It Takes “Alternative Math” to Claim That Redistribution Is Futile
Via Economists View (some of the comments are worth review as Deirdre McCloskey comments). Also see below Peter Dorman’s Review of Economism: Bad Economics and the Rise of Inequality by James Kwak at Econospeak.
Adam M. Finkel at RegBlog:
It Takes “Alternative Math” to Claim That Redistribution Is Futile: The unequal distribution of costs and benefits across society is one of the hottest topics in the regulatory arena—and one that, regretfully, has sparked fundamentally flawed arguments, threatening to distort and obscure much-needed discussion about redistributive policies. …
Although all policies have redistributive effects, some ideologies are viscerally, even militantly, opposed to government interventions that benefit the poor, whether by intention or even as a side effect of an otherwise sound policy. …
In a recent New York Times op-ed, University of Illinois at Chicago Professor Deirdre McCloskey exemplifies this type of argument, in conspicuously misguided fashion. In her column, McCloskey offers a litany of reasons as to why progressive taxation and other policies aimed at redistributing benefits to the poor are ill-advised. At the core of the essay, McCloskey makes the empirical assertion that such policies cannot actually make much of a difference in any event.
Unfortunately, the basic mathematics of McCloskey’s claim are mangled. She may not prefer that we seek progressive tax and regulatory policies, but her claim that these policies do not “uplift the poor very much” is erroneous. That the Times has decided not to correct her error—even in the face of an email exchange in which the author herself acknowledged her mistake—may be an example of how tempting it is to ascribe black-and-white factual issues to the realm of “healthy controversy.” …
As with many of the toxic myths about regulation—that, for example, it is responsible for destroying countless jobs while failing to create any new ones in the process, or that it relies on gross exaggerations of risk and plays to irrational public fears—we are lost without the ability to distinguish between ideological responses to facts and ideological twisting of facts into nonsense.
…
Via Econospeak Peter Dorman writes
Review of Economism: Bad Economics and the Rise of Inequality by James Kwak
There’s economics, a field that has been renewing itself, shaking off theoretical rigidities through more attention to behavior and institutions and shifting its center of gravity toward empirical observation and testing. And then there’s economics as it exists in standard political discourse, seeing the whole world as refracted through supply and demand diagrams where markets are always efficient and outcomes always socially optimal. This second, dumbed down, knee-jerk libertarian creed is the object of James Kwak’s new book, Economism.
If ever a book arrived to fill a need, this one has. Neoliberalism, which is essentially simplified pseudo-economics in action, is finally beginning to break down, but rather than yielding to a more rational politics it is giving us Brexit, Trump and similar delusionary movements. Required to choose between the stale cant of economism and authoritarian fairytales of denial, the public is opting for the second door. Unless economism is disposed of quickly, there won’t be an opening for a more enlightened third option.
Do economists ever read history? What has happened to every civilization that endured massive wealth inequality? The masses always show up sooner or later and when they do, the outcomes are predictable. Sometimes I think economists are so vested in equations that they miss the bigger picture. Everything we think we know about economics is relatively new but history stretches back thousands of years. There is only one remedy when the people finally get fed up.
When the masses are uncomfortable, starving.
When they are comfortable, complacent?
Geez Warren, you are amazing.
Tonight, 10% of American children will go to bed hungry. That number ain’t gonna get better under Trump.
Course, 10% might sound comfortable and complacent to the likes of you.
“Tonight, 10% of American children will go to bed hungry.”
Uh, no.
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The USDA classifies households as “food insecure” if they report worrying about not having enough money to buy food, if they substitute cheaper foods, skip meals, or eat less for financial reasons. If they do these things frequently, they are classified as “very low food secure.”
Slightly over 21 percent of households are “food insecure.” This is the one-in-five statistic we hear from the media and advocacy groups.
The one-in-five figure is for all households, many of which consist only of adults. If we limit the sample to households with children, ten percent of them are classified as food insecure. If any group wishes to use the broadest possible measure of children’s “struggle for food,” the ten percent figure would be it.
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https://www.forbes.com/sites/paulroderickgregory/2011/11/20/are-one-in-five-american-children-hungry/2/#1287acd2fdaa
“Tonight, 10% of American children will go to bed hungry.”
Warren bleats: “Uh, no.”
Then Warren quotes: “If any group wishes to use the broadest possible measure of children’s “struggle for food,” the ten percent figure would be it.”
“10%” = “the ten percent figure”
You might want to read the definition of “struggle for food.”
“food insecure” = “struggle for food” = “lacking reliable access to a sufficient quantity of affordable, nutritious food”
Insufficient quantity of food = hungry
Happy to help.
You could read the USDA’s definition, which is how they came up with that 10% figure in the first place. Ah, there is it! Seems I posted it already.
