Education Media Sex

Profs perpetrate hoax (just not the one you think)

Recently professors James Lindsay, Helen Pluckrose and Peter Boghossian sent out 20 fake papers to various peer-reviewed journals. Six of them were published. This, say various news outlets, is a real black eye for gender scholarship and, perhaps, for academia in general. On closer examination, ThisWeekInStupid concludes that the real hoax was the one in which serious journalists were convinced that influential journals were publishing shoddy, but honest, scholarship.

TWIS did a thorough review of the paper, reviews and revisions of the research titled “An Ethnography of Breastaurant Masculinity: Themes of Objectification, Sexual Conquest, Male Control, and Masculine Toughness in a Sexually Objectifying Restaurant” published in Sex Roles on September 19, 2018. The paper was first submitted to and rejected by Men and Masculinities. This was the only paper TWIS examined. It’s reasonable to expect that some papers were more and some were less legitimate than this paper. TWIS did not explicitly select this paper to support a pre-determined conclusion.

All of the paper and reviews can be found here. Let me first say that it was brave and honest and sincere of the perpetrators of the hoax to publish the papers and reviews. Bravo. But they didn’t pull off what they think they did.

The Con

The original submission, to judge by the reviewer comments, was a few pages of jargon-y reflections on the fake author’s Thursday nights with the bros at the local Hooters. It was peppered with broad generalizations and hair-on-fire hyperbole of the kind that RWNJs attribute to SJWs. It also featured liberal (see what I did there?) use of the brand-new and super-clever label “breastaurant.” The fake authors were very proud of this invention and the various journalists were quite taken in by it as well. But here’s what actually did and didn’t happen.

What didn’t happen

Contrary to coverage by non-academic papers, the journals were not fooled by the original haphazard summary of conversations among 7 men at a Hooter’s restaurant after jiu jitzu class. Both journals, and all but one reviewer, heavily criticized the methods section. They complained that a single restaurant, a single coder and a participant-observer made the findings dubious. Their responses included dozens of questions about how the quotes used were selected, where and when observations and interviews occurred and how the observations were connected to the conclusions. They questioned the time frame, the underlying assumptions about the state of masculinity in the broad culture, the selection of quotes, the coding and the mind-reading of the participants.

Both journals were quick to put the kaibosh on the sweeping conclusions in the original paper. The final paper was reduced (appropriately) to a participant ethnography of a single site with appropriate caveats and qualifications. The authors of the fake paper would do well to explore the theories of ethnographic research as reviewers repeatedly reminded them. Their expectation that a single site ethnography would be enough to codify broad social conclusions indicates they have a lot to learn. The original theoretical framework, grounded theory, was rejected by both the reviewers and the journal.

The reviewers were not fooled by the dense jargon in the paper with one reviewer “encourag[ing] the author to consider word choice and ask himself when he might be inappropriately applying jargon that actually obscures the specific practices at play.” Another was even less convinced.

The use of “pastiche hegemony” and “ersatz sexual availability” is unnecessary and relieves the author of having to be more specific. They sound smart but really stand in for more tangible identification and explanations of practices. Drop these concepts, or refer to them and then move on in favor of a clearer analysis of exact observed practices.

Ouch! In the original response, the editor of Sex Roles summarized

The rigor of your research rests in sound methods, not in obscure language.

In other words, cut out the abstruse posturing. You just sound like morons.

Throughout, reviewers were skeptical of the conclusions drawn by the authors. Here are some samples from reviewers:

Whilst and interesting an engaging topic, it is unclear at the outset what novel insight or contribution this paper will be making. Much work will be required before it is of publishable standard.

The author(s) assert that “this study is mostly theoretical in its approach, but it is bolstered by comparison against my own empirical data” (p. 14, ll. 57-59). This is an unnecessary assertion. This paper may be defined as empirical by conventional standards.

There are a lot of assumptions in this paper, some of which the author uses to build a case for his work and analysis. Assumptions are a good indicator that data is thin, and this is certainly the case in this paper.

The reviewers saw the data as inadequate to draw the conclusions the authors were drawing. A single site participant-observer ethnography is just that and doesn’t give license to draw sweeping conclusions.

Finally, looking at the 20-paper hoax as a whole, the authors did not manage to achieve an impressive publication record for 3 researchers working in concert and skipping all the pesky data collection steps. The authors were quoted saying that 6 articles is enough to earn a professor tenure. That distant laughter your hear is all of the professors in the known universe. Six co-authored papers in the Journal of Poetry Therapy gets exactly no one tenured. And one article based on falsified data is enough to get you canned.

It’s important to note here the background of the fake authors. Peter Boghossian is a professor of philosophy. James Lindsey is a mathematician. These disciplines are unique in that conclusions usually are not, and need not be, backed by empirical data. As such, the authors likely don’t have much understanding of the importance of reliable data or much appreciation for the effort involved in gathering data. But biologists know. And physicists. And astronomers and chemists and geologists and political scientists and engineers and even advertising executives know that there’s a lot of trust in research. Inventing data doesn’t make you clever. It makes you a hack and a liar. A sociologist with whom I discussed this news said, “Big deal. They skipped the hard part. If I could fabricate all my data, I’d win the Nobel Prize!”

What did happen

The final response from Sex Roles indicates that this is the first ever ethnography published in their usually quantitative journal. She also mentioned that a submission by a historian is novel. One can imagine an editor, very excited to expand the (very old) journal into a new area, green-lit a project slightly outside her expertise. The editors and reviewers for Men & Masculinities, where a great deal more ethnography is published, were not fooled. Sex Roles assigned a junior editor more familiar with ethnography to bring the paper up to standard. The final paper is not good and one can feel the authors intentionally pushing the envelope trying to sneak in the maximum allowed number of outlandish claims. To our eyes, this is a case of a junior editor getting snowed by a senior professor and the enthusiasm of her superior.

The experiment actually reveals some very wonderful things about academia. In the first place, Richard Baldwin, an emeritus history professor from Gulf Coast State College, gets legitimate consideration from a sociology and psychology journal neither of which had ever published his work. Gender scholarship is not an isolated, exclusive club. The interdisciplinary interaction among historians, economists, psychologists, anthropologists and scholars of gender, race and class is a boon to scholarship.  But, contrary to the conclusions of Dr. William Eggington the willingness of Sex Roles to entertain scholarship using a variety of methods from a variety of fields is an important check on academic navel-gazing and not an indication of over-specialization.

In the second place, the journals were quite careful about participant consent and potential taint in the research due to personal relationships. The original paper didn’t mention whether participants were aware they were being studied or the relationship of the various participants to the researcher. At the insistence of reviewers, the paper was revised to (dishonestly) indicate that participants, including wait staff, gave consent, that interviews were recorded, etc.

Finally, the ignorance of the authors of concepts and practices in gender studies was ruthlessly laid bare by reviewers. Throughout the reviews, the authors were taken to task for imprecise use or misuse of terms–“coding,” “discourse,” “theme,” “scripts,” “neoliberal-patriarcho-capitalist” (for heaven’s sake), etc.

There is one quite laughable assertion by the fake authors in response to their intellectual paddling at the hands of Men & Masculinities.

Nota bene: The second reviewer is particularly harsh, it is reasonable to conclude that the paper was rejected on the review of the second reviewer. Upon our reading of this review, it seems that the second reviewer wanted us to write a completely different paper, focused more on themes of feminism than on those of masculinity, even though having done so would likely have taken the paper outside of the scope of the journal Men & Masculinities for which it was being reviewed.

This is a bizarre reading of the reviewer’s comments which were actually a criticism of the paper’s methods and the objectivity of the (imaginary) researcher. The review included this passage:

The author really ignores the women as research participants. There needs to be a better, empirical and theoretical explanation for why the author focuses solely on men when the women are clearly key to the interactional processes by which (a particular kind of masculinity – be clear) is supported through women’s work. Ignoring women as participants risks further objectifying them.

Preach! (Did you notice how he authors got a bonus lesson? There is more than one kind of masculinity! There might even be enough to say about masculinity to fill a whole journal!) The reviewer also made this comment which argues that the paper found the women in the space occupying the only role that the research design allowed them to:

Ironically, the author brings women into his analysis only in terms of how they act as “identity resources” for men—that is, he seems to argue one of his main findings is that women are identity resources, but also reduces them to such by not conducting an analysis of women’s agency. Toward the end of the paper, he even suggests that the “power always flows from customer to server”—i.e., men have and exert power over women. This analysis is reductionist.

The ignorance of the hucksters is fully on display here. Naturally, thought the rubes, a journal called “Men & Masculinities” is a place where the behaviors and assumptions of men can be safely analyzed without the pesky intrusion of the sentient feminine. Isn’t there any space left where men can conduct research about manly men in men’s spaces without some feminist interjecting to insist that the women in the story are people!?

Let’s also take a minute to appreciate that the pandering authors were trying to toe the party line with their comment that men always have the power. Meanwhile, the journal, ostensibly packed to the gills with single-minded feminists and “grievance scholars,” stops them short, pointing out that, even in the relatively uncomplicated space of Hooters, the power dynamics are more complicated.

