Sunday, November 29, 2009

Didn't the Germans ban construction of new Synagogues before WW2?

Multicultural Fail.

This really isn't especially surprising, though. The Europeans have a lot of difficulty dealing with racial and religious differences that we don't have in the states. This may sound counter intuitive, but its definitely true. Until recently, it was only America that had a sizable minority population; European nations were mostly homogeneous. Demographic changes in Europe have meant that now there are sizable minorities in many European countries; this is a new phenomenon, and as this recent referendum shows, the Europeans aren't handling it superbly. Even the Swiss, who are world renowned for their openness and tolerance, passed a bill that accomplishes literally nothing other than to inflame tensions and discriminate against one group of people.

Wednesday, November 25, 2009

On Deficits

Great post from Tyler Cowen:
There have been many posts on this topic [whether or not having a large deficit is ok] lately, start with Paul Krugman and Brad DeLong if you need to catch up. Today I have a few simple points:

1. Even if "it is fine to borrow more" is the most likely scenario, it is not the only scenario. Let's take a page from Marty Weitzman on climate change. The worst-case scenarios matter too, because they can be very, very bad. We need to think probabilistically about this issue.

2. Are there current intelligent discussions of the implied interest rate volatility embedded in current options prices? If we are looking for market tests, why not start there? Focusing on the point estimate of the market interest rate(s) discourages you from thinking probabilistically.

3. I know less about Belgium but I am not reassured by Krugman's point that "Italy can do it." I and many other observers consider Italy's economy to be a basket case which will only get worse. Nor is Japan in a satisfactory place, economically speaking.

4. Krugman writes: "Belgium is politically weak because of the linguistic divide; Italy is politically weak because it’s Italy. If these countries can run up debts of more than 100 percent of GDP without being destroyed by bond vigilantes, so can we."

I would interpret this evidence differently. A high deficit often is an unfavorable symptom of bad politics, even if you think the high deficit is economically OK on its own terms. It's a sign that you have dysfunctional institutions and decision-making procedures, as indeed they do in Belgium and Italy. I believe that the not-always-swift American voter in fact understands high deficits -- correctly -- in this light. They don't hold theories about "crowding out," rather they sense something in the house must be rotten. And so they rail against deficits, as do some of their elected representatives. It's a more justified reaction than the pure economics alone can illuminate.

When water regularly overflows from your toilet, you want the toilet fixed, whether or not the water is doing harm.

I heard it myself regularly during the first eight years of the decade, from Bush apologists, that running a deficit isn't really bad. But clearly it isn't a good thing. And like Cowen points out, why are we allowing ourselves to settle for an economic situation that is probably or hopefully not bad, but certainly not good, and possibly catastrophic?

Republicans and Democrats alike are terrible about this. Except for Bill Clinton.

Thursday, November 19, 2009

The Rebirth of McCarthyism

Its been sad, although unsurprising, to watch a certain faction of this country regress into a consensus for bigotry and paranoia. One always has the temptation to believe that we are above this sort of thing as a people, but I know that such a belief would be a delusion. At any rate, you have the "conservative wing of the Republican Party" (which perhaps due to the silence or weakness of the theoretical moderates, is really just another way of saying The Republican Party) descending into this anti-Islamic thing.

Interestingly enough, in some respects I am supportive of criticism of Islam itself, if put in a certain context. Islam is an idea, not a race of people. And while direct criticism of races is pretty reprehensible, criticism of ideas is not; in fact, it is the opposite (criticism and mockery of ideas should be encouraged). Other ideas include: Christianity, evolution, the European Union, communism, and Batman. The fact that 'Islam' is so insecure with mockery (remember the Muhammad Cartoons in 2005?) is an enormous sign of weakness in my eyes. And I strongly applaud anyone who is willing to mock a self-righteous idea. My response to the outrage about the Danish Muhammad cartoons was that we should all draw more cartoons.

One reason that antisemitism is concerning is because Jewish is a race as it is an idea, and so hatred of an idea (Jewishness) becomes racism against a people. Likewise, in the United States, a majority of people are white, and most Muslims are not. Thus in an international context, criticism or mockery of Islam doesn't strike me as racist at all because Muslims are so heterogeneous. In the United States, however, prejudice towards Muslims becomes de facto a form of racism, because someone looking for Muslims would know which racial minorities to look for (still with many cases of mistaken identity).

