Quotes of the day

Never trust a critic.
Especially this critic.--Mark Kermode

But the odds are that one of these years the world’s greatest nation will find itself ruled by a party that is aggressively anti-science, indeed anti-knowledge. And, in a time of severe challenges — environmental, economic, and more — that’s a terrifying prospect.--Paul Krugman

Yes, a terrifying prospect — and an excellent reason to limit the powers of ruling parties, though Paul never seems to notice this.--Steve Landsburg

I get the ball, I throw the ball, and I take a shower.--Mariano Rivera

... those who receive and act out the gift of athletic genius must, perforce, be blind and dumb about it -- and not because blindness and dumbness are the price of the gift, but because they are its essence.--David Foster Wallace

These tempests obscure a larger truth about [SC Justice Clarence] Thomas: that this year has also been, for him, a moment of triumph. In several of the most important areas of constitutional law, Thomas has emerged as an intellectual leader of the Supreme Court. ... In his jurisprudence, Thomas may be best known for his belief in a “color-blind Constitution”; that is, one that forbids any form of racial preference or affirmative action. But color blind, for Thomas, is not blind to race. Thomas finds a racial angle on a broad array of issues, including those which appear to be scarcely related to traditional civil rights, like campaign finance or gun control. In Thomas’s view, the Constitution imposes an ideal of racial self-sufficiency, an extreme version of the philosophy associated with Booker T. Washington, whose portrait hangs in his chambers. (This personal gallery also includes Frederick Douglass, Abraham Lincoln, Ronald Reagan, and Margaret Thatcher.)--Jeffrey Toobin

I don’t do Ivies. ... Yale meant one thing for white graduates and another for blacks, no matter how much anyone denied it. ... We talk about diversity. The real problem of our Court is that it’s all Ivy League. Correct me if I’m wrong, but I think there are other law schools out there. ... I grew up with maids, and janitors, and yard people. It gives you a perspective on society. You’re looking from the bottom up, and how people see it from that direction. . . . You understand why people are angry or upset. You understand why they become rich soil for class envy and class hatred, or class warfare. You see how they become easy pickings for people who have snake-oil merchants for solving all their problems. But you develop a respect for them without condescension. You develop an attitude that we are all inherently equal regardless of who went to school and who did not—that there can be smart people who did not have any book learning and never had a chance. ... There’s a difference between being poor and being stupid. And you’re stupid for thinking that they’re stupid. As my granddaddy would say, you’re just an educated fool. . . . I am passionate about preserving liberty so that people can rise from that to go to the Supreme Court. My wife does this, too. My wife is my best friend. I can rant with her. She doesn’t read opinions or anything. We believe that this is a good country and that people should have a chance. That’s why you see so many of my law clerks who don’t go to Ivy League schools. These are kids who tried hard and did well. Why don’t we reward them?--Clarence Thomas

I always ask people, ‘What would you do with Plessy v. Ferguson, which was sixty years old?’ If it’s wrong, the ultimate precedent is the Constitution. And it’s not what we say it is, it’s what it actually says, and I think we have to be humble enough to say we were wrong. ... When interpreting a constitutional provision, the goal is to discern the most likely public understanding of that provision at the time it was adopted.--Clarence Thomas

In other words, Thomas is humble before his own reading of the constitutional text—and dismissive of the attempts of others, including other Justices, to interpret it. ... To that end, he plumbs the words of the framers and the eighteenth-century (and earlier) thinkers who influenced Jefferson, Madison, and their contemporaries.--Jeffrey Toobin

One of the things the activists care about is that the so-called ‘living Constitution’ is a convenient political fiction. A living Constitution gives more power and authority to the state.--Dick Armey

I don’t agree with him, but Thomas has the most internally coherent view of any Justice.--Richard Hasen, a professor at the School of Law at the University of California at Irvine

Further, notwithstanding Thomas’s enduring certainties, it is difficult to know what the framers would have thought of any given situation. (Alito, a conservative but not a full-fledged originalist, captured this problem nicely, in the oral argument about the California law on violent video games. Following up on a series of questions by Scalia, Alito asked the lawyer, “I think what Justice Scalia wants to know is what James Madison thought about video games. Did he enjoy them?”) It is true, too, that the framers often disagreed profoundly with each other, making a single intent behind the Constitution even more difficult to discern, and the twenty-seven amendments (all with their own framers) created another overlay of complication. For all of Thomas’s conviction, originalism is just another kind of interpretation, revealing as much about Thomas as about the Constitution.--Jeffrey Toobin

Jeffrey Toobin’s gripping, must-read profile of Clarence and Virginia Thomas in the New Yorker gives readers new insight into what Sauron must have felt: Toobin argues that the only Black man in public life that liberals could safely mock and despise may be on the point of bringing the Blue Empire down.  In fact, Toobin suggests, Clarence Thomas may be the Frodo Baggins of the right; his lonely and obscure struggle has led him to the point from which he may be able to overthrow the entire edifice of the modern progressive state.--Walter Russell Mead

Alan Krueger to chair CEA. Congratulations, Alan. An excellent choice by President Obama.--Greg Mankiw

Dismissing the achievements of welfare reform because the poverty rate didn't decline towards zero makes no sense to me. While it would be nice if it had happened, no one really expected it to. The fact that a miracle failed to materialize is hardly a searing indictment of reform. You can argue that the decline in the poverty rate was assisted by other reforms like boosting the earned income tax credit, and I completely agree. But boosting the EITC does nothing to help people who aren't earning income. If we hadn't done welfare reform, "not earning income" would still describe the majority of poor families.--Megan McArdle

Look, Debbie, I understand that after I departed the House floor you directed your floor speech comments directly towards me. Let me make myself perfectly clear, you want a personal fight, I am happy to oblige. You are the most vile, unprofessional ,and despicable member of the US House of Representatives. If you have something to say to me, stop being a coward and say it to my face, otherwise, shut the heck up.--Rep. Allen West, to Rep. Deborah Wasserman Schultz

[Warren Buffet] suggests that the 12 member congressional panel set up to cut current and future federal deficits leave tax rates unchanged for 99.7 percent of taxpayers, and only raise rates on the approximately 250,000 households who make more than $1 million. Simple calculations show that a tax increase on such a small number of households, even a very large tax increase, would have a negligible effect on total tax revenue, and hence on closing the budget deficit. As we will see, there are more sensible ways to improve tax revenue. Warren Buffett has persuaded 68 other billionaires to follow his example and promise to give at least half their wealth to charities. But why hasn’t Buffett proposed also that the very rich make large gifts to the federal government to offset what he considers ridiculously low taxes on their incomes and wealth? My guess is that he and the others who pledged to give away their wealth to charity would have little confidence in how the government would spend such gifts. Buffett, for example, is giving most of his wealth to the Gates Foundation, not to the federal government, and is relying on how this foundation will spend his vast gift. Given this reluctance to make large gifts to the federal government, why should anyone have confidence that the federal government will spend additional tax revenue in a sensible way?--Gary Becker

Bol legends have piled up over the years, and in the e-book "The Defender" Jordan Conn probes as necessary, interviewing Bol's teammates, friends and family. As a child, he may have killed a lion; he quite possibly coined the phrase "my bad"; he certainly warned Congress about Osama bin Laden in 1993. Filtered through the American media, his later life—he died last year of kidney failure—was a sad mishmash of illness and publicity stunts, such as a 2002 bout with William "The Refrigerator" Perry on Fox's "Celebrity Boxing." (Bol won, wearing red shorts stitched with the nickname "Sudanese Freedom Fighter.") The stunts were ridiculous—Manute playing ice hockey, Manute in jockey's silks—but the proceeds went to the Southern Sudan rebels.  As Mr. Conn details what motivated Bol and the responsibilities he felt to his region, "The Defender" gives Bol back the dignity he seemed to have lost. If the image of Bol crouched in the brush, talking strategy with armed fighters, is an unexpected one, it's also revelatory. Even his financial woes were a result of giving too much to the cause, and Mr. Conn suggests that Bol more or less killed himself through his insistence on campaigning for pro-independence candidates. Suddenly the desperation that marked his later years makes a lot more sense.--Nathaniel Friedman

Photo links here and here.

