Links to Consider, 11/24/2024
Aswath Domodaran on corporate sustainability; Hobart and Huber on scientific stagnation; Howard Husock on big philanthropy; me on bureaucracy; Noah Smith on social class in America
I was recently asked to give testimony to a Canadian parliamentary committee that was considering ways of getting banks to contribute to fighting climate change (by lending less to fossil fuel companies and more to green energy firms), and much of what I heard from committee members and the other experts was about how banks would bear the costs. The truth is that when a bank is either restricted from a profit-making activity (lending to fossil fuel companies) or forced to subsidize a money-losing activity (lending at below-market rates to green energy companies), the costs are borne by either the bank's shareholders or depositors, or, in some cases, by taxpayers. In fact, given that bank equity is such a small slice of overall capital, it is bank depositors who will be burdened the most by bank lending mandates, and that opens the door to bank failures and worse.
In my book Specialization and Trade, I quote a skeptical take on the concept of sustainability from Robert Solow, who was not known as a right-winger. His point is that what we leave to our descendants includes more than just natural resources. Should we not build roads because that would leave our descendants with less grass?
Byrne Hobart and Tobias Huber write,
A core driver of the rise of scientific risk aversion is the dominance of citation-driven metrics to evaluate research. This trend is inextricably linked with the continued bureaucratization of science, which demands the total quantification of scientific production. Scholarly journal publications and citation measures, which Google Scholar has made easier than ever to track, have become the dominant factors in publication, grant-making, tenure, and promotion decisions. An inevitable consequence is a bias toward incrementalism, as crowded scientific fields attract the most citations. High-risk, exploratory science gets less attention and less funding because it is less certain to lead to publishable results.
It also selects for cronyism. You get a good referee’s report by citing the papers of the referee.
Their criticism of the scientific method seems to me like tossing out the baby with the bathwater.
Over the past decade, according to Giving USA, foundation giving has grown from 16 to 18 percent of all IRS-tracked charitable gifts, while individual giving has fallen off from 71 percent to 67 percent.
I like “little charity,” meaning individual gifts. People give to the needy (I think that is good), to their church (I think that is not bad), and to their colleges (I think that is bad). I dislike “big philanthropy,” meaning the foundations created by wealthy people and run by social justice activists. The finance causes, many of which are not good. The policy trick would be to encourage little charity while discouraging big philanthropy.
In fact, the only real class distinction in America that I think makes any sense is higher education. Whether you go to college makes a huge difference in your life — both in terms of future income and the kind of jobs available to you, and also in terms of health and other social outcomes. This is why I do think it makes sense to talk about an “educated professional class” in America…
But just because America’s educated professional class has a fairly unified culture doesn’t mean that the people who didn’t go to college have any kind of working-class solidarity or class consciousness. College is a powerful integrating institution — it instills a certain culture and certain attitudes in the people who go there, and it teaches them to behave like a single community. But the Americans who don’t go to college mostly don’t have anything like that, unless they join the military or are very religious. Instead, the non-college “class” is highly fragmented and isolated. We can call them “working class” if we want, but that doesn’t mean they’ll behave like one
I think that the essay displays a clear understanding of what America’s class structure is and isn’t.
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How well does Noah Smith know the working class? I'm not sure to what extent this is true for Smith, but many public intellectuals do little more than read about the working class. This past week I attended a talk by Catherine Ruth Pakaluk at Thales College in Raleigh. Before the talk I spoke with her about her new book, "Hannah's Children: The Women Quietly Defying the Birth Dearth." In writing this book she actually drove around the country interviewing women that have given birth to five or more children. In talking with them face-to-face she probably learned a great deal more and more accurately why these women are having many more children than other American women. Any guesses as to who these women are and why they're having more kids?
The "working class" may not be as ideologically homogenous as the college cohort, but that is not to say they don't share many values. Perhaps one should simply think of those who on the one hand were ideologically indoctrinated in college, and everybody else, whether they went to college or not, rather than think of them in terms of "class," a word which has become freighted with esoteric baggage. Smith thinks of them as fragmented but they share a positive vision of the possibilities of the American future, in contrast to the college cohort's unrelenting negativity, cynicism, and nihilism, which proceed from the Progressives' cult of technocratic meliorism (with themselves in charge, of course), which devalues the present and past in comparison to an imagined perfected future.