Quotes of the day

This [chaos of accounting] is not an issue of malfeasance; it's an issue of competence. But give that the competence at issue is supposed to be, um, the core competence of the SEC, this is a mite worrisome.--Megan McArdle

... political parties may deliberately choose to recruit only mediocre politicians, in spite of the fact that they could select better individuals. ... Given the limited availability of direct monetary compensation, the main incentive a party has to offer to reward such effort is the party electoral nomination. We show that these considerations entail a fundamental trade-off which may play an important role in a party’s recruiting decisions. On the one hand, recruiting the best possible individuals may enhance the party’s electoral prospects in a competitive electoral environment (competition effect). On the other hand, recruiting a relatively “mediocre” but homogeneous group of individuals may maximize their collective effort on behalf of the party since the presence of “superstars” may discourage other party members and induce them to shirk (discouragement effect). In equilibrium, there will either be “mediocracy” if parties choose not to recruit the best politicians, or “aristocracy” if they do.--Penn Institute for Economic Research Working Paper 11-002

We hope [the game "Kolejka" (The Queue)] will show young Poles how difficult it was to buy everyday supplies like sugar, bread or furniture [in communist-era Poland].--Karol Madaj, the game's designer. He was only nine years old when communism ended in Poland in 1989, so he had to seek tips about those days from his older boss.

America’s tax system is broken. It’s needlessly complex, economically harmful, and often unfair. It fails at its most basic task, raising enough money to pay our government’s bills. And it’s increasingly unpredictable, with large, temporary tax cuts not only in the individual income tax, but in corporate, payroll, and estate taxes. For all those reasons, our tax system cries out for reform. Such reform could follow many paths. Some analysts recommend the introduction of new taxes—such as a value-added tax, a national retail sales tax, or pollution taxes—to supplement or replace our current system. Those ideas are worth serious discussion, but in today’s testimony, I will focus on a more traditional approach to reform: redesigning our income tax. My message is simple: the income tax is riddled with tax preferences. These preferences narrow the tax base, reduce revenues, distort economic activity, complicate the tax system, force tax rates higher than they would otherwise be, and are often unfair. By reducing, eliminating, or redesigning many of these preferences, policymakers can: Make the tax system simpler, fairer, and more conducive to America’s future prosperity; Raise revenues to finance both across-the-board tax rate cuts and deficit reduction; and Improve the efficiency and fairness of any remaining preferences.--Donald Marron

Americans make more “stuff’’ than any other nation on earth, and by a wide margin. According to the United Nations’ comprehensive database of international economic data, America’s manufacturing output in 2009 (expressed in constant 2005 dollars) was $2.15 trillion. That surpassed China’s output of $1.48 trillion by nearly 46 percent. China’s industries may be booming, but the United States still accounted for 20 percent of the world’s manufacturing output in 2009 — only a hair below its 1990 share of 21 percent.--Jeff Jacoby

... what made television so evil back when it was evil was not its essence but its omnipresence. Once it is not everything, it can be merely something. The real demon in the machine is the tirelessness of the user. A meatless Monday has advantages over enforced vegetarianism, because it helps release the pressure on the food system without making undue demands on the eaters. In the same way, an unplugged Sunday is a better idea than turning off the Internet completely, since it demonstrates that we can get along just fine without the screens, if only for a day. Hermione, stuck in the nineties, never did get her iPad, and will have to manage in the stacks. But perhaps the instrument of the new connected age was already in place in fantasy. For the Internet screen has always been like the palantír in Tolkien’s “Lord of the Rings”—the “seeing stone” that lets the wizards see the entire world. Its gift is great; the wizard can see it all. Its risk is real: evil things will register more vividly than the great mass of dull good. The peril isn’t that users lose their knowledge of the world. It’s that they can lose all sense of proportion. You can come to think that the armies of Mordor are not just vast and scary, which they are, but limitless and undefeatable, which they aren’t.--Adam Gopnik

Talk turns to [Michael] Lewis’s upbringing in New Orleans. His father had a largely hands-off philosophy, but begged Lewis not to turn down Princeton in favour of a life in New Orleans with his high-school sweetheart. “He went white and said, ‘I’ve never told you what to do, but don’t do this.’” Lewis followed his father’s advice. “It was the right decision. But I really was in love with that girl, and it ended up ending our relationship. And I always felt I violated something in me, making that decision.” When the time came to quit Salomon, he steeled himself against any further paternal entreaties. Explaining his decision to leave Salomon, he casually compares the $40,000 book contract to the $250,000 salary and potentially millions more – big sums in the late 1980s. But he insists that money does not motivate him. “I grew up with a mother who came from a pretty wealthy family – in fact a very wealthy family by New Orleans standards – and my father was kind of a poor boy.” By the age of nine he’d abandoned any sense that money brought fulfilment, because “my father’s family was so happy and my mother’s family so miserable”.--Tim Harford

I’m counting on his engineering professors to undo whatever damage the English department has managed to inflict.--Steve Landsburg

And then I told him WTF doesn’t stand for Win the Future.--Anonymous