Some weeks ago, I posted my skepticism re a NY Times columnist's gullible acceptance of a Portland claim that they had found a way to reduce greenhouse emissions at no cost. Just win-win.
Richard Posner's piece on the NY Times Book Review last Sunday nicely summarized the state of big media in the U.S. They bristle at the bias charge but it is clear that we all have predispositions (no one is pure) and the attitude of most big-media journalists is obvious. It gets weird when they pompously deny it -- and then jump at the chance to report news of the sort that had come out of Portland but which has now been exposed as resulting from a math error.
Rich Page called my attention to a news release from the Cascade Policy Institute, "Portland Now Admits Math Error in Global Warming Report". It appears that their carbon dioxide emissions had been going up, not down.
Will the Times print a correction? How big? What page?
Friday, August 05, 2005
Thursday, August 04, 2005
The mother of all punch lines
The financial pages of major newspapers usually have plenty of fare to feed, both, bullish as well as bearish moods. What to make of the WSJ's inclusion (in their "Money and Investing" section) of historian Niall Ferguson's comparisons of 1914 with today, recently delivered to a gathering of Merrill Lynch executives and clients? There is a punchline at the very end. But it's worth reading the build-up first.
"The Big Picture: Circa 1914
Historian Sees Similarities In Today's Investment RisksAnd Pre-World War I Era"
"In a world that has become increasingly savvy in understanding and measuring all kinds of risks, investors often ignore what may be the biggest of all -- geopolitics.
"Big mistake, says Harvard University history professor Niall Ferguson.
"In a recent lecture to Merrill Lynch executives and clients, he contends that in analyzing financial and economic risks, forecasters tend to ignore geopolitical ones. And when they do take politics into account, investors usually stick to what they can personally recall.
"We need to go further back than living memory to understand the predicament in which we currently find ourselves," says Prof. Ferguson, according to a transcript of his lecture.
"That 'predicament' is the uncanny similarities between the current era of globalization and the original one of roughly 1880-1914, which first harnessed the powers of global communications and swift transport to link the world economically. That ended with the June 28, 1914, assassination of Austrian Archduke Franz Ferdinand and the onset of World War I.
"Then, as now, fears of inflation were negligible. The difference in yields on corporate and emerging-market bonds and those on benchmark government securities was shrinking. Stock-market volatility was abating. Commodity, especially energy, prices -- then it was coal, today oil -- were rising rapidly.
"Other parallels, notes George Magnus, senior economic advisor at UBS, include deregulated and integrated global capital markets, expanding international trade, strong foreign-direct investment flows and the search for new markets.
"As for geopolitics, the first era of globalization was marked by 'a dominant but financially overstretched global power, rival powers that defined themselves only in opposition to the dominant power, new regional powers with global aspirations, the Great Game in Central Asia [then over access to India, now to oil], a proliferation of 'failed states' and state-sponsored armed groups,' Mr. Magnus says. Then the global power was the U.K., now the U.S. Sound familiar?
"Add in anti-Western armed organizations -- in the 19th century, they followed the teachings of Karl Marx, today Osama bin Laden -- and "there is a striking resemblance between what is happening now and what was happening 100 years ago," Prof. Ferguson says.
"Of course, any parallels go only so far and no one is saying investors should dive under the bed. Still, in the years preceding the First World War, investors chose to ignore the threats that were brewing. The well-oiled global economic and financial machine had fostered a "sense of exaggerated security," Prof. Ferguson says. That's a valuable lesson to remember today.
In fact, back then the mood was so complacent that the first mention of the possibility of even a small war the Harvard academic could find in the financial press was an article in The London Times of July 22, 1914. That was just seven days before the Austro-Hungarian artillery began bombarding Belgrade and less than two weeks before Britain declared war against Germany. Major European financial markets closed for the rest of the year.
'Everybody thinks the biggest financial crisis was the [1929] Wall Street crash and its aftermath,' Prof. Ferguson says. 'But 1914 was far, far worse...if they had allowed the markets to reopen, there would have been a complete wipeout.'
"So what is today's investor to do? 'Gold would be the best thing to have as a long-term store of value,' says Eoin Treacy, a strategist at Fullermoney.com, a global strategy service. Investment strategists also say that commodities should perform well, along with investments designed to enable investors to bet on increased volatility. Meanwhile, stocks should do poorly, because a catastrophe probably would rattle consumer confidence and in turn economic growth.
"Investors currently regard bonds as largely a haven. Money managers warn that the threat of surging oil prices could fuel inflation, which could sink long-dated bond prices. For instance, bonds failed to offer investors any protection during the 1973 Yom Kippur War. Prof. Ferguson notes that in off-market trading from July 8 to Dec. 19, 1914, Austrian government bond prices plunged 23%, while French securities fell 15%, Russian ones 8.8% and U.K. bonds 9.6%.