But seriously, I see these knuckleheads on TV debating about whether or not we should call it terrorism. Its like they're using code for "Muslim attack on Christian" when they say "terrorism". Terrorism is of course an idea as well, and it is pretty absurd to think we can declare war on an idea. But that's the sad thing. These people aren't declaring war on terrorism when they say they want to fight terrorism. They're talking about fighting Muslims, killing Muslims, profiling Muslims. They're talking about infringing on American citizens' freedom of religion, the refusal to accept which was a founding issue for this nation. But like I said, I'm not really surprised. We have people who deny that Obama was born an American citizen, we have death panels and socialists. We had communists, and Japanese in internment camps. We also had half the country secede and try fight a war to try to keep black people enslaved.

Here is a parting observation about the people that are inducting the New McCarthyist age. These people are intolerant and bigoted; they are slandering Islam for political purposes; they're talking about racially profiling American citizens, and pushing for a war on Muslims terror: these are the ones who claim to be the most devout Christians! What part of this sort of behavior would Jesus Christ approve of?

Will the true Christians stand up to their extremists in the GOP and on Fox News, just as we urge Muslims to do the same?

Wednesday, November 18, 2009

In defense of dithering

*** Update ***

I'd also like to add something about general strategy. This isn't about whether or not we are going to fight against Al Qaeda. Its about how we are going to fight Al Qaeda. And if people believe that a war against a decentralized, polylithic entity like Al Qaeda, which is at this point more of an idea than an organization, will best be served by performing counter-insurgency in pretty much the most inhospitable country ever, in the absence of a credible local political ally, I think they are mistaken. There is opportunity cost. Every dollar spent fighting in Afghanistan is a dollar that could be spent doing something else (deploying 1 additional US soldier costs enough to build 23 schools). Every soldier in Afghanistan is a soldier that could be doing something else.

And, "something else for our soldiers to do" includes nothing at all! One reason that Iran and North Korea suddenly got so uppity in 2003 is because all of the sudden 150,000 US troops were tied up in counterinsurgency in Iraq, and half that number in Afghanistan. Bush couldn't have attacked another country if he wanted to, because we didn't have the ground forces. Remember, a huge, conventionally invincible American army with nothing to do IS a serious deterrent.

*** End Update ***

Lets make the right call.

Of course, my main criticism of the dithering is this. Clearly, Barack Obama doesn't want to send more troops to Afghanistan. If he did, there wouldn't be a reason to wait beyond the Afghan Presidential Election (which I think should be central to the decision). And yet the election came and went, Karzai was elected by fraud against a weak challenger, and we haven't a decision.

At any rate, I've had certain expectations about Barack Obama and I've always felt that I have a great read on his thought process. And my read is that he does not want to send more troops to Afghanistan. If he does send more troops, I'll be pretty disappointed, because I'll have to believe it was for political purposes. Unless there is some really juicy game-changing intel that I'm not privy to, but I doubt that.

Monday, November 16, 2009

Iraq as a catalyst for war

A week or so ago, Matthew Yglesias made a really good point. One commonly cited reason why the US needed to stay in Iraq and stabilize the country was that if we abandoned it, it would cause a regional war. Saudi Arabia would intervene on the side of Sunnis, Iran on the side of Shias, boom WW3.

However, in the last few weeks we've seen the development of some escalations in violence in Yemen which appears to be the result of some proxy wars going on. You have the governments of Saudi Arabia and Yemen attacking Shia rebels in northern Yemen, which in turn are being backed by Iran.

This proxy war is taking place and yet, as Matt pointed out, nobody is saying that we should be rushing 100,000 US troops into the buffer to prevent a war between the Saudis and Iran. This isn't to say that I don't think Iraq isn't important for other reasons. But purely as a means to prevent a regional war, this parallel situation suggests maybe that isn't a good use for US troops.

