Monthly Archives: December 2012

Reader Questions on the Three Axes

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Taken from the comments on this post.

Are Stalinists and Nazis nothing but progressives and conservatives who are willing to use extreme coercion to get rid of oppressors or barbarism, respectively?

My initial inclination is to leave Stalin and Hitler out of the three-axis model. It might be best to limit that model to the Anglo-American political tradition.

Your leanings are libertarian *now*. When they weren’t, how did you view the world then?

When I was in high school and on the left, I was all about the oppressor-oppressed narrative. Majoring in economics in college helped to change that. Also reading David Halberstam on Vietnam. He was a fierce opponent of the war, but he never took the view that the war was an outgrowth of capitalist oppression, which was the standard line of the New Left in those days. I would now say that I lost my faith in the oppressor-oppressed axis, although I do not think I could have articulated my views that way at the time.

Today, I would say that my three-axis model has made me somewhat skeptical of everyone–progressives, conservatives, and libertarians. Or, more positively, I think that at least sometimes the progressives get it right (oppression is the right issue on which to focus in some cases) and conservatives get it right (barbarism is a legitimate worry). Often, I think that the libertarian focus on the dangers of government power is the most useful framework. But I think that the worst thing is to be so stuck along one axis that you do not even realize that you are stuck there.

Year-end Stories

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In 2005, I listed five stories that I thought would have long-term significance: productivity; cognitive neuroscience, solar power, cancer therapy, and mainstream media meltdown. All five were areas where the trends were not clear. My inclination at the time was to take the optimistic view in all areas (in the case of the mainstream media, being optimistic to me means believing that the meltdown will be rapid).

Today, I would be less optimistic. Moreover, I think that the unsustainable fiscal outlook and its consequences have become one of the most important stories.

In 2003, I wrote one of my favorite essays, on what I called The Great Race between Moore’s Law and Medicare. There is an optimistic scenario for economic growth (think Ray Kurzweil) which would make all concerns about the long-term budget outlook seem foolish. However, other scenarios are less favorable. Recently, the budget situation has been deteriorating faster than the technological outlook has been improving. In terms of the great race, the wrong horse is gaining.

Rent Vs. Buy

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The New York Fed’s Jason Bram writes,

current rent levels, mortgage rates, and property tax rates make it difficult to account for the high prices of Manhattan co-ops and condominiums in 2011 without assuming an expected future price appreciation of at least 4 percent per year.

It is a nice article on the rent vs. buy calculation. Not surprisingly, much depends on expected appreciation rates.

Peter Suderman Predicts the Fiscal Cliff Outcome

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This essay appeared almost three weeks ago.

just as the doc fix has become a yearly congressional ritual with no end in sight, it may be that many of the temporary policies of the fiscal cliff become permanent fixtures on our policy calendar.

And if the doc fix is any guide, that will have deleterious effects on both the budget and the economy. It will provide a convenient way to hide long-term spending commitments inside repeat extensions of temporary policies. And it will result in nagging economic uncertainty as the private sector endlessly worries that this year just might be the fluke year that Congress won’t act like it normally does and make a deal. At the same time, it will have the larger effect of distracting Congress from fixing the budget’s real long term problems by focusing legislators’ attention on an infinite loop of short-term problems. It’ll be the doc fix for everything—and the fiscal cliff forever.

Read the whole thing. Along with my Lenders and Spenders, it provides you with a pretty complete cynical picture.

College Admissions Officers

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Conor Friedersdorf writes,

To imagine that today’s college-admissions officers can step outside the failings of humanity, making subjective judgment calls in secret with racial enlightenment that is unprecedented in human history, is folly. It may have seemed possible and even done more good than harm when America was mostly grappling with black and white. Now that we’re asking people to calibrate the “diversity value” of American blacks, Africans, Hispanics, Thais, Jews, Chinese, Japanese, Native Americans, and many more besides? The prudent course is acknowledging the limits of our wisdom. Alas, intellectual humility and restraint are not among the Ivy League’s virtues.