To be sure, there have been some improvements in the past 100 or so years. There are many more democracies, and warfare is on the wane. What is more, many economists think policy makers have learned from past mistakes.
"Even so, Prof. Ferguson says, "Globalization could end in our time, not with a whimper but with a bang." The hard part, he acknowledges, is designing "a perfect portfolio for coping with the outbreak of World War III."
"The Big Picture: Circa 1914
Historian Sees Similarities In Today's Investment RisksAnd Pre-World War I Era"
"In a world that has become increasingly savvy in understanding and measuring all kinds of risks, investors often ignore what may be the biggest of all -- geopolitics.
"Big mistake, says Harvard University history professor Niall Ferguson.
"In a recent lecture to Merrill Lynch executives and clients, he contends that in analyzing financial and economic risks, forecasters tend to ignore geopolitical ones. And when they do take politics into account, investors usually stick to what they can personally recall.
"We need to go further back than living memory to understand the predicament in which we currently find ourselves," says Prof. Ferguson, according to a transcript of his lecture.
"That 'predicament' is the uncanny similarities between the current era of globalization and the original one of roughly 1880-1914, which first harnessed the powers of global communications and swift transport to link the world economically. That ended with the June 28, 1914, assassination of Austrian Archduke Franz Ferdinand and the onset of World War I.
"Then, as now, fears of inflation were negligible. The difference in yields on corporate and emerging-market bonds and those on benchmark government securities was shrinking. Stock-market volatility was abating. Commodity, especially energy, prices -- then it was coal, today oil -- were rising rapidly.
"Other parallels, notes George Magnus, senior economic advisor at UBS, include deregulated and integrated global capital markets, expanding international trade, strong foreign-direct investment flows and the search for new markets.
"As for geopolitics, the first era of globalization was marked by 'a dominant but financially overstretched global power, rival powers that defined themselves only in opposition to the dominant power, new regional powers with global aspirations, the Great Game in Central Asia [then over access to India, now to oil], a proliferation of 'failed states' and state-sponsored armed groups,' Mr. Magnus says. Then the global power was the U.K., now the U.S. Sound familiar?
"Add in anti-Western armed organizations -- in the 19th century, they followed the teachings of Karl Marx, today Osama bin Laden -- and "there is a striking resemblance between what is happening now and what was happening 100 years ago," Prof. Ferguson says.
"Of course, any parallels go only so far and no one is saying investors should dive under the bed. Still, in the years preceding the First World War, investors chose to ignore the threats that were brewing. The well-oiled global economic and financial machine had fostered a "sense of exaggerated security," Prof. Ferguson says. That's a valuable lesson to remember today.
In fact, back then the mood was so complacent that the first mention of the possibility of even a small war the Harvard academic could find in the financial press was an article in The London Times of July 22, 1914. That was just seven days before the Austro-Hungarian artillery began bombarding Belgrade and less than two weeks before Britain declared war against Germany. Major European financial markets closed for the rest of the year.
'Everybody thinks the biggest financial crisis was the [1929] Wall Street crash and its aftermath,' Prof. Ferguson says. 'But 1914 was far, far worse...if they had allowed the markets to reopen, there would have been a complete wipeout.'
"So what is today's investor to do? 'Gold would be the best thing to have as a long-term store of value,' says Eoin Treacy, a strategist at Fullermoney.com, a global strategy service. Investment strategists also say that commodities should perform well, along with investments designed to enable investors to bet on increased volatility. Meanwhile, stocks should do poorly, because a catastrophe probably would rattle consumer confidence and in turn economic growth.
"Investors currently regard bonds as largely a haven. Money managers warn that the threat of surging oil prices could fuel inflation, which could sink long-dated bond prices. For instance, bonds failed to offer investors any protection during the 1973 Yom Kippur War. Prof. Ferguson notes that in off-market trading from July 8 to Dec. 19, 1914, Austrian government bond prices plunged 23%, while French securities fell 15%, Russian ones 8.8% and U.K. bonds 9.6%.
To be sure, there have been some improvements in the past 100 or so years. There are many more democracies, and warfare is on the wane. What is more, many economists think policy makers have learned from past mistakes.
"Even so, Prof. Ferguson says, "Globalization could end in our time, not with a whimper but with a bang." The hard part, he acknowledges, is designing "a perfect portfolio for coping with the outbreak of World War III."
Wednesday, August 03, 2005
Property, development, law, endowment and fun
The link between property rights and economic development has been recognized for many years, elaborated by Adam Smith, yet stranegly ignored by much of neo-classical economics. But it is now back, again being taken seriously by many scholars. Douglass North and many others share the credit.
