The Minerva education model

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I wrote about Minerva, which is a new college that strips out a lot of the fluff of higher education and tries to focus on core habits of mind and foundational concepts.

To me, it seems plausible that students who choose to apply to Minerva are unusually focused on learning, as opposed to dating opportunities or sports or other features that attract students to colleges. Thus, if these particularly learning-motivated students had not gone to Minerva, they might during their freshman year have made just as much progress, or more, elsewhere.

Readers will recognize the Null Hypothesis lurking the background of my thoughts. But read the entire essay before commenting.

Heritability estimates and eugenics

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L.J. Zigarell writes,

Analyses of responses indicated nontrivial support for most of the eugenic policies asked about, such as at least 40% support for policies encouraging lower levels of reproduction among poor people, unintelligent people, and people who have committed serious crimes. Support for the eugenic policies often associated with feelings about the target group and with the perceived heritability of the distinguishing trait of the target group. To the extent that this latter association reflects a causal effect of perceived heritability, increased genetic attributions among the public might produce increased public support for eugenic policies and increase the probability that such policies are employed.

Pointer from Tyler Cowen, who remarks, “Sad, but not surprising.”

To me, what is sad is that Zigarell strongly implies that suppressing the truth about heritability would lead to better policy outcomes. I may be reading more into those sentences that I should, but I want to argue against suppressing scientific findings about heritability.

The thing is, everyone has an intuition that there is heritability. Humans always have had that intuition, and we always will. Progressive have that intuition just as much as anyone else.

Suppressing the truth about heritability is not a good idea. Some people’s intuition over-estimates heritability, and for them the scientific findings about heritability might actually reduce those over-estimates.

Moreover, suppose that people who favor eugenic policies think that you are lying to them to try to change their minds. That will just make them more difficult to persuade. Instead, if they believe that you are trying to tell the truth, then they will listen to the case against eugenic policies.

A conservative case for countervailing power?

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Ross Douthat writes,

The earlier conservative self-understanding, in which the right was defending nongovernmental institutions against the power of the state, tacitly depended on the assumption that many if not most nongovernmental institutions would be friendly to conservative values. But as civil society has decayed over recent decades, its remaining power centers have also become increasingly left-wing.

. . .Yet conservatives can still win the White House and the Congress, which means that the one power center they can hope to control is the one they are notionally organized to limit — the administrative state.

Pointer from Tyler Cowen. To me, Douthat seems to be saying that since conservatives have been driven out of universities, mainstream media, and entertainment, they need to get hold of government to counterbalance this. I disagree with the proposed solution.

It reminds me of the early Progressive notion of “countervailing power.” The idea was that the emergence of large corporations starting in the late 19th century made market capitalism unfair to ordinary individuals. Government could serve as a countervailing power to offset the new corporate power.

I have two main reasons to be skeptical of the idea of conservatives using government as a countervailing power with respect to leftist cultural institutions. Instead, I think you have to strike directly at the cultural institutions.

1. If the cultural institutions are strongly left, then conservatives are not going to succeed in capturing government.

2. I think that the most effective countervailing power would consist of alternatives. Alternative media have been helpful in limiting the damage of mainstream media. I think that alternative educational approaches are the best hope for limiting the damage caused by public education and elite colleges.

Our goal should be to nourish primary education and higher learning that is not steeped in leftist ideology. The first thing to do is stop making gifts to existing colleges and universities. Instead of donating to that new grandiose fundraising campaign at your alma mater, put that money into some innovative higher education initiative.

Also, resist increases in funding for public education. Without more funding, the public school systems will be so burdened by pension obligations that they will have to scrimp on classroom education, and parents will turn to other means. That will encourage parents to turn to home schooling, private supplemental education, and independent learning for their children. As they make more choices for themselves, most parents will prioritize knowledge over ideology for their own chilren.

Am I a welfare state advocate?