The fake authors submitted shoddy research. On being found out, they doubled down on deception, adding fake details to their methods to address reviewers’ accurate criticisms. In the end, they effectively falsified data, something which would be no more easily detected in physics or engineering and, which, in fact, happens all the time. What’s more, as they began by trying to broadly extrapolate from woefully inadequate data they were thwarted and called to task. That was the prank, you see. “I can get these idiots to publish my ramblings on hanging out at Hooters with my bros. Tee-hee.” But after review, the corrected manuscript was pared down to present the findings as honestly and circumspectly as the deception of the authors allowed. Your participant-observations of your bros are legitimate if you follow established research protocols and forthrightly declare your methods. This is how participant ethnography happens.

TWIS did not take time to review all 20 articles, or even the 7 which were published. We refuse to buy into the Gish Gallop that assumes, without examination, that all represent poor scholarship or to be buried by the proof by verbosity. But, if we assume all of the papers followed a path similar to that of the “Hooters” paper, academia passes the test put to it.

America Race

No lecture for the white guys

We’re going to have to make this a regular column. My last post was about how conservative states’ rights/local solutions arguments suddenly evaporate when the aim of federal programs is to persecute minorities, rather than protect them.

But we’ve not plumbed the depths of conservative hypocrisy yet.

“Culture of failure”

If you’ve watched Fox News any time in the last 8 years, there’s a good chance you’ve heard that the only thing standing between minority communities and success is personal responsibility. Mitt Romney famously attributed the difference in economic success between Israeli Jews and Israeli Muslims to “culture.” The UN emphatically disagrees. But the most popular place to apply this trope is unquestionably black communities in the US. Since the Right has declared racism officially over, the success of black communities is in their own hands. And, by extension, if black communities don’t succeed, they have no one to blame but themselves. They could succeed if they could rid their communities and their lives of drugs, get and stay married and stay in school. You may also have heard about our black President’s failure as a leader to lecture young black men into successful careers as bow-tie-clad hedge fund managers. According to the Right, any discussion of racial disadvantage is unmanly excuse-making. Minorities should stop blaming anyone else for their problems, pick themselves up by their bootstraps, and get a job.

No scolding for the white kids?

But the discussion of white poverty and economic hardship looks very different. White Appalachian coal miners and factory workers really are victims, you see. They can’t be blamed for their increased drug use or suicide or the increasing failure of their marriages or their inability or unwillingness to relocate or retrain for new jobs. Obama’s failure with respect to them (to listen to right-wing media) was too little coddling. When unemployed factory workers blame their hardship on “Obama’s NAFTA” and vote for Trump, it’s not complaining or shirking their personal responsibility. It’s making America great again! Because the natural order of things is for policies like tariffs and subsidies to benefit white, native-born people as they have for generations. This heavy-handed tilting of the economic playing field in favor of white people is not a hand-out. It’s restoring the natural order. See?

This, ladies and gentlemen (and Bill O’Reilly), is what privilege looks like. When Parties and nations mobilize to solve your problems and whole governments are turned upside down out of fear of your electoral wrath, you’ve made it. All the brown folks are entitled to is a scolding from “their” President.

A better way

The Left should not fall into the trap of scolding and blaming rust-belt factory workers for the disaster President Trump is making of our country. They are victims of a system they could not control. And I, for one, do not envy their position. Instead, progressives should be inviting these victims of capitalism back into the Party fighting for a gentler economic system. And we can do so without amplifying their dangerous jingoist streak. In the past, we have been able to have a nuanced discussion of the connections between poverty and irresponsible behavior and we know the importance of digging to find the systemic causes of poverty. This is our chance to show the world the that love sees no color and that whether you’re a victim of driving while black or black lung disease, we’ve got your back.

Race Trump

Look, dummies. It’s about race.

My community is embroiled in a debate over whether to declare ourselves a “sanctuary city.” There’s widespread misunderstanding about this term. It means that local police will not arrest or investigate someone for no other reason than the suspicion that they’re breaking immigration laws. ICE can still operate in sanctuary cities. Persons arrested for other crimes can still be investigated for immigration violations and reported to ICE. The difference between sanctuary cities and other cities is that, in sanctuary cities, local police do not do the job of ICE. They serve the community and defend them against property and personal crimes irrespective of immigration status. Both citizens and non-citizens are safer in sanctuary cities because every minute police spend checking residents’ papers is a minute they don’t spend making the community safe. If deportations are important to the nation, they can pay for the enforcement, but the police in my community have enough to do.

The question of sanctuary cities also lays bare a truth about American politics. The “state’s rights” arguments made famous by Barry Goldwater and touted by Republicans since that time are nothing but a guise for racism. When the question is school integration or voting rights, it doesn’t take two sentences for Republicans to retreat to Constitutional assurances of the primacy of States. Local solutions, they tell us, are the thing that makes this country great. The citizens of South Carolina and Arkansas can and should (and must!) be entrusted with the protection of the rights of minorities in their own state. Federal interference is unconstitutional.

But on the question of sanctuary cities, Federal agencies like ICE are, apparently, within their rights to commandeer local and state police to conduct their business. In this case, States and municipalities, it seems, are incapable of making decisions about protecting minorities against unlawful search. Why the sudden about face by Republicans? Where are the cries for local solutions and the fears of federal tyranny?

The difference, of course, is the skin color of the persons being oppressed. It’s OK to use federal power to terrorize Hispanic communities. They’re not Republicans anyway.

#BecauseMath Economics Taxation Unemployment

Will low corporate taxes bring the jobs back?

Many promises have been made that any number of conservative policies will bring jobs back to America. In this post, we’ll examine the claim that lower corporate taxes will reduce offshoring of jobs by presenting a simple example.

Imagine a multinational company, Big Widget Inc. (BWI), can make widgets either in the United States or in Mexico. In Mexico, where environmental regulations are gentler and wages lower, BWI can make widgets for $90. In the United States, they can make widgets for $95. No matter where they manufacture them, they can sell widgets for $100 in the United States.

Now, in this fictional world, let’s imagine the corporate tax rate is the same 40% in both countries. How much tax will BWI pay and to whom? Answering this requires a short primer on transfer pricing. When a company does business in 2 countries, it has a separate affiliate organization in each country. When goods manufactured by BWI Mexico are imported by BWI America, BWI assigns a “price” for those goods as if BWI Mexico sold those goods to BWI America. The price is called the transfer price. Ideally, this price will match the price that two unaffiliated companies would agree on. The terminology here is “arms length.” The tax authority in each country tries to prevent companies from gaming the transfer price, but there’s some wiggle room here.

If the two countries have the same tax rate, then BWI doesn’t care what the transfer price is. But, the two countries do. If the transfer price is $90, then BWI Mexico recognizes zero profit in Mexico and the USA collects all the taxes. If the transfer price is $100, then BWI Mexico recognizes all of the profit and Mexico collects all the taxes. In either case, BWI pays 40% of it’s $10 profit, or $4.

But Republicans tell us that reducing that corporate tax rate will bring that manufacturing back to the USA. Let’s explore that.

Imagine America cut its corporate income tax to 10% while Mexico holds its tax rate at 40%. In this scenario, BWI wants to minimize the transfer price for widgets. If the transfer price is $90, BWI can recognize the whole $10 profit in the USA and pay just $1 (10%) on its US profit. That’s a nice windfall for BWI but a big loss in tax revenue for Mexico. Mexico will probably insist on a higher transfer price. Maybe $95. At that transfer price and those tax rates, would widget manufacturing return to America?

By importing widgets at a $95 transfer price, BWI can make a $5 profit in each country. Mexico charges a 40% tax on the $5 attributed to BMI Mexico and the US charges 10% on the profit attributed to BWI America, so BWI Mexico pays $2 in taxes (40% x $5), BWI America pays $0.50 and BWI keeps a $7.50 after tax profit. That’s certainly better than the $6 after tax profit before the rate cut. But will BWI be motivated to move manufacturing to the US? In America, they can manufacture widgets for $95 and sell them for $100 and make a $4 after tax profit. BWI will still import since $7.50 beats $4. In fact, even at a transfer price of $100, which forces all profit on imported widgets to be taxed at the high Mexican rate, BWI *still* makes higher after tax profit by importing. The transfer price has to be over $105 (forcing the BMI America to sell at a loss!) before manufacturing in the US generates higher profits (Try it!).

I, myself, don’t see much reason to believe lowering the tax rate will boost American manufacturing. But, there’s another effect of this strategy that’s even more distressing. The policy fight over the transfer price rearranges some political alliances. We can see this by examining the desires of each of several parties–the US government, the Mexican government, US manufacturers and US workers. Two parties have an interest in a low transfer price. The US government wants a low transfer price so that profit is recognized in the US and can be taxed there. Manufacturing firms also want a low transfer price since they can pay less tax overall by moving profits to the low-tax US.

There are two parties in favor of high transfer prices, too. The Mexican government wants a high transfer price to keep taxable profits in Mexico. The other party interested in a high transfer price is American workers. It was only a very high transfer price that made manufacturing in the US more attractive. So, US workers and their unions will push to keep the transfer price high in order to move manufacturing from Mexico to the US. The sudden drop in the US corporate tax rate aligns US corporations and the US government in opposition to the Mexican government and US workers. The reader is left to decide for themselves who they think will win this political fight–the combined forces of multinational firms and US legislators or the Mexican government and American workers. But you can probably guess what I would predict.

This gaming of the corporate tax rate has two sets of winners, both of them powerful. But none of them are you and me.

Elections Trump

Trump supporters ARE the meteor

My Republican friends are all torn up inside over what terrible choices 2016 has left them. Next post will address the absolute insanity in pretending Hillary Clinton and Donald Trump are somehow comparably dangerous. But first, some reflection for my Republican friends.

