Archive for January, 2012

David Brooks reviews Charles Murray’s new book, Coming Apart in today’s NYT. Brooks has high praise: “I’ll be shocked if there’s another book that so compelling describes the most important trends in American society.”

Back in 1963, where the story begins:

Roughly 98 percent of men between the ages of 30 and 49 were in the labor force, upper class and lower class alike. Only about 3 percent of white kids were born outside of marriage. The rates were similar, upper class and lower class.

The Brooks review provides a few striking examples of the differences that have emerged since then with respect to male workforce participation, marriage rates, births out of wedlock, church attendance, etc., and some of the comparisons he draws are difficult to reconcile with the dominant narratives on the Right and the Left.

Brooks notes that Murray’s comparisons are “mostly using data on white Americans, so the effects of race and other complicating factors don’t come into play” (indeed, his book is subtitled: “The State of White America, 1960-2010). My guess is, none of this will matter to the critics, who have dismissed every word that Murray has written since Losing Ground and (in particular) the Bell Curve. From my own interactions with colleague/critics—an admittedly small sample–it appears the more clamorous they are in their rejection of Murray, the more likely it is that they have never read a word he wrote. Why would they start now?

Nonetheless, my order has been placed.

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“[In] communist society, where nobody has one exclusive sphere of activity but each can be accomplished in any branch he wishes, society regulates the general production and thus makes it possible for me to do one thing to-day and another to-morrow, to hunt in the morning, fish in the afternoon, rear cattle in the evening, criticize after dinner, just as I have a mind, without ever becoming a hunter, fisherman, shepherd or critic.” – Marx and Engels, The German Ideology (written 1846 published 1932).

What we want to do, and what others want from us, is one way to articulate the economic problem. Historians, no less than members of any other discipline, profession or trade, would love to believe that there can never be too much of what they produce. This is in essence the position of a curious post by Eric Loomis at the progressive blog Lawyers, Guns, Money.

Loomis is calling for a new national WPA program to put unemployed PhDs in history to work. The American Historical Association, he believes, should make it a priority of its Congressional lobbying efforts. Many of the responses to his post recognize the political weaknesses of the AHA. Loomis himself recognizes this difficulty, but I am struck by how many actually think it is a good idea in principle.

They have not considered the economic problem. It is the problem of what they want versus what others want from them.

The powerful allure of Marx and Engels’ vision was also its failing. Marx and Engels concerned themselves almost entirely with the first part of the problem and left the second part to be worked out by vague references to “society” or to modern methods of production and technology. Wouldn’t it be nice if we could all just do what we wanted to do, when we wanted to do it?

Admittedly, Loomis is speaking of the desire of a vast pool of nontenured potential faculty in history to specialize in a specific area of their choosing. Marx and Engels were speaking of breaking the “tyranny” of specialization. But in point of fact, both Loomis and his socialist brethren are contending for the “freedom” to be what you want to be, when you want to be it.

Loomis’ concern is that a large number of people want to be academic historians, but now cannot. He is bitter that an elite few have obtained their appointments to the exclusion of the rest. He wants the rest to organize to get what they desire from government, which means from the rest of us.

There was a Federal Writers Project once. It was a small component of the original WPA under the New Deal. That portion of it having to do with historical work employed somewhere in the number of just over 300 writers. The aim was mostly archival–to preserve the life stories of various groups throughout the US. It made some important contributions to our historical knowledge. The narratives of ex-slaves is an excellent example. Each state had its own federally funded project. I am particularly fond of the collection of COWBOY AND RANCHING REMINISCENCES AND LORE of Texas. But should it have been done this way?

At its height, the WPA employed some 3.3 million in the Fall of 1936. The idea was to inject money into the economy and create jobs. It had a small impact on the jobless rate, but each time the administration attempted to curtail the program, the rate simply popped back up. People apparently would not voluntarily pay for the things the WPA produced. The program was not self-sustaining, and money had to be continually taken from somewhere else to do the work. With private investment already strained, that meant even less for private sector job creation.

At best, such government spending kept people where they were, but because it had no real mechanism for deciding anything other than what was politically possible, it could not address the second part of the economic problem.

What I want as Joe producer, is not necessarily what I want as Joe consumer. To look only at the first part of the economic problem ignores the constraints of scarcity as well as the reality of diminishing returns. These do not go away when we turn to government. What are the limits then, Mr. Loomis? I might get lots of western folk lore—as much as I like. It might mean that you get too much. And I suppose eventually it might get to the point where I say enough is enough. But who is to decide?

Of course, the original WPA was meant to be only a temporary source of assistance with some useful things done in return. But the problem with this idea applied to historians today is that the unemployment rate for historians well predates the current economic slump by two or three decades. In this context, Loomis’ idea is not so much temporary aid as it is a hope for a going concern.

Loomis forgets that higher education has received lots of public monies over the years and not all of it is dominated by elite private universities. Much much more of it goes to state institutions who get their share of federal spending. Who will manage this WPA, and who gets to decide who will be its beneficiaries?

A former president of the AHA recently wrote in Historically Speaking that “the ideas for reform are out there. All it will take to bring them into being is that elusive thing called political will.” This seems to be a common way of thinking about the economy these days. It is incumbent upon those who would advocate such reform activity, however, to spell out how they intend to make them work. Who will really call the shots? Or will the constraint simply be the limits of personal desire?

Manna from heaven, anyone?

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The mention of public choice theory to those on ‘the left’ of politics can prompt a variety of reactions. Some are based on ignorance about the very existence of public choice economics as a theoretical perspective. This reaction was demonstrated to me following one of the first lectures I gave in my academic career. Having listened to me speak for an hour on the power of incumbent firms to ‘capture’ regulatory agencies an attending student who was an activist in the Socialist Workers Party asked me, ‘when did you become a Marxist?’ Needless to say, for someone who considers himself a radical ‘anti-Marxist’ I was taken aback by this approach! What the question exemplifies though is an attitude that is widespread in academic circles – the assumption that an interest in power imbalances that favour business interests must equate with one having leftist or socialist sympathies. The idea that there might be a classical liberal/free market understanding of ‘power relations’ as exemplified by public choice theory is a possibility that simply hasn’t occurred to this particular species of left-winger.

A second reaction is based on ‘avoidance’. This strategy is adopted by those who are aware of public choice arguments but see them as a direct threat to their most cherished ideas. So why is public choice theory such a threat? I think in part because it offers a more plausible account of ‘power relations’ than its neo-Marxist competitors. Public choice rejects the naive pluralist view that power is evenly distributed across interest groups by offering a non-Marxist account of elite power. Instead of assuming that large ‘classes’ such as ‘capital’ and ‘labour’ are the primary power players on the political stage public choice focuses on how individual incentives affect the capacity of different groups to organise and hence to wield power over others. Yes, business interests can be powerful – but not because they are businesses or because we live in a ‘capitalist’ society. Instead, they exercise power because in some sectors where there are a relatively small number of big players business interests may find it easier to overcome collective action/free-rider problems than other groups such as taxpayers and consumers-who find it much harder to form a cohesive political force. In more fragmented and diverse sectors by contrast ‘business interests’ often lack political clout – and may be less favoured than say labour unions or public bureaucrats with a monopolistic position in the state sector. From a public choice perspective there is no such thing as ‘business’ and ‘labour’ per se. Rather, there are different types of business and labour interest the political success of which depends on the specific incentives and organisational problems facing the actors concerned. As such, public choice offers a more empirically compelling account of the varied special interest outcomes we observe in democratic polities than simplistic theories of ‘class rule’.