The Government-Media complex cries wolf?

Toby Harnden thinks so:

The surf may have told a story but so too did the sight behind the reporter of people chatting and ambling along the sea front and just goofing around. There was a man in a t-shirt, a woman waving her arms and then walking backwards. Then someone on a bicycle glided past.

Across the screen, the “Breaking News: Irene Batters Long Island” caption was replaced by stern advice from the Federal Emergency Management Agency (FEMA): “Stay inside, stay safe.”

The images summed up Hurricane Irene – the media and the United States federal government trying to live up to their own doom-laden warnings and predictions while a sizeable number of ordinary Americans just carried on as normal and even made gentle fun of all the fuss.
...
The media and politicians enjoy a symbiotic relationship during possible impending disasters. The resultant perfect storm of hype over Irene runs the risk of making Americans even more like to ignore warnings in the future.

It's a rookie mistake. Everyone saw what Mayor Nagin and Governor Blanco did, and thought, "Forget taking any pitches, I'm swingin' at anything and everything!"

Irene didn't hit Tribeca hard. But the Financial District got some

I wonder if the markets will open, if the MTA and PATH stays closed.

Via Joshua Brown.

UPDATE:  CNBC reports everyone is opening for business as usual, Monday morning.

3 myths of capitalism, by Jeff Miron

Via Greg Mankiw.

Chart of the day: Gold and Stocks

Source here.

Quotes of the day

I will never figure out two things about Bernard's career: Why the NBA left him off "50 at 50," and why he didn't win a "Best Supporting Actor" Oscar in 1979.--Bill Simmons

If you were Rondo, wouldn't that have been the picture-perfect time to point to one of Obama's advisors and say, "Hey, why don't one of you teach this guy how to run the country?--Sam, Cambridge

I am digging this Sam.--Cav (backstory here).

Economic disparities remain, but in 1960 nine in 10 blacks were poor, whereas today three of four blacks are not. Tracing the remaining disparities to racism becomes trickier by the year. The 'institutional racism' many trace these statistics to is something black people of King's time would have considered a much more workable adversary than open bigotry and segregation. Some holdouts remain bigots, but not enough to keep Barack Obama out of the White House, and overall, racism is considered as socially embarrassing as pedophilia. King could never have predicted that this would happen so quickly. Is America 'post-racial'? Afraid not. But is the treatment of black people in America still so transparently and grievously unjust as to make a mockery of our democratic ideals and require redress with all deliberate speed? Afraid not, again, and Dr. King would rejoice, as we should with him.--John McWhorter

The theory of the firm in neoclassical theory focuses on how much the firm should produce and optimal capacity. Game theory looks at strategic issues arising under various payoffs. Neither approach captures the nature of innovation, the trial and error risk-taking of the visionary entrepreneur or the power of creative destruction to enrich our lives. These ideas are at the heart of the Austrian approach to the firm, an approach that has made even less headway in mainstream academic circles than Austrian business cycle theory.--Russ Roberts

How do the Angels continue to defy the odds? This is a problem we haven't totally solved yet. But I do have two theories. One possibility is that team defense has a cascading effect that raw numbers can't quite detect. A great defense does more than help a pitcher's batting average on balls in play and his ability to prevent runs. It shortens innings. That lets a starting pitcher go deeper into games with less stress on his arm. More innings for starters takes pressure off a bullpen. A fresher pen then enables a manager to use his best arms in high-leverage situations, instead of relying on lesser relievers to put out fires because his more talented teammates are spent. Less stress on pitchers' arms can also decrease the risk of injury, thus preventing a team from having to call up Triple-A piñatas or spend valuable dollars on replacements. A second possibility is Mike Scioscia. When a team fares better than expected every year for eight seasons, it might be that the manager is executing strategies that give his team an edge that others lack. Studies have been murky in isolating the effects that managers have on their team. We can look at tactical moves, which can reveal managers who know when to use one-run strategies (such as bunting or stealing bases) and when to play for the big inning. But the best managers might make a bigger impact in other areas, such as motivating his players to succeed, or simply putting the best nine guys on the field at any given time.--Jonah Keri

Union affiliates in some states are heavily involved in spending members' money on social causes that are sometimes contrary to members' own political leanings. For example, California unions donated more than $2 million—including $1 million from the California Teachers Association—to a campaign in 2008 to defeat Proposition 8, the successful state initiative that defined marriage as between a man and a woman. A CNN exit poll found that 56% of voters in union households supported the initiative despite the opposition of the union leadership. "The California Teachers Association does not poll its members on how it spends its political money," Larry Sand, a union critic and 28-year veteran of the state's school system, observes. Instead, union leaders vigorously oppose efforts to allow their members more control over how their dues are spent. In California, for example, labor groups and their allies expended an astounding $54 million in 2005 to defeat Proposition 75, which would have required that unions seek the permission of members to spend dues money on political contributions. Among the biggest nonunion contributors to the campaign to defeat Prop 75 was the Democratic Party, which kicked in $3.275 million. In Washington state, meanwhile, a judge ruled in 2000 that the Washington Education Association violated a state law barring the use of union dues for political purposes without employees' permission. The union fought the case all the way to the U.S. Supreme Court before losing in 2007 and agreeing to pay nearly $1 million in fines and rebates to teachers. The NEA's leadership has not been enthusiastic about President Obama because his education secretary, Arne Duncan, touts policies like merit pay for teachers and the expansion of charter schools, which the union opposes. Grumble as they do, the NEA's leadership has nowhere else to go. Sadly, neither do the 40% or so of union workers who may not vote for the president but will see a large portion of their dues spent on his re-election.--Steven Malanga

Dr. Kim couldn’t remember the last time she’d seen a bowl of pure white rice. What was a bowl of rice doing there, just sitting out on the ground? She figured it out just before she heard the dog’s bark. Up until that moment, a part of her had hoped that China would be just as poor as North Korea. She still wanted to believe that her country was the best place in the world. The beliefs she had cherished for a lifetime would be vindicated. But now she couldn’t deny what was staring her plain in the face; dogs in China ate better than doctors in North Korea.--Barbara Demick

Perplexities of Consciousness is composed mostly of detailed case studies of aspects of the stream of experience about which people seem to err, grossly and persistently, even in circumstances that might seem favorable to reflection. We aren’t just fallible in hard cases, I argue; we err systematically and pervasively about even the most basic facts of the stream of experience, and even when we set our minds to it carefully and conscientiously.--Eric Schwitzgebel

Photo links here and here.

White House painting of the day

Norman Rockwell's The Problem We All Live With.

Image link here.

Obesity rates

Heaviest 3
34.3% West Virginia
33.6% Delaware
32.1% Mississippi

Lightest 3
20.1% Colorado
21.6% Utah
21.7% Connecticut

Via Catherine Rampell.  Photo links here.

