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Constitutional Crisis ?

To Recap what everyone knows now (in case anyone reads this months from now)

On January 27th Donald Trump signed an executive order suspending the refugee admission program for 120 days and blocking US entry for citizens of 7 countries for 30 days.
The order was written without input from the Justice, Homeland Security, State and Defence departments. As written it banned entry for legal permanent residents (with green cards) who were travelling abroad when it was issued. It also banned entry for people who were on airplanes flying to the USA when it was signed.

On January 28th dozens (to hundreds ?) of people were detained in Airports. Tens of thousands of ordinary Americans went to the airports to protest the new policy (there is hope). Also hundreds of lawyers spontaneously went to airports to attempt to represent (pro bono) the people who were detained and at risk of being put on planes returning to the foreign point of departure.

Early January 29, some aspects of the execution of the executive order was temporarily stayed by a judge


Judge Ann Donnelly of the U.S. District Court in Brooklyn granted a request from the American Civil Liberties Union to stop the deportations after determining that the risk of injury to those detained by being returned to their home countries necessitated the decision.

3:00 AM January 29th, the Associated Press reported — something. It is not clear to me if the recent event is a constitutional crisis or just an absurd lie alternative fact.

The Ap reported

Stephen Miller, a senior adviser to the White House, said that nothing in the judge’s order “in anyway impedes or prevents the implementation of the president’s executive order which remains in full, complete and total effect.”

If Miller meant what he said, he has declared that the Trump administration will order the executive branch to ignore the stay (that is the only way the order could remain in “total effect”. If so, there would no longer be rule of law in the USA. There would only be Trump’s orders and the decision by people in uniforms whether to obey them.

I am fairly confident that the US is still a nation of laws. I think that Miller’s statement is a simple blatant lie not the declaration of a coup. I think he is sayign that the Judges order would have no effect even if it were obeyed. I am pretty sure Miller is insisting that Donnelly didn’t order what Donnelly ordered.

In contrast the more official response by the DHS noted that the stay applies only to people in the USA or in the air at the time it was granted.

Also the DHS didn’t mention legal permanent residents. It is very clear that the DHS can’t block their entry to the USA. In fact, it is known that the DHS argued this immediately and was over-ruled by White House staff. The application of the order to legal permanent residents is very clearly blatantly illegal. Arguably, the executive order is completely illegal, but to ignore green cards is very clearly illegal.

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Donald Trump is a Miracle Worker

Somehow Trump manages to bring out the best in people. In the January 21 women’s march demonstrations, millions of ordinary Americans peacefully engaged in the political process, expressing a variety of consistent opinions with passion and humour. I was delighted.

But today I am amazed. It seems that Donald Trump has somehow managed to make Jasoh Chaffetz act like a statesman. Chaffetz is chair of the government oversight committee, where he has always acted as an aparatchik hack. He promised years of investigation of President Clinton and won’t “go on a fishing expidition” of President Trump. He decided that the most urgent investigation was of the head of the Office of Govermnment Ethics for critizing Trump’s conflicts of interest and not of Trump for profiting from his office and doing business with foreign governments and [uh oh going of on a tangent on Trump's corruption which will never end].

I was confident that Chaffetz cared not at all about the truth and was a pure partizan who always placed the interests of the GOP over the interests of the country, honesty about plain facts and all human decency.

But today he said

On the voter fraud issue that really happens at the county level. I don’t see any evidence, but the President has 100,000 people at the Department of Justice that if he wants to do an investigation, have at it. I just don’t see any evidence of it.

Chaffetz caring whether there is “any evidence of it” is almost a miracle.

I honestly never thought there was a crazy conspiracy theory too extreme for him.

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Legible version of How have Phillips Curves Shifted in the 15 Countries Which Were in The European Union in 1997 ?

First note strong evidence that the rate of wage inflation is mean reverting. This is a pooled regression with data from the Old EU 15 from 1960 through 2015. Indicator variables for countries are included but the coefficients aren’t reported. dw is the percent rate of wage inflation. ddw is the change of dw. The coefficient of ddw on lagged wage inflation is negative. Since wage inflation is not stationary, inference based on the conventional t-statistic is misleading, but it is very hard to defend excluding lagged wage inflation from regressions.

table1

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In all pooled regressions of the 15 countries, country indicators are included, but the coefficients aren’t reported.
Table 2 shows a simple wage Phillips curve regression in which an equal slope for all countries is imposed. ur is the unemployment rate.

table2

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Table 3 adds EcoFin’s estimate of the non wage inflatin accelerting rate of unemployment (nawru). It provides almost exactly zero evidence that the estimated NAWRU is useful when forecasting the acceleration of the rate of wage inflation.

