William Deresiewicz on college students; John Cochrane on solar panel tariffs; Norman Ornstein and Scott Alexander on mental illness; de Rugy and Kling on fiscal distress;
Deresiewicz: "society has not given them any way to grow up." I'm with Lady Thatcher here: society does not exist. My wife and I have two children. One is a published author, married to a financial adviser, and has two children. They are homeowners. The other, ten years younger, works for a financial advising firm, is working through her certification exams, is married to a self-taught video game programmer who is now in the process of being hired for a management position. Also homeowners. We have nine nieces and nephews. All but one are married, at least one of each couple has a permanent job, some in the professions, some in the trades. The married ones all have children. Each nuclear family unit is self-supporting. In short, they are "adulting" within the same society claimed incapable of teaching them how to do so. Most of these are late Gen Xers or Millennials. It's the family, not "society."
It feels like we need a new term to describe our current macro environment. High inflation plus high unemployment = stagflation. What is high inflation + high unemployment + high debt burden? This is the trilemma we are facing. Since it is materially different than the 1970’s, shouldn’t we call it something different?
John Cochrane sees the contradiction but he fails to explain it. The US government simultaneously taxes and subsidizes solar panels not because they are key to America's energy future but because they are not. And when the electricity blackouts happen we will have the trifecta of government interference: The taxing and subsidizing of market failure.
Re: "College is now regarded as the last stage of childhood, not the first of adulthood." - William Deresiewicz
At residential colleges, youths spend most of their time in a bubble with one another; relatively little time with adults; and almost no time surrounded by, and greatly outnumbered by, adults. This is the opposite of most workplaces.
At residential colleges, there is resource egalitarianism. Matriculation confers roughly equal access to academics, food, shelter, services, amenities.
At expensive selective residential colleges, competition among academic departments for course enrollments, faculty autonomy in grading, consumer sovereignty with remote 3rd-party payment, and thin quality control create incentives for an implicit devil's pact at some margin: I pretend to teach, you pretend to learn, and the world won't know or mind our open secret.
Is it any wonder that college often delays adulthood?
1) Real GDP growth seems the wrong measure for understanding the potential to grow out of a debt burdent. Most debts are nominal and nominal GDP growth is much higher. Since nominal GDP growth averages about 5%, if we grow government spending at say 4% we can gradually reduce the debt burden without ever actually cutting nominal spending. My understanding is this is the approach Canada took to reduce their debt burden.
2) While I'm not confident it _has_ to work out this way, my general sense is that raising policy rates to slow inflation should actually reduce long term rates (because inflation should be lower in the future with the central bank having committed to lower inflation). That means the overall effect of tightening need not raise the overall debt burden by much. Under the Volcker tightening, this is pretty much what happened. Short rates when up very high, short rates started to fall, and then short term rates could fall too.
Cochrane is right about the economic silliness of tariffs on Chinese made solar panels with subsidies to install them so as to keep customer price lower. Tho it should be encouraging more solar mfg in the USA. And it seems that it is.
As compared to direct subsidies to a US Solyndra boondoggle, maybe the tariff & subsidy plan actually works better for gov't intervention to protect against excessive dependence on Communist China production.
When will the gov't be putting up solar panels to cover outdoor parking lots? Generating A/C power and protecting the cars from so much direct sun.
With full cost transparency & lifetime costs including maintenance and, eventually, replacement.
Re: "Anosognosia means that those affected have no insight into their illness. It is a symptom and component of some brain diseases that have adversely impacted the frontal lobe of a person’s brain. Untreated, individuals with anosognosia end up homeless, jailed, or dead. Not by choice." - Norman Ornstein, essay at embedded link
Lack of self-insight is commonplace; and not peculiar to individuals who suffer brain diseases.
Most individuals who lack self-insight *don't* end up homeless, jailed, or dead.
It's not obvious that there is any clearcut or simple correlation between self-insight and health/prosperity/success.
It's not obvious that there is any major difference in prevalence of self-insight among (a) individuals who suffer brain disease, and (b) individuals who don't suffer brain disease.