A further reason why many on the left see public choice as a threat to their ideals relates to its’ solution to the problem of special interest power. If the interventions of the state are often captured by corporate special interests -as many left-wingers seem to think they are – then how will social democratic efforts to give the state even more discretionary powers to intervene in markets do anything to undermine the power of these interests. Marxists would, of course, make the even less plausible claim that the only solution to ‘power relations’ is the abolition of private wealth and the monopolisation of all decision-making power in some unspecified public body. From a public choice standpoint, however, if the modern social democratic state is the major source of special interest power then by far the most effective way to reduce this power would be to dismantle the apparatus of anti-competitive intervention in markets. This does not require an egalitarian fantasy land where all inequality is abolished. Rather, it requires a framework of limited government where inequalities which reflect superior performance and entrepreneurial ingenuity are welcomed but where those that reflect the power of crony capitalists, crony union bosses and public sector bureaucrats are reduced to a minimum.

The third type of reaction to public choice sometimes encountered is one of denial. Faced with the argument that politics is a game where self-interested businesses, labour unions and government bureaucrats use the state to enrich themselves at public expense, some left-wingers respond by denying that this is so. Politics they say is motivated by ‘values’ and this is something that the economistic focus of public choice theory simply doesn’t take account of. I for one have a good deal of sympathy with this line of argument. It seems far too simplistic to maintain that every public policy that exists is there because of special interest forces. To suggest otherwise is to be guilty of a sort of ‘right-wing Marxism’. The problem for left-wingers who make this sort of response to public choice, however, is that it implies that many of the quasi- conspiracy theories that are often their most important mobilisation tactic have to be abandoned as well. Might it just be that that central banks and financial regulators who pursued a policy of loose money and the lowering of lending standards did so because they believed it was the ‘right thing to do’ and not because they were in the pockets of corporate bankers? If politics is really about values and ideas then perhaps we should look to the power of ‘mistaken theories’ (such as Keynesianism and Monetarism) as the cause of government failure rather than the corrupt dealings of the ‘top 1%’.

So, public choice theory poses some difficult questions for ‘the left’. If one takes an ‘interest-based’ view of politics then public choice offers a more plausible account of the way special interests seek and gain power than its leftist rivals – and of how to minimise the threat presented by such interests. If on the other hand one takes the view that ideas matter more than interests then the left is robbed of much of the ‘them versus us’ rhetoric which historically has been one of its most important vehicles of political recruitment.

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Given all of the labor talk around the country (especially in Indiana), today’s quotation from Lochner v. People of State of New York, 198 U.S. 45 (1905) seems appropriate:

The general right to make a contract in relation to his business is part of the liberty protected by the Fourteenth Amendment, and this includes the right to purchase and sell labor, except as controlled by the State in the legitimate exercise of its police power.

Liberty of contract relating to labor includes both parties to it; the one has as much right to purchase as the other to sell labor.

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The Costs of Higher Education

The President has decided that now is the time to confront the growing cost of higher education.  As the NYT notes:

President Obama is proposing a financial aid overhaul that for the first time would tie colleges’ eligibility for campus-based aid programs — Perkins loans, work-study jobs and supplemental grants for low-income students — to the institutions’ success in improving affordability and value for students, administration officials said.

As he proclaimed in the SOTU:

“Let me put colleges and universities on notice:  If you can’t stop tuition from going up, the funding you get from taxpayers will go down.”

As the NYT story correctly notes, for public institutions, rising tuition is partially a product of state budgetary decisions in hard times. If the states reduce levels of support, tuition must increase.

Certainly, private institutions are facing a different set of issues. The financial crisis racked a lot of endowments and the impact is still being felt because of spending rules (e.g., many institutions have rules that limit the draw on the endowment to 5 percent of the twelve quarter moving average). Moreover, most private institutions cannot control financial aid (if admissions are partially or wholly need blind) and health care costs. All of this places pressure on tuitions.

But I wonder: How much stock one can place on the story of the increasing costs of higher education given the massive changes that have occurred in the underlying services? Let me illustrate with a brief comparison.

I fondly remember my days as an undergraduate at the University of Wisconsin-Madison some three decades ago. During my time at Madison, I never saw an advisor. The course catalog would be delivered in bulk to Memorial Union (and other locations) and the university assumed that their adult students could make their own decisions about courses, the coherence of their schedules, and the number of courses they wanted to take in any given semester (if it took you longer to graduate than the standard four years, it was your problem). The one year I lived in university housing (a cooperative), I slept in a bunk bed in a cement block room with one window.  The food was rather bland—lots of starch, little in the way of protein—and you had your choice of milk or water (things were a little better in the dorms, but not much). Since no one owned televisions, if you wanted to watch TV you went to a commons area or hit a bar. If you wanted to exercise, you went to a gym that was equipped with an assortment of old steel benches, iron weights, punching bags, and stationary bikes.

The total cost of one year’s education (combining tuition, books, room and board): $5500 in 2011 dollars.

As an academic and a parent who has put two sons through college, I find the contrast between my college experience and the experience of today’s students to be rather striking.

Today, the culture of helicopter parenting has infested the academy. Students are required to meet with their advisors several times a year to receive approval for every course (I love putting that PhD to good work when I need to approve a decision to add or drop a half-credit strength training class).  There appear to be deans, offices, and programs covering every conceivable aspect of a student’s life. We have simply discarded the assumption that students are adults and thus capable of self-governance.  Even in public universities (both of my sons attended them), the quality of the housing has improved dramatically. Everyone seems to have a television and a personal computer, and thus cable and wireless are required amenities. Students dine in what appear to be food courts, making daily decisions about whether to have sushi, vegan, or some quasi-ethnic food, washed down with bottled water, a designer tea, or a latte (to my knowledge, these are among the few decisions that do not require a meeting with an advisor). The fitness centers are nothing short of lavish, with rows of shining weights, ellipticals, stationary bikes, rowing machines, and ceiling mounted television sets tuned to everything from VH-1 to ESPN.  When students select a college, the tour guides devote the lion’s share of their time to exploring the co-curriculum and amenities for a simple reason: This is what attracts students and their parents.

In short, the college experience today is far different than in was a generation ago. Whether it is a net improvement depends on your perspective, I suppose (I am skeptical, and tend to embrace the more Spartan days of the past when students were treated like adults instead of infantilized and resources were lavished on the library instead of the co-curriculum).

It is difficult, in this context, to make sense of the arguments regarding the escalating costs of a higher education. The services that constitute higher education today have little in common with what constituted higher education a generation ago (not to mention several generations ago, when things were even more monastic).

I would write more, but this is the second day of add-drop, and there are undoubtedly some schedule adjustments that demand my immediate attention.

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The new macro (part 1)

Periodically I visit Scott Sumner’s blog The Money Illusion.  I keep asking myself if the market monetarism he and a few others are pushing is important.  I have come to think it is.  Like change-the-world important.  Like Nobel-worthy important.

Well, maybe.

I would usually bounce to Sumner’s blog from a glowing link from Marginal Revolution, and I have found his insights illuminating, though I haven’t always understood them.   I noticed quickly that he was always making references to NGDP (nominal GDP), which I found annoying and odd.  There is perhaps no concept so deeply engrained in an economist’s DNA than the idea that what matters is real.  The first thing we do with any data series is make sure it is represented in real terms, not nominal ones.  I don’t care what is going to happen to my nominal income; I care what happens to my real income–what I can actually buy, not the arbitrary prices that I have to pay for stuff.  Similarly, relative prices matter, not nominal ones.

As a prescription for sound economic policies related to long-term growth, it is the real stuff that matters.  In the long run, markets eventually adjust to shocks and the quantity theory of money holds: if we increase the quantity of money there is no real effect because prices eventually rise.   That isn’t a terribly controversial idea.  But it is the short run that is the rub.  Orthodox economics is about equilibria, but life is about disequilibria.  10% unemployment is a disequilibrium outcome.

Another way to say this is that something is sticking.  Prices for most goods and services do not change frequently, and wages move even more slowly.  But demand and supply can (and do) change very rapidly.  When New York and Washington were attacked on 9/11/01, there was an immediate and profound shock to demand for things like restaurants and a lot of other consumer goods that all of a sudden seemed vastly less important to consumers than they were on 9/10/01.  But the prices charged by restaurants and the and wages paid to their employees did not immediately adjust to the lower demand.   Thus there was an immediate gap between the observed price and the equilibrium prices (fortunately demand recovered before too long).   Most restaurants did not print new menus, but they did respond to the shift in demand by laying off workers, reducing their hours, buying less food from suppliers and a lot of other decisions to cope with the loss of business.  I haven’t seen the data, but I bet that New York restaurants pretty much stopped hiring new people in the wake of 9/11.