Dear Republicans,

See, here’s the thing. Trump supporters *are* the meteor, the Krakken, SkyNet. You, dear GOP, are living “Little Shop of Horrors“. In fact, I think Little Shop of Horrors is the perfect metaphor for the Trump wing of your Party. Here you are, wringing your hands over what to do with your monster, born from Nixon’s Southern Strategy and lovingly nurtured from birth on a diet of mild xenophobia; white, male entitlement and post-truth “news”. When they lost their jobs and their retirement, you told poor white people it was the fault of the black President and his brown supporters. You couldn’t tell them the truth–that capitalism has victims and that a healthy society has to make provisions to care for them–because, well, “I’m not paying for health care for no unemployed freeloader!” So, instead, you made stuff up.

You had lots of chances to step in and say, “Gee. I wonder if we’ll ever regret creating an entire TV channel and blogosphere where true/false is a minor, secondary concern compared with pro/anti-Obama.”

“You know he’s not a Muslim, right? Shall we correct that?”
“Are you kidding? Look at the ratings!?”

“Apologizer-in-chief? Doesn’t that seem a little overstated. I mean, we did just bomb, then invade a country for what turned out to be two completely fabricated reasons.”
“Whose side are you on? It’s like you want higher taxes. I’m telling Grover!”

“He just said Reagan never negotiated with terrorists. Are we going to correct that?”
“Well, but doesn’t it FEEL like Reagan never negotiated with terrorists though?”

And then came the Trump. You couldn’t shut up the Trump when he came with his birther nonsense. Your base’s ability to process a pro-Obama truth had atrophied way too far. By then, you no longer had control of the narrative. You had a microphone, but you sure weren’t going to be caught defending Obama with only truth as your defense!

So, here we are. The years you might have spent creating a platform, you squandered on a Benghazi investigation–then 6 more. You’ve brought up half your party unable to distinguish a misogynist, racist, dangerously unhinged narcissist who wants nuclear weapons for the world, state-controlled press, the intentional targeting of civilians and who won’t commit to being bound by the results of an election; from a woman who used the wrong email. Just like you taught them. For a while, pandering to the basest aspects of your Party won you two houses of Congress, state houses and governorships. But now, Audrey II needs you to chop up what’s left of your responsible economic platform, your family values and your respect for anyone different from yourself and feed it to the beast you’ve nurtured. Tough choices. What would Seymour do?

Sincerely missing the old GOP,


America Class Gender Race

Unstrange bedfellows

While it may be counting chickens before they’re hatched, this election seems to be slipping from the tiny fingers of Donald J. Trump. America, you did it! It was the bare minimum required of a democracy hopeful of its continuance, but you did it.

The GOP has already begun its quadrennial public mortification and, in true Republican form, they don’t have a clue. George Will figures this will be accomplished in a single sentence, “Perhaps it is imprudent to nominate a venomous charlatan.” This has been expressed more concisely elsewhere. You can find half a dozen fresh columns by conservative pundits each week insisting that The Donald has damaged the brand and, crucially, that he was never a real Republican any way and could we please just move on from this whole ugly episode. I see that point. I really do. The Republicans I know have no use for the misogyny, religious persecution, racism or protectionism of the Trump campaign. Their shtick is small government, local solutions, free markets, etc., etc.. They opposed Trump every step of the way and are a fine example of putting principle above Party. Bravo, #NeverTrumpers!

The point of this post is not to rub salt in their wounds. The traditional fiscal conservatives are entitled to their wrong opinions on taxing and spending. They don’t have to take credit for Trump any more than I have to take credit for everything said by the anti-natalists at NARAL. But, in my opinion, Republicans have put far too little thought into how they got here. Is it merely a coincidence that the free market advocates and the racists ended up in the same party? It is, after all, a genuinely impressive trick to win the votes of lower-class whites while advancing a host of policies that would take money from their pockets. Are Republicans just that good?

The key to understanding the big, peculiar circus that is the GOP is the concept that inspires the most eye-rolling from them. The connection between the “where’s the fence!” wing and the “taxation is theft!” wing of the GOP is … privilege. More accurately, it’s the willful or accidental ignorance of inherited privilege in the United States circa 2016. In order for the GOP to exorcise these demons, they’re going to have to first understand, then acknowledge the existence of, privilege and their relationship to it.

What privilege is not

We almost need a new word for this phenomenon. Modern conservatives have so shut themselves off from understanding the concept of privilege that they can’t speak of it sans sarcasm.

“Sorry guys. Gotta go. My white privilege job needs my attention.”

“With all this male privilege I’m enjoying, people just throw money at me.”

(It’s long been established that conservatives are abysmally losing the contest for comedic superiority. Low expectations are key here.)

I wish it didn’t have to happen, but let me say what’s been said thousands of times before: White privilege does not mean you didn’t work for the things you have. The rewards, financial and other, that you receive, are undeniably correlated with the effort you put in. Congratulations!

What we mean when we say that you enjoy “privilege” is that this correlation between effort/character and wealth is not perfect. And, some of the additional variation can be accounted for by your race/gender/religion/parentage/etc.. That’s it. You work hard. But some people who work just as hard as you receives less because they have different parents. Is that so hard to imagine?

We’ve explained this in a hundred different ways. The playing field is not level. Some people are born on 3rd base. There are comics. And object lessons. And a personal address to a lost Yalie. The resources are out there.

White privilege also does not mean that no woman or Black person has ever succeeded. That’s not how a statistical correlation works. At the upper end of the bell curve for all races/genders, we’ll find highly talented, motivated and lucky people who succeed. But that does not mean that one population does not enjoy an unearned advantage. Obama and Oprah do not mean racial privilege is over.

Why privilege is the glue

Privilege is the glue that holds together the Brooks Brothers wing and the patriotic jumpsuit wing of the GOP. The fiscal laissez-faire conservatives want to shrink government since it takes money from deserving makers and redistributes it to unworthy takers. But this only works if you think possessing wealth is highly correlated with deserving wealth. As you become aware of the myriad ways society and its institutions give incremental advantages to (for example) white men born into wealth and put obstacles in the path of lower-class Latinas, this argument becomes a lot less compelling. The weaker you believe that correlation between wealth and character to be, the less you’re concerned about taxing rich people to pay for programs for poor people. Wealthy Republicans believe this correlation is strong and taxes are, therefore, immoral.

The Trump wing of the party has a different privilege problem. They have a hard time coming to grips with their historically-conferred advantages. As astutely observed by Michael Kimmel, Trump is drawing support from the aggrieved entitlement of non-college educated white men and women. These are men and women who pine for the world of their parents and grandparents when a job in the factory got you a house, health care and a retirement. But this set up was always made possible by the presence and effort of both a domestic and an international underclass. Discrimination in employment, housing and education has bolstered the incomes and suppressed the rents of white people for decades. As that discrimination is eliminated, white people find it hard to build the life their parents had with only their high school diploma.

Even leaving aside state-side discrimination, the lives of Americans have been subsidized by the accident of their birth in the United States. The expansions of free trade has reduced that subsidy as well, to the benefit of the international lower class. But even if the knocking down of trade barriers benefits both rich and poor countries on the whole, there are individual victims within those countries. These disenfranchised Trump supporters see this as giving away the jobs to which they are entitled.

It’s not incorrect for this group to recognize themselves as victims of globalization. What’s incorrect is thinking the system has suddenly become unfair because you have to compete with Mexicans on a level field. The system has suddenly become fair and the real problem, that a modern economy does not support low skilled workers at American wages, was previously masked by tariffs. In effect, the US government has been picking winners and losers for decades now. Once it stopped, non-college workers discovered that the market made them the losers in this game.

Unfortunately, the GOP is the wrong place for economic losers. In the Republican Party, those who can’t support themselves have deficient character. So the GOP has to hide from it’s non-college voters the fact that they’re victims of the market. They’ve paraded various scapegoats during the Obama Presidency, but Trump’s genius was to latch on to a scapegoat with a long tradition in Republican states–the brown people.

The college-educated Republican elite are perfectly willing to paint this Republican underclass as victims of a system propping up minorities at their expense. They don’t believe in privilege either and, without white racial resentment, their political future is bleak. But the gig is up. I know right now we liberals are supposed to be sheepishly apologizing and examining our own unfortunate prejudices. But when I contemplate this country long term I believe privilege denialism is near its end. Every day, the racist and misogynist machinations of the system are more apparent. And when that glue that holds this twisted Republican coalition together dissolves, a new day dawns.

Elections Taxation

TWIS: Bernie Sanders is no Socialist!

The knives have come out. George Will has exposed the dark secrets we knew had to be lurking in Bernie Sanders’ closet. Here’s his attack piece in National Review. As an hoers d’ouevre, Will accuses Bernie of caucusing with Democrats (gasp!). And as if that wasn’t bad enough, he’s apparently not even a good enough socialist for Comrade Will. Socialism, says Will, used to mean “government ownership of the means of production.” Over  time, according to Will, this idea was diluted to mean simply taxing rich people more than poor people and providing programs that benefit poor people more than rich people. So, it turns out Bernie Sanders is not a Socialist in the comic conservative propaganda sense. He’s just a reasonable guy who has less faith than many people on the Right in the magical incantations whereby letting rich people keep all their money makes poor people richer.