table3

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Another way to present this is to regress the change of the rate of wage inflation on lagged wage inflation, the NAWRU and the difference between the unemployment rate and the NAWRU (ur_cyc_nawru). If the ewstimated nawru is the rate of unemployment corresponding to non accelerating wage inflation, its coefficient should be zero.

table4

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Results are fairly similar if lagged productivity growth in percent (lp00) and lagged personal consumption deflator inflation in percent (infpce) are included in the regression. When these variables are included, there is statistically signficant evidence that the EcoFin estimates of the NAWRU are of some use, but also very strong evidence that their estimate of cyclical unemployment is not correct.

table6

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table78

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table910

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European Pooled Panel Phillips Curve

This continues joint research with Marco Fioramanti. Our aim is to understand something about European natural rates of unemployment and whether the European Commissions estimated levels which they call NAWRU (for non accelerating wage inflation rate of unemployment) are useful approximations.

Here is a brief summary of work to date (prior to this note). Various subsets of us wrote at length here, here, here, here , and here.

In this note I look at a panel of the 15 countries which were in the European Union in 1997 (that is those for which long series of data are available) and ask if the Commission’s estimates of the NAWRU are useful if one wishes to forecast the acceleration of wage inflation. They don’t seem to be very useful at all.

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Paolo Gentiloni

Foreign minister Paolo Gentiloni has been asked to attempt to form a government. He is a rather bland establishment figure who has two interesting histories. First, back in the day, Italy (then a monarchy) didn’t get along with the pope (they fought a war with a famous battle at the pious gate (no ti sto kiddando per niente). Popes told faithful Italians to boycott elections. This tended to help the relative left (which had radical ideas such as universal suffrage). This ended with the Patto Gentiloni signed in the Palazzo Gentiloni by some people including a Gentiloni. Thus the Gentiloni family is very related to the participation of Catholics in Italian politics.

On the other hand (and maybe making up for this) Paolo Gentiloni himself has a far left past. This is true of an amazing fraction of Italians of his generation. He used to hang out with people who were expelled from the Italian Communist party for left wing deviation from the party line (I think they were the last people ever expelled from the rapidly democratizing party).

He also once said that no one who has been trained as an economist can be really left wing. This was meant as criticism of economics not leftism.

So his ancestor has a history with the ancestor of the old center-right Christian Democratic party and he personally has been far left. Thus there must be some innate dullness which makes my reaction to his surprise appointment one of mild pleasure. He’s not really left wing anymore, but, by the standards of 2016, he’s a raging red.

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Trump Nomination Approval Hearings

It seems we have a cabinet nomination. Word is the Jefferson Beuregard Sessions will be nominated Attorney General. Sen Sessions is an extreme reactionary. He is also, pretty clearly, an old fashioned racist (to complement the new wave alt-right racists). In 1986, Reagan nominated him as a judge and the nomination was rejected by the Senate, because of Session’s alleged racism. He addressed an African American attorney and “boy” and said he should be careful what he says to “white people” and he said he thought the KKK was OK until he learned that some of them smoked marijuana.

I wonder if the Senate will approve the nomination of Sessions as Attorney General. There are three reasons to think they might. First, he is a Senator and if not approved will come back to haunt and hold. Second, Republicans have become much more extreme than they were in 1986 and so the smaller current GOP majority implies a larger minority of right wing loonies. Finally, the general rule that the President should be allowed to pick his team and the very large number of unacceptable nominees will imply that the bar for approval is very very low.

On the other hand, I think there is one reason that Sessions might end up in trouble. He is a Senator.
He contests the allegations of racism. I think he has chosen to lie (as is his right). As a sworn in witness, he will lose that right. Lies become felonies. I think that even extremely dishonest and arrogant people tend to be cautious when testifying in front of Senate committees. I’m not sure that Sessions will be. He isn’t afraid of the Senate. That’s where he has worked for years and years. He doesn’t fear his colleagues with whom he has worked for years and years.

He will be testifying in the particular rooom where he works day after day (Tuesday through Thursday with lots of recesses).

Also he is used to Senatorial comity (which has been something which constrains Democrats and not Republicans for years).

I think Sessions can be provoked into telling lies under oath. I think witnesses prepared to testify under oath that he is lying can be found (and the minority can call them). I think it is possible to block confirmation of Senator Sessions by the other Senators (for one thing I don’t think he can vote on the resolution to confirm him).

My guess is that he is confirmed. But I am not sure.

