rant wasn’t an exception; it was what he honestly believes, what he says when he doesn’t know he’s on camera. He thinks that he earned every penny of his $250 million net wealth; yes, even the part he got from marrying his wife and the part he got from abusing tax laws, arbitraging assets and liquidating companies. He thinks that people who live on $4,000 or even $400 a year are simply lazy freeloaders, who could easily work harder, perhaps do some arbitrage and liquidation of their own (check out these alleged “rags to riches” stories including the line “tried his hand at mortgage brokering”), but choose not to, and as a result deserve what they get. (It’s important to realize just how bizarre this moral attitude truly is; even if I thought you were the laziest person on Earth, I wouldn’t let you starve to death.) He thinks that the social welfare programs which have reduced poverty but never managed to eliminate it are too generous—if he even thinks they should exist at all. And in thinking these things, he is not some bizarre aberration; he is representing an entire class of people, nearly all of whom vote Republican.

The good news is, these people are still in the minority. They hold significant sway over the Republican primary, but will not have nearly as much impact in the general election. And right now, the Republican candidates are so numerous and so awful that I have trouble seeing how the Democrats could possibly lose. (But please, don’t take that as a challenge, you guys.)

	The longest night \|… on What is the cost of all t…
	How to be a deontolo… on Multilevel selection: A tale o…
	What we still have t… on The CBO report on Trump’…
	What we still have t… on What is the cost of all t…
	What we still have t… on Reflections on the Index of Ne…

Human Economics

Cognitive development economics: Understanding the mind in order to feed the world

Democrat