Particularly interesting in this light, is a recent NBER working paper by Ross Levine, "Law, Endowments and Property Rights."
Levine sums up his investigation this way:
"Property rights affect individual liberty and national prosperity. While scholars have hypothesized about the sources of variation in property rights for over 2500 years, researchers have begun to test theories empirically only recently. Researchers have made enormous strides in empirically assessing different theories of the determinants of property rights, but these investigations are in their nascent stages. The law and endowment views offer compelling theories of how legal heritage and natural selection endowments shape property rights today. I see no reason to neglect either explanation but believe that considerably more work is needed in each."
The paper includes a splendid overview of a wide range of relevant background literature for each of the two main hypotheses.
Economics may never have been this much fun.
Particularly interesting in this light, is a recent NBER working paper by Ross Levine, "Law, Endowments and Property Rights."
Levine sums up his investigation this way:
"Property rights affect individual liberty and national prosperity. While scholars have hypothesized about the sources of variation in property rights for over 2500 years, researchers have begun to test theories empirically only recently. Researchers have made enormous strides in empirically assessing different theories of the determinants of property rights, but these investigations are in their nascent stages. The law and endowment views offer compelling theories of how legal heritage and natural selection endowments shape property rights today. I see no reason to neglect either explanation but believe that considerably more work is needed in each."
The paper includes a splendid overview of a wide range of relevant background literature for each of the two main hypotheses.
Economics may never have been this much fun.
Monday, August 01, 2005
Do they know? Do they care?
The 2002 Census of Governments reports that there were 87,525 local governments in the U.S., of which almost 36,000 were cities or townships. I have never seen a survey that determines how many people know what city they reside in. Postal city addresses often do not match municipalities.
We do know something about voter turnout. It tends to be small for local elections. Table 419 of the Statistical Abstract of the U.S. (2003) shows percent voting in even-year elections only. In the 1998 Congressional elections, 41.9% of the voting age population voted; as expected, it was slightly higher in 2000 (the last year reported in this Table) with 54.7% of eligible voters voting.
Data on off-year local elections are harder to come by. We calculated that for just California, in 2001 only 15% of eligible voters went to the polls (114 local elections); in 2003 it was 24% (96 local elections).
Researchers still estimate rank-size relationships from city population data. Why? These are seldom economic units, being defined by arbitrary boundaries. And the voting statistics suggest that cities also lack political significance for most people.
We do know something about voter turnout. It tends to be small for local elections. Table 419 of the Statistical Abstract of the U.S. (2003) shows percent voting in even-year elections only. In the 1998 Congressional elections, 41.9% of the voting age population voted; as expected, it was slightly higher in 2000 (the last year reported in this Table) with 54.7% of eligible voters voting.
Data on off-year local elections are harder to come by. We calculated that for just California, in 2001 only 15% of eligible voters went to the polls (114 local elections); in 2003 it was 24% (96 local elections).
Researchers still estimate rank-size relationships from city population data. Why? These are seldom economic units, being defined by arbitrary boundaries. And the voting statistics suggest that cities also lack political significance for most people.
Sunday, July 31, 2005
Really scary numbers
The July employment report arrives on Friday and these things often move markets. They also move policy makers. Then there is all of the speculation of how markets guess policy makers will respond -- and vice-versa.
In all of the talk of Alan Greenspan's succession, one WSJ op-ed ended by posing the rhetorical question: when Greenspan leaves, would we rather have his computer or his frontal lobe? The writer preferred the latter.
Who processes which tea leaves and how do they do it? Rote reactions to low unemployment as signaling "overheating" have often been blamed for an overeagerness by the FOMC to "step on the brakes".
This week's Economist shows OECD data on long-term unemployment, the proportion of those unemployed for 12 months or longer as a percent of total unemployment in 2004. The U.S. is near the bottom (top) with a proportion that appears to be just over 10%; only Norway, Canada, Iceland and New Zealand have lower proportions. It is the other tail that is revealing. Japan, Ireland, Spain, France, Hungary, Belgium, Italy, Germany and Greece all had proportions over one-third.
Of all the things that should get policy makers' (and market participants') attention, this index should be high on the list.
In all of the talk of Alan Greenspan's succession, one WSJ op-ed ended by posing the rhetorical question: when Greenspan leaves, would we rather have his computer or his frontal lobe? The writer preferred the latter.
Who processes which tea leaves and how do they do it? Rote reactions to low unemployment as signaling "overheating" have often been blamed for an overeagerness by the FOMC to "step on the brakes".
This week's Economist shows OECD data on long-term unemployment, the proportion of those unemployed for 12 months or longer as a percent of total unemployment in 2004. The U.S. is near the bottom (top) with a proportion that appears to be just over 10%; only Norway, Canada, Iceland and New Zealand have lower proportions. It is the other tail that is revealing. Japan, Ireland, Spain, France, Hungary, Belgium, Italy, Germany and Greece all had proportions over one-third.