Thomas Szasz argued that most cases of what experts label 'mental illness' has not been shown to involve a brain lesion/disease. If I understand correctly, schizophrenia is an exception. Prevalence of such brain lesion/disease is an empirical question. I don't know the state of the art in brain science.
Szasz also argued that, apart from cases of brain lesion/disease, the very wide scope of 'mental-illness' labelling reflects a coincidence of incentives between labellers and persons so labelled. The labeller wants a justification for coercion, because the behavior of the person who is "mentally ill" causes friction, social costs, deep dismay. The labelled person wants an excuse to persist in troublesome, troubling behavior.
For example, is alcoholism a brain disease? Or does the alcoholic rather (1) prefer to drink than, say, to care for her children; and (2) welcome the disease label as an excuse for an irresponsible behavior?
Can and will experts and/or policy-makers (i) credibly distinguish hardcore cases of brain lesion/disease, and (ii) strictly limit coercion accordingly? Beware the slippery slope of "mental illness."
Great short paper on inflation, and how hard it is for gov't to stop its spending addiction. Addicted to spending OPM, Other People's Money.
It understates the costs of regulations, without giving Trump's attempt to reduce regulations any credit for the pre-pandemic growth that was happening. If Reps gain gov't power again, cutting regulations should be a high political priority for helping to boost economic growth without increased gov't spending.
De Rugy packs lot of misconceptions into a small paragraph.
1) What interest rates should be is not a policy issue. The policy issue, if any, is what objectives Congress should give the Fed and how well the President and Congress can select people for the Fed who will and can ser interest rates and other policy instruments to carry out those objectives.
2) The fiscal response to higher borrowing rates should not, be higher deficits, but a combination of less spending on activities with NPV<0 at the borrowing ratee and higher taxes.
3) Deficits are bad (when they ARE bad) because the divert resources away from private investment, not because they cause inflation. Causing the right amount of inflation and no more is the Fed’s job (#1 see above).
Cochran: He is right of course. Trade restrictions are bad and subsidizing non-CO2 emitting energy technologies instead of taxing net emissions of CO2 is bad. Snark, however is not a policy.
Deresiewicz: "society has not given them any way to grow up." I'm with Lady Thatcher here: society does not exist. My wife and I have two children. One is a published author, married to a financial adviser, and has two children. They are homeowners. The other, ten years younger, works for a financial advising firm, is working through her certification exams, is married to a self-taught video game programmer who is now in the process of being hired for a management position. Also homeowners. We have nine nieces and nephews. All but one are married, at least one of each couple has a permanent job, some in the professions, some in the trades. The married ones all have children. Each nuclear family unit is self-supporting. In short, they are "adulting" within the same society claimed incapable of teaching them how to do so. Most of these are late Gen Xers or Millennials. It's the family, not "society."
It feels like we need a new term to describe our current macro environment. High inflation plus high unemployment = stagflation. What is high inflation + high unemployment + high debt burden? This is the trilemma we are facing. Since it is materially different than the 1970’s, shouldn’t we call it something different?
John Cochrane sees the contradiction but he fails to explain it. The US government simultaneously taxes and subsidizes solar panels not because they are key to America's energy future but because they are not. And when the electricity blackouts happen we will have the trifecta of government interference: The taxing and subsidizing of market failure.
Re: "College is now regarded as the last stage of childhood, not the first of adulthood." - William Deresiewicz
At residential colleges, youths spend most of their time in a bubble with one another; relatively little time with adults; and almost no time surrounded by, and greatly outnumbered by, adults. This is the opposite of most workplaces.
At residential colleges, there is resource egalitarianism. Matriculation confers roughly equal access to academics, food, shelter, services, amenities.
At expensive selective residential colleges, competition among academic departments for course enrollments, faculty autonomy in grading, consumer sovereignty with remote 3rd-party payment, and thin quality control create incentives for an implicit devil's pact at some margin: I pretend to teach, you pretend to learn, and the world won't know or mind our open secret.
Is it any wonder that college often delays adulthood?