A terrorist attack or a hurricane are real shocks.  But there are nominal shocks, too, that can be equally as devastating to the economy, if not more so.  Often these occur because a speculative bubble pops, which has ripple effects throughout the economy.  Nothing real has happened, but expectations have changed which causes spending to change, often very rapidly.  Because of price stickiness, real interest rates do not necessarily reflect that rapid changes that are occurring with respect to spending.  And because prices are sticky, real GDP is dragged down with nominal GDP.  That is bad.  It is the real stuff that affects people’s lives.

Sumner and the market monetarists are pushing a revolution in macro designed to put the Fed’s focus on nominal GDP.   His provocative claim is that the balancing act between employment and inflation that the Fed is charged with can be accomplished not by worrying about output and prices separately, but by worrying about their combination–which is NGDP.  If NGDP is too high, contract; if it is too low, expand.  In Sumner’s view the low expected inflation revealed by interest rates during the financial crisis of 2008 was not a silver lining (as media reports liked to claim).  Instead, the low inflation was the proximal cause of the recession.  When spending tanked in 2008, NGDP (and RGDP) took a nose-dive.  Sumner argues that even though the Fed did increase the monetary base, its policies were highly contractionary, just as they were in 1932.  What the Fed needed to do was credibly commit to higher inflation in the future by injecting more money into the economy.  Instead, interest rates and inflation stayed low and unemployment soared.

When a negative nominal shock occurs, people contract their spending and aggregate demand falls.  The traditional Keynesian approach is to increase the money supply (monetary policy) or increase the deficit (fiscal policy) to stimulate spending.  But when interest rates are low, people like Paul Krugman and Brad DeLong scream that there is a liquidity trap and that only fiscal policy is an option.   Their arguments are motivated primarily by their love of government spending more than devotion to actual Keynesian arguments, but that is somewhat beside the point.  Sumner argues that there are always monetary options, even in a liquidity trap.  Put simply, creating inflation is easy: just debase the currency.  Anyone can do that.

But isn’t debasing the currency a reckless way to run a country?  As a long-term policy, of course it is.  But this isn’t printing money to fund government expenditures or payoff bad debts.  It is about intentionally creating inflation expectations.  The downfall of Keynesian fiscal policy is that it only works by assuming people are myopic and won’t realize the impact of government policies.  In the real world, government spending restricts private spending because people are not stupid; they realize that government spending today will raise taxes in the future.  Increasing NGDP through expansionary monetary policy not only allows people to realize the impact of government policies, it depends on it.

The recipe is simple: when the economy experiences a negative nominal shock, inject money into the economy.  People will spend more because they know that their money will be worth less in the future because of future inflation.  And (this is important), when nominal growth is too high, the rate of inflation needs to fall.

What is new in NGDP-targetting is not so much the basic macroeconomics, but the policy perspective.  Here are the key points of that perspective:

  • Instead of ignoring the rational expectations revolution, market monetarism embraces it.
  • It also embraces the key insight of the Noe-Keynesians, which is that prices are sticky.
  • It is rule-based and completely transparent, rather than relying on the discretion and hidden agendas of central bankers.
  • It is a short-term perspective on what matters in the short-term: total spending (recessions really suck, after all, and are best avoided).
  • Policy makers don’t dictate market outcomes, they respond to them (hence the “market” in the market monetarism).
  • There is no need for fiscal policy, which at best does nothing and, at worst, is exploited by the worst aspects of redistributive politics

Market monetarism is not an economic panacea.  There will still be business cycles , and real growth still requires all the tough policy choices that are hard to make in a world where politicians care only about the coming electoral cycle.  But it may turn out the a group of economic bloggers in obscure places are pushing a view that will end up making the economists at elite universities cringe with shame when the finally accept its utility and simplicity as an approach to preventing the pain of recessions like the current one.  Time will tell.

Next: the politics of the new macro.


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Romney and His Wealth

There has been a lot of talk – too much in my view – about Mitt Romney’s riches.  Indeed, I half expect Ann Richards to rise from the dead and talk about how Romney was born with a gold spoon in his mouth (since he’s probably too “elitist” for silver) and eats the fruit of the poor’s labor with it to amass even greater wealth.  CNN is suggesting that Republican voters think Romney is “too rich” (which I don’t think is possible to objectively define or cast judgement upon as long as it was legally and morally earned).

I really don’t care how rich politicians are unless their wealth was earned in a way that suggests something problematic about their character which could be reflected in their use of power.  For example, “bad” wealth would be money gained as a product of rent-seeking behavior or other morally dubious or fraudulent acts. 

In Romney’s case, I haven’t heard about anything that suggests this.  Indeed, quite the opposite as he took responsibility for making tough business decisions that affected many people but that were often growth-enhancing.  That suggests something positive about his ability to lead as President. 

What I care about most in a candidate for national office is his/her commitment to the Constitution and the extent to which he/she believes in and will be guided by a political philosophy dedicated to securing individual liberty and a free society.  Unfortunately, there are few (none?) that can fully meet this standard.  But it is a useful standard of judgement.  It tells me I should prefer Barry Goldwater to Lyndon Johnson, Ronald Reagan to Jimmy Carter, Mitch Daniels to Newt Gingrich, and so on and so forth.  Are those men perfect, no.  But there is still a meaningful choice along those dimensions for the American public as a whole.   

More importantly, I think there is something crucial that seems to be escaping public attention through all of this talk of how rich Romney is.  Specifically, former community organizer and current President, Barack Obama is also very, very wealthy.  The Obamas adjusted gross income for 2010 alone was $1,728,096.  Their 2009 AGI was $ 5,505,409.  In 2008, it was $2,656,902.  Not exactly 99% right?  And that is just for a three-year period.  Worse, is that his wealth has largely been the product of his political life (see where he stood – especially before his DNC speech in 2004 – in this 2007 piece).  So if we are going to cast aspersions about someone’s wealth, I’m pretty sure we should pay more attention to the fact that politics pays – just ask Bill Clinton and Newt Gingrich!

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While most of the GOP presidential aspirants are content talking about the mundane and rarely (with the exception of Ron Paul) the most serious problems facing the nation, Newt once again elevates the debate—and this time literally. Enjoy the quotes of Gingrich from a recent campaign stop in Florida:

“By the end of my second term, we will have the first permanent base on the moon and it will be American…I will, as president, encourage the introduction of the northwest ordinance for space to put a marker down that we want Americans to think boldly about the future and we want Americans to go out and study hard and work hard and together, we’re going to unleash the American people to build the country we love.”

And, of course, this is only the beginning:

 “When we have 13,000 Americans living on the moon, they can petition to become a state.”

Sahil Kupur (TPM) has aptly labeled Newt a “Space Keynesian.” One can only imagine–in some parallel universe where Gingrich actually wins the presidency–Paul Krugman writing endless columns arguing that no matter how large the moon colonization program, it  provides an insufficient stimulus to the economy.

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It looks as though the Yuri Wright affair may finally now, mercifully, be over. Yuri Wright is a senior in high school; but not just any student at not just any high school: he was a nationally recruited cornerback at football powerhouse Don Bosco in New Jersey—or at least he was until recently, when Bosco expelled him.

What a life he was having. Colleges from around the country, including Michigan, Notre Dame, Colorado, Wisconsin, and many others, all wanted him. Then, suddenly, Michgan pulled its offer. Why? It turned out that he, like most other high school students, had a Twitter account. And for lo these last many months, he had been tweeting regularly, even during time he was ostensibly in school. What was he tweeting? Well, I will not recount or reproduce the tweets for you; though he closed his original account, screenshots were retained by many media outlets and are widely available on the internet. Be forewarned, however: They are vile. They discuss sexual acts graphically, they use disgusting language to describe women, they are obscene, profane, pornographic, they use derogatory racial epithets, and on and on. And it is not just one objectional tweet: there are lots of them, over a period of months.