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Samuel Hammond writes,

social insurance can enhance market dynamism and economic freedom in four key ways: By enabling entrepreneurial risk-taking; by easing the adjustment and search costs associated with creative destruction; by detaching social benefits from market structure; and by making the economy more robust to immigration. Together, these point to a set of design principles for reforming existing U.S. social insurance programs in a pro-market way.21

Now, check out the footnote:

Discerning readers may recognize an Austrian School influence in the first of these three defenses of social insurance. Austrian School economics places an emphasis on (1) entrepreneurial discovery in the face of fundamental uncertainty; (2) equilibrium as a dynamic, evolutionary process; and (3) the decomposability of capital, implying particular market structures will often need to liquidate given shifting patterns of specialization and trade. While the Austrian School has become mood-affiliated with small government libertarianism, its basic analytical toolkit turns out to be highly congenial to the “free-market welfare state” perspective. For an introduction to these themes see: Kling, Arnold. 2016. Specialization and Trade: A Re-Introduction to Economics.

One of Hammond’s suggestions is that government-provided benefits are better than employer-provided benefits. One reason for this is that with employer-provided benefits, politicians have a stake in keeping the corporation alive. He uses the example of General Motors getting bailed out in 2008.

In a response to Hammond, Kai Weiss writes,

Instead, advocates of the free market should look to a strengthening of civil society, combined with a job-rich economy, to help those left behind. In the end, responding to skepticism about the role of free markets by arguing for more statism might be an oxymoron after all.

If the Scandinavian countries are such great examples of welfare states, then this shows that a risk pool of 5 or 10 million is sufficient. You do not need 300 million. To me, that suggests that at most we need the Federal government to provide a small universal basic income. Otherwise, smaller units, such as cities, counties, states, private insurance companies, or large voluntary associations could deal with health coverage, retirement savings, unemployment insurance, and aid for households dealing with mental and physical disabilities.

Mom-and-Pops have not died?

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Esteban Rossi-Hansberg, Pierre-Daniel Sarte, and Nicholas Trachter write,

When Walmart enters, the total number of establishments in the ZIP code increases, though by less than one-to-one (about 3/4). In other words, Walmart generates some exit, but the net result of opening a Walmart store is a greater number of competitors in the market for at least seven years after entry. This case is paradigmatic, but there are many others across all major sectors. For example, the expansion of Cemex, the top firm by sales in 2014 in the ready-mixed concrete industry, led to a similar decline in local concentration and an expansion in the local number of establishments in the industry.

I found this surprising. I always thought that the national giants, especially Walmart, were driving lots of Mom-and-Pop stores out of business.

But if you follow the link and read carefully, the authors look at Walmart in the discount department store business. Maybe they don’t drive out of business a lot of discount department stores, but they do drive out of business some mom-and-pops. Or maybe the mom-and-pops disappeared well before Walmart came along.

An argument for home schooling

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Jay Schalin writes,

According to her National Academy of Education biography, Ladson-Billings is “known for her groundbreaking work in the fields of Culturally Relevant Pedagogy and Critical Race Theory.” Ladson-Billings once wrote that “we educators should align our scholarship with the philosophy of Marcus Garvey: race first!”

He found that she is the author most used in schools of education. The rest of the top ten authors seem to be equally hard left. The article links to his full study.

A review of Specialization and Trade

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Dirk Niepelt writes,

Kling’s criticism of contemporaneous macroeconomics reads like a criticism of the kind of macroeconomics still taught at the undergraduate level. But modern macroeconomics has moved on—it is general equilibrium microeconomics. Its primary objective is not to produce the one and only model for economist-engineers or “experts” to use, but rather to help us understand mechanisms. A good expert knows many models, is informed about institutions, and has the courage to judge which of the models (or mechanisms they identify) are the most relevant in a specific context. We don’t need a new macroeconomics. But maybe we need better “experts.”

To me, this sounds as though Niepelt is happier than I am with what he calls general equilibrium microeconomics and what Paul Krugman (rightly) calls Dark Age Macro. Of course, Krugman wants to go back to old-time Keynesian religion, which I reject. I would refer Niepelt to my macro memoir essay.

Conservatism after Trump

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This topic is popular in my circles. For example, the brilliant and extraordinarily nice Chris DeMuth writes,

I believe that an important cause of our political turmoil is the decline of representative government—where law is enacted by elected legislatures—and the rise of declarative government—where law is dispensed by bureaucracies and courts.

With all respect to Chris, I cannot see the Trump election as a revolt against the Administrative State. His hammer just doesn’t connect with the nail.