Re: your article with Veronique de Rugy
1) Real GDP growth seems the wrong measure for understanding the potential to grow out of a debt burdent. Most debts are nominal and nominal GDP growth is much higher. Since nominal GDP growth averages about 5%, if we grow government spending at say 4% we can gradually reduce the debt burden without ever actually cutting nominal spending. My understanding is this is the approach Canada took to reduce their debt burden.
2) While I'm not confident it _has_ to work out this way, my general sense is that raising policy rates to slow inflation should actually reduce long term rates (because inflation should be lower in the future with the central bank having committed to lower inflation). That means the overall effect of tightening need not raise the overall debt burden by much. Under the Volcker tightening, this is pretty much what happened. Short rates when up very high, short rates started to fall, and then short term rates could fall too.
Cochrane is right about the economic silliness of tariffs on Chinese made solar panels with subsidies to install them so as to keep customer price lower. Tho it should be encouraging more solar mfg in the USA. And it seems that it is.
https://news.energysage.com/best-solar-panel-manufacturers-usa/
As compared to direct subsidies to a US Solyndra boondoggle, maybe the tariff & subsidy plan actually works better for gov't intervention to protect against excessive dependence on Communist China production.
When will the gov't be putting up solar panels to cover outdoor parking lots? Generating A/C power and protecting the cars from so much direct sun.
With full cost transparency & lifetime costs including maintenance and, eventually, replacement.
Re: "Anosognosia means that those affected have no insight into their illness. It is a symptom and component of some brain diseases that have adversely impacted the frontal lobe of a person’s brain. Untreated, individuals with anosognosia end up homeless, jailed, or dead. Not by choice." - Norman Ornstein, essay at embedded link
Lack of self-insight is commonplace; and not peculiar to individuals who suffer brain diseases.
Most individuals who lack self-insight *don't* end up homeless, jailed, or dead.
It's not obvious that there is any clearcut or simple correlation between self-insight and health/prosperity/success.
It's not obvious that there is any major difference in prevalence of self-insight among (a) individuals who suffer brain disease, and (b) individuals who don't suffer brain disease.
Thomas Szasz argued that most cases of what experts label 'mental illness' has not been shown to involve a brain lesion/disease. If I understand correctly, schizophrenia is an exception. Prevalence of such brain lesion/disease is an empirical question. I don't know the state of the art in brain science.
Szasz also argued that, apart from cases of brain lesion/disease, the very wide scope of 'mental-illness' labelling reflects a coincidence of incentives between labellers and persons so labelled. The labeller wants a justification for coercion, because the behavior of the person who is "mentally ill" causes friction, social costs, deep dismay. The labelled person wants an excuse to persist in troublesome, troubling behavior.
For example, is alcoholism a brain disease? Or does the alcoholic rather (1) prefer to drink than, say, to care for her children; and (2) welcome the disease label as an excuse for an irresponsible behavior?
Can and will experts and/or policy-makers (i) credibly distinguish hardcore cases of brain lesion/disease, and (ii) strictly limit coercion accordingly? Beware the slippery slope of "mental illness."
Great short paper on inflation, and how hard it is for gov't to stop its spending addiction. Addicted to spending OPM, Other People's Money.
It understates the costs of regulations, without giving Trump's attempt to reduce regulations any credit for the pre-pandemic growth that was happening. If Reps gain gov't power again, cutting regulations should be a high political priority for helping to boost economic growth without increased gov't spending.
De Rugy packs lot of misconceptions into a small paragraph.
1) What interest rates should be is not a policy issue. The policy issue, if any, is what objectives Congress should give the Fed and how well the President and Congress can select people for the Fed who will and can ser interest rates and other policy instruments to carry out those objectives.
2) The fiscal response to higher borrowing rates should not, be higher deficits, but a combination of less spending on activities with NPV<0 at the borrowing ratee and higher taxes.
3) Deficits are bad (when they ARE bad) because the divert resources away from private investment, not because they cause inflation. Causing the right amount of inflation and no more is the Fed’s job (#1 see above).
Cochran: He is right of course. Trade restrictions are bad and subsidizing non-CO2 emitting energy technologies instead of taxing net emissions of CO2 is bad. Snark, however is not a policy.