A 2015 Brookings report written for the campaign season is still relevant today. Researcher Isabel Sawhill lays out a few major ideas candidates could use to reduce poverty and improve economic mobility. Three hurdles necessary for climbing out of poverty are:
Graduating high school
Working full-time
Delaying parenthood until they in a stable, two-parent family
Sawhill proposes a number of policies aimed at helping people achieve these objectives:
To support work, make the Child and Dependent Care Tax Credit (CDCTC) refundable and cap it at $100,000 in household income. Because the credit is currently non-refundable, low-income families receive little or no benefit, while those with incomes above $100,000 receive generous tax deductions. This proposal would make the program more equitable and facilitate low-income parents’ labor force participation, at no additional cost.
To strengthen families, make the most effective forms of birth control (IUDs and implants) more widely available at no cost to women, along with good counselling and a choice of all FDA-approved methods. Programs that have done this in selected cities and states have reduced unplanned pregnancies, saved money, and given women better ability to delay parenthood until they and their partners are ready to be parents. Delayed childbearing reduces poverty rates and leads to better prospects for the children in these families.
I found this two-year-old WSJ interview with Angus Deaton while I was combing through some saved posts. I thought it was worth highlighting. Here are a few excerpts that convey Deaton’s thoughts on inequality:
[Inequality] could [even] be people at the bottom versus people in the middle. One of the things that has happened is that at the very bottom there may actually be some squeezing up of those gaps partly because people in the middle may be being replaced by offshoring and so on. Whereas people at the bottom who are mainly in service jobs really can’t be, so they’re doing relatively well.
…I both love inequality and am terrified of it. Inequality is partly a marker of success, so that if someone thinks of something, some new innovation that benefits us all, and the market works properly, they get richly rewarded for that.
And that’s just terrific. And that creates inequality. So some of the greatest inequalities in the world have come from the greatest successes.
The terror part is—well, there are several different things. One that I worry about is that some of the enormous riches we’re seeing at the top in the United States today are coming from activities whose social value is in doubt.[ref]One of those activities could very well be cronyism. Cronyism, according to economist David Henderson, is “negative-sum. That is, in the process of redistributing wealth, cronyism destroys wealth” (pg. 7).[/ref] So some of the activities that are going on in Wall Street that are occupying some of the smartest of our young minds, it’s not entirely clear that their society really wants them to be doing that as opposed to innovating in the private sector, or curing cancer. The other thing that I worry about is the political power that comes with extreme wealth.
He also discusses some alarming findings from his most recent research:
We’ve seen mortality rates falling for the best part of 100 years, maybe even longer. When we looked at the total mortality rates for this middle-aged group from 45 to 55 and we saw they were rising—I mean, this is something that’s been falling forever.
And then about 1998 it just turns and starts going the other way. So, there’s this increase in mortality. And it’s almost entirely for white non-Hispanics. Black mortality rates are falling even faster than they’d ever been, Hispanic rates are falling on track.
The rates in middle age for all European countries are falling exactly as they have been, as they were in the U.S. up until 1998. But for this group, this middle-aged, white non-Hispanics, this mortality rate is going up. If you look at the causes of death that are most rapidly rising, it’s suicides, the biggest one is poisonings…And of course that’s what they’d call accidental overdoses. A lot of it is from prescription painkillers and a lot of it is from illegal drugs, and then a lot of it’s from alcohol.
…This is much worse among those who have a high-school education or less. These are the people who just have not benefited from the positive changes that have happened in the economy as a whole…That doesn’t explain everything, because there are people being left behind in Europe, too. The two explanations that have been floated are that Europe has a more elaborate safety net than we have. And most European countries do not allow overprescription of heavy-duty, dangerous painkillers the way we do here.
Some claim that corporate “short-termism“–or what Hillary Clinton called “quarterly capitalism“–has negative effects on the economy. But is there any evidence for the claim? A new McKinsey report answers in the affirmative:
From 2001 to 2014, the revenue of long-term firms cumulatively grew on average 47 percent more than the revenue of other firms, and with less volatility. Cumulatively the earnings of long-term firms grew 36 percent more on average over this period than those of other firms, and their economic profit grew 81 percent more on average.