Quotes of the day

The thing to remember about the short-term is that we'll almost certainly be around when the long-term shows up.--Seth Godin

Future generations will look back with bemusement on a time when airline passengers couldn’t pay extra for a flight that’s guaranteed first place in the runway queue, and more generally on our odd reluctance to embrace prices. They’ll be unable to imagine why we thought it was better to let people die of liver disease than to pay organ donors, or why the “net neutrality” cult had a problem with Internet content providers being able to purchase resources to serve their customers better. ... The moral circle will continue to expand. As we look back in horror on our ancestors’ harsh treatment of slaves or of Native Americans, our descendants will look back in horror on our treatment of immigrants and our reluctance to trade with foreigners. Slogans like “Buy American” will strike our grandchildrens’ ears the way “Buy White” would strike ours.--Steve Landsburg

A poll in the late 1920s of 282 economists showed that 251 favored a monetary policy aimed at price level stabilization. Isn’t that sort of like New Keynesian inflation targeting? And of course the University of Chicago economists of the 1930s favored a combination of fiscal and monetary stimulus. What Keynes did was move the profession away from the idea of monetary cures for business cycles–which actually can be effective, toward the idea of fiscal cures, which (short of WWII) are almost never effective. It would take many decades for money to be rediscovered. Indeed the influence of Keynes was so powerful that even in 2009 there were many Keynesian economists who should have known better who suddenly announced that monetary policy couldn’t work at the zero bound, and that fiscal stimulus was needed. Fortunately those Keynesians rediscovered money much more quickly this time, indeed within 2 years.--Scott Sumner

In World War I the Allied strategy was to engage and defeat the center of gravity of the Central Powers, the German field army. This strategy was simple in conception but heartbreakingly difficult in execution, being based on flawed assumptions, an irreconcilable gap between strategic design and execution, and a comprehensive failure of management information systems. But by 1918 firepower had been integrated with protective cover and mobility, in the form of tanks and military aviation, and had been complemented by the use of radio to open the lines of communication and facilitate alignment from top to bottom and across units. This ultimately restored mobility to the battlefield and initiated the blitzkrieg form of warfare that would dominate the battlefields of the twentieth century. Great story, but what does it have to do with American business leadership today? A lot, because the strategic models are strikingly similar. Rarely in warfare have the challenges of the battlefield looked so insoluble as in 1916 and ’17; rarely in business have the macroeconomic, fiscal, and technological characteristics of the marketplace looked so complex as in the post-2008 world. And the fundamental problem is the same: a failure of alignment, by which I mean of the elusive ability to link strategic intent at the top of an organization to tactical performance at the bottom, via an unbroken internal narrative. In business terms, this means a chief executive must not only have the intellectual clarity to define his vision but also be willing to give leadership away to those around and beneath him. Only by mandating, and explicitly trusting, successive levels of management to execute according to his strategic design can he release the full potential of his organization.--Robert Fry

Quotes of the day: Russ Roberts edition

What is working well? The Apple Store, access to food and clothing, private high schools, Amazon.com and everywhere else that there is competition. As the economy slinks along or dips down, we’re going to hear continued talk of the decline of America. But what has always made America great is its economic system–a system that let’s competition work. If we want to be great again, all we have to do is remember what made us great before. Our biggest challenge as a nation is our political system. We have overpromised and a democracy that ignores its Constitution isn’t very adept at taking away goodies from the masses. I am very worried about how that is going to turn out. We need to share the pain very widely and that too is not the strong suit of democracy.--Russ Roberts

What I meant is that the Ponzi scheme called Social Security and the demographics of Social Security and medicare are going to require a lot of people to get a lot less than they are expecting. That’s what I meant by sharing the pain. My point about democracy is that politicians hate dashing expectations. See Greece, riots in the streets of.--Russ Roberts

The main thing to realize is that both Citibank and S&P have little to do with capitalism and everything to do with crony capitalism. This is a game of financial musical chairs where the government keeps the market from calling the tune. The cronies call the tune. I should add one more thing. People talk as if S&P and Fitch and Moody’s are independent private organizations. They are, sort of. But the structure of regulation empowers them. Without the regulations requiring their imprimature, I’d assume they’d be gone. Without the implicit support of the regulatory apparatus, why are any of the ratings agencies in business?--Russ Roberts

Wired has an interesting story on the conflict at WikiLeaks

between Julian Assange and Daniel Domscheit-Berg.

Via The Age, in turn via Bess Levin.

Quotes of the day

Over the years, I have paid a significant portion of my income to the various federal, state and local jurisdictions in which I have lived, and I deeply resent that President Obama has decided that I don't need all the money I've not paid in taxes over the years, or that I should leave less for my children and grandchildren and give more to him to spend as he thinks fit. I also resent that Warren Buffett and others who have created massive wealth for themselves think I'm "coddled" because they believe they should pay more in taxes. I certainly don't feel "coddled" because these various governments have not imposed a higher income tax. After all, I did earn it. Now that I'm 72 years old, I can look forward to paying a significant portion of my accumulated wealth in estate taxes to the federal government and, depending on the state I live in at the time, to that state government as well. Of my current income this year, I expect to pay 80%-90% in federal income taxes, state income taxes, Social Security and Medicare taxes, and federal and state estate taxes. Isn't that enough? Others could pay higher taxes if they choose. They could voluntarily write a check or they could advocate that their gifts to foundations should be made with after-tax dollars and not be deductible. They could also pay higher taxes if they were not allowed to set up foundations to avoid capital gains and estate taxes. What gets me most upset is two other things about this argument: the unfair way taxes are collected, and the violation of the implicit social contract between me and my government that my taxes will be spent—effectively and efficiently—on purposes that support the general needs of the country. Before you call me greedy, make sure you operate fairly on both fronts. Today, top earners—the 250,000 people who earn $1 million or more—pay 20% of all income taxes, and the 3% who earn more than $200,000 pay almost half. Almost half of all filers pay no income taxes at all. Clearly they earn less and should pay less. But they should pay something and have a stake in our government spending their money too. ... Why do we require that public projects pay above-market labor costs? Why do we spend billions on trains that no one will ride? Why do we keep post offices open in places no one lives? Why do we subsidize small airports in communities close to larger ones? Why do we pay government workers above-market rates and outlandish benefits? Do we really need an energy department or an education department at all? Here's my message: Before you "ask" for more tax money from me and others, raise the $2.2 trillion you already collect each year more fairly and spend it more wisely. Then you'll need less of my money.--Harvey Golub

The great majority of people in different cultures do not object to someone who has made lots of money when they have superior abilities and talents, and they work hard at producing what are considered useful goods or services. Actors like Tom Hanks or Jennifer Aniston earn millions of dollars per film, yet they are admired as stars rather than condemned for being millionaires because films are a popular form of entertainment. Bill Gates, Steve Jobs, and others who became billionaires by creating innovative companies that provide highly valuable goods and services to millions of individuals are widely admired as the business equivalents of rock stars rather than attacked for their great wealth. Leading transplant and other doctors who become successful and very wealthy through extensive education and superior skills are recognized for their valuable contributions to extending the lives of very sick individuals, and few object to their high earnings. On the other hand, when hedge fund managers become rich by using arbitrage activities to narrow the spreads in interest rates and other prices between different regions (most hedge funds do not only engage in arbitrage) they produce useful services, but the value of what they do is not so apparent as the businessmen who make successful products. It is still harder for many to understand the usefulness of “speculators” who do well financially by successfully shorting shares of companies or commodities, such as oil, because they believe correctly that their prices will fall in the future. Their activities add value by smoothing out the prices of these shares and commodities over time, but few people like individuals who bring bad news, or who profit from anticipating bad news. Other forms of behavior are objectionable because they both add to inequality and lower economic efficiency. These are the most dangerous sources of inequality, and they create negative attitudes toward the wealthy, and even at times social unrest. One illustration is the arbitrary use of government power to give or take away wealth. Some individuals become very wealthy because of the political favors they receive, while others lose much of their wealth because of unjust governmental treatment. Examples include Carlos Slim and the Russian oligarchs who gained big economic advantages by receiving monopoly positions in industries like telecommunications when they were privatized, and the officials of Fannie Mae and Freddie Mac who became wealthy by using their political connections to acquire a dominant position in the US residential mortgage market. A highly publicized recent example is the Indian businessmen who obtained special privileges in telecommunications and other industries because of corrupt government officials. ... I agree with the argument by Warren Buffet in a recent New York Times op-ed piece that it is neither fair nor efficient for highly wealthy individuals like himself to be paying a smaller fraction of their incomes in taxes than middle income and many lower income persons. However, the way that inequity is corrected can make an enormous difference to economic efficiency as well as to the degree of inequality. The best way to reduce these inequities is to substitute for the present tax mess an inclusive equal percentage tax on all incomes, where the income base would be greatly widened by eliminating deductions on mortgage interest payments, restraining the tax-deductibility of charitable contributions, and eliminating special subsidies, such as the generous ones to ethanol producers. With a flat broad equal percent tax on all incomes, capital gains and other sources of income that currently have special tax treatment should then be taxed at the same flat rate as earnings and other incomes.--Gary Becker

