A richly-produced podcast with Bari Weiss. A must listen.
En passant, he connects meme stocks to The Revolt of the Public.
Around minute 23, he talks about people metaphorically being mutilated as they go through the rite of passage of joining an online tribe. Maybe that metaphor is a stretch?
Video presentation by John Cochrane, primarily on the risks in our current fiscal and monetary policy. Very much in the spirit of “Have a nice day.”
DeFi is cool. I am not. I write,
I bet that in order for DeFi to work, you need an understanding of financial institutions in addition to an understanding of blockchain and the layers that have been added to it. I don’t think that young techies understand financial institutions as well as I do. And I think I have a better chance of explaining my knowledge of financial institutions to young techies than they have of explaining DeFi technology to me. So I hereby offer to teach a course in financial institutions.
In general, those who claim inflation is too high have a preference for a tighter monetary policy, and vice versa. But fast NGDP growth is a much better indicator of whether the economy is overheating.
Later in his post, Sumner writes,
We don’t need easy money or tight money; we need stable money. That’s why I didn’t believe the low inflation of 2019 was a problem and it’s also why I don’t think the high inflation of 2021 is a problem. Inflation is not a reliable policy indicator.
I gather that Scott believes we have stable money now. Even though NGDP in the first quarter grew at an 11 percent annual rate. I assume that this qualifies as “fast” by Scott’s standards, but it is just one quarter.
In the past, Scott has said that his preferred indicator is future growth in NGDP. But nobody knows what that is. We have to rely on forecasts. For example, the Congressional Budget Office has a forecast for NGDP growth over the next several years, and it looks pretty benign. But even in the short term, NGDP is notoriously difficult to forecast.
I would be the last (or maybe next-to-last) person to defend using measured inflation as a reliable indicator. But it’s not like there is a reliable indicator sitting out there like the proverbial $20 bill on the sidewalk, waiting to be picked up.
In his new book, Facing Reality, Charles Murray writes,
Because we have not talked openly about group differences, we have kidded ourselves that the differences are temporary and can be made to go away.
maybe the Jewish advantage will turn out to be cultural. If that’s true, I think it would be even more interesting – it would mean there’s some set of beliefs and norms which can double your income and dectuple your chance of making an important scientific discovery. I was raised by Ashkenazi Jews and I cannot even begin to imagine what those beliefs would be – as far as I can tell, the cultural payload I received as a child was totally normal, just a completely average American worldview. But if I’m wrong, figuring out exactly what was the active ingredient of that payload would be the most important task in social science, far outstripping lesser problems like crime or education or welfare (nobody expects good policy in these areas to double average income!).
There is a folk theory that says that cultural differences explain group differences in academic achievement. Jewish and Asian culture places a premium on academic achievement, while African-Americans who do well in school are derided by their peers as “acting white.” I don’t know how to test the folk theory rigorously. You can’t randomly assign children to different sets of parental and peer influences.
I doubt that the folk theory explains a lot. But I am a bit surprised that both Murray and Alexander slide past it.
Another folk theory is that differences in school quality explain a lot. On the contrary, I believe in the Null Hypothesis. As Murray puts it,
no one has yet found a way to increase cognitive ability permanently over and above the effects of routine education. The success stories consist of modest effects on exit tests that fade out.
Murray says that the purpose of his book is to get society to treat a black individual primarily as an individual. Instead, identity politics puts all the emphasis on black.
Murray admits that it is “paradoxical” that he is devoting a book to analyzing differences in group outcomes in order to get people to stop focusing on group differences. He wants to convince people that we should blame differences in group outcomes largely on immutable characteristics. Call that option A. But we might be better off with what I might call option B: stop paying attention to differences in group outcomes.
Neither option A nor option B is palatable on the left today. But I bet that option B stands a better chance of becoming accepted in our society.
The US seems to elect some of the most conservative politicians in the Western world, but has perhaps the wokest institutions. Civil rights law makes all major institutions subject to the will of left-wing bureaucrats, activists, and judges at the expense of normal citizens.
