Archive

  • Why the Protectionism?

    The NYT had a very interesting piece about a new laptop computer, designed for the developing world, which is supposed to sell for $150 a piece, with the price projected to drop to $100 in a couple of years. (The computer uses a Linux operating system.) While this sounds like it could potentially be a great advance for people, and especially school children, in the developing world, the article reports that the innovator behind the project insists that people in rich countries should pay $450 for Dell computers. The reporter should have pressed this one a bit. According to the article, the manufactuer will be making a profit selling the computer at $100-$150. What's wrong with letting people in rich countries also benefit from this technology? It won't take away the benefits for the poor. A good reporter would ask this question. Fortunately, markets being what they are, the computers will find their way into rich countries regardless of the innovator's intentions, but it would seem to...
  • Chris Farrell: When it Comes to Social Security Most People Are Nobody

    Chris Farrell demonstrated the incredible contempt with which the elites view the American public in his comments on MarketPlace this morning. He assured us that "everyone" agrees on what a solution to the Social Security solvency problem looks like. At the top of his list was raising the retirement age. All the polls that I have seen show that large majorities of the public (more than 60 percent) strongly oppose raising the retirement age beyond 67 (the age reached in 2022 in current law). This leaves one wondering who is the "everyone" in Mr. Farrell's world. I assume that he is referring to some group of policy types who he talks to. Of course, all the policy people I talk to know that the non-partisan Congressional Budget Office projects Social Security to be fully solvent until 2046 with no changes whatsoever. Even after that date it will always be able to pay much higher benefits than current retirees receive, even if no changes are ever made. Given the distant and relatively...
  • JAILBIRD ROCK? ...

    JAILBIRD ROCK? Newt Gingrich (who I still believe will be the Republican nominee in 2008, so get used to him) got some attention in New Hampshire this week for giving a speech at "First Amendment" dinner and declaring that the War on Terror called for "a totally different set of rules" on speech. But what he would take away with one hand, he gives back with another. In the interest of, he said, "expanding First Amendment rights," he called for the elimination of all limits on campaign contributions, in exchange for candidates' and parties' reporting all contributions on the Internet. This proposal is not new: Fred Wertheimer of Democracy 21 informs me that when it was introduced in Congress a few years ago, it was known as " DeLay-Doolittle-Ney ." Now that the first of those is under indictment, the third has copped a plea, and the middle one is under serious investigation, one has to wonder: What should you call a piece of legislation when all of its cosponsors are in jail? (By the...
  • BUT DID ANYONE...

    BUT DID ANYONE TELL HIS POLITICAL ADVISORS? I don't know how this process works, but Mitt Romney has named his two primary economic advisors for the 2008 campaign, and, to his credit, they're proponents of, quite arguably, the most politically radioactive ideas in economics. Greg Mankiw 's current obsession is a significant gasoline tax, a policy he's so committed to he's created a Facebook group to promote it. Meanwhile, Glenn Hubbard provided crucial backup support when Mankiw admitted that outsourcing was good for the economy -- a position that doesn't play so well in The Rust Belt. In a weird way, both these moves speak well of Romney. Mankiw's "Pigou tax" obsession is arguable policy, but it's an undoubtedly serious -- and even unpopular -- attempt to deal with a profound threat. And taking a fatalistic view of outsourcing, while again up for debate (which I'll leave to Dean Baker ), is at least ideologically honest. Both these guys are serious about policy -- more so, in fact,...
  • FASCISTS OR HYSTERICAL PUNDITS?

    FASCISTS OR HYSTERICAL PUNDITS? : Diane McWhorter has the most bizarre interpretation of this year�s election results to date, in Slate *. It appears to argue that the midterm elections confirm not that Americans are more populist, or even more conservative, but that they are more fascist. Based on a 66 year old musing from Eleanor Roosevelt , McWhorter asserts--without a shred of empirical evidence--that Americans have a long standing tolerance for any political movement that can instill confidence in the public that they will competently carry out their agenda whatever it may be. At the time, Roosevelt fretted that Nazism would appeal to Americans for that reason. Therefore, she leaps to conclude that Americans only voted Democratic on November 7, because they rejected President Bush� s incompetence, not his policies. While I�m not one to gainsay the importance of the government�s failed response to Hurricane Katrina and violence in Iraq as decisive factors, I think her assertion...
  • NO SHAME IN...