Long-term firms invested more than other firms from 2001 to 2014. Although they started this period with slightly lower research-and-development spending, cumulatively by 2014, long-term companies on average spent almost 50 percent more on R&D than other companies. More important, they continued to increase their R&D spending during the financial crisis, while other companies cut R&D expenditure; from 2007 to 2014, R&D spending for long-term companies grew at an annualized rate of 8.5 percent versus 3.7 percent for other companies.
Long-term companies exhibit stronger financial performance over time. On average, their market capitalization grew $7 billion more than that of other firms between 2001 and 2014. Their total return to shareholders was also superior, with a 50 percent greater likelihood that they would be in the top decile or top quartile by 2014. Although long-term firms took bigger hits to their market capitalization during the financial crisis than other firms, their share prices recovered more quickly after the crisis.
Long-term firms added nearly 12,000 more jobs on average than other firms from 2001 to 2015. Had all firms created as many jobs as the long-term firms, the US economy would have added more than five million additional jobs over this period. On the basis of this potential job creation, this suggests, on a preliminary basis, that the potential value unlocked by companies taking a longer-term approach was worth more than $1 trillion in forgone US GDP over the last decade; if these trends continue, it could be worth nearly $3 trillion through 2025.
The report concludes that “the potential value that could have been unlocked had all US publicly listed companies taken a long-term orientation exceeded $1 trillion over the past ten years” (pg. 7).
How do the researchers determine that a company is “long-term”? Their Corporate Horizon Index consists of five financial indicators:
After running the numbers on these indicators, two broad groups emerged among those 615 large and midcap U.S. publicly listed companies: a “long-term” group of 164 companies (about 27% of the sample), which were either long-term relative to their industry peers over the entire sample or clearly became more long-term between the first half of the sample period and the second half, and a baseline group of the 451 remaining companies (about 73% of the sample). The performance gap that subsequently opened between these two groups of companies offers the most compelling evidence to date of the relative cost of short-termism — and the real payoff that arises from managing for the long term.
…While we can’t directly measure the cost of short-termism, our analysis gives an indication of just how large the value of what’s being left on the table might be. As noted earlier, if all public U.S. companies had created jobs at the scale of the long-term-focused organizations in our sample, the country would have generated at least five million more jobs from 2001 and 2015 — and an additional $1 trillion in GDP growth (equivalent to an average of 0.8 percentage points of GDP growth per year). Projecting forward, if nothing changes to close the gap between the long-term group and the others, then the U.S. economy could be giving up another $3 trillion in foregone GDP and job growth by 2025. Clearly, addressing persistent short-termism should be an urgent issue not just for investors and boards but also for policy makers.
When it comes to enacting social change, are broken windows and displaced limousine drivers merely the cost of doing business? No. In fact, violent and destructive protesting is less efficient than nonviolent protesting, according to the research.
“Why Civil Resistance Works,” a study written by Maria J. Stephan and EricaChenoweth,[ref]The authors have an excellent article in Foreign Affairs about their research as well.[/ref] found that nonviolent tactics were much more effective than violent tactics. Researchers surveyed anti-governmental resistance movements in the 20th century in a variety of countries: nonviolent means achieved their aims 53 percent of the time, while the violent means worked only 26 percent of the time.
“Whereas governments easily justify violent counterattacks against armed insurgents, regime violence against nonviolent movements is more likely to backfire against the regime,” wrote the authors. “Potentially sympathetic publics perceive violent militants as having maximalist or extremist goals beyond accommodation, but they perceive nonviolent resistance groups as less extreme, thereby enhancing their appeal and facilitating the extraction of concessions through bargaining.”
Another study, by Princeton University Assistant Professor of Politics Omar Wasow, found that violent extremist movements in the United States in the 1960s and ’70s inspired a conservative backlash that helped elect Richard Nixon to the presidency. Nonviolent protests, on the other hand, did not provoke a backlash.
“In the 1960s, black-led protests that escalate to violence cause increased conservatism in white voters who live nearby,” Wasow wrote in an email to Reason. “Conversely, I find that proximity to black-led nonviolent protests, particularly those in which the state engages in brutal repression, are associated with increased liberalism among white voters.”