The revelation that the Securities and Exchange Commission had a history of destroying documents has once again raised questions about how well the agency has exercised its enforcement authority. Although Matt Taibbi in Rolling Stone described the policy as “Orwellian,” the practice looks more like corner cutting to avoid cumbersome federal regulations on document disposal — the very type of conduct that the S.E.C. often criticizes companies for when it pursues an enforcement action. ... The S.E.C. is responsible for enforcing the internal controls rules for corporations, which require that their “books, records and accounts are kept in reasonable detail to accurately and fairly reflect transactions and dispositions of assets.” How does it look when a federal agency may have violated the law by destroying records related to one of its most important public functions? No one can be sure whether the S.E.C. policy on disposing of records from closed MUIs had any concrete impact on other investigations because any missed leads will never be known. What is clear, however, is a policy that may have violated federal law raises the specter that the S.E.C. was more concerned with making its life easier by getting rid of documents rather than complying with burdensome regulations. That is an often-repeated complaint about the S.E.C.’s own rules, a claim that might now gain greater resonance.--Peter Henning

... when it comes to education, good outcomes are not the same as great teaching. The most reliable way to amass impressive alumni is to screen for impressive freshman. But at the policy level it’s more important to identify institutions that are unusually good at helping people learn, not institutions that are unusually good at screening.--Matt Yglesias

In short, software is eating the world.--Marc Andreesen

Perhaps the single most dramatic example of this phenomenon of software eating a traditional business is the suicide of Borders and corresponding rise of Amazon. In 2001, Borders agreed to hand over its online business to Amazon under the theory that online book sales were non-strategic and unimportant. Oops.  ... Cisco talk about 50 billion devices but you can't see it in their revenue line.  Instead in the middle of the biggest imaginable boom they had that dreadful conference call where they talked about government spending being weak. Hey isn't this a private sector routing boom? Well it is but the private sector is appifying really fast. The government sector are all paranoid about Chinese government hacking and terrorist vulnerabilities and so are wanting the tried-and-proven hardware-software integrated device (which they think is harder to hack). Government paranoia is stopping the software eating the hardware and them guys at the Department of Homeland Security are sitting there safely in their (antiquated Cisco) box...  But whilst the government holds back the tide of history the lesson holds true: if you make hardware-software integrated devices your risk is you are going to get appified and unless you do the appification someone will do it for you.--John Hempton

Are wars increasing or decreasing?

Kathryn Hadley thinks so.

Joshua Goldstein, Andrew Mack, Erik Gartzke, and John Owen disagree (via Alex Tabarrok). As do I.

I will change this view if my son gets drafted, though.  (If he volunteers, well, maybe he is a better man than me).

Photo link here.

Quotes of the day

Your 60th got us into the financial crisis. Let’s hope this party gets us out of it.--Lloyd Blankfein, to Steve Schwarzman, at Leon Black's 60th birthday party

I got crucified because I said you can keep your money in Bear Stearns. I got crucified in this country!!! I learned my lesson, you can’t be as confident as you’d like. I never said you should buy Bear Stearns, I said you should keep your money there. In 36 hours Bear Stearns fell apart. It was fine to say it wasn’t going to fall apart and then it fell apart. My first call was that it was okay to keep your money there which turned out to be true.--Jim Cramer

It’s like a machine out there, and I’m that one part that isn’t up to speed with everyone else.--Chad Ochocinco

The idea of getting paid to take some 'abstract risk,' is becoming more quaint every year.--Eric Falkenstein

I too think our politicians are inadequate, but I don't want them to listen to me, rather, I would like them to be less important. That would take people actually voting for people who aren't promising to increase government, however, and I sense I'm not in the majority on that, and may never be.--Eric Falkenstein

By now, most Americans have lost hope that our current government will come up with a viable jobs program. It won’t. I am coming more and more to think that with the government essentially paralyzed for the foreseeable future, the only way we’re going to get jobs is by turning to actual job creators: business itself.--Joe Nocera

Yeah, that Joe Nocera, the one who called the Tea Party 'terrorists'.--Cav

If [Warren Buffet] really wanted to make (the tax code) fair, why doesn’t he propose a wealth tax on everyone over $1 billion worth of wealth of 50 percent once and for all. That would really work for him, but of course he’s not going to suggest that because he would have to pay that. It’s never seen a tax, and when he gives (the investments) to the Bill and Melinda Gates Foundation, it never will. This is ridiculous.--Arthur Laffer

I've been practicing literary criticism for more than 60 years. In 1976, I resigned from the once splendid Yale English department, which I had joined in 1955, to protest the decline in aesthetic and cognitive standards in the profession. I became a professor of the humanities, a department of one. I have been the pariah of the profession for the last 45 years. I maintain canonical standards for the study and appreciation of literature. I practice philology and knowledge of the history of language. I do not give in to political considerations, however they mask themselves. All this business about gender, social class, sexual orientation and skin pigmentation is nonsense. I'm 81. I'm not prepared to temporise any more. I've been prophesying like Jeremiah since 1968, warning the profession that it was destroying itself. And it has. There are fewer and fewer people teaching English, or any other kind of literature, in American universities. Students don't wish to study garbage and that's all they're offered.--Harold Bloom

I adopted, subconsciously at least, my father's view that those with much more than us had come by it dishonestly. I had no evidence, of course. Sure, I had a few stories about wealthy people who had taken advantage of others, but I had no basis for my grudge against the millions of people I resented. Because I couldn't have some of the material possessions other kids had, I felt left out, and that was enough. Then, in my late teens, I started to learn economics. I started to understand that the vast majority of income in a relatively free society is earned. It's true that a small number of wealthy people did get their money by fraud or dishonesty. More common, especially in societies with lots of government controls, were people who got wealthy by using political pull. But I started to see that the typical high-income person in a relatively free society gets his or her income the old-fashioned way--by earning it. This resentment over the good fortunes of others is not unique to me. Often, when one person tells another that he or she won a prize or is going on a great vacation, the other person responds, "I hate you." It's generally said jokingly, but the fact that it is said at all speaks volumes. ... [Will Herberg, a prominent American Communist] told us of his intense resentment of the fact that he was smart and had nothing, while they were dumb and had a lot. "That," he said, "is how I became a Marxist. I hated the rich." We were shocked. We had thought that virtually all intellectuals came to their views via their intellect, not via their resentments. Herberg must have read our faces, because he added that his route to Marxism was a very common one. "The number of people who became Marxists by reading Marx," I still remember him saying, "can be counted on the fingers of one hand."--David Henderson

When women's wages rise, the cost of kids rises. But so does wealth! The income and substitution effects go in opposite directions. And the fact that they go one of the three logically possible ways consistent with consumer rationality does nothing to confirm consumer rationality. ... higher value of time ("the increased opportunities for the mother outside of the home") is supposed to imply fewer kids. In the second paragraph, lower value of time ("short term income low and longterm prospects--for both parents and children--bleak") is also supposed to imply fewer kids. You could say the first is a substitution effect and the second is an income effect, but both effects are plainly both income AND substitution effects.--Bryan Caplan