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The USDA classifies households as “food insecure” if they report worrying about not having enough money to buy food, if they substitute cheaper foods, skip meals, or eat less for financial reasons. If they do these things frequently, they are classified as “very low food secure.”
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Since you obviously could not be bothered to read the entire article, I will quote another passage for you:
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Not publicized by the childhood hunger lobby are the USDA’s most direct measures of childhood hunger. They reveal that between one and two percent of families “cut the size of children’s meals” or report that “children were hungry” or “skipped meals.” And only one tenth of one percent of families reported that “children did not eat for a whole day.”
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Between one and two percent. And that is NOT every day, either.
Gee, Warren
what is there to worry about? only one or two percent of kids are hungry or skip meals…. no doubt in order to lose weight.
but not every day… or is that different from “a whole day”?
as for alternate math…. i didn’t see the actual math. but i wish to make a comment:
“Inequality” is a losing political slogan. Of course there is inequality. The rich will tell you it’s because they are smarter and work harder. In any case they won’t like the government taking away “their hard earned money” and giving it to the undeserving poor. So they will conspire to take control of the government and build a system of laws that fovors themselves. Oh, they have already done that. Well, we can always have a protest march.
and just exactly “who” are the rich?
Who thinks they are rich enough to worry about being taxed to pay for welfare?
On the other hand we could look at the details of where “inequality” or at least unreasonable poverty comes from and work on those case by case. I’d start with bank fraud… that is fraud by banks. and then the generally predatory business model we have learned to expect in our economy. even the rich don’t like to be robbed. some of them might vote on our side. of course, the more money people have, the better they are able to protect themselves from predatory businesses. I’m not sure some kind of government consumer aduacation/advisory service wouldn’t work. problem is, of course, that the govrnment agencies all seem to be operated at the top by the predators who own the government.
strange isn’t it.
What a horror of a human being. Hungry is not the same as starving.
“The Agriculture Department staff told us that they order these questions by the severity of the situation they describe. The fifth question, about the children being hungry because of a lack of money, triggers the department’s most worrisome category of “very low food security.” In the latest survey, about 765,000, or 1 percent of all children, lived in families where the answer was “yes.”
The government uses the less severe category, “low food security,” for children who live in families where, at the very least, a lack of money meant the kids couldn’t get a balanced meal during the last 12 months.
The number of children in that group, plus the very low security group, is about 8.5 million, or about 11.7 percent of all children.
The most commonly heard statistic, that one in five children live in food insecure households, refers to the 15.7 million kids that live in families in which, at the very least, anyone in the household of any age couldn’t afford a balanced meal at some point during the year. This includes adults and children.”
http://www.politifact.com/punditfact/statements/2014/oct/01/william-benson-huber/ny-post-op-ed-rebuts-starving-children-claim-was-n/
Coberly, according to the USDA, “low food security” (which is where that 10% number comes from), has “Little or no indication of reduced food intake.”
It should also be noted that such food insecurity is declining, not increasing. So the concern that this situation will get worse and result in food riots and revolution is not supported by facts.
“While children are usually shielded from the disrupted eating patterns and reduced food intake that characterize very low food security, both children and adults experienced instances of very low food security in 0.7 percent of households with children (274,000 households) in 2015. ”
Note that word — INSTANCES. So, 0.7% of children, at some time in 2015, went short of food. That is a long way from 10% going to bed hungry TONIGHT.
Full report: https://www.ers.usda.gov/webdocs/publications/err215/err-215.pdf?v=42636
In fact, you might get to that “10% will go to bed hungry tonight” for the WORLD.
https://www.ers.usda.gov/webdocs/publications/gfa27/59794_gfa27.pdf?v=42551
Warre,
Don’t you find it difficult to jump from one cherry to another while ignoring so much?
“The government uses the less severe category, ‘low food security,’ for children who live in families where, at the very least, a lack of money meant the kids couldn’t get a balanced meal during the last 12 months.”
Most definitely NO, EMichael. If you change the phrase, “couldn’t get a balanced meal during the last 12 months” to “couldn’t get a balanced meal AT LEAST ONCE in the last twelve months,” then you might be correct. But that is still a long way from 10% EVERY NIGHT.
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Coberly, I agree that we need to deal with bank fraud. I’ll narrow it down a little more — start with CREDIT CARD fraud. To my mind, credit cards are one of the greatest evils of modern society.
You could read the USDA’s definition, which is how they came up with that 10% figure in the first place. Ah, there is it! Seems you posted it already.
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The USDA classifies households as “food insecure” if they report worrying about not having enough money to buy food, if they substitute cheaper foods, *skip meals*, or *eat less* for financial reasons. If they do these things frequently, they are classified as “very low food secure.”