The science isn’t exactly settled: Wasow said other scholars have found that violent protests occasionally prompt the government to implement favorable social policies as a means of de-escalating the violence.
“If the recent modest amount of protest-related property damage remains an outlying event, I’d expect very little effect,” wrote Wasow.
Still, violent tactics—such as those displayed against Spencer—run a risk of provoking a conservative counter-reaction. Historically, authority figures have known this. When President Nixon was informed by an aide that campus violence was expected to increase in the coming year, his response was, “Good!” Nixon understood what too many leftists do not: Violent resistance is often the health of the state.
The article concludes,
The Women’s March sent a message that Trump is unpopular. The black bloc rioting likely accomplished the exact opposite: undermined public sympathy for Trump resistors.
It certainly seems like the organizers of the Women’s March chose the more tactically effective route. Wasow said the march might have the same kind of lasting effect as the Tea Party movement, which accomplished many of its political goals…I won’t say violence never works as a means of advancing social progress, but the Women’s March is powerful evidence that orderly resistance is the better tactic for the struggles that lie ahead. And recall that during the primaries, when protesters shut down Trump’s speeches, this made Republican voters more favorably disposed toward Trump.
With that, enjoy this rap battle between two advocates of nonviolent resistance.
“By and large,” writes economist Bryan Caplan, “I think news is a waste of time. If I want to increase my factual knowledge, I read history – or Wikipedia. News, I like to say, is the lie that something important happens every day.” With the influence of “fake news” being overblown, is this really a legitimate claim on Caplan’s part? To help make his case, he links to a paper by Swiss writer Rolf Dobelli entitled “Avoid News.” In Dobelli’s view, “News is to the mind what sugar is to the body” (pg. 1). He lists the following reasons:
News misleads us systematically
News is irrelevant
News limits understanding
News is toxic to your body
News massively increases cognitive errors
News inhibits thinking
News changes the structure of your brain
News is costly
News sunders the relationship between reputation and achievement
News is produced by journalists
Reported facts are sometimes wrong, forecasts always
News is manipulative
News makes us passive
News gives us the illusion of caring
News kills creativity
What does Dobelli suggest instead? “Go without news. Cut it out completely. Go cold turkey…If you want to keep the illusion of “not missing anything important”, I suggest you glance through the summary page of the Economist once a week” (pg. 10). He notes that if there is indeed “some bit of information is truly important to your profession, your company, your family or your community, you will hear it in time – from your friends, your mother-in-law or whomever you talk to or see” (pg. 10). But the clincher is the following:
Read magazines and books which explain the world – Science, Nature, The New Yorker, The Atlantic Monthly. Go for magazines that connect the dots and don’t shy away from presenting the complexities of life – or from purely entertaining you. The world is complicated, and we can do nothing about it. So, you must read longish and deep articles and books that represent its complexity. Try reading a book a week. Better two or three. History is good. Biology. Psychology. That way you’ll learn to understand the underlying mechanisms of the world. Go deep instead of broad. Enjoy material that truly interests you. Have fun reading (pg. 10).
At least those in economics, history, journalism, law, and psychology, according to a 2016 study. The abstract reads,
We investigate the voter registration of faculty at 40 leading U.S. universities in the fields of Economics, History, Journalism/Communications, Law, and Psychology. We looked up 7,243 professors and found 3,623 to be registered Democratic and 314 Republican, for an overall D:R ratio of 11.5:1. The D:R ratios for the five fields were: Economics 4.5:1, History 33.5:1, Journalism/Communications 20.0:1, Law 8.6:1, and Psychology 17.4:1. The results indicate that D:R ratios have increased since 2004, and the age profile suggests that in the future they will be even higher. We provide a breakdown by department at each university. The data support the established finding that D:R ratios are highest at the apex of disciplinary pyramids, that is, at the most prestigious departments. We also examine how D:R ratios vary by gender and by region. People interested in ideological diversity or concerned about the errors of leftist outlooks—including students, parents, donors, and taxpayers—might find our results deeply troubling.
Langbert, Quain, Klein, 2016, pg. 425.