    NO SHAME IN HIS GAME. I don't know how to find the audio of it, but David Frum gave a really rocking commentary on NPR today. It argued -- without shame or self consciousness -- that just as Republicans entered office and passed massvie subsidies for the oil industry, Democrats are about to pass massive subsidies for some of their big supporters. And which sinister sector will the Democrats be lavishing funds on? Public universities. The degree to which the GOP message machine has fallen apart ("Democrats: They'll expand your Pell Grants!") is really quite remarkable. Update : Here it is. --Ezra Klein
  • FRIST IN FLIGHT....

    FRIST IN FLIGHT. All of us in punditry shed a tear today upon news of Bill Frist 's withdrawal from the 2008 presidential contest. His absence will deprive us of a seemingly limitless number of gaffes, craven flip-flops, and opportunistics overreaches, all of which make for excellent copy. Given the sad news, it's worth going back to our November issue and reading Brian Beutler' s send-off to Frist. Beutler seems to be operating under the belief that Frist was a bad majority leader. Speaking as a liberal, I believe he's one of the greatest leaders Republicans have ever had, and I hope they keep the mold intact. --Ezra Klein
  • If Only Business Columnists Were Required to Know What U.S. Government Bonds Are

    We keep hearing about the failings of the U.S. education system. Economic columnists give us endless examples of such failings. Alan Sloan, a columnist for Newsweek, the Washington Post and MarketPlace radio gives us a beauty in a column that appeared in some form in all three venues (here's the Newsweek version.) Sloan notes that Social Security is projected to need to draw on its trust fund in about a decade. He says that at this point "we'll fix Social Security by again increasing payroll taxes and trimming the benefit formula." Now, if Mr. Sloan understood how government bonds worked, he would know that they have value, that's why people all over the world hold them and in fact are willing to hold them at a very low rate of interest. When Social Security starts drawing on the trust fund it will simply redeem its bonds at the U.S. Treasury, just as tens of millions of people, corporations, and banks have done over the years. Of course, the Treasury will need the money to repay...
  • THE PROBLEM WITH...

    THE PROBLEM WITH PICKING A SIDE. Laura Rozen has reported that there's chatter in military circles about picking a side in the burgeoning civil war in Iraq. I have also heard this option described as the "pick a winner" strategy, with the idea being that the U.S. could forge an alliance with whoever appears to be likely to win the conflict and then help them crush the opposition in a short and decisive war, thereby creating a state with enough of a monopoly on the use of force to have internal stability (though not necessarily justice). Should this strategy be pursued, all signs point to the U.S. allying itself with the Shia in Iraq, since they are the dominant population, and also less involved in the anti-American insurgency. In today's Washington Post , however, Saudi national security advisor Nawaf Obaid throws a wrench into the works and makes clear, once again, the conundrum of our present position. If the U.S. picks a side, he warns, Saudi Arabia will have to pick one, too:
  • MUSICAL CHAIRS. ...

    MUSICAL CHAIRS. I'll have to disagree with the mighty Atrios on this one . Blogospheric talk about the Harman/Hastings contest wasn't premature or chump-like. Just because "there was never anything coming from Pelosi 's office suggesting that he was her designated man for the job," didn't mean there was no reason to believe he was her man for the job. Second in seniority, publicly supported by the Congressional Black Caucus, there was every reason to believe Pelosi would turn to Hastings. And for those who thought it a bad idea, every reason to oppose it publicly and prematurely. Unless I've misremembered my School House Rock, there's no public campaign for Select Committee Chair -- the Speaker simply chooses who her candidate, and then the deed is done. If you want to influence it, you have to do so before the appointment. As for whether this was really "a big fact-free fake controversy likely set up by Harman supporters," it's resulted in the elimination of both Hastings and Harman...

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