Japan was hit by a tsunami last year on March 11. … What’s the upside to this natural disaster? I’ll be blunt. There isn’t one. But some economists think there is.
To come to such an inhumane conclusion is to forget the economic discipline’s most fundamental lessons. … As it turns out, Japan’s GDP is growing twice as fast as America’s.
This is a simple mistake to make if the Keynesian model is the basis for your thinking about macroeconomics: higher employment is always good.
But, this goes back to Bastiat’s broken window fallacy: you shouldn’t conclude that breaking a window is a good thing because it creates work when it is fixed.
The reason people get to this point is that they are only thinking about flow variables (current work) not stock variables (past work embodied in current capital). Accountants are very careful about this: that’s why they use balance sheets and income statements. Public policymakers … not so much.
Think about it: we run our macroeconomies based on GDP. This is a flow variable. Where’s the stock variable? We simply don’t think about it much in macroeconomics. Mostly we do this because national wealth is difficult to measure. That’s a reason for being careful, not a reason for ignoring stock variables.
Imagine for a minute that the tsunami never happened. Japan’s GDP growth would probably be slower; Krugman is almost certainly correct on that. And yet, a tsunami-less Japan would be better off. …
As far as the economy goes, all that reconstruction spending would instead go to creating brand new wealth, as opposed to merely replacing what people already had to begin with. It is better to build than to rebuild.
This sort of mistake simply doesn’t happen if you’re using a growth model as the basis for your thinking. In that model, 1) a reduction in capital (from, say, a tsunami) clearly makes you worse off because it leads to lower output and per capita income, and 2) it also will lead to a higher growth rate because it takes you further away from the steady state. But, there isn’t any way you’d view that as a good thing because # 1 clearly causes # 2 in the growth model.
Funny how the sweet spot for births in mid-September, which averages about 38 weeks after “the act”, corresponds to dates between December 16th and December 31st. That’s a lot of sales pitches for better gifts and rewards for good ones.*
Funny how such a random event doesn’t fall on New Year’s Day, July 4th, or Christmas. More power to our ability to schedule life’s little speed bumps.
Do note that in this version, the coloring of the callouts on the right-hand side is incorrect.
* I never got a clear story for their certainty, but my parents were quite sure that my mid-August birth date corresponded to a hotel in Binghamton over Thanksgiving weekend in 1963. For my money though, the dates correspond better to an emotional response to the Kennedy assassination.
… Republicans tolerated inequality, handing out more very high and very low grades, while Democrats' grades grouped more tightly around the average. Republicans also gave black students lower grades than did their colleagues.
The study is (still) forthcoming out in American Economic Journal: Applied Economics. Kudos to the newspaper: I went and read the journal piece second, and didn’t get much extra out of it.
It is not capable of determining if Republicans give lower grades to blacks because they are prejudiced, or because Democrats are giving them better grades than they deserve, or if blacks have weaker backgrounds.
But, the study finds no gender effects, or racial effects other than the Republican-professor-black-student one.
It’s odd, living in a remote, predominantly Mormon town, and seeing the local items that draw national attention.
Today, it’s this. I draw your attention to the following part:
Parents and faculty members had asked police to bring a K-9 to the scene before the bus departed to check students' bags for drugs.
Who was on the bus?
About 100 students from Canyon View High School in southern Utah had just graduated Thursday night and boarded the charter bus for their senior trip …
Where were they going?
… A bus full of recent Utah high school graduates headed to Disneyland …
Here’s what I wonder.
Was there probably cause? If so, why wasn’t it mentioned?
No doubt parents had to sign permission slips. Were they informed that this included submitting their kids to a search with dogs?
I’m all for parents policing the actions of their children, and schools avoiding legal liability. But, bringing the government in to do this under these circumstances violated the spirit of the First and Fourth Amendments.*
Also, what does this say about local students? About 80% are LDS. In this area, those who are not LDS are often immigrants who are unlikely to be able to afford a school trip. They were going to Disneyland. Have our moral borderlines shifted so far that we don’t see a problem presuming that a group of predominantly well-off Mormon kids going to Disneyland are violating the law?
Oh yeah … and who do you think they caught? The bus driver (queue Simpsons’ joke) … the local paper contained no reports of kids having drugs (although with Utah leading the nation in prescription drug abuse, this is kind of surprising). No kudos to the legacy media, who decided the most interesting thing about this event is that a bus driver was caught.
* The First Amendment reads: Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances. So, technically this would only be a violation if Congress passed a law saying that assembling for a school trip to Disneyland was a problem, thus a violation in spirit.
The Fourth Amendment reads: The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized. I’m not sure that this case doesn’t go beyond a violation in spirit to just a plain violation. Is it unreasonable for parents and teachers to ask the police to use dogs to search a bus full of kids without probable cause (other than they’re teenagers, and there’s a high probability of finding something)? I would say no.
Moderates and conservatives were adept at guessing how liberals would answer [moral] questions. Liberals, especially those who described themselves as “very liberal,” were least able to put themselves in the minds of their adversaries and guess how conservatives would answer.
… For liberals, morality is largely a matter of three values: caring for the weak, fairness and liberty. Conservatives share those concerns (although they think of fairness and liberty differently) and add three others: loyalty, respect for authority and sanctity.
Another way of putting it is this: Americans speak about values in six languages, from care to sanctity. Conservatives speak all six, but liberals are fluent in only three.
This actually speaks to a position I’ve been taking in classes for about 20 years. In economics, I stress that the end result of helping the weak is a central goal of most politics, and that liberty is economically beneficial.* And I emphasize that it is a mistake to think about policy decisions made by different groups as differing on these points; I’ve never felt that they did.
* I also emphasize that economics doesn’t have much to say about fairness.
In my most recent book … I quote an old joke about the British equivalent of the U.S. antitrust division: “Why is there only one Monopolies Commission?” This is a profound insight into the nature of statism: By definition, there can only be one government — which is why, when it’s “monopolizing,” it should do so only in very limited areas.
With the development of internet technology, work at home jobs are increasing in the market. Also setting up small business online with ones own bank savings can provide excellent work at home opportunities. Apart from savings, banks offer0 credit card to cater to short term finance needs. Partial tax payments like tax credits are also available to promote online businesses. Market now offers several alternatives to traditional credit card debt which are helpful to work at home businesses.