Of course, this is nothing new. For example, Jonathan Haidt and colleagues recently highlighted the lack of political diversity in academic psychology. What’s particularly interesting to me, however, is the D:R ratio in economics. I recall a Facebook discussion toward the end of last year in which this bias was downplayed and economic departments were more-or-less given as examples of conservative (read Republican) hubs on campus.[ref]”They have the Hoover Institution at Stanford!” apparently counts as evidence that bias doesn’t exist.[/ref] I already knew this wasn’t true and said as much, but my comment was pretty much ignored. This exchange made me realize that many outsiders likely think mainstream economics is tainted by an American brand of conservatism.[ref]Nevermind that modern Republicans are virtually mercantilists: an economic theory that was refuted in the 18th century.[/ref] But more important, it made me realize that some (many?) on the left reject the findings of mainstream economics because they think it’s politically biased.
So, to those who think economic departments are full of conservatives: yes, these departments are more conservative than others. But the only way they could be labeled “conservative” is due to other departments being so far to the left. Basically, econ departments are more politically diverse. Nonetheless, they are still dominated by Democrats. While this may not instill confidence in my Republican friends, perhaps it will convert some of my Democrat ones.
From Gregory Mankiw’s Principles of Economics, 7th ed. (pg. 32).
Drug overdoses are the leading cause of death from injuries in the United States today, exceeding deaths from suicide, gunshots and motor vehicle accidents (Murphy et al., 2013). They are also a prime contributor to the recent rise in mortality among middle-aged white Americans (Case and Deaton 2015). In 2010, 16,651 deaths were caused by a prescription opioid overdose, representing nearly 60% of all drug overdose deaths, and exceeding overdose deaths from heroin and cocaine combined (Jones, Mack and Paulozzi, 2013). While a modest decline in opioid overdose deaths has occurred since 2012, more than 16,000 lives are lost annually to prescription opioids (NCHS, 2014).
These numbers are the result of a dramatic rise in morbidity and mortality associated with prescription opioid abuse over the past two decades. The number of fatal poisonings due to prescription pain medications quadrupled between 1999 and 2010. Over the same period, the distribution of opioid pain medications also quadrupled, demonstrating a parallel rise between the distribution of opioid pain medication and its abuse nationally (CDC, 2011). Treatment admissions grew at an even faster rate, increasing nearly six-fold between 1999 and 2009 (CDC, 2011b). Opioid-related emergency department (ED) visits more than doubled from 21.6 per 100,000 in 2004 to 54.9 per 100,000 in 2011, for a total of 1.24 million ED visits involving nonmedical use of pharmaceuticals and pain relievers in 2011 (SAMHSA, 2013a). It is these trends that led the Centers for Disease Control to deem the misuse of prescription opioids in the United States an “epidemic” (pg. 2).
The researchers conclude,
Considerable attention has been paid in the literature to the potential unintended consequences of medical marijuana laws, with people examining impacts of these policies on youth initiation, recreational marijuana use and abuse as well as drunk driving (Wen et al., 2015; Choi, 2014; Lynne-Landsman et al., 2013; Anderson, Hanson and Rees, 2012 & 2013; Pacula et al., 2013). In this paper we consider a potential unintended benefit of these laws: a reduction in the misuse of prescription opiates.
Our results are intriguing in that we find fairly strong and consistent evidence using difference-in-differences, event study, and synthetic control group methods that states providing legal access to marijuana through dispensaries experience lower treatment admissions for addiction to pain medications. We provide complementary evidence that dispensary provisions also reduce deaths due to opioid overdoses. We estimate even larger effects in states that have both legally protected and active dispensaries.
…The fact that opioid harms decline in response to medical marijuana dispensaries raises some interesting questions as to whether marijuana liberalization may be beneficial for public health. Marijuana is a far less addictive substance than opioids and the potential for overdosing is nearly zero (Hall and Pacula, 2003). However, it remains unclear from our current analysis whether the findings we observe are short term or persist. In addition, we ultimately need to weigh any potential indirect benefits from medical marijuana dispensary provisions in terms of its implied reductions in opiate misuse (or other positive outcomes) against any potential negative impacts of these provisions on other factors, such as tobacco use and drugged driving. At a minimum, however, our results suggest a potential overlooked positive effect of dispensary enabling medical marijuana laws (pgs. 21-22).