This mealy-mouthed Socialism lite doesn’t work for Michele Malkin either, who can’t tell the difference between Hugo Chavez and Comrade Bernie. For Michele, policies like free college education can’t have any other motivation than “punishing” and “shaming” the “wealth-creators,” peace be upon them. Bernie’s moderate Euro-socialism is clearly not comfortable for conservatives. If word gets out that socialism just means taxing rich people to provide basic necessities to poor people, the fanged Jabberwock that drives conservatives to the polls will turn out to be sorta sensible, if slightly idealistic, policy. And so, Malkin reminds us in National Review that there’s but a razor thin distinction, hardly even worth mentioning, between breaking up the big banks and impaling hedge-fund managers on stakes.

Confronted by new and perplexing ideas, the impulse of the Stupid (and, if fact, all of us) is to retreat to the safety of simplistic categories and pithy platitudes. Ambiguity is not for the faint of heart. But therein lies safety and prosperity.

I’m With Stupid

HeyStupid is a socialist in the vein of Bernie Sanders and this might be a good opportunity to lay out my case for redistribution. Because I’m not running for any office, I can say what Democratic politicians (except Bernie Sanders) can’t: The current distribution of wealth is, to a large degree, not based on merit and therefore preserving it is not inherently moral. Let me rephrase. I reject the conservative notion that income is strongly correlated with superior character or work ethic.

That doesn’t seem to bother some conservatives. I’ve asked a few of my friends to evaluate the following scenario. Imagine that your paycheck, and in fact, everyone’s paycheck, was based, either partially or entirely, on a dice roll. You could change jobs if you want, but the result of this dice roll would follow you. In that scenario, I ask my conservative friends, would explicit wealth redistribution still be immoral. Imagine that fifty percent of your salary were determined this way. In that case, would you support taxing the very richest people at 50%? Most of them agree with me on this point. Then the question becomes, how much of peoples’ income can we reasonable attribute to their talent and work ethic? Even Greg Mankiw, reliable defender of the 1%, couldn’t see his way clear to assigning more than 22% of income variation to genetics. The rest was upbringing, family connections and plain, dumb luck. I don’t disagree with them that taking money from people that earned it by their efforts is bad. I just have a lower estimate of the fraction of wealth that is actually distributed according to merit.

I’d like to clarify that I don’t hate the rich. I don’t fault them for winning the socioeconomic lottery or for playing the game the very best they can. But I don’t like the game and I think it should be changed.

Now, some of my friends have no moral objection to redistribution. They have more practical concerns with redistribution. Mostly, they complain that high tax rates demotivate the wealthy. Why, after all, would they get out of bed and go to work at their very hard jobs if they didn’t make a whole lot of money? But this is trivial. The wealthy don’t go to work to make money. They go to work to make more money than someone else. Sure, you might initially have a few people that decide to hang it up and sail around the world rather than work for a paltry $2.4 million/year after taxes. But before long, no one would notice they had less than before because they’d be too busy worrying about having less than someone else. And off they’d go again.

In redistributing wealth, we are bound to, in some cases, take money from deserving, hard-working people, and give it to undeserving, lazy people. It’s time we came to grips with this. However, since our starting point is monumentally unfair, I feel quite confident our new distribution could scarcely be worse than the one that exists now.

Gender Health Care Sex

TWIS : I believe life begins at conception

“Well, I believe life begins at conception.”

You don’t. It might seem convenient or fashionable in your circle to say that, but it’s important to think that through. And the place that idea inevitably takes us is a bleak vision of government surveillance and control. You see, for every person born in the US, two fertilized eggs died. That means induced abortion (the kind we always holler about) is about 9% of the unborn deaths in the country. But where’s the outrage over the other 91%? Where’s the campaign to raise research dollars to stop failed implantation and spontaneous abortion? If  SIDS were killing two-thirds of babies, you can bet we’d hardly talk about anything else. And why aren’t we prosecuting for manslaughter those parents who fail to maximize their zygote’s chances. If you really believed life begins  at conception, you ought to favor the following policies.

Mandatory birth control. Unprotected sex, because it has such deadly consequences for zygotes, would need to be carefully controlled. This is especially true of married couples who are by far the most likely to be having unprotected sex. Couples would need to undergo an examination to determine they have maximized implantation chances before they are allowed to pursue pregnancy. Forgetting to take your birth control is now a prosecutable offense.

Lots more money for the NIH. Great research is being done to improve implantation rates for in vitro fertilization (IVF). Most of this research is funded by the NIH or NSF. However, one Party in particular is determined to keep those budgets low. We should expand research related to infertility by 10X at least. (As a bonus, we just might improve the lives of the post-natal!)

Mandatory tubal ligation at 35. Beyond 35, implantation rates begin to drop. In IVF clinics, it’s been found that 45% of (in vitro) fertilized eggs successfully implant for women under 35. As women age, that rate drops quite quickly to about 7% for women over 40. Remember that IVF involves fertilizing up to a dozen egg cells, then selecting the healthiest ones and implanting at the optimal time. Natural implantation rates are liable to be quite a bit lower.

Mandatory transvaginal ultrasounds. As you can imagine, the state of the uterine walls is critical for successful implantation. Women seeking to come off of their (state-mandated) birth control should undergo a transvaginal ultrasound to determine their viability. Women with insufficient uterine walls may be required to lose weight or make other dietary and lifestyle changes in order to pursue pregnancy.

In short,  if life begins at conception, there’s going to be a whole lot more of Uncle Sam in your vagina. Even if the only sex you’re having is with your spouse. And, lest you gentlemen feel left out, there is evidence that your health can have an effect on implantation as well. Get ready to drop those drawers for your state scrotum inspection!

Now, ThisWeekInStupid supports a grown-up discussion of when life begins. But we want it clear at the outset that it won’t just be about slut-shaming unmarried women. If life begins at conception, the choices of all of us are going to need to be severely restricted.

America Foreign Policy War

Pre-emptive Candy-bombing!

Since no one else seems willing to be President, I guess I’ll have to finally lay out my platform, officially. Despite all my rantings on widely varying subjects, I, heystupid, have only one plank to my Presidential platform: pre-emptive candy bombing. For those unfamiliar with the concept of candy-bombing, the original candy bomber, Gail “Hal” Halvorsen, dropped candy from his C-54 cargo plane to the children of Berlin in the aftermath of World War II. Soon, American candy makers were sending chocolate by the ton and Americans were mailing their own handkerchiefs to Halvorsen to use as parachutes. Almost 70 years later, Colonel Halvorsen was invited to carry the German team’s national placard during the opening ceremonies of the 2002 Winter Olympics. There’s a school in Berlin named for him. Check him out here:

This is a terrific example of winning hearts and minds at the price of about 12 cents per heart.

However, it occurs to me that it’s wasteful and unnecessary to bomb a country with ordnance before we bomb it with food, water, clothing, medicine, malaria nets, soccer balls and, yes, candy. We should be mercilessly pre-emptively candy-bombing (and potato-bombing and water-bombing and amoxicilin-bombing and …) dozens of countries, especially our enemies. Let them tremble before our charity! Hal Halvorsen said, of his act, “It wasn’t the candy that was important. What was important was that somebody–an American–knew I was in trouble. Somebody cared.” Imagine how many fewer countries we’d have to invade if the people of the world felt like Americans knew their struggles and cared.

So, if elected my first priority will be to redirect one-third of the US military budget to humanitarian and rescue efforts. The US military already does a lot of humanitarian work, and they do it astoundingly well. Coupling these efforts with military capability will help ensure aid is directed where most important. But, let us go into this venture with open eyes. There will be American casualties from this, despite our best efforts. What could be more noble than to die that families may have enough to eat?

I propose we raise a worldwide generation whose first memory of the stars and stripes is attached to a Hershey bar and a bottle of Pepsi (or a SodaStream!). HeyStupid 2016!

Foreign Policy War

TWIS: Either have a good plan or a long-term plan

It seems like you can always count on Dr. Ben Carson to provide a fresh, hot batch of stupid to save your (sorta) weekly column. He was interviewed by The Hill and said (as he had to), “I was never in favor of going into Iraq.” So far, so good. But his follow-up was priceless. “When you go into a situation with so many factions and such a complex history,” he said, “unless you know what you’re doing or have a long-term strategy, it just creates more problems.” Now, Dr. Carson might have meant we should have both knowledge and a long-term strategy, except that he adds “..and since we did go in, the big problem is that we didn’t secure victory there, and that’s a huge problem.” In other words, since you didn’t know what you were doing going in, you’d better make up for it by staying longer.

This is the unanswered question for the Right. Imagine you’re Barack Obama in 2009. You’ve inherited two wars. Both will be a decade old (twice as long as WWII) by the end of your first term and rapidly approaching the 100,000 deaths and 4 trillion dollar mark. What’s a traitorous, deficit-ballooning, secret Muslim election-stealer to do? Continue Bush’s folly, rooted in deception, greed and industrial-strength denial? Cut and run? Stay the course?

The answer from the Stupid, of course, is that you should have done the opposite of whatever Barack Obama did do. Since he left, then the right (Right!) answer was not to leave. But was it? By 2010, the government of Nouri al-Maliki, Shia prime minister of Iraq, was corrupt, sectarian and weak. It was heavily supported by Iran-backed, loosely-controlled Shia militia. It was complicit in the persecution of the Sunni minority. The actions of this government and its thugs really created ISIS in Iraq.