Of all the things that should get policy makers' (and market participants') attention, this index should be high on the list.
Saturday, July 30, 2005
The cost of our politics
Both houses of Congress have now passed and agreed on an Energy Bill and a Transportation Bill. In both cases, mega-bucks go to large numbers of projects that could not pass a benefit-cost test nor could many of them pass any sensible federal role test. The motivations of the Congressional reps involved is self-aggrandizement and re-election. Business as usual in an atmosphere of stunning rational ignorance and/or superficial due diligence from voters.
Yet, we manage 3.4% quarterly GDP growth (probably to be revised upward), even while oil prices top $60/barrel, more than one costly war engages us (here and abroad), most urban public schools remain dysfunctional, unfunded liabilities are practically ignored in the face of the cold demographic facts of life, bizzare tort settlements abound, etc. One wonders, how rich would we be if our politics could generate just a few common sense policies?
We will never know but researchers have often benefited from cross-sectional studies of the 50 states. For example, the Fraser Institute's Economic Freedom of North America: 2005 Annual Report points to an answer. More economic freedom means greater prosperity -- and they tell us how much: "... a one-point improvement [on a scale of ten] in economic freedom on an all-government index increases per capita GDP by US$ 5,907 ..."
As near to a free lunch as we will ever get? Back in the real world, members of Congress are now flying home to bask in their accomplishments.
Yet, we manage 3.4% quarterly GDP growth (probably to be revised upward), even while oil prices top $60/barrel, more than one costly war engages us (here and abroad), most urban public schools remain dysfunctional, unfunded liabilities are practically ignored in the face of the cold demographic facts of life, bizzare tort settlements abound, etc. One wonders, how rich would we be if our politics could generate just a few common sense policies?
We will never know but researchers have often benefited from cross-sectional studies of the 50 states. For example, the Fraser Institute's Economic Freedom of North America: 2005 Annual Report points to an answer. More economic freedom means greater prosperity -- and they tell us how much: "... a one-point improvement [on a scale of ten] in economic freedom on an all-government index increases per capita GDP by US$ 5,907 ..."
As near to a free lunch as we will ever get? Back in the real world, members of Congress are now flying home to bask in their accomplishments.
Wednesday, July 27, 2005
Close the public libraries?
Now that Amazon's quarterly earning's report came in better than expected, some of the worriers can relax. The WSJ's "Ahead of the Tape" Justin Lahart had shown concern yesterday that Amazon now faces the prospect of e-commerce competition from just about anyone. E-bay and copycats make that a possibility.
When Amazon came out of nowhere ten years ago to compete with established book retail giants Borders and B&N and others, a new business model had to be acknowledged. Yet, Lahart has a point. Amazon's well deserved customer loyalty will be up against the most intense price competition imaginable once the thousands (or more) who had always dreamed of running a bookstore set up a virtual one.
You may have noticed that most books on Amazon these days are damned cheap. Borders and B&N fight back with coffee bars and reading spaces.
Time to think about closing the public libraries?
When Amazon came out of nowhere ten years ago to compete with established book retail giants Borders and B&N and others, a new business model had to be acknowledged. Yet, Lahart has a point. Amazon's well deserved customer loyalty will be up against the most intense price competition imaginable once the thousands (or more) who had always dreamed of running a bookstore set up a virtual one.
You may have noticed that most books on Amazon these days are damned cheap. Borders and B&N fight back with coffee bars and reading spaces.
Time to think about closing the public libraries?
Monday, July 25, 2005
Death of distance (not)
In a previous post, I noted that the top-75 U.S. cities' share of the total population peaked in 1940. This makes sense because people have been suburbanizing beyond (almost) fixed city boundaries for many years.
The Census Bureau also tracks population by urbanized areas which are not defined by political boundaries but which follow actual development -- "where the lights start when you fly in at night."
And the amazing Wendell Cox makes it easy for everyone to track and compare the top 33 UAs since 1950. Their share of the total population has grown over the last 50 years -- from 33% to 40%.
Urban economists rely on agglomeration economies, the all-purpose and all-manner of "glue" that binds all sorts of activities together. Interestingly, these effects have not gone away, even as communications costs have plummeted. Rather, they have become available over larger areas. The "death of distance" has been overrated.
The Census Bureau also tracks population by urbanized areas which are not defined by political boundaries but which follow actual development -- "where the lights start when you fly in at night."
And the amazing Wendell Cox makes it easy for everyone to track and compare the top 33 UAs since 1950. Their share of the total population has grown over the last 50 years -- from 33% to 40%.
