Monthly Archives: October 2010

Conservatism is …

Conservatism may mean small government to some, but clearly not to others.

Conservatism is in different versions:

1) Don’t change anything!  No new healthcare law, but keep Social programs in place.  I’m comfortable, so no change.  (Republican party)

2) Government should be small!  No social programs.  No security super state.  (Ron Paul and most libertarians)

3. Government should stick to to two functions:  Defense, and law enforcement, perhaps these should be quite large.  (I think the Tea Party and maybe Glenn Beck might be here)

4. Process is what is important, not the result necessarily.  Actions should be prudent and fact based, and respect tradition.  The power of government to fix society is limited.  (Andrew Sullivan, who like to put Obama in the prudent category.)

5. Hyper-nationalism is the thing.  Kick out immigrants.  Thumb your nose at other nations or unfamiliar cultures.  (Tom Tancredo and others)

6. Protect my privileges, that I’m afraid I may lose.  (I think Rush Limbaugh, Sarah Palin, parts of the Tea Party and Beck represent this point of view)

I’d put myself somewhere between 2 and 4, and afraid of 3, 5, and 6.

Call me disaffected from most of the current conservative movement.


From the Onion: Democrats go down running away

Democrats: ‘If We’re Gonna Lose, Let’s Go Down Running Away From Every Legislative Accomplishment We’ve Made’

October 27, 2010 | ISSUE 46•43


WASHINGTON—Conceding almost certain Republican gains in next month’s crucial midterm elections, Democratic lawmakers vowed Tuesday not to give up without making one final push to ensure their party runs away from every major legislative victory of the past two years.

Party leaders told reporters that regardless of the ultimate outcome, they would do everything in their power from now until the polls closed to distance themselves from their hard-won passage of a historic health care overhaul, the toughest financial regulations since the 1930s, and a stimulus package most economists now credit with preventing a second Great Depression.

"There’s a great deal on the line, and we know it isn’t going to be easy for us," said Senate Majority Leader Harry Reid (D-NV), speaking from the steps of the Capitol. "But if we suffer defeat, we will do so knowing we cowered away from absolutely anything we produced that was even remotely progressive or valuable in any way."

"And we will keep cowering right up until Election Day," Reid continued. "From Maine to Hawaii, in big cities and small towns, we will collapse into a fetal position and refuse to take credit for our successes anywhere voters could conceivably be swayed by learning what we have achieved on their behalf."

Why Can’t Spammers Write a Coherent Email?

You’d think that spam that will be sent to hundreds could be made coherent when the message is reused so many times.


Megan McArdle

via Why Can’t Spammers Write a Coherent Email?.

Fight our wars with citizen soldiers! (via Whatever Works)

Fight our wars with citizen soldiers! Today, The New York Times is all over the latest Wikileaks document dump. I'm pretty agnostic about the issue, but am of course interested in the contents. One story (they have many today looking at it from all aspects) in particular grabbed my attention – about our use of contractors in war since 2001. From the story: "Contractors were necessar … Read More

via Whatever Works

The failure problem with industrial policy (via  Modeled Behavior)

There is a fair amount of support these days for the idea that the government should be getting involved in industrial policy. The argument is that the government can help make the U.S. become a competitive producer of green technologies. This will have several benefits, so the theory goes, including giving us something to export, creating high paid green jobs, and helping the environment. Proponents point to the example of Germany, which has use … Read More

via  Modeled Behavior

Night of the Living Fed

From the Big Picture


Jeremy Grantham has some fun at the Fed’s expense:

The Ruinous Cost of Fed Manipulation of Asset Prices: My diatribe against the Fed’s policies of the last 15 years became, by degrees, rather long and complicated. So to make it easier to follow, a summary precedes the longer argument. (For an earlier attack on the Fed, see “Feet of Clay” in my 3Q 2002 Quarterly Letter.)