I strongly recommend taking judgment out of the college admissions process altogether. Humans over-emphasize their skill. Daniel Kahneman, in Thinking Fast and Slow, describes a formative experience in which he and others thought that their judgments in placement decisions for the Israeli army were sounder than they actually were.

James Kurth on Conservatism

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He writes,

The economic and fiscal thinking of the Tea Party movement had much in common with that of traditional American conservatism, and with theorists such as Friedrich Hayek and Ludwig von Mises. It had much less in common with the economic and fiscal thinking of reinvented conservatism, and with theorists such as Friedman and the monetarists. Indeed, the thinking of the Tea Party movement was largely the same as that of the libertarian movement, which had long been a marginal element within the Republican Party.

…American conservatism is now split between two tendencies: (1) a partially-discredited reinvented conservatism, which nevertheless continues to dominate the leadership or “establishment” of the Republican Party because it corresponds to the economic interests of the party’s elites and big donors, and (2) a partially-revived traditional conservatism, which is a significant insurgent force within the Republican Party, because it corresponds to the economic interests of much of the party’s base and many of its core voters.

It is a long essay, which I recommend reading even though I disagree with a fair amount of it. Some thoughts:

1. What is the plural of post mortem? It seems to me that we have seen a lot of them after the election. I had a traumatic experience after 2008, in which I made the case that the U.S. was going to turn into a one-party state. Bryan Caplan challenged me to a bet, which I lost when the Republicans won the House in the 2010 mid-terms. Still, I may have been correct, at least in terms of national politics. But it is interesting that so many states are in Republican hands.

2. Kurth’s history of conservatism has traditional conservatives favoring free markets, while what he calls “reinvented conservatism” comes across as cronyism. He associates “reinvented conservatism” with Milton Friedman and Ronald Reagan, which I am sure will annoy fans of those two icons.

3. As those of you have read Not What They Had in Mind know, I disagree with Kurth’s narrative in which banks fought for and achieved deregulation, leading to the financial crisis. First, this ignores the role played by housing policy and capital regulations. Second, it ignores the views of regulators, who did not think that they were loosening up the reins but thought that they were in fact exercising better control and fostering an environment of reduced risk-taking by banks. There is a huge hindsight bias in claiming that the regulators were intentionally easing up.

4. Kurth summarizes the current state of affairs as follows:

The core voting groups for the progressive coalition and the Democratic Party are (1) blacks, (2) Hispanics, and (3) workers in the public sector. Conversely, the core voting groups for the conservative coalition and the Republican Party are (1) economic and fiscal conservatives; (2) Evangelical or Bible-believing Protestants; and (3) white male workers in the private sector

…there remains one immense independent or swing group, and that is white women. A substantial majority of these now vote for Democratic candidates, with economic issues being primary for working-class women and social issues being primary for middle-class women. If these women continue to vote for the Democratic Party in the future, the prospects for the Republican Party to win most presidential and senatorial elections will remain bleak.

5. I think that what potential factor that could shape up electoral politics is the government debt problem. Will it cause continued political friction, as I predict? And will voters perceive the problem as unsustainable progressive programs or Republican recalcitrance? Keep in mind that objective reality, even assuming that it is knowable, may play little or no role in public perceptions.

Adverse Consequences of the Internet

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Jaron Lanier warns of them, in a story by Ron Rosenbaum.

he [Lanier] singled out one standout aspect of the new web culture—the acceptance, the welcoming of anonymous commenters on websites—as a danger to political discourse and the polity itself. At the time, this objection seemed a bit extreme. But he saw anonymity as a poison seed. The way it didn’t hide, but, in fact, brandished the ugliness of human nature beneath the anonymous screen-name masks. An enabling and foreshadowing of mob rule, not a growth of democracy, but an accretion of tribalism.

Read the whole article. Some thoughts.

1. Lanier’s view that Google and other companies that aggregate user information (in his example, to train Google’translation algorithm) are taking unfair advantage of those users was not at all persuasive to me.