I’ve never heard a critic of Obama’s Iraq policy state what should have been the criteria for withdrawing troops from Iraq. How long, after all, should we have continued to prop up the Maliki government in contradiction of its own expressed wishes? John McCain thinks we should have stayed for 100 years. At least he has the courage to say so. Cowards like Carson make sideways allusions to some phantom fool-proof strategy that’s a bound to succeed. Clowns like Donald Trump comically state they have a secret silver bullet strategy, but won’t tell us what it is.

Politics is politics, of course, but now we have a chorus of GOP Presidential candidates who brazenly advocate for the reinvasion of Iraq. (Carson, to his credit, is not one of them.) For the GOP, and their defense contractor backers, war doesn’t need a goal. It is the goal. The more nebulous and unattainable the exit strategy, the better.

Madonna once said, “I prefer young men. They don’t know what they’re doing, but they can do it all night!” Looks like Dr. Ben and the GOP may have found another fan of their foreign policy.



Media Obama Race War

Beyond the “race card”

Charles Blow recently had some terrific things to say about race in the New York Times. In summary, people should stop “playing the ‘race card’ card”–trying to shut down dialogue about race because they see it as a facade for excuse-making. While it can’t be disproved that someone, somewhere deflected legitimate criticism by accusing her accuser of racism, it’s surely not the imminent threat to healthy dialogue its made out to be. Anyway, that’s Mr. Blow’s excellent point, expertly advanced in his article. Mine is different.

There are all kinds of silly ways conservatives attempt to shut down dialogue. Of course, as curator of a site called ThisWeekInStupid, I worry constantly about painting with too broad a brush. Not all conservative arguments fall into the categories described below. However, I’d like to coin a few new terms to describe some of the most ridiculous conservative arguments.

Playing the “stop playing the ‘Bush card’ card.” When cons play the “stop playing the ‘Bush card’ card,” they attempt to blunt criticism of GOP policies or defenses of liberal policies by asking liberals to pretend the world was created in 2009. No one is responsible for the rise of ISIS because there was no 2008. Budget deficits started in 2009. Obama should stop making excuses for the economy because it’s not like anyone else cratered the housing and credit markets. In one survey 20% of Americans faulted Obama more than Bush for the poor response to Hurricane Katrina in 2006. That’s some weapons-grade self-deception. Expect to see a lot of railing against the ‘Bush card’ in 2016 whether Jeb gets the nomination or not.

Playing the “Neville Chamberlain” card. In my experience, you cannot engage in a conversation about Khomeini, Putin, Kim Jong-Il, Obamacare or the Denver Broncos without someone invoking Hitler.  Ben Carson if no one else. And, whether he’s mentioned by name or not, the specter of Neville Chamberlain and his policy of Nazi appeasement will, inevitably, haunt the discussion. To listen to players of the Neville Chamberlain card, you’d think that, without their constant vigilance, we’d have a world war every other year (perhaps in off-Olympic years?). Don’t want to put troops in Ukraine? You’re probably the kind who would have just let the Nazis walk in to London. Worried about collateral damage from air strikes against Iran/Syria/Libya/North Korea/Belgium? You appeasing pantywaist. Neville Chamberlain would be proud.

Playing the “free speech” card. You can read literally thousands of pages of whining by conservative pundits and politicos that conservative viewpoints are not heard and that this is a grievous blow to the First Amendment. When college students protested the invitation of Condolezza Rice to speak at commencement, that was the “PC police” out to throw a wet blanket over the discussion. But all viewpoints do not get equal time. Stupid doesn’t get the same respect as rational debate. You have the right to spout whatever ridiculous nonsense you want on your blogs and cable channels, but it is not limiting free speech when I call it out as ridiculous nonsense. If your views are valid, let’s have a discussion. But stop playing the “free speech” card and explain to me how to distinguish your ignorance from garden variety bigotry and selfishness.

I respect your conservative views. I do. Just kidding. I can’t really pull that off. These days it seems to me the Republican platform is equal parts racial ignorance and denial, poor arithmetic and the mistaking of the 1980s movie Red Dawn for a documentary. But I’m glad to explain all of that to you, and to hear your responses. But as soon as you pull out the Neville Chamberlain card, I’m outta here.

#BecauseMath Economics Unemployment

A non-economist examines the minimum wage

There are no economists at ThisWeekInStupid. But, that’s not going to stop us from weighing in any more than it stops economic ignoramuses like Paul Ryan, Bernie Sanders or Peter Schiff. Recently, we penned a piece opposing a minimum wage hike, or at least suggesting that there were plenty of other ways to help minimum wage workers that were less apt to cause unemployment. Today, we’re going to go back on that a little. The main argument against a minimum wage involves, naturally, a supply and demand plot, like this one.


The downward sloping curve is the demand for workers. These are the employers who hire fewer workers when the wage is high. Many businesses can make money hiring workers for $4/hour. Fewer businesses can operate profitably paying $15/hour and very few can survive if they must pay $25/hour. The other curve, which slopes upward, is the supply curve. These are the workers. For $4/hour, lots of people will go back to school or live on their spouses income or live in their parents’ basement rather than work. For $15/hour many more will be willing to work. And for $25/hour, workers will come out of the woodwork. They’ll get childcare, come out of retirement, rearrange their class schedule, etc. (Note that this curve assumes all workers are equal, which is nonsense, but it may be illustrative anyway.) Where these two curves meet is the equilibrium wage. That’s where wages will naturally fall without any government interference. This next graph is decorated a little more.


In this graph, I’ve colored two regions underneath the curves. The green region represents the producers surplus–extra profit for workers. That is, there are some workers which would have been willing to work for $4/hour. They consider their hour to be worth $4. If the equilibrium wage is $6/hour, then they are $2 richer for every hour they work.

The orange area is the consumer surplus–extra profit for employers. Some employers could break even by paying workers $8/hour. If they only pay $6/hour, the employer is wealthier by $2 for every hour worked. These two areas are what make capitalism fun. Voluntary exchanges make both parties wealthier. Always. So is it ever a good idea for government to interfere with voluntary exchange? Let’s see.

The effects of a minimum wage

When a minimum wage is introduced above the equilibrium wage, a few things change. The first result is unemployment. In our curve, the equilibrium wage might be $6/hour. With a minimum wage set at $8/hour, two things happen. First, more people are seeking work. Second, fewer businesses are willing to hire. Both of these effects cause unemployment (but only the second of these effects represents a change in employment from the equilibrium situation). It’s represented by U in the plot below.


At the new wage, employers are demanding fewer workers than the total workers seeking a job. Liberals should stop denying this effect. It’s true that there are studies that found that in a subset of businesses hiring minimum wage workers, the effect on employment was weak or absent. But these studies and others also point to a stimulative effect of a minimum wage wherein wealth is transferred to poorer workers who tend to immediately spend their money. This tends to boost demand. So the question is, if there’s a boost in demand, why does employment stay the same? Why doesn’t it increase? A natural explanation is the argument above. The first order effect is the one we see on the supply and demand curve pushing employment down. The stimulative effect helps to mitigate that effect. Also, there are many careful studies which reach the conclusion that a minimum wage does decrease employment.

Returning to the supply/demand plot, let’s look at what’s happened to the green and orange regions. The wage is higher, so the green region would be the area under the supply curve up to the new minimum wage. Except that there is unemployment. Only a fraction of the workers desiring employment can find jobs. So we should reduce the green region by the unemployment. An approximation of that is the green shaded region above.

The orange region is more straightforward. Those employers who could not profit by hiring workers at the minimum wage, stopped hiring. So the orange region is the area under the demand curve above the minimum wage.

So, are the workers, collectively, better off? Certainly those workers who keep their jobs are better off. Our worker who was willing to work for $4/hour is now making $8/hour and gaining wealth at $4 for every hour worked (up from $2 before the minimum wage). But, some other workers, including some willing to work for $4/hour, have lost the chance to work. In many cases, this represents an overall gain for the workers as a whole. It’s easy to see how the new green region could be larger than the old especially if the demand is quite inelastic–that is, if demand for workers stays largely the same as wages increase. But when this is the case, it’s important to ask, where did this extra money come from?

Partly, it comes out of the profits formerly collected by the employers. In our new curve, the orange region is clearly smaller. Employers of minimum wage workers will almost always argue against a minimum wage. The first order effect is to shrink their profits.

Another source of increased wages for workers is increased prices for the end goods. Conservatives often say dumb things like, “Employers just pass the additional costs on to consumers.” This is lazy economics (just ask a non-economist!). There’s a separate supply/demand curve for whatever good or service the employer is selling. Presumably, this curve is what set the consumer price of the end good in the first place. Unless the minimum wage changes the market for end goods, the pricing strategy of the employer is unlikely to change much. Of course, the supply curve for the end goods may change as competitors with smaller profit margins who cannot afford the new higher wage, drop out of the market. This may cause prices to rise, but it will still be subject to the end consumer demand curve. Consumers will not blithely pay higher prices just because our employers’ costs rise. Research shows that something like one-third of the additional cost of a minimum wage hike is passed to consumers as higher consumer prices.

