Politics

2017: The Best Year Ever

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I know I said the same thing about 2016. And 2015. Even 2013. But that’s because things continue to get better. Nicholas Kristof writes in The New York Times, “There’s a broad consensus that the world is falling apart, with every headline reminding us that life is getting worse. Except that it isn’t. In fact, by some important metrics, 2016 was the best year in the history of humanity. And 2017 will probably be better still…Polls show that about 9 out of 10 Americans believe that global poverty has worsened or stayed the same.” And yet,

Every day, an average of about a quarter-million people worldwide graduate from extreme poverty, according to World Bank figures. Or if you need more of a blast of good news, consider this: Just since 1990, more than 100 million children’s lives have been saved through vaccinations, breast-feeding promotion, diarrhea treatment and more. If just about the worst thing that can happen is for a parent to lose a child, that’s only half as likely today as in 1990. When I began writing about global poverty in the early 1980s, more than 40 percent of all humans were living in extreme poverty. Now fewer than 10 percent are. By 2030 it looks as if just 3 or 4 percent will be. (Extreme poverty is defined as less than $1.90 per person per day, adjusted for inflation.) For nearly all of human history, extreme poverty has been the default condition of our species, and now, on our watch, we are pretty much wiping it out. That’s a stunning transformation that I believe is the most important thing happening in the world today — whatever the news from Washington.

What’s more is that “global income inequality is…declining. While income inequality has increased within the U.S., it has declined on a global level because China and India have lifted hundreds of millions from poverty.”[ref]Nathaniel and I covered global poverty and inequality in our 2014 SquareTwo article.[/ref] Today “some 40 countries are now on track to eliminate elephantiasis. When you’ve seen the anguish caused by elephantiasis — or leprosy, or Guinea worm, or polio, or river blindness, or blinding trachoma — it’s impossible not to feel giddy at the gains registered against all of them.” In “the 1960s, a majority of humans had always been illiterate; now, 85 percent of adults are literate. And almost nothing makes more difference in a society than being able to read and write.”

For me, this was the clincher in Kristof’s piece:

On a recent trip to Madagascar to report on climate change, I was struck that several mothers I interviewed had never heard of Trump, or of Barack Obama, or even of the United States. Their obsession was more desperate: keeping their children alive. And the astonishing thing was that those children, despite severe malnutrition, were all alive, because of improvements in aid and health care — reflecting trends that are grander than any one man.

He concludes, “The most important thing happening is not a Trump tweet. What’s infinitely more important is that today some 18,000 children who in the past would have died of simple diseases will survive, about 300,000 people will gain electricity and a cool 250,000 will graduate from extreme poverty.”

How’s that for a little pick-me-up?

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Regulation vs. Innovation

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AEI’s James Pethokoukis has a nice little blog post on the negative effects of ill-conceived regulation:

So I very much liked a Mercatus study last year finding US economic growth has been slowed by an average 0.8% per year since 1980 due to the cumulative effects of regulation. Also a favorite of mine: A 2013 study from economists John Dawson of Appalachian State University and John Seater of North Carolina State University, Federal Regulation and Aggregate Economic Growth, that estimates the past 50 years of federal regulations have reduced real GDP by roughly two percentage points a year, or nearly $40 trillion. Both studies show pretty sizable effects from smarter regulation or deregulation.

He points to new articles at Reason and National Affairs demonstrating that the Federal Communications Commission limited tech advancement, including cell phones. As economist Thomas Winslow Hazlett writes in his Reason piece,

Image result for cell phoneWhen AT&T wanted to start developing cellular in 1947, the FCC rejected the idea, believing that spectrum could be best used by other services that were not “in the nature of convenience or luxury.”…  A child conceived at the same time as cellular would have been 37 years old by the time the first commercial cellphone—Gordon Gecko’s $3,995 Motorola DynaTAC 8000X brick—was released onto the market. Once the blockage was cleared, progress popped. Soon, the science fiction vision of the Star Trek communicator was reality.

Check them out.

Zoning Out

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“Arguably,” writes economist Edward Glaeser,

Image result for zoning lawsland use controls have a more widespread impact on the lives of ordinary Americans than any other regulation. These controls, typically imposed by localities, make housing more expensive and restrict the growth of America’s most successful metropolitan areas. These regulations have accreted over time with virtually no cost-benefit analysis. Restricting growth is often locally popular.  Promoting affordability is hardly a financially attractive aim for someone who owns a home.  Yet the maze of local land use controls imposes costs on outsiders, and on the American economy as a whole.