Two extreme models of the macroeconomy have recently been discussed on the internet. On the extreme right you have Casey Mulligan, arguing that demand shocks can’t explain high unemployment, and that our economy is faced with a supply problem. If workers cut wage demands we could return to full employment. On the extreme left people like Paul Krugman argue that wage cuts won’t boost employment at all; instead they will simply depress AD even further. In the middle is the sensible AS/AD model, with downward-sloping AD curves and upward sloping AS curves. The textbook workhorse. This is the model that accurately describes the US economy. If AD declines, output will also decline (due to the upward sloping SRAS curve.) If workers accept pay cuts, then SRAS will shift right and output will increase. Neither the Mulligan nor the Krugman models are consistent with the empirical evidence. ... Both Krugman and Mulligan are partly right. More monetary stimulus really would reduce unemployment (at least if it succeeded in raising NGDP.) Krugman’s right about that. And cutting the minimum wage and reducing maximum UI benefits really would reduce unemployment. A competent government would do all of those things. An incompetent government would do none of them. Which one are we?--Scott Sumner

Prior to meeting Warren [Samuels], I think it would be accurate to say that I divided the world neatly into those who are (a) stupid, (b) evil, and (c) those who obviously are smart and good who agree with me. I disagreed with many people both in college and outside of the academic setting. But I thought the root cause of the disagreement was in 90% of the cases was a consequence of them being misinformed because of their lack of exposure to the ideas of Mises and Rothbard. Once they would have read Mises and Rothbard, their world view would change appropriately. Unless, of course, they were in the 10% of people who are evil. Warren destroyed that simple intellectual picture of the world. Here was a man who was as sharp as anyone I have ever met, who had read more and in fact forgotten more than I would ever read, and who was genuinely interested in the truth with no hidden agenda, and yet his disagreed; he questioned; he probed; he thought about the choice of words; he simply expressed the joy in figuring things out. In the process, Warren didn't overturn my intellectual commitments to the Austrian school and the Virginia Political Economy tradition in which I was being educated, but he made more self-critical and less self-satisfied, and hopefully a better scholar, teacher, and a more sophisticated representative of the Austrian school and Virginia Political Economy. ... Besides his role as a mentor to generations of scholars in political economy, Warren was also just an amazing scholar and economic thinker. He set a standard for professional work ethic that I think is rivaled only by his debate partner in political economy --- James M. Buchanan. Everyone should just look at his CV and see what it takes to build a professional career as a scholar. He spent his career as an engaged editor of scholarly journals, of book series that kept the classic works in print, as well as encouraging contemporary work, and he was an author of journal articles as well as books. He just worked day in and day out as a scholar of political economy. His natural curiosity took him from Wisconsin style institutionalism, to Classical economics, to Chicago economics, to public choice, to Austrian economics, to Coasean law and economics, etc. The overarching theme of his work is the role of government in political economy, and he kept thinking seriously about that question throughout his career.--Peter Boetkke

Protein engineering is a hot field, as well it should be, since enzymes do things in ways that we lowly organic chemists can only envy. Instead of crudely bashing and beating on the molecules out in solution, an enzyme grabs each of them, one at a time, and breaks just the bond it wants to, in the direction it wants to do it, and then does it again and again. If you're looking for molecular-scale nanotechnology, there it is, and it's been right in front of us the whole time. Problem is, enzymes get that way through billions of years of evolution and selection, and those selection pressures don't necessarily have anything to do with the industrial reactions we're thinking of these days. And since we don't have a billion years to wait, we have to speed things up. Thus the work at places like Codexis on engineered mutant enzymes, and thus a number of very interesting takes on directed evolution.--Derek Lowe

New York fails to crack the Top 10 list

of most promiscuous cities in America.

Via Dealbreaker.  Photo link here.

Photo of the day: Shalala, my oh my, look at the boy not shy

you're gonna kiss the girl.

Had the president of Miami University worked in Bush's cabinet instead of Clinton's, I think she'd already be gone. It's great when the mainstream media has your back. Not even Jon Stewart has taken a token shot, which is a typical masquerading-as-objective tactic of his.

Hey, New England, no more pulling for Obama

Just ask Rajon Rondo about it.

Quotes of the day

No joke: Presidential candidate Rick Perry and comedian Stephen Colbert, who last week barraged Iowa voters with advertisements urging voters to support “Rick Parry,” shared the same political committee treasurer – until they didn’t. Salvatore Purpura, who has represented numerous political committees as treasurer over the years, told POLITICO that he resigned on Thursday as treasurer of Colbert’s super PAC, Americans for a Better Tomorrow, Tomorrow.--DAVE LEVINTHAL

So, no disrespect Gov [Perry], but when you’re getting your Keynes on like that, no need to hide it behind all that anti-gov’t rhetoric.--Jared Bernstein

Would Keynesian stimulus spending work only when it came as a surprise? Or only when the spending was outside the range of prior business experience? Keynesian economists have not even begun to answer these questions. For now, Keynesian theory has so many exceptions that we might as well discard it.--Casey Mulligan

It sounds like this time the [People's Bank of China] might be pretty serious about diversifying their risk away from USG bonds, right? Let’s leave aside the fact that every six months we have heard the same thing for the past several years, and nothing has happened, shouldn’t we nonetheless be worried? Won’t reduced PBoC purchases be hugely disruptive to the US economy and to the US Treasury markets? No, they won’t. There is so much nonsense still being said about this, even by economist who should know better, that I thought I would try to address what it would mean if the PBoC were actually serious and not simply making noises aimed at domestic political constituents. First of all, remember that the PBoC does not purchase huge amounts of USG bonds because it has a lot of money lying around and doesn’t know what to do with it. Its purchase of USG bonds is simply a function of its trade policy. You cannot run a current account surplus unless you are also a net exporter of capital, and since the rest of China is actually a net importer of capital, the PBoC must export huge amounts of capital in order to maintain China’s trade surplus. In order the keep the RMB from appreciating, the PBoC must be willing to purchase as many dollars as the market offers at the price it sets. It pays for those dollars in RMB. It is able to do so by borrowing RMB in the domestic markets, or by forcing banks to put up minimum reserves on deposit. What does the PBoC do with the dollars it purchases? Because it is such a large buyer of dollars, it must put them in a market that is large enough to absorb the money and – and this is the crucial point – whose economy is willing and able to run a large enough trade deficit.--Michael Pettis

If you look at the box score from last night’s baseball game, there’s a lot of risk in concluding which player is the best hitter on the team based on what you find in that one box score. We’re very used to seeing, say, player performance vary from game to game and making conclusions about the most productive player based on a large sample of observations, likewise with the stock market. We know that the stock market varies not only day-to-day, but hour-to-hour and minute-to-minute, and we can watch that variation online almost in real-time…. There is a lot of risk in drawing conclusions about what the Dow Jones industrial average index value will be 10 years from now based on what happened yesterday… So again, the current state, or the most recent departure, is not a rational basis for making conclusions about the long-term trend or the long-term state of a system that’s noisy.--Noah Diffenbaugh

Enumerating a long list of disparate things that may happen, without any probabilities, may work for Nouriel Roubini, but he's a charlatan: here he is last week taking credit for his client switching to cash a couple months ago, he doesn't mention he has been suggesting investors go to cash since 1990, always for a slew of reasons (though Lawrence Summers is here giving props to Roub for calling the housing crisis). I have seen reports that endlessly enumerate risks many times in large corporations, and they are highly correlated with people who either are too afraid to make a mistake, or profoundly do not understand their job.--Eric Falkenstein

As expected, the group members rated the most narcissistic leaders as most effective. But they were wrong. In fact, the groups led by the greatest egotists chose the worse candidate for the job. Says Nevicka, “The narcissistic leaders had a very negative effect on their performance. They inhibited the communication because of self-centeredness and authoritarianism.”--Association for Psychological Science

Moral hazard

Like Michelle Rhee recently said: If you turn your head to the people who are yelling the loudest, you’ll be turning your back on the children, because they don’t vote. Speak up for those who cannot speak up for themselves.

Via Glenn Reynolds.