Purpose: If I were a benevolent dictator, I would strip the Fed of its obligation to worry about the economy and ask it to limit its meddling to attempting to manage inflation. Better yet, I would limit its activities to making sure that the economy had a suitable amount of liquidity to function normally. Further, I would force it to swear off  manipulating asset prices through artifi cially low rates and asymmetric promises of help in tough times – the Greenspan/Bernanke put. It would be a better, simpler, and less dangerous world, although one much less exciting for us students of bubbles. Only by hammering away at its giant past mistakes as well as its dangerous current policy can we hope to generate enough awareness by 2014: Bernanke’s next scheduled reappointment hearing.”


click for PDF


Night of the Living Fed
Jeremy Grantham
GMO, 10/26/2010

Live Writer Experiment

I am trying live writer, part of the Windows Live suite.

I’m always willing to try something.  I live dangerously.  Maybe I’ll end up like this tree, but in living on the edge you know you’re alive

Cut down by the Earth


I’m such a nerd!

Hayek Quotes of the Day (via  Modeled Behavior)

I can’t add much other than some of this may shock some who buy Road to Serfdom on Glenn Beck’s advise. Though a lot of people who buy the book may never crack the cover.

My Hayek exposure was mostly The Use of Knowledge in Society style stuff. I am  just now reading The Road to Serfdom for the first time. While his analysis of why markets work has always been wonderful, from what I can tell his political economy seems to echo that of a distinctly left-of-center economist by modern standards. Probably nothing has done so much harm to the [libertarian] cause as the wooden insistence of some [libertarians] on c … Read More

via  Modeled Behavior

Which economic ideas are hard to popularize?

I think the two most important might be:

1. Free trade is good, even if it eliminates some existing jobs; and

2. Policy that produce jobs aren’t always good

People have trouble with the idea that keeping some jobs may be worse than allowing those jobs to be displaced and letting larger benefits accrue to consumers than accrue to those who lost their jobs, and that better jobs will be created.


From Marginal Revolution:

“Ryan, a loyal MR reader, asks:

1. What are the most important economic ideas that are not popularized, i.e. not accessible to laypeople in books and articles by credible authors? …Are there any theories that have gained traction over competing theories based primarily on their ability to be more easily conveyed to a layperson audience as opposed to their providing a better solution to a particular problem?

As for non-popularized theories, I have a few nominations. First, the sensitivity of many economic results to assumptions about Bertrand, Cournot-Nash, and other solution concepts is not easily popularized.  Second (until the Cowen-Tabarrok macro text), the Solow growth model was not easily popularized.  The difference between a “once-and-for-all” change and a “change in the rate of growth” is not well understood, probably not at any level, yet it is important.  Tax incidence theory is not easily popularized, although an incorrect version of it — “they’ll pass it all along to consumers” — circulates.

Most behavioral economics can be easily explained in popular terms and that partially accounts for its broad influence.  Most people are also capable of grasping a crude version of Keynesian economics, albeit without the subtleties of Keynes (“we should spend more” resonates).  The insights of supply-side economics and monetarism have been popularized without much difficulty.

Most of all, it is hard to popularize “maybe” claims, agnoticism, uncertainties, confidence intervals, and contingencies.  The marketing process encourages excess certainty.

In terms of good but hard to popularize economic theories, what else can you think of?”

via Which economic ideas are hard to popularize?.

Crass Ass Conservatism: The Real Republican Pledge to America (via The Erstwhile Conservative: A Blog of Repentance)

I was thinking of voting Republican beause of the advantages of mixed government, but I think I’ve drawn back. Read on from “the Erstwhile Conservative” to see why.

Crass Ass Conservatism: The Real Republican Pledge to America Paul Krugman wrote yesterday in the New York Times about the failure of the Obama administration to propose a large enough stimulus plan to combat the financial crisis the administration underestimated. While admitting that the Recovery Act made things better than they would have been—he estimated unemployment would be near 12% without it—Krugman called the stimulus a "political catastrophe."  "Voters respond to facts," he said, "not counterfactu … Read More

via The Erstwhile Conservative: A Blog of Repentance