Wednesday, November 11, 2009

On Dithering

Obama still contemplating Afghanistan strategy, according to the NY Times. I suspect that Obama does not want to increase troop levels at all, and probably wants to begin to end our involvement in Afghanistan. That's what I would do. However, the military-industrial complex seems to be inexorably pushing him in the direction of additional troops.

At any rate, I wanted to point out that one thing that makes me question my own position is that I share it with Joe Biden. Biden has an almost unparalleled history of being epically wrong on foreign policy issues. He was opposed to the first Gulf War, to kick Saddam out of Kuwait. He then supported the US invasion of Iraq in 2003, which obviously was a mistake. After that, he opposed the troop surge, which ultimately worked in Iraq, and advocated partitioning the country into three smaller nations, which would have been a disaster.

So really, the safe bet here may be to find out what Biden wants to do, and just do the opposite. He wants to draw down troop levels and focus on al Qaeda only. Maybe we should support McChrystal's plan, then.

Monday, November 09, 2009


Quick comment. There had better be a very good reason why we haven't been updated on the Afghanistan strategy by the Obama Administration. The Afghan elections came and went, they were a failure. Karzai is in charge, and he is incompetent and corrupt. What now? My vote is that it isn't worth it. I suspect Obama feels the same way. What is he waiting for?

Opposition to Health Reform

A short article from The Economist declares that "Unfortunately, a government-run insurance policy is on the table again". A relevant quote from the article, with numbered brackets for my response below:

"A public plan is likely to damage competition[1]. A government insurer has some big advantages over a private one; its financing costs would be lower because the government can borrow cheaply[2]; it would not have to worry too much about future liabilities since it could never go bust[3]; and its economies of scale would be larger than those of the competition[4]."

1. Competition is already extremely low in the industry.
2. Isn't this a good argument as to why we should want a government option?
3. As the financial crisis showed, the government isn't going to let big private insurance companies go bust either.
4. Isn't this the best argument one could make for a public option?

So, I'm not saying that a public option is a fantastic idea. I just haven't, up till now, really had it articulated to me strongly as to why it's not. I figured The Economist could step up to that plate if anyone could, but this article in the October 31st issue really falls short.

Oh, and a final quote from the article:

"And finally, by resurrecting the idea of a public plan, the Democrats are serving notice that what little chance there was of a bipartisan effort on health care is gone."

Please. It is quite obvious at this point that the GOP has but one objective: do everything in their power to make sure the President of the United States fails.

Thursday, November 05, 2009

Quote of the Day

A good illustration why international cooperation on climate change is so challenging:

Current American attempts to persuade China to emit less carbon, are, as one distingushed economist put it, akin to a “nation of SUV drivers trying to tell a nation of bicyclists not to drive mopeds.’’ To have any global credibility, the United States must stop enacting new policies that encourage SUV lifestyles.

This was an excerpt from a discussion of how the home buyer's tax credit encourages suburban sprawl. The suburbs are a great place to raise a family, there is no denying that. Even so, I have a perhaps idealized vision in my head of what it is like to live in a high-density urban area. Basically what it comes down to is that I hate driving cars and I hate sitting in traffic even more. I want to be able to walk to the places I need to go, and for those that I can't walk to I want to be able to sit on a subway. Its simply not possible to do those sorts of things in a city like Indianapolis, which is extremely sparse as cities go, which means it is basically impossible to get anywhere without a car.

I am really a very anti-car person. I think they affect Americans in all sorts of negative ways that are very under appreciated. I was in Amsterdam in May, and it was super relaxing, and most of the locals struck me as very relaxed, calm people. Marijuana jokes aside, the people in Amsterdam ride their bikes or walk everywhere. They are never sitting in a car or stuck in traffic. So of course they aren't stressed! And when driving somewhere, it is purely lost time or even negative time, as nothing else of substance can be accomplished and it isn't particularly relaxing. I would almost relish riding a subway for 30 minutes every day, where I could relax and read my weekly Economist, listen to music and sip on my coffee, ignoring everything around me. Maybe I just don't have an appreciation for what it is like to sit in a crowded subway car, but the prospect of having an efficient, fast public transit system that allows me to avoid driving a car is a major factor that will decide where I want to live in the future.

The other problem could be that I don't have an especially nice car, but that isn't likely to change for another decade or more =).