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TARP and Twitter

I had an interesting web experience. My tweet noting that the US Treasury made a profit on TARP got a relatively large number of replies. Many people were outraged in many contradictory ways.

Twitter is damaging the discussion. Trump on twitter lowered the level of debate. I am now a carrier of Twitteritis into the Angry Bear community, because I am brining a tweet debate here.

The discussion starts with this tweet

tarptwitter

note it is the 5th of a series. Trying to summarize, I realize that I should quote

1. To those saying there is no such thing as a good Trump voter. Context man. Context
2. Imagine a scenario. You got two choices, as understood by you
. This is the key. This is how you see it, not how others think you see it
3. Vote for candidate
A) who will devalue you socially & economically
Or
B) who might devalue economically, but will value you socially
4. What will the majority of any group do? Including blacks & Latinos?
If you don’t give them SOMETHING to vote for they won’t vote for it
5. Mistake is thinking that Trump voters believe they are getting anything economically out of a Clinton administration. (TARP cough TARP)

I will briefly summarize my impresssion of @Chris_arnade thoughts on the topic expressed on twitter.

Overall the point is that it is possible to understand why people voted for Trump. Consider TARP. Anger at TARP (and NAFTA) helped Trump. I agree entirely, and think this is important. Hatred of TARP helped Trump.

I am trying to get to responses to my tweet

“@Chris_arnade TARP was a Bush admin initiative and a gigantic success. US gov made a profit”

They do not include anyone suggesting it is unfair to Consider Clinton responsible for TARP (I agree — she deserves credit only for her yes votes in Senate roll calls). The fact that TARP was a Bush administration initiative is clearly considered irrelevant to the question of whether Democrats should be punished for TARPing.

I’m going to put alll of my thoughts after the jump.

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Donald and Deportations

This post is partly inspired by “The cracks are already starting to show between Donald Trump and Republicans” by Amber Phillips at The Washington Post. My general impression is that the article mainly shows that cracks are already starting to show between Donald Trump and Donald Trump. More generally, the fact that Trump and the other Republicans are lying a lot about what Obama has done makes it almost impossible to determine how they will change things.

A case can be made that there plan is to mainly stick to current policy (except by cutting taxes on rich people of course) and to rename the current policy and claim credit for what Obama has done and continue to claim he did something horrible. I wish I believed this is what will happen. I am sure they will make major changes. The point is that their statements are vague and often based on false factual premises, so it is impossible to figure out what they will actually do.

Consider deportation of undocumented aliens.

Trump: “What we are going to do is get the people that are criminals and have criminal records, gang members, drug dealers, a lot of these people, probably 2 million. It could even be 3 million,” he told CBS’s Lesley Stahl in a “60 Minutes” interview that aired Sunday. “After the border is secured and after everything gets normalized, we’re going to make a determination on the people that you’re talking about, who are terrific people.”

One plausible interpretation of this is “We are going to stick to current policy, and consider possible policy changes late in my second term”. Under current policy, people with criminal records are deported. Trump proposes sticking with that policy. He doesn’t explain how sticking with current policy will cause an increase in the rate of deportations. He doesn’t even claim that, under his policy, people will be deported at a higher rate than under Obama’s policies. He says 2 million people will be deported, but he doesn’t say when. According to ABC “President Barack Obama has often been referred to by immigration groups as the “Deporter in Chief.”Between 2009 and 2015 his administration has removed more than 2.5 million people through immigration orders, ” Trumps 2 maybe 3 million people claim is consistent with between two and three million in the next six years (with Trump assuming he will be re-elected).

The quoted statement is perfectly consistent with sticking to current policy including the conditions for deportation and the rate of deportations.

It is also possible that Trump proposing sticking with current policy but says the outcome will be bigly more winning, because Trump is a winner. He might argue that, because of his excellent management and winnerness, la migra will do things much more quickly.

It is fairly likely that Trump believes that applying the current policy will cause a large increase in the rate of deportations, because he doesn’t know what current policy is.

Finally, it is possible that he is just lying and plans to deport people who wouldn’t be deported under current policy.

Trump is so vague that it is not possible to prove that there is any “crack” separating Trump and Congressional Republicans. In fact, it is not possible to prove that there is any “crack” between Trump and Obama.

This also true of other policy issues. For example, Trump and the other Republicans agree that they will repeal Obamacare and replace it with something which protects people with pre-existing conditions and is based on consumer choice and markets. One reasonable interpretation of this is that they plan to replace Obamacare with Obamacare. This will come as no surprise to Obama who told us they would do this.