…[The] most productive parts of America are unaffordable. The National Association of Realtors data shows median sales prices over $1,000,000 in the San Jose metropolitan area and over $500,000 in Los Angeles…America’s affordability problem is local, not national, but that doesn’t mean that land use regulations don’t have national implications. Historically, when parts of America experienced outsized economic success, they built enormous amounts of housing. New housing allowed thousands of Americans to participate in the productivity of that locality. Between 1880 and 1910, bustling Chicago’s population grew by an average of 56,000 each year. Today, San Francisco is one of the great capitals of the information age, yet from 1980 to 2010, that city’s population grew by only 4200 people per year.

…Land use controls that limit the growth of such successful cities mean that Americans increasingly live in places that make it easy to build, not in places with higher levels of productivity. Hsieh and Moretti (2015) have estimated that “lowering regulatory constraints” in areas like New York and Silicon Valley would “increase U.S. GDP by 9.5%.” Whether these exact figures are correct, they provide a basis for the claim that America’s most important, and potentially costly, regulations are land use controls.

…Land use controls may be benign even if they restrict growth and increase prices. Their proponents argue that they prevent environmental damage and reduce the downsides of local growth to the community. Theoretically, it is at least conceivable that America’s web of locally-constructed zoning codes have worked out to be a finely tuned system that functions like a perfect Pigouvian tax internalizing all the offsetting externalities of all new construction.

Yet such a view seems untenable. Getting the right national policy requires comparing the social costs of building in one location versus the costs of building elsewhere. Few localities seriously consider the negative impact that restricting buying will have on non-residents of their town. No locality considers the impact that their local rules may induce more building elsewhere.

We’ve written on zoning laws before. As Glaeser concludes, “Reforming local land use controls is one of those rare areas in which the libertarian and the progressive agree. The current system restricts the freedom of the property owner, and also makes life harder for poorer Americans. The politics of zoning reform may be hard, but our land use regulations are badly in need of rethinking.”

The Second Amendment is for All Americans

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Philando_Castile_-_Falcon_Heights_Police_Shooting_(27864126610)

Minnesota Bureau of Criminal Apprehension (BCA) investigators process the scene of where a St. Anthony Police officer shot and killed 32-year-old Philando Castile (Tony Webster from Minneapolis, Minnesota; CC BY-SA 2.0)

Last week, Jeronimo Yanez was acquitted of manslaughter after shooting Philando Castile to death. Yanez was a police officer. Castile was a law-abiding citizens with a concealed carry permit who followed Yanez’s instructions and was killed anyway.

I didn’t comment right away, because I wanted to study the issue more before commenting. Everything I’ve read since then has confirmed my initial impressions.

First of all, the verdict is a travesty of justice. If police officers can kill law-abiding, compliant citizens just because the officer is afraid, then we live or die basically at the discretion of police officers. “Sorry for killing somebody again, your honor, but I felt scared.”

Secondly, either constitutional rights apply to all citizens or they are not “rights”. Several outlets–like the Washington Post and the New York Times–have pointed out that if Philando Castile had been a white man instead of a black man, then the NRA would have gone into overdrive defending him and fundraising off of this story. The fact that they apparently can’t do the latter explains why they are not doing the former. It certainly appears that the NRA’s leadership, it’s base, or both simply don’t care about black concealed carry permit holders the way they do about white concealed carry permit holders. This is inexcusable. The time has come to decide if you’re defending the Second Amendment, or just perks for white folk.

This story is yet another example of the widening divide on the American right. The reaction to the verdict shows that Trump’s base is populist, nativist, but totally devoid of any consistent principles. Meanwhile, the derided “establishment Republicans” are turning out to be the ones with the real principles after all. That’s why it’s folks like David French writing for the National Review who are willing to say what needs to be said: “The jury’s verdict was a miscarriage of justice.”

We live in strange times. Antipathy between the red and blue tribes within the United States are at an all-time-high, with each suspecting–and sometimes relishing–the worst in each other. But in this atmosphere of partisanship and tribalism, there are also opportunities to bridge that divide over matters of shared principle.

If you care about social justice and equality, then clearly you will be passionately opposed to this injustice. But if you care about gun rights and the Second Amendment, then reason calls you to be just as passionately opposed. In this tragedy, conservative and liberal philosophies align, and all Americans of principle can say: this is not right.

 

Does Imprisonment Reduce Repeated Drug Offenses?