“The Earned Income Tax Credit isn’t super well-known,” writes Vox,
but it’s one of the best tools the federal government has for fighting poverty. It functions as a wage subsidy for the working poor, providing an average of $2,982 a year to families with children come tax season. The results are impressive. According to the Census Bureau, refundable tax credits like the EITC and the similarly structured Child Tax Credit cut the poverty rate (correctly measured) by 3 percentage points in 2013 — that’s 9.4 million people kept out of poverty.
But a [2015] study suggests that even that is an underestimate. UC Berkeley economist Hilary Hoynes and the Treasury Department’s Ankur Patel find that the EITC might be twice as effective at fighting poverty as the census estimate suggests.
How so?:
Hoynes and Patel focus on the credit’s effect on single women with children, the single biggest group of recipients. It’s well-known that the EITC encourages nonworking single moms and dads to enter the workforce; an analysis by the Center on Budget and Policy Priorities found that EITC brought more single mothers into the workforce in the 1990s than welfare reform did. That means that it boosts income not just by giving people money, but by getting people to work more and bring in more in wages. These increased wages can reduce income in other ways, such as by making people ineligible for programs like food stamps, but on the whole it boosts pay.
Hoynes and Patel find that bringing this effect into the analysis doubles the number of people lifted out of poverty by the EITC. The expansion of the EITC included in Bill Clinton’s 1993 budget reduced the share of people under the poverty line by 7.9 percent. That’s much more than you’d find in an analysis that doesn’t take the EITC’s effect on employment into account.
Hoynes nicely summarizes these findings in a 2016 policy brief. In short,
“The EITC is the cornerstone of U.S. anti-poverty policy. It is the largest anti-poverty program for children in the US. Together with the Child Tax Credit (CTC), the EITC removed 4.8 million children from poverty in 2015. It is also the second largest anti-poverty program for the population as a whole. Together with the CTC, the EITC lifted a total of 9.2 million people out of poverty in 2015. Only Social Security removes more people from poverty” (pgs. 2-3).
The EITC “lowered mother’s risk of cardiovascular disease, metabolic disorder and inflammations, and improved their mental health. The expansion also led to a reduction in smoking among single mothers with children” (pg. 4).
The EITC also “reduced the incidence of low birth weight…and increased mean birth weight” (pg. 4).
“The EITC raises both math and reading test scores in elementary and secondary schooling” (pg. 5).
“The EITC is associated with higher rates of high school completion (or GED) and also higher college attendance rates. This in turn translates into better employment outcomes and higher earnings” (pg. 5).
I’ve written before about the (un)likelihood of dying at the hands of a foreign terrorist here on American soil. But for kicks, let’s drive the point home a little more. As Vox reports,
To put [the Cato Institute’s numbers] in perspective, I’ve produced the following chart, which compares the average annual likelihood of American pedestrians being hit by a railway vehicle, dying due to their own clothes melting or lighting on fire, and being killed in a terrorist attack perpetrated by an immigrant. It’s quite revealing:
Even better, you have a higher chance of winning the lottery or being struck by lightning than being killed by a refugee in a terrorist attack:
Here’s hoping we can all get a grip.[ref]Unfortunately, Trump’s Chief Strategist Steve Bannon doesn’t just dislikeillegal immigration, but legal immigration. I imagine the restrictions will continue to be ratcheted up.[/ref]
As a friend of mine said in response to this Tweet, “The left is anti-drone bombing once again. Welcome home after 8 years.” Now, if you think his quip is unfair, it should be noted that it’s based on sound social science: the majority of anti-war Democrats of the Bush years weren’t really all that anti-war as much as they were anti-Bush. As soon as Obama took office, the opposition dropped considerably.
In President Obama’s last year in office, the United States dropped 26,172 bombs in seven countries. This estimate is undoubtedly low, considering reliable data is only available for airstrikes in Pakistan, Yemen, Somalia, and Libya, and a single “strike,” according to the Pentagon’s definition, can involve multiple bombs or munitions. In 2016, the United States dropped 3,028 more bombs—and in one more country, Libya—than in 2015.
