Relevant and even prescient commentary on news, politics and the economy.

Reopening Isn’t Reopening—It’s Cutting Off Unemployment

Reopening Isn’t Reopening—It’s Cutting Off Unemployment

Donald Trump, cheering on his “warriors” who demand that states lift their lockdown and distancing orders (where they have them), would have you believe this is about bringing the economy back to life so ordinary people can get their jobs and normal lives back.  Elitist liberals who work from home and have country estates to retreat to don’t care, but “real” people do.

The reality is different.  The shuttering of stores, restaurants, hotels and workplaces didn’t begin with government orders and won’t end with them.  If the rate of new infection and death is too high, a lot of people won’t go along.  Not everyone, but enough to make a huge economic difference.  Ask any small business owner what it would mean for demand to drop by 25-50%.  Lifting government orders won’t magically restore the economic conditions of mid-winter.

Planet of the Humans: A De-Growth Manifesto

(Dan here…Great comments for this post at Econospeak)

Planet of the Humans: A De-Growth Manifesto

Planet of the Humans, directed by Jeff Gibbs but featuring Michael Moore as its “presenter”, has been viewed by almost five and a half million people since it popped up on YouTube last month.  In case you haven’t heard, it’s quite a provocation, and the response from almost every quarter of the environmental movement has been outrage.  It traffics in disinformation and scurrilous personal attacks, they say, and I can’t argue.  Two big problems: it falsely claims that more carbon is emitted over the lifespan of a photovoltaic cell than by generating the same energy through fossil fuels, and it uses dishonest editing techniques to portray activist Bill McKibben as having sold out to billionaire ecological exploiters.  You can read about the misrepresentations elsewhere; my point is that, whatever else it is, the film is a logically consistent statement of the de-growth position.

Alas, much of the “left” has concluded that the chief obstacle to meeting our climate and other environmental challenges is the “capitalist” faith in economic growth.  Capitalism requires growth, they say, and growth is destroying the earth, therefore we must abolish capitalism and embrace de-growth.  Anything less is a sellout.

This philosophy is central to Planet; twice (at least) Gibbs proclaims, “You can’t have endless growth on a finite planet.”  He shows charts depicting human population and consumption growth that portray us as a metastasizing cancer.  Early in the film, when he’s setting the tone for what’s to come, he asks, “Is it possible for machines made by industrial civilization to save us from industrial civilization?”

But movies are not just words; they make their arguments visually as well.  Planet has horrific scenes of mining and logging, as well as speeded up, frenzied shots of manufacturing, warehousing and shipping.  It ends with heartbreaking footage of doomed orangutans amid a wasteland of deforestation.  The message is clear: human use of nature is a travesty, and any activity that imposes a cost on Mother Earth is immoral.

An Update on Shadow Government

An Update on Shadow Government

Not only is the current level of testing for the coronavirus insufficient, the tests themselves are flawed.  Read this summary by infectious disease specialist Michael Osterholm and a coauthor for particulars.  Their key policy conclusion is

A blue-ribbon panel of public health, laboratory and medical experts, ethicists, legal scholars and elected officials should be convened immediately to set out a road map with realistic goals for testing and contact-tracing.

If we had a reliable government, it would get this done, but we don’t.  Concretely, one of the main jobs of a shadow government organized by Democrats would be to assemble this group and give it a regular, high profile platform.

We Need a Shadow Government

We Need a Shadow Government

Republican rule in the US is a horror show.  We get incoherent ramblings from our president on injecting bleach into our veins, calls for the states to file for bankruptcy from the Senate majority leader, a veto of modest IMF support for developing countries hammered financially by the virus, and a complete absence of guidance on the most crucial aspects of public health.

We already know this.

The greater tragedy is that the Democrats are barely better.  Their program, to the extent it makes sense to speak of one, is protecting the immediate interests of their key constituents.  This begins with the financial sector, and since the Republicans share the same commitment, their multi-trillion dollar bailout zipped right through.  Small business is also important to both parties, if not quite as much, and upwards of a billion will wend its way to them—via the banks, of course.  Lots of health sector money flows to the Democrats, and Pelosi and Schumer found a way to bail them out too.  Beyond this it has been hit or miss.  The unemployed will get greater wage replacement, even above 100% for the bottom end of the labor market.  There may be future money for the states.  A few billion for testing, and that’s about it.

What all this adds up to is top-heavy interest group protection.  It’s not a plan.

The irony is that informed opinion has largely converged in the two key areas of public policy.  To overcome the pandemic we need four things:

Does Google’s Search Algorithm Protect the New York Times?

Does Google’s Search Algorithm Protect the New York Times?