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Ha. Nope. According to a recent article in the Journal of Experimental Criminology,

Image result for drug offendersImprisonment for drug crimes as opposed to non-prison sentences such as jail stays and terms of probation was not associated with a reduction in the likelihood of recidivism. That “null” finding held for all felony drug offenders as well as for different racial, ethnic, gender, and age groups and for inmates with different punishment histories. The sole and notable exception was for whites. For white drug offenders, imprisonment—as compared to being sentenced to community sanctions such as jail, intensive probation, or probation— appeared to increase recidivism. The results of this study thus do not support the argument that prison appreciably reduces or increases recidivism for most drug offenders, but they do suggest the possibility that it may do so for white drug offenders.

These results “raise questions about the benefits that stem from tough-on-crime anti-drug legislation.”

“In short,” the authors conclude,

this study echoes other scholarship that has raised questions about the wisdom of imprisoning drug offenders if the goal is to increase public safety. That does not mean that legislation should necessarily change. Public policy reflects a range of considerations, and evidence about the effectiveness of a particular policy, such as imprisonment, on one outcome, recidivism, constitutes but one factor that may be relevant. Even so, the study adds to others in calling attention to the need to carefully assess the empirical foundation for criminal justice policy.

Politics and Populism Make Us Stupid

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Political ignorance is a topic I’ve been reading up on as of late. It’s a tad depressing, if not all that surprising. A brand new Brookings paper builds off this research to argue the following:

  • Always empirically questionable at best, the populist-progressive idea that more participation will reliably improve either the products or the popularity of governance has taken a pounding in recent years, to the point where it is basically untenable. The populist model assumes that voters are better informed, more rational, and more engaged than is the case—or ever will be.
  • Even implausibly well-informed and rational voters could not approach the level of knowledge and sophistication needed to make the kinds of decisions that routinely confront the government today. Professional and specialist decision making is essential, and those who demonize it as elitist or anti-democratic can offer no plausible alternative to it.
  • Professional intermediaries make democracy more inclusive and more representative than direct participation can do by itself. In complex policy spaces, properly designed intermediary institutions can act more decisively and responsively on behalf of the public than an army of “the people” could do on its own behalf. Intermediated systems are also less likely to be paralyzed by factional disputes and distorted by special-interest manipulation than are systems designed to maximize voter participation and direct input.
  • Nonetheless, the predominant ethos of the political-reform community remains committed to enhancing individual political participation. This is a costly oversight. Some populist reform ideas are better than others, but, as a class, they have eclipsed a more promising reform target: strengthening intermediating actors such as political professionals and party organizations.

They review the literature on political ignorance to reveal the following:

  • Voters are very ignorant, and always have been.
  • Voters are ignorant because they’re rational, not because they’re stupid.
  • Voters are irrationally biased as well as rationally ignorant.
  • Providing more education or information isn’t a solution (though it’s worth doing anyway).
  • Even if voters were deeply informed and meticulously rational, elections still would not reliably tell us what the public thinks or wants.

What’s to be done? GMU law professor Ilya Somin suggests “foot voting“:

Image result for vote with feetIn many situations, the better approach to mitigating political ignorance is not to give up on empowering ordinary people, but to do so in a different way. Instead of putting our faith in political participation, we can instead give people more opportunities to “vote with their feet.”When people vote with their feet in the private sector, or by choosing which jurisdiction to live in within a federal system, they have much better incentives to acquire relevant information and use it wisely. Unlike ballot box voters, foot voters have the opportunity to make individually decisive choices that are likely to make a real difference. If you are like most people, you probably spent more time and effort acquiring information the last time you decided which TV or smartphone to buy than the last time you decided who to support for president or governor. That is likely because you knew that the decision about the smartphone would make a real difference, whereas the one about the presidency had only a miniscule chance of doing so.

We can enhance opportunities for foot voting by limiting government power and devolving it to lower levels. It is cheaper and easier to vote with your feet between states than between countries, and easier still to choose between localities or between competing alternatives in the private sector. There is also much that can be done to make foot voting easier for the poor and disadvantaged. Greater decentralization of power can also help mitigate the partisan bias and polarizatoin that both Rauch and I believe have exacerbated our political pathologies.

…I certainly do not claim that decentralization and foot voting can overcome all the dangers of political ignorance. Probably no one strategy can do that. But I think it can be be a bigger and less risky part of the solution than increasing the role of political professionals, even though there are indeed some situations where we should rely more on the latter. Be that as it may, Wittes and Rauch deserve credit for taking the problem of political ignorance seriously, and for their valuable contribution to the debate over this crucial issue.

Check both pieces out.