Urban economists rely on agglomeration economies, the all-purpose and all-manner of "glue" that binds all sorts of activities together. Interestingly, these effects have not gone away, even as communications costs have plummeted. Rather, they have become available over larger areas. The "death of distance" has been overrated.
Sunday, July 24, 2005
Globalization
International ties via voluntary commercial contracts evoke a warm glow in some of us. What can get in the way? Many things: distance, trade barriers, currencies, items "falling of the truck," etc. The Economist cites recent research by Luigi Guiso and colleagues that documents another limit: cultural biases.
"The economists find that cultural biases do drive wide variations among trust among European countries ... and ... cultural driven trust does shape trade and investment."
Yet, even trade between former antagonists is up. So there may be hope that trust follows trade even though trade is impeded by mistrust.
"The economists find that cultural biases do drive wide variations among trust among European countries ... and ... cultural driven trust does shape trade and investment."
Yet, even trade between former antagonists is up. So there may be hope that trust follows trade even though trade is impeded by mistrust.
Saturday, July 23, 2005
Realities and TV
Irshad Manji writes "Is Islam to blame?" and chastises "moderate Muslim leaders" who have been silent through the carnage. They were mostly silent when Israeli civilians were targeted and now have trouble finding their voice when others, including Muslims, are targeted.
London's "Red" Ken Livingston and others on the left have long equated Israeli air strikes with Arab suicide bombers. Tragically, civilians die in each case but it is not too subtle to add that they are specifically targeted in only one case.
Meanwhile "Sleeper Cell" is coming to a cable TV station near you. The terrorists are: "... a wealthy blond ex-student from UC Berkeley, a former skinhead from France, a Bosnian Muslim whose family was murdered -- and a practicing black Muslim secretly dedicated to thwarting their plans as an undercover agent for the FBI."
They say that TV audiences get the programming they deserve (or demand). Sleeper Cell will surely be an important test of this idea.
London's "Red" Ken Livingston and others on the left have long equated Israeli air strikes with Arab suicide bombers. Tragically, civilians die in each case but it is not too subtle to add that they are specifically targeted in only one case.
Meanwhile "Sleeper Cell" is coming to a cable TV station near you. The terrorists are: "... a wealthy blond ex-student from UC Berkeley, a former skinhead from France, a Bosnian Muslim whose family was murdered -- and a practicing black Muslim secretly dedicated to thwarting their plans as an undercover agent for the FBI."
They say that TV audiences get the programming they deserve (or demand). Sleeper Cell will surely be an important test of this idea.
Friday, July 22, 2005
Mercenaries
Interesting discussion re mercenaries for the U.S. military at Marginal Revolution. Alex Tabarrok asks if U.S. business can do well outsourcing, then why not the U.S. military?
Around the world, many young people would kill to get into the U.S., now they legally could. Offer full U.S. citizenship to anyone serving honorably for, say, five years or more. Gurkhas and many others would galdly take up the offer, perhaps even weighing it against the one they have from Great Britain.
There would be an end to putting reservists and others who have qualms about going to the front in harm's way. The MR post mentions that many now sent are the wrong ones for the job anyway. It is simply win-win all around.
Around the world, many young people would kill to get into the U.S., now they legally could. Offer full U.S. citizenship to anyone serving honorably for, say, five years or more. Gurkhas and many others would galdly take up the offer, perhaps even weighing it against the one they have from Great Britain.
There would be an end to putting reservists and others who have qualms about going to the front in harm's way. The MR post mentions that many now sent are the wrong ones for the job anyway. It is simply win-win all around.
Monday, July 18, 2005
Bowling Alone -- Not
The Economist features "Survey of America: Degrees of Separation" in the July 16 issue.
One of the topics taken up is the Bowling Alone thesis. As many had suspected, there is also good news and it has to do with the internet.
"... if you go to meetup.com, you can type in where you live and what your interests are -- say Young Republicans, Chihuahua fanciers or Brazilian reggae -- and the site will tell you where and when Young Republicans, Chihuahua fanciers and Brazilian reggae enthusiasts are meeting up withing 15 miles of your home over the next two weeks. ... Since 2002, Meetup has been the forum for over 100,000 clubs with 2m members. This spring there were 2,400 Meetup meetings of the like-minded, of people with particular tastes in common ..."
The pessimists do not even have to get out more. It's all there on your browser.
One of the topics taken up is the Bowling Alone thesis. As many had suspected, there is also good news and it has to do with the internet.
"... if you go to meetup.com, you can type in where you live and what your interests are -- say Young Republicans, Chihuahua fanciers or Brazilian reggae -- and the site will tell you where and when Young Republicans, Chihuahua fanciers and Brazilian reggae enthusiasts are meeting up withing 15 miles of your home over the next two weeks. ... Since 2002, Meetup has been the forum for over 100,000 clubs with 2m members. This spring there were 2,400 Meetup meetings of the like-minded, of people with particular tastes in common ..."