If you read the whole piece (it may be behind a paywall), you will find that what Chris wants conservatives to support going forward is what I want them to support: reining in the Administrative State; more competition in K-12 education; more commitment to free inquiry in higher education; regulatory reform (not always meaning deregulation); and finally, and most important in my view,

One way or another, America is going to move from a debt-financed welfare state to a tax-financed welfare state. If the transition is abrupt and chaotic, it will bring widespread hardship, especially to the Somewheres who have become increasingly dependent on transfer payments, and possible political instability. For this reason, it would be nice if a few courageous souls in active politics would specialize in mastering and advertising the problems; this could help condition public expectations and encourage personal contingency-planning, and might even set the stage for a Churchill-like summons to leadership down the road. But the transition, hard or soft, will present opportunities as well—as the political scientists say, the American system gets around to needed reforms only in response to crises. When Congress is obliged to fund a much larger share of entitlement and welfare spending with tax revenues, it will just have to pick up its fiscal reins and exercise a level of collective discipline that no current member has experienced. The political parties will have to wake up from populist hallucinations over taxation, redistribution, and economic growth. And American citizens will acquire a much keener sense of their obligations to one another.

But there is a sense in which it strikes me that our standard focus on political economy may be anachronistic. I find myself muttering, “It’s the culture war, stupid” as a description of the situation that we face currently. Think of it as the progressive-minded, college-educated women forming up at one end and the cantankerous non-college educated men forming up at the other, with the rest of us either choosing sides or trying to find some middle ground.

Wages and productivity

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Scott Alexander writes,

Median wages tracked productivity until 1973, then stopped. Productivity kept growing, but wages remained stagnant.

This is called “wage decoupling”. Sometimes people talk about wages decoupling from GDP, or from GDP per capita, but it all works out pretty much the same way. Increasing growth no longer produces increasing wages for ordinary workers.

Is this true? If so, why?

He makes a valiant effort to summarize and assess the economic literature. But this is where orthodox economics is hopeless.

Productivity by definition is output divided by the amount of labor input. Let me make three points:

1. You can’t measure the numerator very well.

2. You can’t measure the denominator very well.

3. The U.S. is not just one big GDP factory. Both the numerator and the denominator are affected by shifts in the composition of the economy, even if actual productivity and wages were not changing at all.

The numerator is output. How many people work in businesses with measurable output? Scott Alexander doesn’t. I never have. Most of my readers never have. There are entire industries, like health care, education, and finance, where we do not have any idea how to measure output. And even within an industry that has quantifiable output, we still have the issue that, as Garett Jones pointed out many years ago, most workers are not engaged in actual production; they are building organizational capabilities. Even if the factory managers can count widget production, they cannot measure the productivity of the tax accountants or of the team developing a new marketing initiative.

The denominator is labor input. But most of labor input consists of human capital. To measure labor input, you need to be able to measure quality, not just quantity. What is the incremental value of X years of schooling and Y years of experience? We do not have a reliable way to do that. One approach uses wage rates as an indicator of quality, but that amounts to assuming that productivity and wage rates are tightly coupled, but that amounts to assuming away the question that Alexander is raising.

We are not in a GDP factory. As the share of GDP devoted to health care and education goes up and the share devoted to manufacturing goes down, we are giving more weight to a sector where real output and the quality of labor input are extremely difficult to measure.

I think that for economists to say anything useful about productivity and wages, they should try to study individual units of individual firms. My guess is if you were to undertake such a study, you would be overwhelmed by doubts about the precision of your measurements and the difficulty of obtaining a decent signal-to-noise ratio. It’s perverse that you would instead look at the aggregate statistics cranked out by the Commerce Department and the Labor Department and pretend that it’s 100 percent signal.

A conference on moderation (Martin Gurri watch)

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I attended this event on the 25th.

There are two videos, one for the morning talks, and one for the afternoon talks. If you watch the video for the afternoon talks, near the end, close to the 4 hour, 11 minute mark, I ask the last question at the session that featured Tony Blair.

My father would have been proud. He always liked to measure the social distance that he traveled from his childhood with Yiddish-speaking parents in the St. Louis ghetto. Finding me in the same room with the former British Prime Minister would have given my father lots of nachas, so to speak.

My review of the conference overall:

David Brooks gave a lucid, entertaining opening speech. About minute 44-45 in the video, he gives an account of contemporary progressiveness that could come straight out of my three-axes model.