When they were “discovered”—although he had some 1,600 followers, so it was not as if they were exactly private, and, quite frankly, I find the claim by Don Bosco to have been unaware of their content hard to believe—Michigan pulled its offer; other schools, like my alma mater Notre Dame, were apparently considering pulling their offer as well. Don Bosco then decided to expell him. Again, I am not particularly impressed with Bosco’s assumption of moral high ground. It cost them almost nothing: the football season is already over, and Yuri was probably on scholarship to Bosco anyway; so there was no downside to them to expelling him in January. Since Yuri has now opted to attend Colorado, the affair seems to be over, at least for the time being.

There are many lessons one might learn from this episode. One is that nothing on the internet is private. Nothing. Ever. Another lesson: whatever is once on the internet is there forever. So anything you write you should imagine that literally every person on the planet will read: Do you still want to write it?

But this was a high school student, not an adult. So some argued that he should be forgiven, given a second chance. I read many people saying things like, “hey, that’s how all high school students talk these days—especially boys in New Jersey!” I also read claims that his words were offensive only to older-generation white people who were unfamiliar with hip-hop culture or the language in some rap music. Some Notre Dame fans who had wanted him to commit there argued that Notre Dame’s Catholic mission requires it not only to forgive a mistake but also to teach virtue, so perhaps Notre Dame had a moral obligation to keep recruiting him, in the hopes that it could turn him into a virtuous person.

Right. Let’s not kid ourselves. Notre Dame would not even sniff an applicant who had displayed that kind of spectacularly questionable character and judgment—unless he was a spectacular football player. And it was not “a” mistake: it was months of display of very low character. It is moreover simply not true that all high schoolers talk like that. Not all high school boys view women like that; not all teenagers see the world and the races like that. To claim otherwise is an affront and slander to the vast majority of good kids out there—yes, even in New Jersey! And it is all still repellent and wrong regardless. Accepting it as inevitable or expected merely increases its occurrence, which is the opposite of what we should want.

That suggests the lesson I think this affair indicates. We are all about tolerance and freedom, as we should be, because it is required by the respect we should show to the decisions that free people make. But respecting the decisions that free people make requires not one thing but two: It requires not only giving people the liberty to act on the basis of their decisions, but it also requires holding them responsible for the consequences of their decisions. We often forget that second part—understandably so, since it is often unpleasant. But it is precisely as much entailed by respect for individual agency as respecting liberty to act is. Punishing people who act wrongly just is respecting their individual agency.

Shielding people from the unpleasant consequences of their decisions does them no favors. Not only does it inferfere with the process of developing good judgment, for that can happen only on the basis of feedback; but it disrespects their agency as not, in fact, up to the demands of liberty.

Now in Yuri Wright’s case, he is in that nether-realm between boyhood and manhood, so he is still developing his character and his judgment. And by the outward signs, things have not been going well. The fact that he has now already returned to tweeting with a brand new account, without taking even a short-term moratorium to reflect on his his life, is also not an encouraging sign. What better time, then, to hold him accountable for his actions, to make clear to him that those aspects of his character are unacceptable, and that bad judgment suffers bad consequences. Otherwise the feedback he gets will be all the wrong kind, and we might find that his judgment leads him to even worse places in the future.

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[M]ilitias are out of control and holding thousands of people in secret detention centres… More than 8,000…are being held by militia groups, amid reports of torture, UN officials said… Four died in clashes…on Monday.

Where is this happening? Libya. Responsibility to protect whom?

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Bomb, Bomb, Iran?

News of note on Iran:

1.  Israeli journalist supposedly in the know claims: “Israel will indeed strike Iran in 2012″  Why do people think his view is newsworthy?  According to another security journalist: “Bergman is one of a small circle of heavyweights in the Israeli media who spend a significant amount of time with the politicians, spies and generals who are going to make the ultimate decision. So his assessment carries more weigh[t] that your average Israel-Iran analyst.”  Not everyone is so sure Bergman is right.

2.  Colin Kahl, a security studies professor at Georgetown University, argues that the Arab Spring hasn’t been the blessing the Iranians had hoped it would be.  Kahl:  “One year later, however, it is hard to find evidence that Iran has benefited from the Arab uprisings. In fact, Iran’s regional position has taken a big hit. With the partial exception of Yemen, Tehran has struggled to build new networks of influence with emerging Islamist actors. Meanwhile, Assad’s regime has been thoroughly delegitimized, expelled from the Arab League, and is wobbling in the face of nationwide protests. This, in turn, has created considerable anxiety for Hezbollah, the Lebanese militia that constitutes Iran’s chief non-state ally.”

3.  Don’t believe the hype on Iran’s nuclear pace?  So says an op-ed for the Bulletin of the Atomic Scientists.  Money quote: “It is crucial to recognize that the quality of Iran’s nuclear workmanship has been consistently poor, so it has been able to progress at no more than a snail’s pace.”  Apparently the boys who cry nuclear wolf didn’t learn from Iraq.  Or did they actually get what they wanted (or at least some of them)?! 

4.  Brookings Institute scholar Bruce Reidel gets it exactly right (and Obama last night, not to mention most Republicans, get it exactly wrong): “So don’t let the hot air from Tehran or the Republican debates confuse the reality on the ground. Iran is a dangerous country but it is not an existential threat to either Israel or America.”

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How Thick Is Your Bubble?

How Thick Is Your Bubble?

View user's Quiz School Profile
Score » 7 out of 20 (35% )
On a scale from 0 to 20 points, where 20 signifies full engagement with mainstream American culture and 0 signifies deep cultural isolation within the new upper class bubble, you scored between 5 and 8.

In other words, you can see through your bubble, but you need to get out more.

Quiz School Take this quiz & get your score

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My first impression of Obama’s SOTU: it was an interesting combination of contradictory materials (transcript here).  Obama appealed to Lincoln:

“I’m a Democrat. But I believe what Republican Abraham Lincoln believed: That Government should do for people only what they cannot do better by themselves, and no more.”

If he truly believes this, then he has a rather jaundiced view of what the American people can “do better by themselves,” given that the SOTU was full of calls for additional government intervention.

There were plenty of populist appeals (ahem, not class warfare) but like the populist appeals of the President’s new Progressive Era idol, Teddy Roosevelt, it was a thin populism that only makes the case for social engineering. Thus the president presented his “blueprint for an economy that’s built to last – an economy built on American manufacturing, American energy, skills for American workers, and a renewal of American values.”

How should we respond to the President’s “blueprint”? Here is where the military metaphors come into play:

“At a time when too many of our institutions have let us down, they [America's Armed Forces] exceed all expectations. They’re not consumed with personal ambition. They don’t obsess over their differences. They focus on the mission at hand. They work together.

Imagine what we could accomplish if we followed their example.”

Yes, just imagine. And I wonder who would serve as commander of this mission-focused nation, free of personal ambition and blind to their differences?

The military metaphors that provided bookends to the SOTU reminded me of that other Roosevelt who deployed them artfully in his first inaugural.

“if we are to go forward, we must move as a trained and loyal army willing to sacrifice for the good of a common discipline, because without such discipline no progress is made, no leadership becomes effective. We are, I know, ready and willing to submit our lives and property to such discipline, because it makes possible a leadership which aims at a larger good. This I propose to offer, pledging that the larger purposes will bind upon us all as a sacred obligation with a unity of duty hitherto evoked only in time of armed strife.

With this pledge taken, I assume unhesitatingly the leadership of this great army of our people dedicated to a disciplined attack upon our common problems.”