So, some of the extra worker profit comes out of employer profit and some comes from the end consumers. One important thing should be clear from the plots. The profit the workers gain from the minimum wage is always less than the profit the employers lose. That is, the first order effect of government interference is to reduce the overall wealth of the economy. This should have been obvious from the beginning. When a worker valuing his time at $4/hour works for an employer who values that same work at $10/hour, there is, in total $6/hour profit to be made and split between the employer and employee. Changing the wage shifts the allocation between the employer and employee, but does not affect that total. So the total possible surplus (consumer + producer) was fixed before the minimum wage was introduced. The minimum wage can only affect this total by prohibiting some of the exchanges, reducing the total profit.

So, isn’t a minimum wage just a terrible idea?


Not necessarily. Think of a minimum wage as a leaky pipeline that transfers wealth from wealthy employers to less wealthy workers. There are some good reasons to redistribute wealth downward. First, wealth exhibits a diminishing marginal utility. That is, each dollar improves the life of a poor person more than it does a rich person. To a poor person, $500 may mean repairing his only car or fixing his children’s teeth. Meanwhile, to a rich person, it may mean an additional Coach purse or a spectacular bottle of wine. Even though the total amount of stuff has not increased (and has, in fact, decreased) the utility of the stuff, or the happiness it produces, may increase.

The second reason to redistribute wealth applies only in a Keynesian recession. When an economy is in the doldrums due to deflation and weak demand, shifting wealth from rich to poor can boost the economy since poor people tend to spend their money more quickly and readily than rich people. This moves money through the economy faster and creates inflation. In an economy dogged by deflation due to a shrinking money supply and weak demand, this is a welcome effect. But, in an economy operating at full capacity or one experiencing supply-push inflation, this is a problem. More spending can cause inflation to run too high, distorting price signals. The great part about a fixed minimum wage is that inflation quickly makes the minimum wage irrelevant as wages are pushed above the mandated minimum. A minimum wage below the equilibrium wage is like having no minimum at all. So a mildly restrictive minimum wage is an automatic recession fighter providing stimulus when demand (and wages) fall without causing inflation when wages rise.


The final reason to redistribute wealth, especially through a minimum wage, comes from Henry George (whom modern economists ignore at their peril). George and his disciples point out that at least some of the profits employers collect are “economic rent” on the non-produced inputs to production. That is, the division between employer and employee may be partly because of something about the employer which does not make her more productive. Certain people may have better access to capital due to their birth or connections or physical characteristics or land ownership or habitus. Where these characteristics are unrelated to productivity, they amount to a contrived exclusivity, depressing the demand for workers and reducing wages. Marx would say that the separation of the workers from the means of production enables excessive profit-taking by employers. Of course, not all advantages of employers are rent taking. An employer who has labored to produce 10 shovels might reasonably hire 10 workers to use them, taking profit for providing the shovels. But, when that employer takes additional rent because she owns the land or because her father-in-law fronted her the money for the shovels or because she has an exclusive right to produce or use shovels, she’s collecting economic rent. Rent-taking reduces the efficiency of markets and destroys wealth in the same way a minimum wage does but to the disadvantage of workers. A minimum wage forbids any exchange of labor for money below a certain wage. Rent requirements forbid or discourage businesses started by otherwise productive people without the right characteristics or connections.

A brief clarification is probably a good idea here. In economic terms “rent” is not only the money you pay your landlord to continue to live in your apartment (although that’s one example). It’s also the benefit you get from being white or being the boss’s nephew or even for holding the patent on a product. Not all assets on which you collect rent are nefarious or unfair. But what makes it rent-taking is that you benefit for some other reason than that you’re more productive.

Let’s look at our supply and demand curves again. Rent requirements artificially reduce the number of potential employers. For simplicity, we represent this as a simple multiplicative reduction in the labor demand. Suppose that our rent requirement means that 15% of potential employers are pushed out of the market.


In the curve above, it’s clear that the downward shift in demand reduces the wage and increases the profits for the remaining employers. At the same time, the employment shrinks. The effect is, in fact, quite similar to the effect of a minimum wage with the increased profits for employers coming partly from decreased profits for workers.

In cases where there are rent requirements for new businesses, a minimum wage may boost wages which were artificially suppressed by rent-seekers. But, a minimum wage is a very blunt instrument. It harms both rent-seekers and naturally profitable businesses. In this curve, we can see that the combination of a minimum wage and rent requirements is better for workers than no minimum wage (or might be), but still much inferior to eliminating both the minimum wage and rent requirements.


Here, the minimum wage has pushed the price back out to the equilibrium price, but it cannot undo the effect of the rent requirements. An economy is much better served by finding ways to reduce rent-seeking, especially since both the minimum wage and the rent requirements drive up consumer prices. But, in markets dominated by rent requirements, a reasonable minimum wage may do more good than harm.



Elections Gender Race

Mia Love boldly goes where only 26 Black women have gone before

The Republicans are in the middle of an orgy of self-congratulation having just elected the first ever female Black Republican to Congress. Mia Love, newly elected representative of Utah’s 4th district, narrowly defeated Doug Owens on Tuesday. In that race, she outspent her opponent 7 to 1, having garnered millions of dollars’ worth of support from the New York investment bankers, the Kochs and Utah’s thriving multi-level marketing industry. This was important to the GOP. And so, on Wednesday the media took to the interwebs and airwaves to hail this important leap forward for America.

Now, ThisWeekInStupid would be over the moon if the Republican Party started addressing real problems with race in America, and we hope Representative Love will bring an important perspective. However, we thought it appropriate to point out that the GOP is about 40 years behind. The first Black Congresswoman was Shirley Chisholm, elected in 1968 by New York’s 12th district. She served there until 1983 and even sought the Democratic nomination for President in 1972. Since that time, the Democrats have elected 26 Black Congresswomen and one female Black Senator. Take a minute and let that sink in. That’s forty-six years. Babies became grandmothers in that length of time. The Beatles were still together then. There’s been a flag on the moon for a shorter amount of time than the time in which Black women in Congress only belonged to one Party.

So, congratulations, GOP. I do hope you’ll listen to Ms. Love and her perspective. But something tells me if you were really interested in being a part of progress in America toward racial and gender equality, you’d already be over here.

Class Economics Education Elections Health Care Taxation

More questions for 11-year-old Peggy Noonan

Peggy Noonan took pen in hand on the pages of the Wall Street Journal to tell us we should think like 11-year-olds in combating Ebola and impose a travel ban. Peggy doesn’t trust people with degrees in public health or medicine. People with degree in law and business should know how to combat infectious diseases.

That got me thinking about what other policy decisions we could leave up to children. If you have an 11-year-old, please give them this brief survey and mail it to Ms. Noonan.

1. What should we do with foreigners brought here as children?
a. criminalize and shun them (but tax them)
b. hug them

2. Which of these parties do you think will best represent Americans?















3. Do you think giving housing, food, and medical care to poor families:
a. Makes them get less done; or
b. Helps them get more done

4. What should we do with children whose parents don’t provide health insurance?
a. Give them health insurance
b. Not give them health insurance

5. To reduce gun violence does America need
a. More guns
b. Fewer guns

5. Our country has a lot of debt. What shall we do to pay it off?
a. Tax the wealthiest people
b. Take it from old people’s retirement

6. Which is worse?
a. Secretly selling weapons to a militant dictatorship (Iran); or
b. Asking for too much paperwork from charities with “Tea Party” in their name

7. Which do you think is the best use of our money?
a. Bombs
b. Schools

Today’s GOP manages to capture all of the ignorance of children without any of their compassion.

Economics Education Taxation Unemployment

5 Ways To Help the Poor That Beat Raising the Minimum Wage

There’s a lot of minimum wage denial out there. Some of it is well-informed. But if I could have one political wish, it would be that my Democratic friends would stop pretending like Economics 101 is a vast right-wing conspiracy. It should be taken for granted that the primary effect of raising the minimum wage is less employment for people at the bottom of the wage scale. Yes, I’ve seen the Krueger and Card study where the effects on employment cluster around zero, but I think this is evidence of my point. You see, a minimum wage puts money in the pockets of the people most likely to spend it tomorrow–the poor. So if that secondary effect helps the economy increasing employment, there must be some other factor pulling the effect back toward zero, right? The CBO’s assessment of a $10.10 minimum wage was that it would cost 500,000 jobs, but lift 900,000 people out of poverty.

There’s another reason to be suspicious of the federal minimum wage. It’s a cruelly blunt instrument. A $15 minimum wage might do nothing at all to employment in Seattle, but might cost many more jobs in rural Mississippi, where prevailing wages are substantially lower. Proponents of the minimum wage are always very excited to tax Walmart and McDonald’s–massively profitable multi-nationals. But most of the minimum wage increase is likely to be paid by businesses with 10 or fewer employees, many of which have razor-thin margins. The result there will be higher consumers prices and serious lay-offs and previously profitable businesses closing. Further, earners of the minimum wage are not all working parents. At least some minimum wage workers are middle-class teenagers, who, frankly, are getting their share of breaks as is. Almost half of minimum wage earners are between 16 and 24. I spent a lot of years working for minimum wage to earn date money, then going home to dinner and two loving, college-educated parents. That was a terrific experience, but is my upper-middle class teenage self really the most worthy recipient of wage assistance? Could we find ways to direct more of the benefits of wage assistance to the truly needy?