Most (24,287) were dropped in Iraq and Syria. This number is based on the percentage of total coalition airstrikes carried out in 2016 by the United States in Operation Inherent Resolve (OIR), the counter-Islamic State campaign. The Pentagon publishes a running count of bombs dropped by the United States and its partners, and we found data for 2016 using OIR public strike releases and this handy tool.* Using this data, we found that in 2016, the United States conducted about 79 percent (5,904) of the coalition airstrikes in Iraq and Syria, which together total 7,473. Of the total 30,743 bombs that the coalition dropped, then, the United States dropped 24,287 (79 percent of 30,743).
Micah Zenko of the Council on Foreign Relations points out,
As Donald Trump assumes office today, he inherits a targeted killing program that has been the cornerstone of U.S. counterterrorism strategy over the past eight years. On January 23, 2009, just three days into his presidency, President Obama authorized his first kinetic military action: two drone strikes, three hours apart, in Waziristan, Pakistan, that killed as many as twenty civilians. Two terms and 540 strikes later, Obama leaves the White House after having vastly expanding and normalizing the use of armed drones for counterterrorism and close air support operations in non-battlefield settings—namely Yemen, Pakistan, and Somalia.
…Less than two weeks ago, the United States conducted a drone strike over central Yemen, killing one al-Qaeda operative. The strike was the last under Obama (that we know of). The 542 drone strikes that Obama authorized killed an estimated 3,797 people, including 324 civilians. As he reportedly told senior aides in 2011: “Turns out I’m really good at killing people. Didn’t know that was gonna be a strong suit of mine.”
The newspaper headlines today all blare shocking reports about Trump’s continued bigotry. But further down the page, a different story about Muslim lives is receiving far less attention: the U.S. bombing of Syria, and its increasing numbers of civilian casualties. While Trump says racist things about Muslims, U.S. warplanes are actually killing them, something far less discussed even though (or perhaps because) it morally implicates Democrats.
The U.S. has also been accused of concealing the true death toll…[But i]t’s also important to remember that death tolls themselves only begin to capture the scale of a bombing’s impact. The numbers of injuries are often far higher (and frequently unreported). “Injuries” can mean lost limbs, blindness, and paralysis. They can mean permanent disfigurement. They can mean that a person will never work again, and will suffer from depression and PTSD, or will require medical care for the rest of their lives. Furthermore, even those who are not “injured” can experience deep and lasting trauma, after seeing loved ones or even strangers torn to shreds before their eyes. The actual pain of a mother realizing her child has been blinded, or a brother watching his sister die, is absent from death toll statistics.
The complaint of human rights advocates has centered around the fact that the United States is downplaying and concealing casualties, and that the deaths are growing in frequency without any justification…All of this occurred under a Democratic president. So while the organizers of the Democratic National Convention where proudly presenting the Khan family as evidence of their superior devotion to Muslim lives (and while DNC attendees were chanting “USA, USA, USA” as if they were frenzied 2004-era Bush Republicans), the Obama administration was directly responsible for killing scores of living, breathing Muslim civilians. While Democrats were voicing their outrage that Donald Trump had said yet another despicable racist thing, the party was speaking up in defense of a candidate who had decimated a Muslim country, and who had actually voted for the senseless war that killed Cap. Kahn in the first place.
Rhetorical attacks on Muslims are indefensible. But physical attacks on Muslims, using tanks and gunships, are even more horrific. Democrats might not want to be so certain that they have the moral high ground when it comes to valuing Muslim lives.
Of course, this by no means lets Republicans off the hook. Nor does it equate Obama and Trump (or the GOP) or fail to recognize the nuances of war. It shouldn’t dampen our optimism about the decline of war and violence in the modern era either. But it does call for some consistency; to minimize selective outrage. If we treated all administrations like public servants accountable to us instead of celebrities on our favorite football team, some of this might have been avoided.[ref]Unfortunately, I don’t have all that much faith in the generalelectorate to oppose bad policies.[/ref]