Of course, the SOTU did not have the elegance of FDR’s address, but President Obama’s appeal to military unity and discipline combined with the claim that he is in possession of the “blueprint” to the future certainly draws attention back to 1933 (as do the attacks on the role of financiers in the old order and the threats of unilateral action should Congress not prove sufficiently compliant).

There were many other odd components that deserve comment, including the aggressive comments about trade, the statements about regulation, the lack of attention to the debt and the larger fiscal crisis, and the claims of the success of the auto bailout (I doubt that the disaster in Japan that destroyed Toyota’s supply chain was part of some “blueprint” for the auto industry).

In the end, the “blueprint” for the future will likely be stored on a shelf next to last year’s plans for “winning the future” as the 2012 elections pass into history.

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Nice measured statement about our predicament (esp compared to Obama’s):  “The President did not cause the economic and fiscal crises that continue in America tonight. But he was elected on a promise to fix them, and he cannot claim that the last three years have made things anything but worse: the percentage of Americans with a job is at the lowest in decades.”

“Broken, complex tax system” – yup

Republican record on debt/entitlements not as rosy as Mitch suggests

Mitch was low-key, mature, and serious about dealing with our problems without blinders on – exactly what we need in the Oval Office

BTW, Tea Party is foolish to go with Cain to give their response. Fools. Should have picked someone like Rand Paul (and maybe they tried to get someone else). Cain discredits them after his downfall in the Republican primary.

UPDATE: Funniest line of night belonged to NRO commenter:

I’m currently uploading “Help us Mitch Daniels. You’re our only hope” holo-message on to R2 unit.

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Ahh, be careful about bragging about the Arab Spring.  Many have talked about how it is getting wintry.  Moreover, the US was a reactive force not an active force in those changes (with exception of Libya).

Note to Iran: “Don’t do as we do, do as we say.”  His rhetoric scares me.  Can he really find a workable compromise with Iran with statements like that? 

Obama slams Zakaria et al on American declinism — wonder if Fareed would like that puff interview back?!

Is it absolutely necessary to suck up to the military in the SOTU?  Founders rolling in grave.

BTW, when he said “some might be Democrats, some might be Republicans” – research has shown that a supermajority of officers are Republicans/conservatives while enlisted mirror the general population.  Just fyi, not a criticism of what Obama said.

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Here is what I’m hearing through that translator:

Corporatism, class warfare, protectionism, green waste, pork (“nation-building at home” – done by my clientele), and waving my wand and making serious problems go away is easy

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Ryan Lizza presents an interesting portrayal of President Obama in the New Yorker (“The Obama Memos”) that is well worth a read. Some samples:

The premise of the Obama campaign was unusual. “Change We Can Believe In” wasn’t just about a set of policies; it was more grandiose. Obama promised to transcend forty years of demographic and ideological trends and reshape Washington politics. In the past three years, though, he has learned that the Presidency is an office uniquely ill-suited for enacting sweeping change. Presidents are buffeted and constrained by the currents of political change. They don’t control them.


Predictions that Obama would usher in a new era of post-partisan consensus politics now seem not just naïve but delusional. At this political juncture, there appears to be only one real model of effective governance in Washington: partisan dominance, in which a President with large majorities in Congress can push through an ambitious agenda. Despite Obama’s hesitance and his appeals to Republicans, this is the model that the President ended up relying upon during his first two years in office. He had hoped to use a model of consensus politics in which factions in the middle form an alliance against the two extremes. But he found few players in the center of the field: most Republicans and Democrats were on their own ten-yard lines.

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Athletes, celebrities, and politicians are usually very disappointing people the more you know about them or hear from them.  So it came as a great surprise and pleasure to see that one of my favorite hockey players is actually an articulate defender of a free society and not just the great guardian of the Bruins’ goal mouth.  Moreover, he appears to be a man who is willing to make a personal sacrifice for his principles.

In case you haven’t heard, Bruins’ goalie Tim Thomas did not participate in the team’s visit to the White House in honor of their Stanley Cup victory in 2011.  The reason he declined the invitation is that he apparently did not want to show any support for a Federal government that he believes has been responsible for injuring and threatening our liberty and wanted to make a statement about that danger.  Here is what he said about his decision:

I believe the Federal government has grown out of control, threatening the Rights, Liberties, and Property of the People.

This is being done at the Executive, Legislative, and Judicial level. This is in direct opposition to the Constitution and the Founding Fathers vision for the Federal government.

Because I believe this, today I exercised my right as a Free Citizen, and did not visit the White House. This was not about politics or party, as in my opinion both parties are responsible for the situation we are in as a country. This was about a choice I had to make as an INDIVIDUAL.

This is the only public statement I will be making on this topic. TT.

My guess is that he – like most Americans – would have enjoyed visiting the White House and seeing a place of such importance to our country’s history.  But he was willing to sacrifice a personal pleasure in order to avoid complicity with what he regards as a public bane and take a stand for his beliefs.  Gotta love that and dare say many of us would not have foregone such a rare chance.  Plus, I enjoy Thomas’ stress on his INDIVIDUALism, his inclusion of property in his list of threatened ends, and his sound reflection that the blame for these threats is shared by both parties and not merely the current resident of the White House.

And the argument that some have made that not attending was disrespectful of the President/Presidency and unpatriotic is baloney.   The President must earn our respect and is not someone of royalty whom we ought to put on a pedestal and obey when he asks us to visit.  And what could be more in the spirit of the founding patriots than figuratively spitting in the eye of what you believe to be a threat to liberty?  Remember, the founding generation of patriots were radicals for freedom who were willing to go to great lengths at places like Lexington and Concord to defend their liberties.  Surely, an appropriately peaceful demonstration of concern for our liberties is hardly unpatriotic and far less radical or threatening than what the Founders chose to do.   

Here’s to TT and I hope he’ll hoist another Stanley Cup over his head in 2012.

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I have just finished reading a fascinating symposium of papers on America’s sovereign debt crisis published in the most recent Econ Journal Watch (volume 9, number 1: January 2012). It is introduced by Tyler Cowen, and includes short papers by Jeffrey Rogers Hummel, Garett Jones, Arnold Kling, Joseph Minarik, and Peter Wallinson.

It is fascinating, if sobering. I am among those who believe the debt matters—indeed, that it may soon become the only issue that matters, because it will cripple our ability to handle any other issue. If you care about national defense, health care, education, investment in “green” energy, or anything else, beware: the ever-larger portion of our wealth that will need to go to paying interest on our debt, and of course the entitlements of Social Security, Medicare, and Medicaid, will mean that there is ever-less wealth available for anything else.

(By contrast, some, like Paul Krugman, argue that the debt is not as big an issue as I believe it to be, but I have a harder and harder time believing that position has credibility. Scott Winship has a point when he argues in National Affairs that we often exaggerate the economic “bogeymen” we face, but the national debt is one bogeyman he rather conspicuously leaves out of his discussion.)

So, back to the EJW symposium. I highly recommend reading it, sharing, as I do, the editors’ “hope that it’s not too late for them to make a difference” (22). I will not attempt reproduce their arguments and data, but I will offer a handful of short reflections that might whet your appetite for the papers themselves.

1. One thing the contributors seem to agree on is that there is only a handful of possible ways we might address the impending fiscal crisis. As Jones puts it, “There are four possible tools: Higher revenues, lower spending, inflation, and default” (41). But it strikes me that there is at least one other possible way we might address the potential crisis, a possibility that none of the contributors mentions: imperialism. By that I mean that we might start invading other lands, territories, and countries, and simply appropriating their assets. There is certainly ample historical precedent. I do not think we should discount the potential attraction of large-scale theft and confiscation as a method of financing our debts and the lifestyles to which we have become accustomed.