The pessimists do not even have to get out more. It's all there on your browser.
Saturday, July 16, 2005
Local democracies
In 1963, Mel Webber published "Order and Diversity: Community without Propinquity." In this and related papers, he noted:
"The enlarged freedom to communicate outside one's place-community that the emerging technological and institutional changes promise, coupled with an ever-increasing mobility and ever-greater degrees of specialization, will certainly mean that urbanites will deal with each other over greater and greater distances. The spatial patterns of their interactions with others will undoubtedly be increasingly disparate, less and less tied to the space in which they reside or work, less and less marked by the unifocal patters that marked cities in an earlier day. ... I contend that we have been searching for the wrong grail, that the values associated with the desired urban structure do not reside in the spatial structure per se. One pattern of settlement is superior to another only as it better serves to accommodate ongoing social processes and to further the nonspatial ends of the political community ..."
This morning, I found this from Randy Cohen: "The congressman from $37,000 ... Why shouldn't our political districts reflect our incomes instead of our ZIP codes? ... Because it is our 1040s not our ZIP Codes that best express our political interests, congressional districts should be re-imagined to comprise not the people who happend to live within a few miles of one another, but whose earn within a few dollars of one another."
Granted we would be rid of re-districting controversies and granted Webber's prescient insights from over 40 years ago, Cohen's proposal scares me for its class warfare assumptions and implications.
Why not the other extreme? Just as modern data and computing can carve districts that provide safe havens for incumbents, we could also write code to draw geographically cogent and compact districts that maximize the income diversity of the voters.
Congressional (and perhaps local) politics would be more about finding common ground than manning the barricades. Representatives might have to spend more time in their districts and they might have to help to develop common visions rather than exploiting anatgonisms.
"The enlarged freedom to communicate outside one's place-community that the emerging technological and institutional changes promise, coupled with an ever-increasing mobility and ever-greater degrees of specialization, will certainly mean that urbanites will deal with each other over greater and greater distances. The spatial patterns of their interactions with others will undoubtedly be increasingly disparate, less and less tied to the space in which they reside or work, less and less marked by the unifocal patters that marked cities in an earlier day. ... I contend that we have been searching for the wrong grail, that the values associated with the desired urban structure do not reside in the spatial structure per se. One pattern of settlement is superior to another only as it better serves to accommodate ongoing social processes and to further the nonspatial ends of the political community ..."
This morning, I found this from Randy Cohen: "The congressman from $37,000 ... Why shouldn't our political districts reflect our incomes instead of our ZIP codes? ... Because it is our 1040s not our ZIP Codes that best express our political interests, congressional districts should be re-imagined to comprise not the people who happend to live within a few miles of one another, but whose earn within a few dollars of one another."
Granted we would be rid of re-districting controversies and granted Webber's prescient insights from over 40 years ago, Cohen's proposal scares me for its class warfare assumptions and implications.
Why not the other extreme? Just as modern data and computing can carve districts that provide safe havens for incumbents, we could also write code to draw geographically cogent and compact districts that maximize the income diversity of the voters.
Congressional (and perhaps local) politics would be more about finding common ground than manning the barricades. Representatives might have to spend more time in their districts and they might have to help to develop common visions rather than exploiting anatgonisms.
Friday, July 15, 2005
A harsh world
The morning after 9/11, I was at a meeting where no one really knew what to say. One learned man asserted that we will now embark on massive racial profiling, something that he suggested we were very good at. This turned out to be standard leftist silliness. Almost everyone has by now witnessed the TSA charade at U.S. airports. Old ladies in wheelchairs are searched, etc. Europeans as well as Americans are trading political correctness for security.
Charles Krauthammer explains that there is now a civil war within Islam that necessarily involves the rest of the world. Christianity's reformation and counter-reformation, coming about when the religion was approximately as old as Islam is now, were also long and bloody.
The recent Pew survey of Muslim attitudes is hardly comforting; the LA Times reports: "Poll Finds Less Support for Terrorism". Even then, the newer numbers on how many Muslims assent to the use of terror and suicide bombings denote much more than just a fringe -- 57% in Jordan, 39% in Lebanon, 25% in Pakistan, 15% in Indonesia, 14% Turkey, 13% Indonesia. That is a lot of people.
When large numbers of people cope badly with the modern world, there is, unfortunately, no simple way to bring them into modernity. The Bush people have a plan and there are many reasons to be skeptical of it. Yet, I have heard nothing from the other side -- except perhaps the admonition that we go easy on the profiling.
Charles Krauthammer explains that there is now a civil war within Islam that necessarily involves the rest of the world. Christianity's reformation and counter-reformation, coming about when the religion was approximately as old as Islam is now, were also long and bloody.