Quotes of the day

If [Keynesians] really don't care what the [stimulus] money is spent on, why not just reduce taxes across the board? It would be far simpler and faster. I suspect because the real objective is redistribution, and lower tax rates across the board is regressive on a dollar basis even if proportionately the same. Too bad, but it highlights that old maxim I learned in my litigation--a dispute is never about what its most zealous disputant says it's about. In this case, the real wish of Keynesians is to redistribute wealth via the government, giving bureaucrats more power over the bourgeois. If it were otherwise it would be too easy to stimulate the economy in short order via their model of the economy.--Eric Falkenstein

Hoover wasn’t able to print gold, but can be blamed for supporting the Fed’s tight money policies. Obama can’t print dollars, but can be blamed for not moving aggressively to put people at the Fed who understand the need for more dollars.--Scott Sumner

OK, I have decided to stop posting updates. I almost regret writing this post, actually. In my attempt to show that Mankiw was sympathetic to the Old Keynesian point of view, I unfortunately seem to have ended up causing some offense (the "hypocrite" thing), which was certainly not my intent. And then I was led to try to parse the totality of Dr. Mankiw's actual views on stimulus, which turned out to be quite difficult (they are indeed nuanced).--Noahpinion

It’s easy for me to dismiss 99.9% of progressives, as I see right through their biases, their lapses in logic, their lack of understanding of economic principles, their shameless misuse of statistics. It’s not so easy to do that with Matt Yglesias. I’d guess many progressives feel that way about Tyler Cowen. If there were no Tyler Cowens we could easily be dismissed as a bunch of moonies. With him, it’s not so easy.--Scott Sumner

Pundits should probably try to stop extrapolating guidelines for economic policy by comparing whichever country happens to be doing worst, with the one that is doing least badly. Germany's consensus based management and export focus was touted as a recession-fighting miracle by liberals, while its relatively modest stimulus was praised by conservatives. But these things may have been incidental rather than central to Germany's relatively mild recession experience. Our experience in the Great Depression seems to indicate that such recessions are long and painful, and that they do not always affect all countries the same way at all times. At any given moment, some country is going to be doing better than the others, while some other country is going to be doing worse. This is not necessarily related to policy. This is obviously a huge problem for the eurozone. Those who think that the euro can muddle through this without losing the periphery have been counting on Germany (and to a lesser extent, France) to deliver a bailout. A recession is going to erode Germany's economic ability to funnel cash into the PIIGS, but more importantly, it is going to make German voters much less patient with the notion. It's probably not so great for the rest of us, either. When the global economy is dealt a blow, we all get bruised.--Megan McArdle

We are a strange lot, the human race. We learn in funny ways. Once you break a taboo it is gone, once you break a boundary it is gone, if you get away with something and you enjoy it, you do it again. When kids attack teachers, (and it happens thousands of times a year) being sent to the cooling off room is pretty much a reward, a fixed term exclusion often makes no odds either. If a social worker tells a teenage mum the word ‘no’ emotionally damages a child, a message goes out. If an adult admonishes a gang of children for littering and gets a police caution a message goes out. If a father is reported to the police for smacking a child a message goes out. If an adult is arrested for grabbing a child who is stealing, or assaulting another child, a message goes out. If knife criminals receive community sentences, a message goes out. If people tell you about your rights as a child, and never about your responsibilities, a message goes out. If teenage girls are given flats for having babies a message goes out. If the police arrest you fifty times and nothing happens a message goes out.  How did it come to this? It is all about the power of ideas. The left wing sales pitch of grievance, victim, blame and excuse has done immense damage to society, as has the rights culture and the sense of entitlement many young people now have. If we look there is clear chain of causality that goes through the decades as other poisonous ideas took hold and turned society on its head: The family is outmoded, children don't need fathers, they should be treated the same as adults, they don't need discipline or boundaries, authority is oppression, everything is society's fault, right and wrong are relative concepts, as is morality, ethics are contextual and no one view is worth more than another. Well-meaning this may be, but no society in the history of the world has taught its children this and survived. Edmund Burke must be turning in his grave.--Simon Marcus

Jim Thome has been a great hitter. Not a good hitter. Not a very good hitter. He has been a slam-dunk, first-ballot, no-doubt Hall of Famer hitter. People have missed this because, well, people have missed a lot about Jim Thome. The man has a .403 lifetime on-base percentage, 25th all-time for players with 7,500 plate appearances, higher than DiMaggio, higher than Wagner, higher than Mays or Yaz or Rose or Ichiro. Many people will never respect on-base percentage the way they should because many people just don't like walks. But walking is an art. And Thome is Picasso. Anyway, his on-base percentage is not all the 1,700-plus walks he's earned. He's a .277 lifetime hitter, which doesn't sound great, but it's better than many of the other big home run hitters -- Ernie Banks, Cal Ripken, Eddie Matthews, Mike Schmidt, Reggie Jackson and Harmon Killebrew among them. Heck, Thome hit .300 three times. He, of course, has struck out more often than any player except Reggie Jackson (and it doesn't look like he will quite catch Reggie). But when he hit baseballs, he hit them hard.--Joe Posnanski

Chart of the day: The Obama Hockey Stick

An inconvenient truth, more dire than global warming.  Source here, via Greg Mankiw.

Sign of the day: Open source group relies on closed source tech

Via John Hempton.

30 minutes of TV is the new cigarette

Reuters and MSNBC report:

... scientists at the School of Population Health at the University of Queensland studied 11,000 Australian adults who were aged at least 25 in the year 2000.

The academics checked their data against an estimate from 2008 that Australians aged 25 or above watched TV for 9.8 billion hours. This was associated with the loss of 286,000 years of life, the AFP said.

An extrapolation of these figures found that a single hour of TV was responsible for the loss of just under 22 minutes of life, the news agency reported.

Smoking two cigarettes has approximately the same effect.

Photo link here.  Via Drudge.

Quotes of the day

On August 15th, 1971, the dollar's final gold tether was severed, allowing it to sail away into uncharted seas.--John Carney

When markets are bullishly priced,
A hedge fund seems cooler than ice.
But when markets fall,
Some hit a brick wall.
Hope Greenwich soup kitchens are nice.--Kevin Roose

Independent Study – Each student is encouraged to develop an individually tailored program, in conjunction with a faculty advisor and registered therapist, which is designed to counteract psychological, intellectual, and emotional shortcomings which will prove to be deleterious to his or her productive insertion into society post graduation. Popular programs of study include How Not to Be a Hubristic Ass, How to Respect the Opinions and Choices of Others, and How Not to Bite the Hand that Feeds You. In the case of Mr. Lohse, the faculty would like to draw special attention to a newly-offered course, No-one Wants to Hear My Poorly-Thought-Out, Half-Assed Opinions Over a Beer at the Student Union on Saturday Night. It has been recommended for him by a number of his classmates and peers.--TED

I’ve had many opportunities to experience the “pleasant” Chinese living standards. The Chinese people seem to spend their money much more wisely than the Chinese government. China is poorer than Mexico. China is growing fast, as you’d expect of a country filled with 1.3 billion people whose culture reveres education, hard work, and entrepreneurship, and who has been moving away from the madness and starvation of Maoism. I have no doubt that if the US moved some of its vast spending on social programs to highway construction we too could have big new smooth roads. Taxes normally grow as a share of GDP as countries get more developed, and easier to tax. The East Asian countries that actually are pretty rich (Singapore, Hong Kong, Taiwan, South Korea and Japan) tend to have tax rates that are well below the average of western countries. Despite taxes that are much lower than in the US, Singapore has lots of nice roads and new infrastructure. If we want to find an East Asian model to emulate, I’d suggest looking to low tax, rich, efficient Singapore, not poor and inefficient China.--Scott Sumner