By the time this post goes up, I expect a lot of you will have seen Hanania’s piece. Somehow, over the course of the 1960s the culture managed to go from lots of anti-black racism to lots of anti-white racism without stopping at “color-blind.” Hanania blames the civil rights bureaucracy. Indeed, that bureaucracy might be an iconic example of a self-licking ice cream cone, in that its institutional survival is inversely related to its effectiveness at addressing the problem.
Note that Shelby Steele would blame white guilt. I would caution against any simple cause-and-effect story.
Finally, this amusing comment from a prior post.
DEI is a fad, and will disappear like the Macarena.
Imagine a world in which universities and corporations had set up organizational units dedicated to the Macarena. It would be better than the world we got.
In Wanting, Luke Burgis writes,
One hundred years ago, there was a much wider gap in knowledge between someone who had a doctoral degree and someone who didn’t. Today, with the world’s information at nearly everyone’s fingertips, the knowledge gap between people with a great amount of formal education and those with less has narrowed.
. . .Today value is largely mimetically driven rather than attached to fixed, stable points (like college degrees). This has created opportunities for anyone who can stand out from the crowd. This has positive and negative consequences.
We used to think of expertise as embedded in prestigious institutions. But attachment to a prestigious institution no longer guarantees expertise.
Another concept that Burgis introduced to this reader is the self-licking ice cream cone. This phrase was coined by Peter Worden of NASA to refer to an institution whose main purpose is sustaining itself, having lost sight of its higher mission.
Peacetime armies tend to degenerate into self-licking ice cream cones. The CDC and other bureaucracies that were supposed to help us deal with the virus turned out to be self-licking ice cream cones.
Harvard University once had a higher mission of selecting and training leaders for politics and business. But Harvard has degenerated into a self-licking ice cream cone.
We need new and better institutions.
I’ve finished one pass-through of Wanting, by Luke Burgis. The book is an attempt to spread and build on the ideas of Rene Girard. I liked the sections of the book that I thought I grasped. Other sections did not reach me, but perhaps I will get more out of a second reading.
The Burgis-Girard view is that we all have models, meaning people to whom we compare ourselves. What Girard calls mimetic desire is the tendency to want what our models want. That can make us jealous of our models, especially if they inhabit our intimate world rather than our remote world.
Here was one interesting aphorism:
think seriously about the people you least want to succeed
Some remarks:
1. I think of my friend from high school who, a few months before the 2020 election, said that he would never take a vaccine “developed by Trump and his cronies.” Clearly, he (along with many other Americans) really wanted President Trump to fail. That probably means that Mr. Trump was a model for my friend, in that my friend was comparing himself, consciously or not, with Mr. Trump. Incidentally, my friend was voted President of our student body our senior year.
2. I think of a situation from almost 30 years ago at Freddie Mac. I wanted to be in charge of a project, and when someone else was put in charge, I really wanted him to fail.
3. If I resent the success of Olivier Blanchard, Paul Krugman, or Ezra Klein, then that probably means that I treat them as models. Because I have met them, I cannot emotionally dismiss them as being part of the remote world.
4. I think that social media have crunched together the intimate world and the remote world. Burgis agrees that social media creates amped-up rivalry. He says that we are all like new college freshmen–feeling insecure and competing to stand out in a crowd of people who seem similar.
5. Think of someone who has had a nasty divorce. How would they feel if their ex were to be happy in a new relationship?
If you have not yet heard the podcast with Jonathan Rauch and Andrew Sullivan, I strongly recommend it. Rauch thinks that “the counter-movement is beginning to form” against the religion that punishes heretics. Along the way, he and Sullivan get into some heated, but friendly, disagreements.
One of the disagreements concerns whether the mainstream media has earned distrust or not. Sullivan and I would say that it has. Rauch tries to argue otherwise. On the lab leak hypothesis, for example, Rauch argues that we should give the media credit for eventually turning around. Sullivan points out that media hatred of Mr. Trump was the reason that they failed in the first place. But listen to the episode before you comment.
I try to explain inflation’s real cost.
I think of inflation as causing the following problems: it rewards the most alert and aggressive economic actors, and it punishes people who are passive and habitual; it interacts with the tax system to reduce productive investment; and it makes planning for the future difficult, particularly when it comes to buying a home.