2. His concern about the down side of anonymity is one that I share.

3. Suppose we use the three-axis model to examine anonymity. For a conservative, the concern would be that anonymity would encourage man’s barbarous nature. Thus, Lanier’s argument should resonate well with conservatives. For a libertarian, anonymity represents a way to evade government control. Hence, along the freedom-coercion axis it is a plus. For a progressive, anonymity is good if it is used by the weak and bad if it is used by the strong. Note that in the story Lanier emphasizes different axes on different issues (that is by no means a bad thing).

4. Facebook cuts against the grain of anonymity on the Internet. I think that this is one of the most interesting and important aspects of Facebook, and I have not come across any commentary about it.

Exaggeration in Political Stereotypes

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Jonathan Haidt’s latest.

The ideological “culture war” in the U.S. is, in part, an honest disagreement about ends (moral values that each side wants to advance), as well as an honest disagreement about means (laws and policies) to advance those ends. But our findings suggest that there is an additional process at work: partisans on each side exaggerate the degree to which the other side pursues moral ends that are different from their own. Much of this exaggeration comes from each side underestimating the degree to which the other side shares its own values. But some of it comes, unexpectedly, from overestimating the degree to which “typical” members of one’s own side endorse its values.

Pointer from Kevin Drum, via Tyler Cowen.

This is consistent with what I think happens in my “three axes” model. That is, I would expect progressives to view themselves as particularly sympathetic to the oppressed and to view others as on the side of oppressors. I would expect conservatives to view themselves as particularly sympathetic to the civilized and to view others as on the side of barbarism. I would expect libertarians to view themselves as particular sympathetic to freedom and to view others as on the side of coercion.

Let me emphasize that I am not using “three axes” to try to explain what different people believe. It is not a theory of why people believe what they believe. Rather, it is a way of organizing their beliefs. It is a way of predicting how different partisans will communicate their beliefs, how they will interpret issues, and how they will interpret the views of those who disagree.

Haidt is a major influence on my thinking. However, there are limits as to far I want to go in the direction of relating ideological beliefs to personal psychology. As Jeffrey Friedman has taught me, trying to explain why person X believes something is often an effort to avoid treating X’s beliefs with respect. It is really hard, perhaps even impossible, to psychologize about someone else’s political beliefs in a way that is not demeaning.

The goal of the three-axes model is to enable people to see how others might arrive at a different viewpoint on a particular issue. My own leanings are libertarian. However, I would hope that anyone, whether progressive, conservative, or libertarian, could use the three-axes model to better appreciate that others’ views have some justification.

My Election Post-Mortem

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In this essay, I attempt to channel Winston Churchill.

Romney’s campaign was cautious and uninspired, with no chance of glory in either eventuality. Had he instead said in plain terms that our government is broke and offered specific, bold steps to eliminate activities and reform entitlements, perhaps the result would have been a resounding loss. But it would have been an inspiring defeat, one that would have positioned the Republican Party to gain favor as the United States heads toward fiscal crisis, just as Churchill’s long record of warnings about the Nazis positioned him to gain favor when Hitler launched his blitzkrieg.

Activities vs. Results

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Edward Glaeser writes,

The U.S. has six large programs — Temporary Assistance for Needy Families, Medicaid, food stamps, housing vouchers, unemployment insurance and the earned-income tax credit — spread across four Cabinet departments and the Internal Revenue Service.

Pointer from Reihan Salam. Salam also recommends an essay by Steven Teles on kludgeocracy.

Unfortunately, this is not an accident. There is a tendency in all organizations to focus on activities rather than results. Every program represents an activity. Managers of an activity seek to perpetuate and expand their domains.

Activities are easy to measure. The impact on results is difficult to quantify. Think tanks report on how many op-eds their scholars publish. How many think tanks report on their impact on results?

Corporations are often the victims of activity-centered thinking. Activities acquire a momentum of their own. One thing that management consultants do is challenge the mindset and power of departmental managers who focus on activities rather than results.

Fortunately, corporations face market constraints and competition. These forces serve to weed out mindless activities and re-focus attention on results. In government, those checks are missing. Thus, it is almost inevitable that government programs will be perpetuated without regard to results. That is the natural behavior in organizations, and only if there are countervailing forces will that natural behavior be overcome.