Now, imagine we could find other ways to help the poor make ends meet without simultaneously encouraging unemployment. Imagine these same programs could target the wealthiest people and corporations to pay for them and the poorest to receive the benefits. Terrific, right? Here are five:

Boost the Earned Income Tax Credit. While I don’t always agree with him, Milton Friedman is a man I greatly admire. Besides being a brilliant economist, he was, I think, the original compassionate conservative. His ideas on the benefits of a “negative income tax” are still extremely relevant. We owe the existence of a robust EITC partly to Friedman and he would be ashamed to see Republican efforts to dismantle this program and it’s sister, the Child Tax Credit. Both are methods of rewarding work while redistributing wealth with minimal distortion to markets. Unlike programs which can create a “poverty trap,” wherein at some income levels, you actually take home less money by working more, the EITC and CTC always reward earning income.

Invest in Poor Schools. This is a long term play to be sure, but it also has important positive short term effects. Schools that keep kids safe and feed them as well as educate them make life easier for the lower class parents who are trying to build a better life. This leads to more productive and stable workers who can then demand higher pay and better educated workers for the future.

Ditch mandatory minimum sentences for drug possession. ThisWeekInStupid is not an advocate for drug legalization, but neither do we see the logic in obligating judges to jail drug users who might do more good than harm for their families and communities at home.

Provide free, convenient English courses. This is just one example of ways to boost the skill-level of minimum wage workers. Workers who have good English literacy and basic computer and arithmetic skills are better able to know and insist on their rightful wages. And, as worker productivity grows, it lifts the whole of the economy.

Scale back right-to-work. Unions contribute to a whole host of positive changes in working conditions including raising wages. Right-to-work laws reduce the effectiveness of unions by allowing workers to free-ride, enjoying the benefits of union negotiations without paying in to the system. Freeriders result in less cooperation and worse results. However, ThisWeekInStupid thinks there are strong arguments that unions of government employees are less beneficial since government workers’ vote puts them on both sides of the negotiating table.

Raising the minimum wage is the laziest way to help the poor and not the most effective. In inflation adjusted dollars, even a $11.00 minimum wage would be the highest ever. Now, I’ll take a minimum wage over nothing, but I’d much rather pursue other angles first.



America Economics Obama Taxation

All those things you hope the GOP will do? They can’t do them

Ben Howe says today’s GOP is different from GOP circa 2006–that we should stop holding the budget-busting, war-mongering actions of Bush-era Republicans against today’s fiscally responsible, TEA party Republicans. This is not your father’s GOP. This idea is getting some traction. There is some wishful thinking out there that this time your vote for Republicans will mean smaller government despite the fact that the last Republican President to reduce either federal spending (adjusted for inflation and population) or the budget deficit was Eisenhower.

There’s a part of me that would like to believe in the sincerity of GOP rhetoric. I do worry about a government that allocates fully a quarter of everything produced in the country. But, I’m skeptical not just because the faces at the top of the GOP have not changed. I believe people can change. The problems is the incentives for GOP legislators have changed very little since 2006. When a politician (of any persuasion) pays lip service to a policy you like, it’s important to consider how the stake holders feel about it and how they’re liable to react politically. Here are three good conservative ideas which the GOP has no chance, or indeed intention, of accomplishing.

Raising the retirement age (or other Social Security fixes). You know and I know that it’s ridiculous to pretend people aren’t staying healthy longer or that Social Security isn’t approaching a precipice. Without any changes, the trust fund (i.e. the surplus accumulated by payments into Social Security, also the money loaned to the treasury to fund our government these 20 years) is predicted to be exhausted in 2033. At that point (or some time before), Social Security must either cut benefits by an average of 23% or begin collecting more money. To listen to them, you’d think the GOP were making this top priority. But today’s Republicans have no hope, or even inclination to make substantive changes to the Social Security. The reason for this is that Republican electoral success increasingly relies on strong majorities among retirees to compensate for their poor showing among younger age groups. The Democrats enjoy an advantage among registered voters in every age category except the over 65 crowd. Candidates on the Left who openly advocate raising the retirement age or trimming benefits regularly face attacks from the Right. Most of us remember Mitt Romney’s criticism of the President’s 700 billion dollar reduction in Medicare spending. The Washington Post highlighted more such attacks against Democratic candidates by Karl Rove’s American Crossroads. Until Republicans find a demographic to replace retirees, all Republican entitlement reform is dead on arrival. You heard it here first, when it comes to fixing Social Security, the GOP will sell you, hard-working taxpayer, out to their AARP base in a heartbeat.

Eliminating mortgage interest deductions. This is a great Republican idea. The mortgage interest deduction is a giveaway to home owners and shifts the tax burden to poorer renters. It drives up home prices, complicates tax filing and distorts the market unnecessarily. But the GOP can’t do it. They take too much money from the people most harmed by this policy. The third largest individual donor to Mitt Romney, post TEA party revolution candidate for President, was Texas real estate developer, Bob J. Perry. He gave $15 million to the Romney campaign. Real estate interests gave three times more money to the Romney campaign than to the Obama campaign. Aside from investment professionals, real estate was the industry most supportive of Romney’s candidacy. The National Association of Realtors is a powerful organization which spends $40 million on lobbying every year. They support candidates on both sides including GOP House Candidate Mia Love and Democratic Senate candidate Mary Landrieu. Until money no longer rules politics, the mortgage interest deduction is here to stay.

Reducing agricultural subsidies. No one but the recipients of farm subsidies thinks they’re a good idea. The Department of Agriculture directly pay about $19 billion each year to American farmers, large and small, in the form of subsidies to crop insurance premiums and direct crop price support. Recipients include Jon bon Jovi, Rockefeller heirs and 1500 residents of New York City. Subsidies to US farmers harm third world agrarian economies which could be lifting themselves out of poverty while providing cheaper groceries for American consumers. Countries around the world hold this up as an example of the US’s protectionist trade policy and our hypocrisy as we ask countries like China to open their markets to foreign goods. Cutting these subsidies gets some play on conservative talk radio and in conservative think tanks. But it’s a non-starter among Republicans who actually govern. President Obama’s 2014 budget includes some cuts to these which Republican lawmakers have resisted. The Republican Study Committee recently uninvited the influential conservative Heritage Foundation to its meetings over Heritage’s support for reducing farm payments. Again, Republicans have both a demographic and a fund-raising problem. They enjoy broad support from rural communities and states whose voters, even when they don’t receive subsidies themselves, identify with the image of the struggling Midwest farmer. It also brings in the dollars. Campaign contributions by agribusiness has increased five-fold since 1990 with 71% of contributions going to Republicans. An estimated $150 million is spent on lobbyists for agricultural industries every year. In 2007, facing reductions to farm subsidies spearheaded by Democrats, 3000 lobbyists flew to Washington and killed changes to the farm bill. The farm lobby has even helped write provisions that enable US farmers to trade with embargoed countries like Iran.

Don’t misunderstand me. Democrats also are crazy to oppose these sensible proposals and electing Democrats is only slightly more likely to make these reality. But they have other policy objectives that are both possible and sensible like immigration reform, expanded infrastructure spending and health care reform. In the GOP playbook, I see only stupid ideas (aggressive foreign policy, balanced budget amendments, etc.) or smart but impossible ideas like those above. A realist must confront the fact that America can expect more of 2003 from today’s GOP. What Republicans can do is start wars. It’s a thing they believe in and that their base can get behind. It plays well with their demographics and brings in campaign contributions from military contractors. As previously discussed, in Republicanland, the Law of Unintended Consequences doesn’t apply to foreign policy, so there’s very little downside.

Meet the new boss…



Tax those corporations?

The Left is excited about this idea. Corporate taxes used to generate a much larger share of taxes, but since the 1980s, corporations pay only about 10% of taxes. To the liberal mind, this is inexcusable. This is what liberals thinks corporations look like.

Greed is GoodFinding and taxing that guy is a notoriously hard problem. But, taxing corporations is not the way to do it. The reason is that people like Gordon Gekko do not own the majority of corporations. When you think of corporations, put this image in your mind instead.


Most of American corporations is owned by American retirees. Corporations and their profits are the thing that allows people to retire. American retirement plans were valued at $17.5 trillion last year. Some of this is in government bonds and other assets, but the entire value of the US stock market is only $20 trillion. The total wealth of the over 65 crowd in the US is about $33 trillion. Make no mistake, American retirees own this country. And that’s fine by me. They built it.

Now, picture your hard-working grandparents as I propose the following:

1. Don’t tax corporations

2. Tax dividends and capital gains exactly like income

3. Increase tax rates for high incomes

For your grandparents, this means they are taxed on the entirety of their corporate profits as if they were wages. If they get $40,000/year, they’ll pay very little in taxes. If they make $350,000, they’ll be taxed a lot. With a small bump to tax rates for high income, this could be a nicely progressive system.

Compare this with the current system. Today, Apple sells an iPad and makes a profit. The government takes 35%, then Apple disburses some to your grandparents and some to Gordon Gekko. On that dividend, Gekko pays a 15% individual income tax rate, but your Gran gets taxed as if her retirement disbursements were wages. For Gekko, that’s an overall tax rate of about 45% (1-0.65*0.85). But, if your grandparents make, for example, $100,000, they’ll end up paying a further 28% for a total tax rate of 53%. Terrible!

Of course, none of the above considers the reality of transfer pricing. In today’s world, Apple doesn’t pay nearly 35%. Instead, they transfer profits to an Ireland-based subsidiary and pay about 7% overall. Then the strategy is to wait patiently for Republicans to gain control of the Senate, when they’ll announce a “temporary” tax holiday for repatriated capital avoiding taxes altogether (but your Gran still pays her 28%). More about tax avoidance here. It’s time for a better system. Trying to tax the wealthy via corporate tax rates is like playing piano through boxing gloves. We don’t have the precision to tax the right people, and in the process, manage to create a whole lot of havoc in the markets.