The recent Pew survey of Muslim attitudes is hardly comforting; the LA Times reports: "Poll Finds Less Support for Terrorism". Even then, the newer numbers on how many Muslims assent to the use of terror and suicide bombings denote much more than just a fringe -- 57% in Jordan, 39% in Lebanon, 25% in Pakistan, 15% in Indonesia, 14% Turkey, 13% Indonesia. That is a lot of people.
When large numbers of people cope badly with the modern world, there is, unfortunately, no simple way to bring them into modernity. The Bush people have a plan and there are many reasons to be skeptical of it. Yet, I have heard nothing from the other side -- except perhaps the admonition that we go easy on the profiling.
Wednesday, July 13, 2005
Political competition
Competition is a very good thing, in everyday markets as well as in political markets. The insights of public choice economics are clear once articulated and even more appealing once corroborated by serious research. This is why "Political Competition and Economic Performance" by Timothy Besley, Torsten Persson and Daniel Strum deserves attention.
EU planners and constitution drafters might take note. The free flow of goods, labor, capital and ideas is a wonderful thing. Top-down management is not.
On this side of the pond, Brookings scholars (and many others) are exploring the benefits of metropolitan government. People, moving to small cities in outer suburbs and exurbs, on the other hand, are doing what they can to get out of harm's way.
EU planners and constitution drafters might take note. The free flow of goods, labor, capital and ideas is a wonderful thing. Top-down management is not.
On this side of the pond, Brookings scholars (and many others) are exploring the benefits of metropolitan government. People, moving to small cities in outer suburbs and exurbs, on the other hand, are doing what they can to get out of harm's way.
Tuesday, July 12, 2005
Who knew?
From Forbes (July 25, 2006): "Don't Invest After Sex ... Investors exposed to oxytocin, a hormone commonly released during childbirth, breast feeding, and sexual activity, start acting like dupes in financial matters, says a study just published in Nature. Swiss-led researchers let test subjects play a simple trading game with real money. Those administered a dose of the hormone were twice as likely to overcome any fears of betrayal and display 'maximal trust level.' meaning they were more prone to being hosed by an opponent ..."
I have not read the original article but expect that someone, somwhere, has the evolutionary psychology explanation.
I have not read the original article but expect that someone, somwhere, has the evolutionary psychology explanation.
Monday, July 11, 2005
Planning analysis
The segment of I-405 near my home is being worked on (at great cost) so that a diamond lane can be added. Why?
"Carpooling good!" is a pretty good representation of the tone and depth and extent of the underlying analysis.
Carpooling is also unpopular and down by 16%, between the 1990 and 2000 census. As origins and destinations become ever more dispersed, the 11.2% carpooling level of 2000 will fall even further -- no matter how many diamond lanes are built.
Any one can play the game. Here is my contribution: "pricing good."
But here is more: during the Monday-Thursday 6am-9am peak only 35% of the trips are worktrips without a nonwork trip attached. Add the worktrips that are "chained" to an errand and the total rises to 45%. That means that there are a lot of trips (at least 55%) that are candidates for being priced to the off-peak (2001 NHTS is the source).
The idea is old. The numbers that make it compelling continue to pile up.
"Carpooling good!" is a pretty good representation of the tone and depth and extent of the underlying analysis.
Carpooling is also unpopular and down by 16%, between the 1990 and 2000 census. As origins and destinations become ever more dispersed, the 11.2% carpooling level of 2000 will fall even further -- no matter how many diamond lanes are built.
Any one can play the game. Here is my contribution: "pricing good."
But here is more: during the Monday-Thursday 6am-9am peak only 35% of the trips are worktrips without a nonwork trip attached. Add the worktrips that are "chained" to an errand and the total rises to 45%. That means that there are a lot of trips (at least 55%) that are candidates for being priced to the off-peak (2001 NHTS is the source).
The idea is old. The numbers that make it compelling continue to pile up.
Tuesday, July 05, 2005
New ideas not in old bottles
In 1970 (and practically in another galaxy), the grad students that I knew were grappling with Burmeister and Dobell's Mathematical Theories of Economic Growth. About the only thing that now rings a bell is Robert Solow's introduction. The founding member of the neo-classical economic growth school had kind words for his students' work, noted all the intellectual progress since his own, and ended by extrapolating and noting that the mind boggles when thinking about how far his students' students might go.
Neo-classical growth economics has been supplanted (thank God) by the New Institutional Economics which asks, bigger questions, looks to anthropology, cognitive science, geography, history, you name it -- and is a lot more fun.
Douglass North's just published Understanding the Process of Economic Change (thanks, Lanlan) is one of those books that I plan to re-read -- for the pure delight of its many fascinating insights and the thinking that they prompt.