Yesterday morning, after reading the Sunday New York Times, I posted two pieces on EconoSpeak within a few minutes of each other.  One was a short, cute little item (a visual grab from the paper) entitled “The Art of Juxtaposition”; the other was a longer, more substantial takedown of a deficit hysteria “analysis” I called “The Usual Deficit Blather from the New York Times”.

As usual, I monitored the posts through the day to see if they were being picked up anywhere.  This has become largely an exercise in nostalgia, since with the fading of the economics blogosphere there isn’t much to track.  What happened next was interesting, however.

The Usual Deficit Blather from the New York Times

The Usual Deficit Blather from the New York Times

The Times today ran a truly execrable article warning us that, once the virus has passed, we will suffer dire consequences from the runup of government debt.  As most readers know, this argument is theoretically illiterate, derived from the false comparison between household and government debt.  We’ve been through this many times before, and I have nothing to add.

I do want to focus on one sentence, however, to illustrate how intellectual blinders can lead to absurd conclusions.

To quote the author, Carl Hulse, “In other words, the bill will come due, as it always does.”

Does it?  Check out total Federal debt measured as a percent of GDP:

As you can see, it skyrocketed during the 1940s, when the US went to war against Germany, Italy and Japan.  By the time the war was over it was at an all-time high.  Yes, we had to borrow to produce all the war materiel and send millions of troops around the world; no one doubts that.  But after V-E and V-J, how were public finances affected?

World Chess Championship Ends

World Chess Championship Ends

The two best chess players in the world faced off this month, undeterred by lockdowns, travel bans or any other restrictions.  They never had to see each other either.

It helped that they were both computer programs.  The former champ, Stockfish, is the strongest of the traditional type of program, designed by humans and invested with all the fine points of judgment the best human players can translate into code.  Because of its tremendous calculating abilities, it is rated far higher than the top flesh and blood competitors: 3600 to 2800+ for Magnus Carlsen and his closest challengers.  (The numbers are measured on the Elo scale, named for physicist and chess enthusiast Arpad Elo, who developed it over 50 years ago.  Players’ scores rise and fall based on how they do against other rated players.  I had the pleasure, long ago, of sipping homemade cordial at Arpad’s modest home in Milwaukee.)

But the new top performer is lc0, Leela Chess Zero, a pure implementation of machine learning.  No one told it how to calculate or evaluate; it played millions of games with itself and learned through experience how to make the best moves.  As a result, it has odd blindspots (poor appreciation for fortresses, for instance) but also finds strategies no human would ever consider.  It has a rating a little higher than Stockfish’s, and the gap will be wider still after the latest match.

CNN’s Slavish Service to Trump

CNN’s Slavish Service to Trump

I had to do a double-take when I saw this news item.  First came the headline, “Pence won’t let public health officials appear on CNN unless Trump’s disinfo briefings run in full”.  I thought, this is horrible: the administration is holding Fauci and Birx hostage to force CNN to cover not only them but also Trump in his daily blatherings.  But no, it was exactly the other way around.  Pence was keeping them from being interviewed on CNN unless the network also covered their regular briefings.  What CNN has been doing instead is broadcasting the Trump portion and then cutting away when people who actually have something to say step forward.

Bad enough that Trump has a high profile daily outlet for his ravings; it’s incredible the media would treat this as news and CDC updates as disposable filler.  I guess they think they are doing the guy a favor by giving him free media so he doesn’t have to buy as much.

This has been a peeve of mine for some time; see here and here.  We expect Fox to offer itself as a mouthpiece for Trump, but why should the self-designated “enlightened” wing of journalism be just as craven?  Yes, the owners care more about ratings than the political consequences of their coverage, but why do working journalists go along without a peep?  What would it take to get through to them?

Lessons from the Pandemic

Lessons from the Pandemic

First, all who produce things we need or want are “essential workers”.  Health care practitioners are essential, but so are the people who stock pharmacies and grocery and hardware stores or staff customer service phone lines.  Truck drivers are essential.  Farmworkers who pick the crops we plan on eating are too.  Nothing demonstrates whose work matters in this world better than a pandemic that threatens to pull them off the job.

Second, because they are essential, whatever these workers need is what we all need.  If they need a bus to get to work, we all need that bus.  If they need childcare, we all need it.  Obviously, if they need healthcare or time to stay home and get over an illness or tend to their kids, that’s our need too.  And if they need a paycheck that provides secure housing, covers their expenses and gives them a chance to recharge their batteries periodically, we all need them to have it.

A virus does not respect the boundary of skin, the line we draw between ourselves and others.  It tells us that “we” is not just an idea or an attitude, but real economic and physical interconnection.  It’s true that we are not all in the same boat, that the burden of this pandemic falls unequally according to how much money we have, what neighborhood we live in and how much respect we get from those with power over us.  But those inequalities were always in front of us if we were willing to look.  It’s the interconnectedness that is suddenly starkly visible.