The Trade-Offs of Paid Leave

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With Trump’s budget proposing paid family leave, it’s worth considering the economics behind it. Economist and author Charles Wheelan explains in his fantastic book Naked Economics,

Economists study how we acquire information, what we do with it, and how we make ecisions when all we get to see is a book’s cover. Indeed, the Swedish Academy of Sciences recognized this point in 2001 by awarding the Nobel Prize in Economics to George Akerlof, Michael Spence, and Joseph Stiglitz for their seminal work on the economics of information. Their work explores the problems that arise when rational people are forced to make decisions based on incomplete information, or when one party to a transaction knows more than another.

…Consider a small law firm interviewing two job candidates, one male and one female. Both candidates are…eminently qualified for the position. If the “best” candidate for the job is the one who will earn the most money for the firm…then I will argue that the rational choice is to the hire the man…Women still bear the bulk of child-rearing responsibilities. Demographics suggest that both candidates are likely to start families in the near future. Yet only the female candidate will take paid maternity leave. More important, she may not return to work after having the child, which leaves the firm with the cost of finding, hiring, and training another lawyer.

Is any of this certain? No…The female candidate is punished because the firm has no information on her specific circumstances but good data on broad social trends. Is this fair? No. (And it’s not legal either.) Yet the firm’s logic makes sense (pg. 105-106).[ref]He goes on to point out that professional women that take the paid maternity leave and run impose a cost on other women by making firms more likely to discriminate against women. His solution?: “a generous, but refundable maternity package. Keep it if you want to come back to work, return it if you don’t” (pg. 107).[/ref]

Obviously, Wheelan is not endorsing discrimination, but simply laying out the economic factors that incentivize it. Over at The Week, AEI’s James Pethokoukis lays out some of the evidence for the theory above:

Even the best ideas have downsides, and it’s up to policymakers to deal with them. Paid leave is no different.

A 2017 study, by UC Santa Barbara economist Jenna Stearns, of maternity leave policy in Great Britain found that access increases the probability of women returning to work, while job protection benefits result in higher overall maternal employment rates and longer job tenure. Sounds good! But there’s a tradeoff: Expanding job protected leave benefits led to “fewer women holding management positions and other jobs with the potential for promotion.”

Likewise, a 2013 study by Cornell University’s Francine Blau and Lawrence Kahn found family-friendly policies indeed make it easier to balance work and family. But they also “leave women less likely to be considered for high-level positions. One’s evaluation of such policies must take both of these effects into account.”

Few economists would be surprised at these analyses. In a classic 1983 paper on mandated benefits like paid leave, former Obama economist Lawrence Summers explained businesses would offset higher benefits with lower pay or hiring workers with lower potential benefit costs. You know, tradeoffs.

Paid parental leave obviously has real upsides. But we can’t ignore the downsides either: Lower pay, stingier promotions, and a potential employer favoritism toward the childless.

The trade-offs may very well be worth it. But we need to at least be aware of what they are.

Basking in Motivated Ignorance

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Vox covers the unsurprising results of a new study regarding political bias:

If you ever thought, “You couldn’t pay me to listen to Sean Hannity / Rachael Maddow / insert any television pundit you violently disagree with here” — you are not alone.

A study, recently published in the Journal of Experimental and Social Psychology,essentially tested this very question.

Two hundred participants were presented with two options. They could either read and answer questions about an opinion they agreed with — the topic was same-sex marriage — or read the opposing viewpoint.

Here’s the catch: If the participants chose to read the opinion they agreed with, they were entered into a raffle pool to earn $7. If they selected to read opposing opinion, they had a chance to win $10.

And yet,

A majority — 63 percent — of the participants chose to stick with what they already knew, forgoing the chance to win $10. Both people with pro same-sex marriage beliefs and those against it avoided the opinion hostile to their worldview at similar rates.

…This is a key point that many people miss when discussing the “fake news” or “filter bubble” problem in our online media ecosystems. Avoiding facts inconvenient to our worldview isn’t just some passive, unconscious habit we engage in. We do it because we find these facts to be genuinely unpleasant. And as long as this experience remains unpleasant, and easy to avoid, we’re just going to drift further and further apart.

Similarly, the researchers found that “[l]istening to a political opponent isn’t as awful as getting a tooth pulled, but it’s trending in that direction. It’s certainly a lot more awful than taking a leisurely stroll.”