Institutions matter, as does culture, and smart people have good ideas on how each evolve. The jargony "multi-disciplinary" now makes sense -- and sets the stage for lots more interesting work as we continue to grapple with differences in the performance and the wealth of nations.
Neo-classical growth economics has been supplanted (thank God) by the New Institutional Economics which asks, bigger questions, looks to anthropology, cognitive science, geography, history, you name it -- and is a lot more fun.
Douglass North's just published Understanding the Process of Economic Change (thanks, Lanlan) is one of those books that I plan to re-read -- for the pure delight of its many fascinating insights and the thinking that they prompt.
Institutions matter, as does culture, and smart people have good ideas on how each evolve. The jargony "multi-disciplinary" now makes sense -- and sets the stage for lots more interesting work as we continue to grapple with differences in the performance and the wealth of nations.
Sunday, July 03, 2005
No trade-offs in Portland
I suppose that one must put up with public discourse that does not acknowledge trade-offs. How about forbearance for the discovery of big-time "solutions" that are perfectly obvious but that the rest of the world had not noticed? And all this from the authority of a NY Times columnist?
Nicholas Kristof writes about Portland: "A Livable Shade of Green ... Tackling global warming need not wreck the economy ... Newly released data show that Portland, America's environmental laboratory, has achieved stunning reductions in carbon emissions ... What's more, officials in Portland insist that the campaign to cut carbon emissions has entailed no significant price ... This was achieved partly by a major increase in public transit, including two light rail lines ..."
Mr. Kristof must dig beyond the assertions of these Portland officials. Portland's light rails are among the most lightly traveled on the planet. And they are not cheap. The literature on all this is quite public and volumnious (demographia.com, cascadepolicy.org, americandreamcoalition.org).
Randal O'Toole likes to share the famous photo of a coyote relaxing on the seats of one of Portland's MAX trains (taken Feb 13, 2002). Confronted with the fact that there several photos of notoriously people-shy coyotes in and around these light rail cars, Portland officials dismiss this as having taken place before the trains were open for business. Well, no. The photos were taken five months after the trains opened for business.
Nicholas Kristof writes about Portland: "A Livable Shade of Green ... Tackling global warming need not wreck the economy ... Newly released data show that Portland, America's environmental laboratory, has achieved stunning reductions in carbon emissions ... What's more, officials in Portland insist that the campaign to cut carbon emissions has entailed no significant price ... This was achieved partly by a major increase in public transit, including two light rail lines ..."
Mr. Kristof must dig beyond the assertions of these Portland officials. Portland's light rails are among the most lightly traveled on the planet. And they are not cheap. The literature on all this is quite public and volumnious (demographia.com, cascadepolicy.org, americandreamcoalition.org).
Randal O'Toole likes to share the famous photo of a coyote relaxing on the seats of one of Portland's MAX trains (taken Feb 13, 2002). Confronted with the fact that there several photos of notoriously people-shy coyotes in and around these light rail cars, Portland officials dismiss this as having taken place before the trains were open for business. Well, no. The photos were taken five months after the trains opened for business.
Friday, July 01, 2005
Campaign promises
LA's new Mayor Antonio Villaraigosa is now in office and the LA Times reports that "Promises, Promises Could Cost LA Millions, Billions." These include extending each one of the area's rump rail system lines. The Red Line subway would be among these and the cost of that one alone is projected to be $2.7 billion.
This is the line that was to carry 3760,000 riders per day (1983 EIR) but actually serves about 25% of that. Construction costs went over $300 million/mile and the bus system had to be curtailed to make ends meet.
But who's counting? In a low-turnout election, a heavy union vote was essential and the faithful must be rewarded. That much makes sense.
What make no sense is support for this silliness from quarters that do not even have the excuse that they are on the take. Green groups fall into this category and now invoke the threat of global warming to make the case for projects like this.
Trouble is that low transit ridership, negligible impacts on auto use, high-energy heavy lifting during construction and (gasp) high levels of electric power use to run the underused trains do not add up to any atmospheric benefits.
There's a lower standard when other people's money is involved.
This is the line that was to carry 3760,000 riders per day (1983 EIR) but actually serves about 25% of that. Construction costs went over $300 million/mile and the bus system had to be curtailed to make ends meet.
But who's counting? In a low-turnout election, a heavy union vote was essential and the faithful must be rewarded. That much makes sense.
What make no sense is support for this silliness from quarters that do not even have the excuse that they are on the take. Green groups fall into this category and now invoke the threat of global warming to make the case for projects like this.
Trouble is that low transit ridership, negligible impacts on auto use, high-energy heavy lifting during construction and (gasp) high levels of electric power use to run the underused trains do not add up to any atmospheric benefits.
There's a lower standard when other people's money is involved.
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