Ah, little Warren, I guess you don’t get hungry when you skip meals or eat less. But for most folks, including children, skipping meals and eating less leads directly to hunger.
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Since you obviously could not be bothered to read the quote you posted, I’ll repeat it here:
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Not publicized by the childhood hunger lobby are the USDA’s most direct measures of childhood hunger. They reveal that between one and two percent of families “cut the size of children’s meals” or report that “children were hungry” or “skipped meals.” And only one tenth of one percent of families reported that “children did not eat for a whole day.”
Ah, young Warren. In your simpleminded haste to paper over your own incomprehension, you have equated “not eat for a whole day” with the definition of hunger. You see, Warren, it is possible to eat *something* in the course of a day, and still go to bed hungry. In the Nazi concentration camps and the Soviet gulag, they still fed their prisoners, so they did eat during the course of 24 hrs. But they all went to be hungry.
Hope that helps.
Joel
it won’t help.
Warren has already fixed in his mind that “at least one day” means “at most one day.”
and that one percent of kids going hungry is okay in “the richest country in the world.”
and it’s fine if ten percent of families have to worry about whether they will have enough to eat this month, or this year.
the fact that we could fix this with no noticeable change in our own standard of living is a national secret.
Warren
glad you noticed there is something wrong with the credit card business.
follow that lead.
you may get a whiff of what’s wrong with the road we are on, and why the pfree market can’t fix it by itself.
Coberly, the government’s job in regard to the free market is to prosecute fraud. If that is done well, then the free market works rather well.
For instance, if someone reports that his car was stolen, the government investigates, brings charges, and prosecutes. Why is that not the case if a company cheats you? If a company sells you a car they know is a lemon, you have to sue them and pay your attorney out of your own pocket, yet you were robbed just as much as if your car were stolen. Where’s the sense in that?
Now, perhaps we cannot send a corporation to jail, but we can shut it down. Imagine if criminal penalties were imposed on a company such that it could do no business whatsoever for one month — doors padlocked by the sheriff, power shut off, email and internet blocked, all accounts frozen, etc. How ’bout that for fraudsters?
Warren
sounds like a good start. problem is the corpoations own the government and make the laws. for example
surveyor I know was cheat out of 60 thousand dollars by Kerr Corporation. Lawyer says he has a case. Threatened to sue. Kerr called bluff. Lawyer wants 10k retainer, expects cost to sue about 30 to 40 thousand and will take about half of proceeds if any.
add that to the suspicion many of us have that the courts “favor” the corporations. doesn’t sound like a good bet to sue. so surveyor swallows loss plus attorneys fees so far.
I don’t think America… free enterprise… can work that way for long. But it has been done in other countries for hundreds of years, or thousands in the case of Egypt.
i invite you to try to get “justice” out of the legal system in this country. i doubt you can afford it. lots of people hate “the government.” they don’t realize the government is owned by the people who tell them “the government IS the problem.”
“[The] problem is the corporations own the government and make the laws.”
So part of that “Convention of the States” thing should be a Constitutional Amendment prohibiting all but voters registered to vote in the election for which a candidate is running may contribute to that candidate. Stock corporations may only send campaign material to their direct shareholders. PACs, unions, not-for-profit organizations may only send campaign material to their members.
It is also my contention that, the more powerful we make the government, the more cost-effective we make it for corporations to own.
“[I] invite you to try to get ‘justice’ out of the legal system in this country. [I] doubt you can afford it.”
There are some lawyers who will work “on spec.” My father died hours after first taking Vioxx. It was years before my mom got any compensation. The lawyer took a third as his fee, but without him she would have gotten nothing.
But there was criminal negligence there, and no-one has gone to jail.
Warren
well, there you have it.
i’ll tell my surveyor friend to shop for a lawyer who will take the case on spec.
meanwhile i don’t think Citizen’s United really changed the “money is the mother’s milk of politcs” law of nature. all of your suggestions would just increase the relative advantage of money as against the people. checks and balances, my friend. checks and balances.
wonder if you ever read Robert Heinlein “The Moon is a Harsh Mistress” (1966)
he says mostly the things you like to believe. and he’s a better writer than Ayn Rand. but remember, it’s fiction. and even Heinlein mentions, that it doesn’t work. but it’s easy for a true believer to read the “theory” and miss what actually happens. or would happen in the non-fiction world.
I have read all of Heinlein’s writing, but I must admit that that was a VERY long time ago. I will have to pick it up again.
I don’t know about “all of [my] suggestions,” but let me focus on one. How would disallowing any campaign contributions from anyone but a voter registered to vote in the election that candidate was running in, “increase the relative advantage of money as against the people”?