Texas has 10,135 megawatts of installed wind-generation capacity. That’s nearly three times as much as any other state. But during three sweltering days last week, when the state set new records for electricity demand, the state’s vast herd of turbines proved incapable of producing any serious amount of power. Consider the afternoon of August 2, when electricity demand hit 67,929 megawatts. Although electricity demand and prices were peaking, output from the state’s wind turbines was just 1,500 megawatts, or about 15 percent of their total nameplate capacity. Put another way, wind energy was able to provide only about 2.2 percent of the total power demand even though the installed capacity of Texas’s wind turbines theoretically equals nearly 15 percent of peak demand. This was no anomaly. On four days in August 2010, when electricity demand set records, wind energy was able to contribute just 1, 2, 1, and 1 percent, respectively, of total demand.--Robert Bryce

More than half of Americans would rather give up chocolate, alcohol and caffeine for a week before parting temporarily with their phones, according to a recent survey by technology firm TeleNav.  One-third would give up sex, 22% would give up their toothbrushes (versus 40% of iPhone users, who evidently love their phone more than clean teeth) and 21% would rather go shoeless before separating from a mobile phone.--Shan Li

Like it or not, it’s the gatekeeper for every new drug and device marketed in the U.S., and it’s a big reason why it takes over a decade and hundreds of millions of dollars to bring a single new drug to market. Getting innovative new products through the FDA’s development and approval process faster and less expensively would improve public health and help lower health-care costs.--Paul Howard

Rioters are mainly younger men, particularly those who are unemployed and have lots of time on their hands. The high unemployment rates of young French Muslim males who were not integrated into the French economy were a major factor behind the 2005 rioting there. The likelihood that many rioters will be apprehended and punished affects the willingness of many to participate in riots, especially individuals with much to lose from being arrested and punished. Police crowd control techniques and police efforts to address grievances in minority neighborhoods are also important in preventing some riots, or at least ending them more quickly once they have begun.--Gary Becker

But while the rioters have been maintained in a condition of near-permanent unemployment by government subvention augmented by criminal activity, Britain was importing labor to man its service industries. You can travel up and down the country and you can be sure that all the decent hotels and restaurants will be manned overwhelmingly by young foreigners; not a young Briton in sight (thank God). The reason for this is clear: The young unemployed Britons not only have the wrong attitude to work, for example regarding fixed hours as a form of oppression, but they are also dramatically badly educated. Within six months of arrival in the country, the average young Pole speaks better, more cultivated English than they do.--Theodore Dalrymple

The Sushinomics Cost-of-Living Index

in 27 cities and their rankings, with 100 as average.

Los Angeles 126.63
New York 120.97
San Francisco 117.44
...
Columbus 85.57
Portland 84.22
New Orleans 76.25
Princeton, N.J. 72.92

Photo link here.

Quotes of the day

I believe that taxes are a necessary evil. The fact that they are necessary should not obscure the fact that they are evil.--Neptunus Lex

I don’t think the recent legislative debt did “enormous damage to our economy and the world’s.” I think the debt limit threat was undesirable, necessary, and effective.--Keith Hennessey

Already, hundreds more American troops have been killed in Afghanistan during the less than three years of the Obama administration than during the eight years of the George W. Bush administration.--Ira Stoll

Those of us who were bewitched by his eloquence on the campaign trail chose to ignore some disquieting aspects of his biography: that he had accomplished very little before he ran for president, having never run a business or a state; that he had a singularly unremarkable career as a law professor, publishing nothing in 12 years at the University of Chicago other than an autobiography; and that, before joining the United States Senate, he had voted "present" (instead of "yea" or "nay") 130 times, sometimes dodging difficult issues.--Drew Westen

One of the great puzzles of the past 30 years has been the way that men, as a group, have responded to the declining market for blue-collar jobs. Opportunities have expanded for college graduates over that span, and for nongraduates, jobs have proliferated within the service sector (at wages ranging from rock-bottom to middling). Yet in the main, men have pursued neither higher education nor service jobs. The proportion of young men with a bachelor’s degree today is about the same as it was in 1980. And as the sociologists Maria Charles and David Grusky noted in their 2004 book, Occupational Ghettos, while men and women now mix more easily on different rungs of the career ladder, many industries and occupations have remained astonishingly segregated, with men continuing to seek work in a dwindling number of manual jobs, and women “crowding into nonmanual occupations that, on average, confer more pay and prestige.”--Don Peck

... why are men failing to keep up? There are two common answers. First, girls are “better at school” than boys, and are able to better compete for the higher paying, higher status jobs that require a college education. The reasons for this are highly disputed. One possibility is that boys learn differently than girls and that the schools, where women do most of the teaching, fail to recognize boys’ particular interests and “learning styles.” Female teachers choose fiction, goes one example of this line of thinking, but boys prefer adventure stories and biographies. Another possibility is that girls possess noncognitive strengths that lead to greater school success. In a 2002 paper, “Where the Boys Aren’t,” Harvard economist Brian Jacob compared a large cohort of college grads who had been 8th graders in 1988. He found that while boys and girls scored similarly on cognitive tests, girls were better at paying attention in class, keeping track of homework, and collaborating with classmates.[13] Other studies have also found them to be more self-disciplined.[14] The second and related theory about why men are falling behind has it that today’s labor market prizes female strengths more than male strengths. The manufacturing economy, the one that ironically gave women the household revolution that helped to liberate them, relied on physical strength and endurance.  ... I would add a third, more existential explanation, for the male problem. The economic independence of women and the collapse of marriage norms have deprived men of the primary social role that incentivized their achievement. Adult manhood has almost universally been equated with marriage and fatherhood. Boys grew up knowing that they had inescapable future demands on them. There were exceptions, of course. In polygamous societies, low status men often had neither wives nor children; in others some males became priests and some, warriors and soldiers. But in most human societies, men knew that they were expected to become providers. Why have men agreed to do all of those dangerous, boring, dirty, exhausting jobs? Because people were depending on them. Evolutionary psychologists would point out it’s not insignificant that many of those dependents shared their genes.  Beginning in the middle of 20th century, not coincidentally the same historical moment that great numbers of women were moving into the workforce and becoming economically independent, the universal assumption that men were essential to family life started to erode.--Kay Hymowitz

Meltzer is probably one of the three most distinguished post-war monetarists (along with Brunner and Friedman.) But it seems to me that this type of monetarism has reached a dead end. It needs to be reformulated to incorporate the insights of the rational expectations and EMH revolutions. It needs to focus on targeting the forecast, using market forecasts, not searching for an aggregate with a stable velocity. And it must be symmetrical, with just as much concern for excessively low NGDP growth as excessive high NGDP growth. It needs to offer answers for high unemployment, and advocate them just as passionately as Friedman and Schwartz argued that monetary stimulus could have greatly reduced suffering in the Great Depression. Just as passionately as Friedman and Meltzer argued for monetary stimulus in Japan once rates hit zero. Unemployment is the great tragedy of our time. History will judge the current schools of thought on how seriously they addressed this issue.--Scott Sumner

Bill Barnwell thinks Bill Belichick is channeling Al Davis

writing:

It's a good thing Bill Belichick is who he is, because if Al Davis or Daniel Snyder made the moves he's made, they'd end up becoming embarrassing trending topics on Twitter. After inexplicably cutting defensive end Ty Warren at the end of July, the Patriots went shopping for a defensive line that would have been football's best in 2005. The trade for Albert Haynesworth was one thing, but they've also brought in defensive ends Mark Anderson, Shaun Ellis, and Andre Carter, none of whom looked particularly effective last year.

The Ellis signing, in particular, is exactly the sort of thing that the Raiders would do: Go out and acquire a player because he had a great playoff game against you. While it's always hard to quantify the statistical impact of a 3-4 defensive end because his job is usually to simply occupy blockers, the Jets weren't willing to give Ellis much more than the veteran's minimum, even after their aborted approach for Nnamdi Asomugha. That's telling.

Carter had 11 sacks in 2009, but he struggled when the Redskins moved to a 3-4 last season. At 32, he could very well be finished. Anderson never developed after a 12-sack rookie season, and once offensive linemen figured out what he was doing to get those sacks, he never adjusted. He's also too small to serve as anything beyond a situational pass-rusher, which the Bears discovered before cutting him last season.