2. There is some disagreement about how likely default is. Jones, for example, argues it is relatively unlikely; Kling argues it is relatively more likely. I would be interested to hear how Jones and Kling might respond to one another, but, beyond that, another striking feature of the discussion is the astonishing degree to which they seem to agree that no one really knows. We are in uncharted territory here. The prospect of the largest wealth-producing nation in the entire history of humankind, whose economy has huge and deep ramifications in the rest of the world’s economies, facing the prospect of being unable to service the largest amount of debt that any nation has ever produced in the history of humankind—well, who knows? Kling writes, “much of what I will be discussing is outside the competence of . . . well, anybody, making the exercise highly speculative” (51; ellipsis in the original). Perhaps this fact contributes to the reason Tyler Cowen writes, in his introduction to the symposium, “Our times are now truly scary” (21). Indeed.

3. Finally, I wish there had been more discussion of possible solutions. The contributors seem to agree both that we are facing a desperate situation and that, nevertheless, we can avoid catastrophe if we act quickly. They offer various reasons for being pessimistic that solutions will actually be forthcoming (see particularly Minarek’s and Wallinson’s contributions), but perhaps recommendations about positive steps that might actually help, along with some discussion of how these steps might be feasible, would be helpful. Diagnosing the true extent of the sclerosis is, of course, the first step; but recommended courses of treatment are the next step.

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So, is Newt’s SC victory a sign of real support by conservatives (and thus a really sad reflection of the state of conservatism right now given who/what Gingrich is and represents) or a reflection of their simple unwillingness to support Romney’s claim to the nomination?  If the former, I’m depressed.  If the latter, then why the heck didn’t party leaders realize this a lot earlier (premature cognitive closure?  motivated misperception?  miscalculation?) and coax someone else into the race before it was too late to avoid the train wreck ahead: tepid support for a nominee who is dulling the limited government fervor of the moment or the Newtpocalyse.

I don’t think it is the former problem of a changing (dumbing of) conservatism.  I just think many conservatives have deeply internalized the long-running conservative-libertarian argument against Romney (and for some, this is buttressed by a deep suspicion of his Mormon faith) and are flailing about wildly for ABR.  (This also explains conservative flirtations with so many suitors during the campaign season).  However, in the course of doing so, they’ve landed upon a candidate incompatible with the conservative approach and philosophy - and absolutely incompatible with the libertarian-leaning Republican view.  I wonder if some Republicans now wish they had jumped into the seemingly done deal race.

Finally, before we make too much of South Carolina (with many pundits saying it is Romney’s 2008 McCain in NH moment of doom), we should remember that there are a lot of places still to vote in the Republican primary where voters aren’t exactly Gingrich-friendly and a lot of time left for Romney to make the easy case that Gingrich is a nightmare for conservatives and conservatism. 

Myself, I can’t decide if I’d rather have the worst outcomes (Gingrich, Santorum) sunk in favor of the least worst likely outcome (Romney) or for the next-to-impossible but most desirable outcome (Romney and Gingrich split a bunch of primaries with Paul picking up delegates where he can followed by a convention fight where someone like Daniels or Christie emerge as the nominee in a bitterly divided convention).  Since I’m not the marginal voter – and neither are you – my preferences of course don’t matter one bit.  And every Gingrich or Santorum vote will likely lead only to a strengthening of the positions within the Republican Party that I don’t much care for.  So is the most prudent course a libertarian could hope for among the real possibilities a quick Romney victory with Paul hanging around the longest and gathering votes/delegates to wield as a sword?

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Matt Yglesias, now promoting his libgressive views freely at Slate, gives us five lessons from the SOPA/PIPA debate.  See here.     

I’ll provide a sixth: Corporate free speech is worth protecting.  And as Peter Scheer highlighted in a recent HuffPo column, we should be happy about the much-reviled Citizens United for helping protect the speech of such “persons”:

In this context it is worth noting that the First Amendment rights on display in this debate were secured by the US Supreme Court’s controversial decision in Citizens United v. Federal Election Commission. That misunderstood case is reviled in some quarters for its affirmation of the First Amendment rights of corporations.  Indeed, in the aftermath of the Citizens Uniteddecision, a cottage industry has emerged to advocate legislation (or, God forbid, a constitutional amendment) to curb the influence of corporations in the political sphere.

Their good intentions notwithstanding, those who believe corporations have no free speech rights (or that they should have, at most, a second-rate version of the free speech protections for individuals), should realize that only the First Amendment stands in the way of governmental punishment-legislative, regulatory or otherwise-against Google and other Fifth Estate corporations for their inciting of public opinion against SOPA-style legislation.

Think of how many members of Congress, humiliated (or at least humbled) by the anti-SOPA blow-back on the internet, would love to not only punish the Fifth Estate for its political impudence, but to neuter it permanently-for example, by blocking corporate acquisitions, unleashing antitrust and SEC investigations, or instigating IRS scrutiny.

One does not have to be a Ron Paul supporter to appreciate that for corporations (like Google, Twitter, Facebook and Microsoft), there is nothing more intimidating than being in the cross-hairs of government law enforcement agencies, egged on by pissed-off members of Congress with power over the agencies’ budget appropriations.

Corporations, no less than individuals, need First Amendment protection for their criticism of government and advocacy of policies opposed by government. They need this protection for themselves, for their employees, and for their shareholders and customers.

And as Matt notes, the corporate powers that spend the most bucks don’t always win.  Even when we don’t like what corporations say or that they can say it louder than we can, perhaps we should take a little understanding from Jefferson when he noted:  “I would rather be exposed to the inconveniences attending too much liberty, than those attending too small a degree of it.”

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George Will not engaging in hyperbole (though some might say Roe and subsequent abortion cases, not to mention Baker v. Carr, Griswold v. Connecticut, or Kelo v. City of New London)*:

The Obamacare issues of Medicaid coercion and the individual mandate are twins. They confront the court with the same challenge, that of enunciating judicially enforceable limiting principles. If there is no outer limit on Congress’s power to regulate behavior in the name of regulating interstate commerce, then the Framers’ design of a limited federal government is nullified. And if there is no outer limit on the capacity of this government to coerce the states, then federalism, which is integral to the Framers’ design, becomes evanescent.

So, the time the court has allotted for oral argument about Obamacare is proportional to the stakes. This case is the most important in the more than half a century since the Brown v. Board of Education cases because, like those, it concerns the nature of the American regime.

* Bush v. Gore was important but the result would have been the same had the Court allowed the political process to play out (right?), so it can’t make that list.  Other important cases that are probably beat by the ObamaCare case but which certainly merit consideration include: Loving v. Virginia, Lawrence v. Texas, Mapp v. Ohio, District of Columbia v. Heller, and McConnell v. Federal Election Commission (and subsequent Citizens United).  This is just off the top of my head, so I’m sure I’ve missed other potential cases worthy of note in the post-Brown world.

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There is little excitement about the current field of GOP presidential aspirants (with the possible exception of the always entertaining and quickly marginalized Ron Paul). What is somewhat striking is the extent to which Perry and Gingrich have framed the core debate, playing right into the hands of Obama’s 2012 campaign.

I think Charles Krauthammer (todays WaPo) has correctly diagnosed the current state of affairs. He notes that the President’s efforts to frame the debate as an issue of economic inequality seemed to get little traction.

Then came the twist. Then came the most remarkable political surprise since the 2010 midterm: The struggling Democratic class-war narrative is suddenly given life and legitimacy by . . . Republicans! Newt Gingrich and Rick Perry make the case that private equity as practiced by Romney’s Bain Capital is nothing more than vulture capitalism looting companies and sucking them dry while casually destroying the lives of workers.

He continues:

Now, economic inequality is an important issue…in a stroke, the Republicans have succeeded in turning a Democratic talking point — a last-ditch attempt to salvage reelection by distracting from their record — into a central focus of the nation’s political discourse.

The end result of “the GOP maneuvering itself right onto Obama terrain”:

The president is a very smart man. But if he wins in November, that won’t be the reason. It will be luck. He could not have chosen more self-destructive adversaries.

Given the way the GOP presidential aspirants have framed the debate, can they make any principled argument against expanded efforts at redistributing income and regulating business post 2012?

Can they make principled arguments at all?