What’s worse is that “partisans were unfamiliar with [the opposing side’s] viewpoints. So it’s not the case that people are avoiding learning about the other side because they’re already familiar. What’s going on here is “motivated ignorance,” as Matt Motyl, one of the study co-authors calls it.” Vox laments,

This is the dark truth that lies at the heart of all partisan politics, and makes me pessimistic that Facebook or any other social networking site can really solve the problem of people filtering into their own content bubbles. We automatically have an easier time remembering information that fits our worldviews. We’re simply quicker to recognize information that confirms what we already know, which makes us blind to facts that discount it. It’s the reason why that — paradoxically — as we learn more about politics and politically charged issues, we tend to become more rigid in our thinking.

Just more evidence that politics makes us mean and dumb. Here are a few useful steps to help you escape your political echo chamber:

 

An Upside to Trump?

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It’s no secret that I was, am, and will remain #NeverTrump. But two stories I saw today made me think of a possible upside to the Trump presidency.

Now, I’m not saying Coulter is turning on Trump because he endangers our relationships with allies by handing over intel that has been trusted to us to a third-party without permission[ref]And not just any third-party, but our strategic opponent in Syria![/ref]. She’s mad he hasn’t built that wall yet or what-not.

Still, the depth, breadth, and stunning intricacy of Trump’s incompetence is such that all those who backed him–the Ann Coulters and Sean Hannitys of the world–may take a serious, serious hit as Trump’s once bright star turns into a screaming, self-annihilating meteor crashing from the heavens.[ref]Let’s just hope it’s small enough not to take us all with it, yeah?[/ref]

This occurred to me today as I was driving around after 7pm when NPR has started playing weird jazz instead of news and talk, and so I flipped to AM radio and hear Sean Hannity. I’ve always disliked Hannity–even when I was at my right-wingiest–but tonight was different. I only caught a few minutes, but he was interviewing a guest about Hillary Clinton and (as far as I could tell) her emails.

Seriously. In 2017. With the election over. And Trump as president. And he was talking about Hilary. Clinton’s. Emails.

If that’s not the definition of sad irrelevance, I don’t know what is. The fever-swamp of paranoid right-wing alternative media conspiracy theory peddlers is a major reason we ended up with Trump. The idea that he takes a few of them down when he falls has a pleasing symmetry. Oh, I’m sure his hard core will praise him until the end, but their audiences will be much, much smaller.

Or so we can hope.

The Economic Consequences of Political Partisanship

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Image result for partisanship

I’ve mentioned the tribal nature of politics before and its tendency to make us mean and dumb. Now check out the findings from a new paper:

In the first experiment, carried out in a nationwide online labor market, we assess whether partisan congruence between employer and employee influences the willingness of the latter to work, as well as the quality of work they perform. We do so by tracking the wage proposals and task performance of freelance editors when the document they edit indicates whether their employers are co-partisans or supporters of the out-party. Study 2 examines whether partisan considerations also affect consumer behavior. Specifically, we explore whether people are less likely to pursue an attractive purchasing opportunity if the seller is affiliated with the out-party, and more likely to do so if the seller is a co-partisan. We conducted another field experiment that uses an online marketplace to study this question in a more naturalistic setting, albeit one that relies on ecological inferences. Finally, we replicate these patterns in the context of an incentivized, population-based survey experiment, where we find that fully three-quarters of respondents are willing to forego higher personal remuneration to avoid benefitting the opposing party.

Taken together, our studies offer substantial evidence that partisanship shapes real-world economic decisions. All four experiments offer evidence that partisanship influences economic behavior even when there are real pecuniary or professional costs. Although the effect sizes vary somewhat across contexts, in some situations, they are quite large. For example, the effect of partisanship on reservation wages in the labor market experiment is comparable to the effect of task-relevant skills such as education and experience. In the marketplace, consumers are much more likely—almost two times as likely—to engage in a transaction when their partisanship matches that of the seller. In our survey experiment, three quarters of all subjects forego a higher monetary payment to avoid helping the other party. We show that these effects of partisanship are at least as large as the effects of religion, another well-known and salient social cleavage. Even among weak or leaning partisans, fully two-thirds of them reject the partisan offer. In sum, partisanship’s effect on economic decisions is not only real but often also sizable, extending throughout the electorate.

…The results underscore the power of partisanship as a social identity in an era of polarized parties—partisanship can shape apolitical behavior, including economic transactions. The results also call for paying greater attention to potential discrimination based on partisan affiliation. To date, few social norms are in place to constrain it, as they are with respect to unequal treatment along other social divides (e.g., race and gender). Our analysis suggests that partisan-based discrimination may occur even in the most basic economic settings, and as such should be the subject of more systematic scrutiny (pgs. 3-5).

Hooligans in action.