New England is reportedly making these moves as part of a switch to a 4-3 defensive alignment, which doesn't make much sense when you consider that its best defenders — nose tackle Vince Wilfork and linebacker Jerod Mayo — would be marginalized in the 4-3. The Patriots signed Wilfork to a five-year, $40 million deal in 2010, so it's strange that they're not building their defense around his strengths. He excels at holding up blockers at the line of scrimmage and isn't the sort of penetrating, one-gap force on the interior that the 4-3 usually demands.

Why am I not worried? Somehow, I am thinking that Belichick knows a wee bit more football than Barnwell. Call me irrational

Poetry in motion: Kevin McHale

No, no, no, not this guy;

this other dude.

Video link here.  (WARNING: Pre-Jordan short-shorts).

Via Bill Simmons.  Photo links here and here.

Bikini Statistics (Tornado version)

Source here.

Quotes of the day

You've probably seen the headlines about a new experimental treatment for leukemia. For once, the excitement seems justified - this is a remarkable and very promising result, and it's worth taking a close look at it. ... It's important to note, though, that in one way this experiment did something quite strange: it worked much better than anyone expected. The dose of engineered T cells was much smaller than used in previous trials, and was deliberately chosen to be on the low side because no one was quite sure what to expect. Given the response, that was certainly a good move. I've no idea what would have happened if the therapy had been more aggressive, but it couldn't have been good. I hope, though, that everyone involved is enjoying this as much as possible, because this is a rare event indeed. Having things go suddenly, crazily right in a clinical trial is a once-in-a-career thing, if ever. The field of immunological cancer therapy has been given a huge boost, and now all the other groups working in the area have a huge motivation to spur them on. This is potentially some of the best oncology news in years, so let's hope that it continues to work out.--Derek Lowe

The Fed has picked such a bizarre and convoluted strategy that it is difficult for markets to predict which way the economy will go. Under interest rate pegging, NGDP can either fall or rise at an accelerating rate, depending on tiny differences in initial conditions. (Think about those saddle-point graphs you studied in math.) Fortunately, they only committed to this idiotic policy for two years, and hence it’s unlikely we’ll see explosive moves in either direction. But it would have been much simpler if the Fed has just TOLD US WHERE IT WANTS TO GO.--Scott Sumner

So if you're scoring at home, we just free-falled from Rita Hayworth to Marilyn Monroe to Raquel Welch to Farrah Fawcett to Madonna to Pam Anderson to Britney Spears to Kim Kardashian. And you wonder why our country's credit is dropping.--Bill Simmons

... the architecture of the military has become increasingly computer-based, with online communications, information storage, and other essential components that use cyberspace, or can be disrupted through attacks from cyberspace. Countries at war would gain an enormous military advantage if they could shut down the computer-networks of their adversaries for even a few hours.--Gary Becker

Once upon a time, the evil ogres of the military-industrial complex spawned a mutant flying machine, a freakish helicopter-airplane hybrid so dangerous and costly it deserved to die. Yet tribes of pork-addicted toadies and blind intellectual dwarfs shielded the beast from knights in shining armor who sallied forth tirelessly -- heavily armed with GAO reports -- to slay it. That's the fairy tale the V-22 Osprey's bitterest critics like to believe, but the facts about the tiltrotor transport, which the Marines fought a quarter of a century to get into service, tell a far happier story. This ugly duckling is turning out to be a swan. ... By the time the Marines first put the Osprey into service in Iraq in 2007, though, it had cost more time, money and lives than any other piece of equipment the Corps has ever bought -- 25 years, $22 billion and 30 deaths in crashes during its development. The Osprey was a very ugly duckling. Since then, the saga has taken a very different turn, but many of the Osprey's loudest critics – notable among them the New York Times editorial page – went to sleep in the middle of the story. ... Since Dec. 11, 2000, the Osprey has suffered one fatal accident – one in 11 years.--Richard Whittle

A White House photographer was allowed to take and widely distribute a photo from the ceremony Tuesday for the return of the remains of 30 American troops killed in a weekend helicopter crash in Afghanistan despite the Pentagon's claim that any public depiction of the scene would violate the wishes of bereaved families.--LOLITA C. BALDOR

I never knew an admiral I respected more as a man than a second class petty officer SEAL. I believed that if I had played the game the way it was meant to be played, and caught a few lucky breaks, I might have made flag rank. I know that I do not have now, and never did have, what it takes to be a Navy SEAL. The selection process is rigorous, the training syllabus withering. You may think you have what it makes to be a member of the teams. But if the instructional staff has doubts about your intelligence, your dedication, your ability to work as a member of a team, your physical stamina and endurance, you are done. There is no court of secondary appeal. And when they have decided that you do not have what it takes to make the grade, to fight alongside their beloved brothers in arms, you will leave thinking it was your decision. You will ring the bell and be grateful. For those few who make the cut, those who get to wear the Budweiser, the real challenges are yet to come. The challenge now is not to make the cut, it is not to grasp the intricacies of advanced training. The challenge is to go to places so utterly foreign, and fight foes so thoroughly implacable that to take the mission is to willingly part with all that you have, and all that you love, and place everything in the balance in a desperate gamble.--Neptunus Lex

For those who know, no explanation is necessary. For those who don’t, no explanation is possible.--unnamed TOPGUN instructor

Slide link here.  Photo links here, here and here.

Quotes of the day

Everyone is born an original but most die as copies.--Abraham Lincoln

Quotes of the day

Always keep what's important close to you.' You can have a million dollars, but if you don't have love, you're broke.--Robert Kraft

People asked me how a person from Glennville, Georgia who went to Savannah State could win three Super Bowls. It's the three D's: dedication, determination and discipline. Don't hope someone gives you an opportunity. Create one for yourself. When I left for Savannah State with two brown grocery bags filled with my belongings, nothing was going to keep me from my dreams. You may not know this: I was never supposed to be a Hall of Famer or a tight end. ... To my brother Sterling: I'm the only player that's walked through this building that can say he's the second-best player in his own family. ... My position coach once asked me why I work so hard. "You're not eating. You're in the gym. You study harder, you practice harder, you have more fun." I said, you don't know what it's like to eat raccoon, opossum, squirrel and turtle. I'm not gonna have to eat that when I become an adult.--Shannon Sharpe

Sorry, folks

another busy trading day.

Quotes of the day

Busy trading again today, but here's something more than nothing.--Cav

... that's what happens in a mediated world of the unreal: The winners feel as empty as the losers.--Chuck Klosterman

In my December 2008 column, I argued that the only practical way to shorten the coming period of painful deleveraging and slow growth would be a sustained burst of moderate inflation, say, 4-6% for several years. Of course, inflation is an unfair and arbitrary transfer of income from savers to debtors. But, at the end of the day, such a transfer is the most direct approach to faster recovery. Eventually, it will take place one way or another, anyway, as Europe is painfully learning. Some observers regard any suggestion of even modestly elevated inflation as a form of heresy. But Great Contractions, as opposed to recessions, are very infrequent events, occurring perhaps once every 70 or 80 years. These are times when central banks need to spend some of the credibility that they accumulate in normal times. The big rush to jump on the “Great Recession” bandwagon happened because most analysts and policymakers simply had the wrong framework in mind. Unfortunately, by now it is far too clear how wrong they were. Acknowledging that we have been using the wrong framework is the first step toward finding a solution. History suggests that recessions are often renamed when the smoke clears. Perhaps today the smoke will clear a bit faster if we dump the “Great Recession” label immediately and replace it with something more apt, like “Great Contraction.” It is too late to undo the bad forecasts and mistaken policies that have marked the aftermath of the financial crisis, but it is not too late to do better.--Kenneth Rogoff

It’s the elderly, stupid.--Robert Samuelson

Been busy trading today

Probably back tomorrow.

Scott Sumner has nominated a worthy successor for Fed chair

here.