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This past week a letter signed by a wide swath of high-ranking American religious leaders was released.  It was entitled “Marriage and Religious Freedom: Fundamental Goods that Stand or Fall Together.”  See the full letter hosted by the US Conference of Catholic Bishops.

Conservative religious groups opposing gay marriage is hardly news.  However, the slant taken by the religious groups caught my eye.  Rather than argue against gay marriage on moral grounds, they make claims of the loss of religious freedom in a variety of areas.

…[W]e believe the most urgent peril is this: forcing or pressuring both individuals and religious organizations—throughout their operations, well beyond religious ceremonies—to treat same-sex sexual conduct as the moral equivalent of marital sexual conduct. There is no doubt that the many people and groups whose moral and religious convictions forbid same-sex sexual conduct will resist the compulsion of the law, and church-state conflicts will result.

As examples they cite the following types of practical concerns:

So, for example, religious adoption services that place children exclusively with married couples would be required by law to place children with persons of the same sex who are civilly “married.” Religious marriage counselors would be denied their professional accreditation for refusing to provide counseling in support of same-sex “married” relationships. Religious employers who provide special health benefits to married employees would be required by law to extend those benefits to same-sex “spouses.” Religious employers would also face lawsuits for taking any adverse employment action—no matter how modest—against an employee for the public act of obtaining a civil “marriage” with a member of the same sex. This is not idle speculation, as these sorts of situations have already come to pass.

And they go on to site specific examples going beyond the simple hypothetical:

For example, in New Jersey, the state cancelled the tax-exempt status of a Methodist-run boardwalk pavilion used for religious services because the religious organization would not host a same-sex “wedding” there. San Francisco dropped its $3.5 million in social service contracts with the Salvation Army because it refused to recognize same-sex “domestic partnerships” in its employee benefits policies. Similarly, Portland, Maine, required Catholic Charities to extend spousal employee benefits to same-sex “domestic partners” as a condition of receiving city housing and community development funds.

Many libertarians argue that 1) government shouldn’t be in the marriage business in the first place and 2) that the examples cited by the religious leaders involve religious groups using public funds in a way that exceeds the appropriate scope of government (community development, for instance) regardless of who is receiving the funds — whether religious or non-religious groups.

I would largely agree with the second claim but, as I’ve argued before, the first one is exceedingly naive, especially as a practical political manner.  Marriage is ingrained in thousands of statues touching virtually every aspect of our lives and thousands of years of human history.   Governments, as a matter of law, can and should be indifferent to a lot of human practices and institutions, but that doesn’t mean it should have blinders on.  Socially and culturally, the marriage relationship is as foundational to the order and functioning of society as the parent-child relationship.  A full consideration of the consequences of re-defining marriage is far more complicated than the “love has no boundaries” crowd wants to admit.

Though I don’t think the whole fabric of religious liberty is being undermined by gay marriage, I do believe there are legitimate threats to believers and religious groups from the gay political agenda.  Religious groups have long played, for instance, a central role in the case of adoptions, where they have traditionally provided low-cost or free services to both expectant mothers and adoptive parents.  It is hard not to see religious groups being pushed out of these sorts of activities as the gay marriage movement advances.  And, despite the recent Court ruling granting a “ministerial exception” to anti-discrimination law, it is hard not to see churches being subject to “the full arsenal of government punishments and pressures reserved for racists,” as the religious leaders are worried about.

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Here is the bearish perspective on China.  Short version: the real estate market will drag down the country’s economy.  He thinks he’s being generous.  If the reality is south of that, watch out.  Is there any scenario in which a diversionary war is the optimal strategy for Chinese leaders?  I doubt it.  Nonetheless, isn’t that the most likely scenario that leads to a US-China clash in the medium term?  

More interesting news on China:  an admittedly weakly sourced post at World Affairs suggests that civil-military relations in China may have taken another turn for the worse.   But is there any real fire behind this smoke (that seems to be eluding the senses of the MSM):

According to a report, around New Year’s day officers in two Chinese air force units were arrested on suspicion of plotting a coup. At the same time, a nuclear submarine on patrol was ordered back to port because some on board were thought to have links with the plotters. This report, circulated on Sunday on a China-watching listserv, remains unconfirmed. This rumor could be linked in some fashion to the detention last month of Colonel Tan Linshu, of the Chinese navy, for subversion.

A coup at first glance seems inconceivable, but there has been an evident erosion in civilian control of the Chinese military in recent years. The most important manifestation of this breakdown is that colonels and flag officers have begun openly criticizing civilian leaders and are now speaking out on matters once considered the exclusive province of diplomats.

On the real estate piece, HT: MR.

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This is the first of two videos filmed for the Institute for Humane Studies ‘Learn Liberty’ series.
It summarises an argument I advanced here on Pileus last year in a post entitled ‘The Burden of Too Much Choice’.
Hope you like it. MP

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Romney’s Cayman Islands story is sure to play well in Middle America.

And Gingrich’s past is sure to resonate with regular voters too when it plays wall to wall and not just among elites.

Great work Republican Party.  Can someone light the Mitch Signal and tell him to ride in and save Gotham?*  And yes, I know it is far too late for that unless all of these flawed candidates fail to amass enough delegates before the convention. 

* And no, I don’t really believe any individual can save the Republic but surely lots of people wish someone could rescue the Republican Party’s flagging chances at unseating President Obama.  Yes, the big macro variables matter a heck of a lot – but candidate quality can’t be irrelevant?!?  I guess we’ll get a chance to test that hypothesis if the economy is poor and so is the Republican nominee (and no pun intended on the nominee being poor)!

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Today a number of websites are either going dark (see Wikipedia) or blackening out some part of their logo (see Google) in protest to SOPA(Stop Online Piracy Act) in the House and the PROTECT IP Act in the Senate. This is an interesting issue. Advocates of the bills claim that they will provide new tools for shutting down rogue websites that are used to download material that is protected by copyright.

The protection of property rights should one of the fundamental functions of government. However, opponents argue rather convincingly that the government already has adequate tools to battle online piracy by forcing the removal of materials covered by a copyright (e.g., the Digital Millennium Copyright Act).

This legislation is different insofar as it targets the platform. These bills would allow the government to shut a website down, prevent it from appearing in search engine results, and freeze payments and ad revenue. In short, it vastly expands the power of the state.  It may also produce a good deal of collateral damage (e.g., small startups might find the costs of monitoring content to be prohibitive, enhanced oversight by platforms might have a chilling effect on speech as they become de facto censors working in the shadow of the state).

For additional coverage, see the New York Times and The Hill.

For some libertarian critiques,  there is quite a bit at the  Electronic Frontier Foundation and Cato (Julian Sanchez and Jim Harper).

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Friday, President Obama announced that he will seek the authority (via a proposed Consolidation Authority Act) to reorganize and consolidate government agencies with business and trade responsibilities.  Targeted agencies include: the Commerce Department, the Export-Import Bank, the Overseas Private Investment Corporation, the Office of the U.S. Trade Representative, and the U.S. Trade and Development Agency. The Small Business Administration would be elevated to Cabinet status. In addition to streamlining the bureaucracy and achieving greater efficiencies, the goal is the eliminate up to 2,000 FTEs, largely through attrition. See summary here.

Reorganization authority usually amounts to very little, but at times it can deliver some surprising results (think of Nixon’s creation of the Environmental Protection Agency in 1970, based in part on the work of the Ash Commission). Of course, Nixon was working with a Democratically controlled Congress and the creation of the EPA was consistent with the sentiment on the Left following Earth Day (while serving Nixon’s short term goal of limiting Senator Muskie’s claim as the nation’s chief environmentalist).

Nixon’s larger goal of consolidating numerous agencies to create a set of super agencies never had a chance. Members of Congress jealously guard their committee jurisdictions. While they are pleased to support the creation of new agencies, they seem loathe to eliminate those that no longer serve a valuable function (assuming they served an important function at their creation other than rewarding organized constituents).

