Sunday, June 27, 2010
multiple transferrable vote
Monday, June 21, 2010
Matthew Yglesias » The Cost of Fannie and Freddie
If you look at the fiscal cost of TARP compared to the cost of the Fannie & Freddie takeover, it’s quite small. But the legislative measure authorizing the Fannie/Freddie nationalization, the Housing and Economic Recovery Act of 2008, was passed by a bipartisan congressional vote and signed by George W Bush with very little controversy back in July of 2008.The government should not be subsidizing home ownership anyhow. The US has better housing than anywhere else on earth and more home ownership.
And the idea that middle class families should basically live inside their lifesavings seems perverse. The good idea at the heart of mortgage securitization is that it doesn’t make sense for a bank to make a geographically undiversified investment in housing. But of course that’s exactly what a household is doing when it buys its home.
Monday, May 17, 2010
Matthew Yglesias » Why Does Alabama Need an Election for Agriculture Commissioner
Democracy should be about accountability, not holding lots of elections. Too many independently elected officials makes lines of responsibility murky and makes it impossible for citizens to monitor their agents.
Friday, May 7, 2010
Our Lucky Ozone Escape | Mother Jones
You all know the story of Stanislav Petrov, right? He's the Soviet lieutenant colonel who was on duty in 1983 when an early warning system reported that an American ICBM was heading toward the Soviet Union. Luckily (and correctly), he decided it was just a computer error and decided not to start World War III. Whew!
That's about how I felt when I read Brad Plumer's piece on possible planetary disasters in the last issue of the New Republic. I'd never heard this story before, but it turns out that back in the middle years of the 20th century Planet Earth dodged a serious ozone layer bullet thanks to nothing more than a chance decision by Dupont about how to manufacture chlorofluorocarbons:
As luck would have it, DuPont had been using chlorine instead of bromine to produce CFCs. As far as anyone could tell, the two elements were interchangeable. But, as another prescient ozone researcher, Paul Crutzen, later noted, bromine is 45 times as effective at destroying ozone as chlorine. Had DuPont chosen to use bromine, the ozone hole could well have spanned the globe by the 1970s instead of being largely confined to Antarctica — long before anyone had a glimmering of the problem.
It’s not hard to see what massive worldwide ozone depletion would’ve meant. Punta Arenas, the southernmost town of Chile, sits under the Antarctic ozone hole, and skin cancer rates there have soared by 66 percent since 1994. If humans had destroyed stratospheric ozone across the globe, we would likely be unable to set foot outdoors without layers of sunscreen and dark shades to prevent eye damage. Worse, the excess UV rays could have killed off many of the single-celled organisms that form the basis for the ocean’s food chain and disrupted global agriculture (studies show that bean and pea crop yields decline about 1 percent for every percent increase in UV exposure).
Matthew Yglesias » Filibuster and Accountability
accountability is maximized when it’s relatively simple for ordinary people to deploy the means at their disposal (voting, or not) to effectuate their ends (throwing the bastards out, or not). When you combine majoritarian legislative procedures with strong party discipline, then all a voter needs to do is (a) remember which party is in charge, and then (b) decide if he likes what’s going on. But thanks to the filibuster, if you don’t approve of policy outcomes you’re likely to blame the majority party even if the outcomes are actually being determined by a minority.
Wednesday, April 21, 2010
Marginal Revolution: The public choice economics of spending cuts
Marginal Revolution: The public choice economics of spending cuts:
This issue deserves more attention and I cover it in my latest NYT column:Most relevant, perhaps, is Canada, which cut federal government spending by about 20 percent from 1992 to 1997. The Liberal Party, headed by Jean Chrétien as prime minister and Paul Martin as finance minister, led most of this shift. Prompted by the financial debacle in Mexico, Canadian leaders had the courage and the foresight to make those spending cuts before a fiscal crisis was upon them. In his book “In the Long Run We’re All Dead: The Canadian Turn to Fiscal Restraint,” Timothy Lewis describes Canada’s move from fiscal irresponsibility to a balanced budget — a history that helps explain why the country has managed the current global recession relatively well.
To be sure, the spending cuts meant fewer government services, most of all for health care, and big cuts in agricultural subsidies. But Canada remained a highly humane society, and American liberals continue to cite it as a beacon of progressive values.
Counterintuitively, the relatively strong Canadian trust in government may have paved the way for government spending cuts, a pattern that also appears in Scandinavia. Citizens were told by their government leadership that such cuts were necessary and, to some extent, they trusted the messenger.
It’s less obvious that the United States can head down the same path, partly because many Americans are so cynical about policy makers. In many ways, this cynicism may be justified, but it is not always helpful, as it lowers trust and impedes useful social bargains.
Forces like the Tea Party movement argue for fiscal conservatism, though it isn’t obvious that they are creating the conditions for success. Over the last year, we have been treated to the spectacle of conservatives defending Medicare against proposed cuts, in large part to curry favor with voters and mobilize sentiment against the Democratic health care plan.
The column also offers up some general reasons for considering spending cuts and not just tax increases. Maybe Arnold Kling won't like this column, but when I look around the globe for episodes of successful spending restraint I see Canada, Finland, Sweden, and now possibly (probably) Ireland, which is in the midst of fiscal restructuring. I see change coming from elites and I see relatively left-wing governments (Ireland, admittedly, is harder to classify) which are trusted by their citizens. The Greek government, in contrast, doesn't operate with the same level of social cohesion and thus it is likely to fail.
I believe the "social trust" scenario for spending cuts is overlooked because it raises the relative status of groups which people who favor spending cuts do not wish to raise.
I wouldn't want to force the view that the United States will or can follow the path of these other nations. But when there is no other evidence, look to the path of what has been shown to be possible. This is a neglected point in the debate on fiscal restructuring and it suggests we are not currently on a propitious path. Right now many fiscal conservatives are looking to voter outrage to drive change and I'm just not sure there is a "there there." Here's one good post on how much conservatives like government spending.