So, the next time Bernie Sanders says (with indignation),

In 1952, 32% of all the revenue generated in this country came from large corporations. Today, just 9% of federal revenue comes from corporate America.

take a deep breath, compute how much of your own retirement is invested in “corporate America” and call your Gran.

Economics Taxation

This Week In Stupid: Electing Republicans shrinks the government

In 2003, I was a Republican and yet the idea of the Republicans controlling both houses of Congress and the Presidency made my blood run cold. At that time, George W. Bush had inherited a budget surplus. Liberals are fond of pointing this out claiming it as proof of the efficacy of Bill Clinton’s Presidency, but it was mostly due to the dot-com bubble revving up the economy. When the bubble burst in 2001, two things happened. First, expenses for things like unemployment payments rose suddenly. Second, tax revenue dropped as business started generating less revenue. But George W. had been elected on the promise of a tax cut to give Americans back the surplus. Would the Bush administration and the Republican Congress change course when facing budget deficits? In the midst of this debate, the Heritage Foundation published this gem of a rationalization for the deficit spending planned by Republicans. Their argument opposes completely the position of today’s conservatives: Deficit spending by governments has a very small effect on inflation.

Republicans bought this easy idea and spend they did. Not only did the GOP significantly cut taxes, but they began spending at an impressive pace by any standards. Bush pushed through the expansion of Medicare called Medicare Part D at an annual cost of $50 billion. They started two wars and dramatically increased spending for national security, creating the brand new Department of Homeland Security. That was all deficit spending.

The Gipper

Reagan is another fine example of a big spending Republican. Although Reagan is heralded as a champion of small government, the fact is that, during his tenure, the size of the federal budget expanded by more than a third, the number of government employees increased by the same amount and the deficit doubled. In the early 90s, the effects of a TRILLION DOLLAR deficit kept voters up nights. Further, even as the federal government expanded, less of that spending was transfers to states. Federal money for state education and health care programs was reduced. States increased their contribution to those programs, boosting spending even more.

What’s worse, Reagan, consistent critic of the stifling effects of government bureaucracy, actually (and dramatically) boosted government payrolls. In the Republican universe, this is the worst kind of government spending.

Now, I don’t fault Reagan. He followed exactly the path I (or Paul Krugman) would have in pulling the country out of a recession–borrow and spend. I, myself, would have spent less on big bombs and more on education, but I have the benefit of hindsight. Who knew the USSR would be kaput before his Vice President left office?

As an aside, many on the Right will lay the blame for this increase under Reagan at the feet of Democratic Congress at the time. I think that’s fine as long as they don’t simultaneously give Reagan credit for the recovery.

So, don’t buy it. Recent history demonstrates that Republicans are only critical of spending by Democrats. They know, just like you do, that spending during a recession is the right idea. They just wish they got to do it.

#BecauseMath Economics

Spontaneous order is always awesome

As I take aim at Friedrich Hayek, on a site called thisweekinstupid, I do it with some trepidation. Hayek was a well-spoken, skilled and innovative economist. That doesn’t mean he didn’t occasionally get it wrong. And in the unfortunate case I’ll discuss today, Hayek is found contributing to a potent and damaging piece of stupid that characterized much of the late 20th century–the cult of the invisible hand.

Beauty and power, spontaneously
Beauty and power, spontaneously

Pros and cons of spontaneous order

In the 1950s natural sciences like physics and especially biology began to notice that large systems made from simple parts could work together to create surprising and miraculous results. The brain is the most exciting example of this. Although some neurologists will likely disagree, the dynamics of a single neuron are simple. On receiving a pulse of energy from a nearby neuron through its dendrites, it sends a pulse to other neurons through its axon. This pulse is then received by the dendrites of other neurons. No one would look at that simple system and guess that a collection of those interactions would produce human thought. That miracle of complex macrodynamics from a multiplicity of simple microsystems is what Hayek called “spontaneous order.” Hayek and others believed fervently in the power of spontaneous order to improve people’s lives. Hayek called it a “fatal conceit” to imagine that a designed system could match a spontaneously ordered system for efficiency.

During the Goldwater/Reagan revolution, this became the justification for opposing government economic interference in almost any form. Any top-down tweaking by government moves the economy away from the spontaneous order, which is assumed to be the most efficient possible. It was also a convenient defense against the primary ideological foe of the United States–the Soviet Union. To those of the Austrian school, the economic failure of the Soviet Union was definitive proof of Hayek’s idea.

But on closer examination, the assumption that spontaneous order is always elegant or beneficial seems to come from nowhere, and certainly not from any of the natural sciences. As we look at other examples, we find spontaneous order is, indeed, powerful. But sometimes spontaneous order can be fatal. A herd of cattle can be thought of as a complex system made of simple parts. We could describe the behavior of cows quite simply: Move toward grass; avoid obstacles. But, spurred by the wrong external stimulus, those simple dynamics can cause a stampede as one cow starts to run enticing others to run to get out of its way. Here, the order that arises spontaneously is certainly unexpected in that it does not follow in a straightforward way from the micro behavior. In this, a herd of cattle is like a snowflake or a brain or an ecosystem. But in the case of cows, the macro behavior is not beneficial. Although the microdynamics were about avoiding injury, the resulting stampede can cause cattle to be trampled and killed.

Spontaneously ordered transportation

So, which kind of spontaneous order is our modern economy? Here’s modern-day libertarian John Stossel extolling spontaneous order and its wisdom in leading America away from transportation by train in favor of cars.

At last month’s State of the Union, President Obama said America needs more passenger trains. How does he know? For years, politicians promised that more of us will want to commute by train, but it doesn’t happen. People like their cars. Some subsidized trains cost so much per commuter that it would be cheaper to buy them taxi rides.

The grand schemes of the politicians fail and fail again.

By contrast, the private sector, despite harassment from government, gives us better stuff for less money—without central planning. It’s called a spontaneous order.

Cars may be the right answer for many communities, but transportation innovations can be a very clear example of the failure of spontaneous order. That is to say, the order arises, it’s just not helpful. Examine the problem of electric cars. My conservative friends have posted pictures to Twitter and Facebook of four or five completely unused car charging stations, usually at government buildings. “Typical government waste,” they’ll say.

Thanks, Obama!
Thanks, Obama!

They think the market has spoken, and maybe it has. But the other side of the story is that the least convenient aspect of owning an electric car is finding a place to charge it. This certainly reduces the number of electric cars on the road. When a car buyer (one simple part in our complex system) is shopping, she, hypothetically, considers an electric, but since there are no charging stations where she works, she decides on internal combustion. Meanwhile, someone at her work proposes installing charging stations in the parking lot. They take a stroll through the parking lot and find that very few employees own electric cars. So they decide against the charging stations. And around and around we go. More electric cars and more charging stations might be the optimal solution, but the individual actors, pursuing their own interest, can’t get there. Certainly the company can take a chance and build the charging stations hoping more employees are enabled to buy the electric cars they want, but that risk undeniably reduces the chance of us getting there.

For some other examples of the inefficiencies of spontaneously ordered system, check out my post on public goods.

Lessons from simulation science

In simulating complex systems, we call this a local minimum. Very often a complex system can find itself in a configuration that is not the global best configuration, but from which any small change looks worse. This is a local minimum. When considering electric cars, the status quo (no electric cars and no charging stations) is better than either a) some electric cars with no charging stations or b) no electric cars and some charging stations. So each individual player sees it in their interest to stay right where they are.

Consider this ball rolling on an odd-shaped surface.

The lowest potential energy configuration for the ball–the place it “wants” to be–is at the bottom of the valley marked 3, but in some places on the curve, point 2 for example, the ball sees a hill on either side. It’s in a “stable equilibrium.” If I want to move the ball to the true lowest energy state, it needs a push up the hill. It needs to be moved toward higher energy in order to find a better state.

Our electric car economy is the same (or might be). The economy of transportation is sitting at point 2. Everyone’s myopic view tells them unilateral action is wasteful. Charging stations installed at libraries and government buildings are an attempt to push us up the hill to see if we’ll fall into a better global minimum. It looks like “typical government waste” because we’re not looking at the whole curve. All we see is the hill in from of us. It might work or it might not. Only a global view could hope to predict. But only a fool concludes that the order found organically is always best. In game theory, this kind of stable, non-optimal state is called a Nash equilibrium after John Forbes Nash, Jr. profiled in A Beautiful Mind.

Simulating large systems is what I do for a living. Hayek didn’t have the benefit of huge supercomputers to predict what complex systems will do, but from my experience, assembling a system of millions of interacting parts, turning it on and expecting it to organize itself into an optimal configuration in a reasonable time without any help from me is insanity. When we want to optimize complex systems like static fluid flows or magnetic materials, we have to nudge them to pop them out of local minima or steer them speedily through what would otherwise be a slow spiral toward optimality. We try solving pieces of the problem independently, then stitching them together. Sometimes we reset things to an alternate starting configuration and see if that leads to a better place. (The economic implications of that should keep wealthy capitalists up nights). From where I sit, to expect something as complex as a national economy to optimize its resources without any help demonstrates profound ignorance of the dynamics of complex systems.

We should neither discount the power of spontaneous order, nor place unwarranted faith in it. That’d be stupid.