Also they continue to denounce the Obama stimulus and propose a big increase on infrastructure spending

McCarthy: McCarthy said on Fox News that “there is a place we could find common ground with Republicans and Democrats” on infrastructure. But he seemed unable to explain how Trump’s infrastructure spending plan differs from President Obama’s 2009 stimulus. “Obama never had infrastructure in his stimulus,” he said. (Infrastructure spending was a major part of Obama’s stimulus.)

So far this post has been wildly optimistic. Again, I don’t really hope that Republicans will mostly stick with Obama’s policies except for cutting taxes on the rich. I’m sure they will do horrible things. I am also sure that they haven’t told us what horrible things they will do, because they are still promising all things to all people. They haven’t switched from messaging to policy making yet. I hope wish they never make policy.

On the other hand, I think that the strategy of copying Obama while continuing to denounce him is likely to be politically successful. Republicans have managed to convince many Americans that Obamacare is horrible in some mysterious way. The hope was that people would notice that, for example, there aren’t any death panels. If Republicans stick with Obamacare but call it TrumpCare, there won’t be any new proof that Obamacare doesn’t have horrible provisions.

The public doesn’t know what current policy is. Many are convinced that Obama policy is extremly leftist and unsuccessful. This makes it easy for Republicans to convince them that the repealing Obama’s policies and replacing them with Obama’s policies is a huge improvement and that Republicans deserve credit for Obama’s gigantic accomplishments. The strangest thing is that I suspect that Obama is OK with that.

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Relatively not bad news about Health Care Reform

Via (one of) the brillian Waldmans

I find a very interesting and actually somewhat reassuring article by Caitlin Owens

“Obamacare repeal? More like Obamacare reform”.

I strongly recommend reading the article which considerably reduced my fear and loathing.

An excerpt

To be clear: Republicans will likely call whatever they end up doing Obamacare repeal, especially publicly. And when you end up with something vastly different, what’s the difference?

What they say they won’t get rid of:

Pre-existing condition coverage
Letting children stay on their parents’ plan until age 26
Lifetime caps on coverage
Medicaid expansion (but it will look different)

What they say they will go after:

Essential health benefits (insurers won’t have to cover as many things)

Age rating bands (bigger range of premiums will be allowed)

There’s no step-by-step plan yet — because they had never planned for a President Trump. “We’re in rapid detox of holy crap, we have to actually do this,” the first aide told me.

I love the “holy crap” quote. Now this is only somewhat reassuring for reasons. First, Owens talked to aids. They are people who actually know what is in the ACA, but they have no power. There is no reason to be confident that actual senators will listen to their aids. Second, people talk to reporters for a reason. The apparently very frank statements might be a trial balloon soon to be shot down by enraged conservatives. Third the list of what to keep doesn’t include exchanges, subsidies or a mandate. Even if the claims of the anonymous aids correspond to the decision of a majority of senators, they leave $ 60 billion questions open.

Partly, I love the article, because the anonymous aids confirm that Republicans have been post policy for years. I also liked this quote

Congress tested its repeal strategy last year using “reconciliation,” a procedural tool that prevents legislation from being filibustered in the Senate. Even this repeal bill didn’t get rid of the whole law. But one of the aides said this version of the bill was mostly about “messaging,” and that this time, “We’re not going to use that package. We’re not dumb.”

I am shocked shocked that congress passed a bill which they knew was “dumb” just for messaging.

Repeat of warning: these are anonymous quotes from sources who may have influence but don’t have power and who are motivated by motives.

update: Waldman[n]s think alike.

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Patrick Ruffini’s Interesting Beliefs About a Regression

“Patrick Ruffini is a strategist, thinker, and organizer focused on data and technology’s disruptive impact on politics and business. “

Here is a tweet he just posted (retweets are not necessarily endorsements so don’t blame Barro)

ruffiini

Since the percent Asian + … + percent other always must add up to 100% the computer can’t estimate coefficients on all the variables. It excluded percent Asian. This means that, to the extent the country level (I assume) data tell us anything about ethnicity and voting, they say the shift in votes from 2012 to 2016 was similar for Asians, Blacks and Hispanics.

If the excluded grouu had been non college whites, then Black and hispanic would have been extremely predictive.

Nothing can be inferred from such coefficients without thinking about the excluded group.

Treating coefficients on an indicator as a measurement related only to the group indicated by the variable is absurd.

Now we know from exit polls that the percentages of votes for Romney and Trump of blacks were similar (both roughly zero) and the same for Hispanics (neither roughly zero). The only new information that the regression could give us regards turnout of blacks and hispanics.

Ruffinis conclusions are probably correct (say exit polls) but they are not supported by the regression results.

This is a top Republican data guy and his party just won it all.

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