In any event, the congressional response seems tepid and organized labor is already mounting opposition to the proposed consolidations.  In the words of National Federation of Federal Employees National President William Dougan:

“With millions of American workers already unemployed, we are looking for proposals that create jobs, not eliminate them. Our sincere hope is that as these federal agencies are reconfigured, they find a way to make sure thousands of people working in these agencies aren’t given pink slips.”

It is difficult to imagine that President Obama, facing a tough reelection bid and difficulties shoring up the support of key coalition members like organized labor, will invest much of his depleted political capital in pursing a goal as arcane as consolidating agencies that most voters have never heard of in the first place.

In a perfect world, we would pursue efficiency by simply eliminating the rouges’ gallery of agencies under consideration, salvaging the few components that are worth retaining (e.g., the Census Bureau, the National Oceanic and Atmospheric Administration). Most are actively engaged in dispersing various forms of corporate welfare and make little if any contribution to national economic performance.

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I think part of the reason that people (especially city folk) are so afraid of guns is that they don’t have any experience with them.  Or rather, any real experience since they’ve seen plenty of gun use in the movies and on tv.  So here is a nice little piece that exposes some of the myths that might be partially behind that fear.

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“I submit that an individual who breaks a law that conscience tells him is unjust, and who willingly accepts the penalty of imprisonment in order to arouse the conscience of the community over its injustice, is in reality expressing the highest respect for the law.” – letter from Birmingham jail, April 16, 1963

More good quotations here.

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This USC professor is interested in rail, urban planning, and even the economic impact of terrorism.  Cool.  I think I should be reading his blog and more of his research.

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Just kidding.  Taylor* has been dead for nearly two centuries.  This, from his book Tyranny Unmasked, is still worth remembering:

“Liberty and tyranny are neither of them inevitable consequences of any form of government, as both depend, to a great extent, upon its operation, whatever may be its form.  All that man can accomplish, is to adopt a form, most likely to produce liberty, and containing the best precautions against the introduction of tyranny.” 

Although I’m not sure institutions can hold so much weight without a liberal culture in the first place, Taylor’s words still resonate.

* Just so there is no mistake, I find Taylor’s negative views on African-Americans deplorable.  Unfortunately, these were all too common among some of our Founding Fathers.

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Individuals here at Pileus have given Jon Huntsman largely positive reviews as an alternative to the Romgrichorum.  Well, looks like the former Ambassador to China is dropping out of the race according to ABC News

Perry is basically out.  That leaves four left.  And a fourth place finish in South Carolina will usher Santorum to the door.   As I’ve said numerous times (and it wasn’t rocket science figuring this out), Romney is going to be the Republican nominee absent something really strange happening.  To paraphrase George Will, how did we get here? 

So, seems about time for pundits to start thinking about the generals, how Romney is going to deal with Paul and the Paulistas, and who Romney’s VP choice will be.  In terms of the last issue, Marco Rubio will be a very tempting pick for Romney.  He’s from Florida, he’s a darling of the Republican establishment press (hello NR), he’s handsome and young (which will contrast nicely with oldsters Biden or Clinton), and he has what appears to be a great family (his wife – a former Miami Dolphin cheerleader – is gorgeous).  Did I leave anything out?  Ah, yes, he’s also Hispanic.  Unfortunately, he’s a strong neocon on foreign policy (though this still resonates among Republican elites for some reason). 

One way Romney could deal with the Paul problem would be to select Rand - but I have a hard time imaging that right now.  I’ll talk about some of the other possibilities in future posts.

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Scotland’s upcoming independence referendum has been in the news in Britain. The Scottish government wants to hold the referendum in 2014, but UK Prime Minister David Cameron has said that Westminster holds ultimate control over the wording and timing of any legally binding referendum and wants to hold the referendum sooner.

Another point of contention is whether the referendum question should include two or three options. The SNP government in Scotland is open to a three-question (status quo, independence, or “devo max“) referendum, while the Conservative-Liberal Democrat coalition government in the UK wants a two-question (in or out) referendum. The apparent worry from Westminster is that a three-option referendum could split the unionist vote and allow independence to win with a bare plurality (say, 40% for independence and 30% each for status quo and devo max). Here is a debate among British political prognosticators about what will happen.

The solution to the problem is simple: (more…)

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“If Not PBS, Then Who?”

Politico: “A new, four-hour documentary portrays the arc of his career as one littered with sexual dalliances and foibles.  That’s doubly surprising when you consider the source: not a conservative production company but PBS.”

Who would have expected that PBS would be the one to stomp on Clinton revisionism? 

So does this give Sven more or less reason to like PBS?   ;-)

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That’s right; in addition to the 23% of the Republican vote he took, Paul took 4% of the Democratic vote as a write-in candidate, good for second place, according to the NH Secretary of State. (Note: the NH SOS website is down right now, so I’m relying on descriptions of what it says given to me by my colleagues in New Hampshire.)

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I love to spend time with opensecrets.org, a website sponsored by the Center for Responsive Politics. It delivers data on contributions and lobbying in a user friendly and searchable format.  After reading a blog posting by Vox Day decrying Romney’s financial ties with Wall Street, I did a quick comparison of the top contenders. As Open Secrets notes, the figures reflect the money came from the organizations’ PACs, their individual members or employees or owners, and those individuals’ immediate families.”

Mitt Romney’s top three: 1. Goldman Sachs ($367,200), 2. Credit Suisse Group ($203,750), and 3. Morgan Stanley ($199,800).  A majority of Romney’s top 20 donors are financials.

I don’t find this particularly surprising given that many on Wall Street have turned on Obama and the Democrats. Indeed, while Goldman Sachs invested far more heavily in Democrats that Republicans in 2008, this time around its PACs and employees have invested a rather paltry $50,124 in Obama—less than 14 percent of what Romney has received. Note: in 2008, Goldman Sachs (PACs and employees) provided over $1 million to candidate Obama–the second largest source of funds.

Ron Paul’s top three: 1. US Army ($24,503), 2. US Air Force ($23,335), and 3. US Navy ($17,432). There are also several donations from individuals in defense contractors, the US government, and the Department of Defense—which I presume involve former members of the service.

This is far more interesting than Romney’s appeal to Wall Street. While several Republican candidates and pundits decry Paul’s foreign policy positions as irresponsible and naïve, no other candidate has members of the military in their list of top twenty donors.

I don’t want to draw too many conclusions given the limits of the data (e.g., it could be the case that members of the military give to each of the candidates but Paul’s relatively modest fundraising allows members of the military to rise to the top of the list). However, I do find it encouraging that members of the military constitute the largest donors to the only candidate who wants a radical break from the status quo in foreign policy. Perhaps they have the greatest stake in the outcome of the 2012 election.

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Two sides of the New Egypt brought to you by Tom Friedman, who manages to write an interesting column today and one that only has one of the self-indulgent lines for which he’s famous (“Muhammad Khairat el-Shater, the vice chairman of the Muslim Brotherhood and its economic guru, made clear to me over strawberry juice at his home that his organization intends to lean into the world”).

On the one hand you have this Islamist vision of the future (can you hear the giant sucking sound of tourist dollars leaving the country as he talks?):

Hazem Salah Abu Ismail, an independent Salafist cleric and presidential candidate, was asked by an interviewer how, as president, he would react to a woman wearing a bikini on the beach? “She would be arrested,” he said.

On the other hand you have this sensible perspective that would provide a lesson to Rick Santorum:

Agence France-Presse quoted another spokesman for Al Nour, Muhammad Nour, as also dismissing fears raised in the news media that the Salafists might ban alcohol, a staple of Egypt’s tourist hotels. “Maybe 20,000 out of 80 million Egyptians drink alcohol,” he said. “Forty million don’t have sanitary water. Do you think that, in Parliament, I’ll busy myself with people who don’t have water, or people who get drunk?”

Unfortunately, I think Friedman and Nour underestimate how many millions care deeply about what those 20,000 people are doing.  Sound familiar?

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