Earlier, he cites Andrew Delbanco’s The Real American Dream, which argues that America has had three phases of animating cultural idea. Until around 1830, it was “God.” Americans were fulfilling God’s will. From then until World War II, it was “nation,” meaning manifest destiny for the United States. After the war, it became the “self.”

Brooks argues that the individualism of the latest phase has reached its end as a successful animating idea. We need a cultural paradigm shift. He suggests that what might work better now is a form of communitarianism, in which we care about children (not just our own), the dignity of work, our local living places, and racial and social integration. We need for politics to be less important.

In the end, his “politics of love,” as he calls it, is easy to ridicule, and he recognizes that. But he tries hard to justify his proposal.

The first panel was “Why isn’t the center holding?” and it included Martin Gurri. Not surprisingly, I found Gurri’s remarks the most compelling. But I think he also came through to people in the audience who were not as familiar as I am with his views.

Frances Lee did make the interesting point that as political parties separated on ideological grounds (recall that 60 years ago, the Democratic Party was an amalgamation that included Northern African-Americans and white segregationists from the South where African-Americans were kept from voting) and elections became close enough that either party could win, party loyalty has strengthened. There is fear that if you work with the other side, you are helping them win, and this fear is expressed very strongly in the primary-voting public.

I got to ask a question at this panel. I wanted to make the point that the political divide is a subset of a broader cultural divide. It’s about the 2 hour and 9 minute mark. I don’t think anyone wanted to answer the question, but Brink at least helped to clarify what I was trying to get at.

The next panel struck me as less focused. I did note that Damon Linker cited a poll that suggests that in the 2×2 quadrant of left/right and social/economic issues, the least populated quadrant among American voters is the libertarian one of socially on the left and economically on the right. Will Wilkinson expressed doubt that any poll holds for very long, because American voters are volatile on the issues. Yascha Mounk suggested that demagogic politics is on the upsurge because people want contradictory things (I would say that in economic jargon, they don’t appreciate trade-offs), and politicians must try to cater to that.

The third panel turned me off quite a bit. Often, the discussion veered into philosophical and historical trivia. When it got back to present-day reality, it seemed to consist mostly of ritual expressions of contempt for Mr. Trump. At one point, Professor Levy implied that the Republican Party as an institution would benefit by having a prominent conservative Senator utterly denounce Mr. Trump. While I think that it would help to have a Republican challenge Mr. Trump in the primary in 2020, that challenge should serve to articulate what mainstream Republicans want the party to stand for. The challenger should in no way denounce Mr. Trump but instead should commit to supporting whoever the party nominates in the general election. And, no, William Weld does not get my endorsement for the role.

Denouncing Mr. Trump as Mr. Levy recommends would amount to the political equivalent of a suicide bombing that fails to even approach its target. Mr. Trump does not depend on establishment support in the way that President Nixon did. When Nixon lost the establishment, he was gone. But today a politician’s personal brand is more important than establishment support. See Tyler Cowen’s column on the young Democratic congresswomen. In general, hearing Professor Levy’s pontifications reminded me of the refrain, “You want more Trump??? This is how you get more Trump.”

In the hallway, Elaine Kamarck, a Bill Clinton Democrat who has written a book on primary politics, expressed her view that the winner of the Democratic nomination in 2020 will be someone who drives down the “center-left lane,” as she called it. I suggested that the convention might arrive with 12 candidates each having 8 percent of the vote. She ridiculed that possibility. If there had been time, it should have been possible to formulate a bet. A simple one would be, “A center-left candidate will arrive at the convention with more than 40 percent of the delegates.” Presumably, she would bet for this. I would bet against it. I would not bet more than a few dollars, because she knows much more than I do about the subject. That is what would make it fun if I won.

What do I think of the overall project of reviving a “third way” or a moderate center? I was skeptical going into the event, and I remain skeptical.

I would like to see a more moderate tone in politics. But oddly enough, Levy speaks for me when he writes,

if “moderate” is the name of a substantive position, then it risks being nothing at all, or at least nothing stable, only something defined with reference to the shifting sense of who counts as extreme.

I look at the “shifting sense of who counts as extreme” differently than he does. To me, it looks like the Overton Window is racing full speed to the left. In fact, the window has moved so far to the left that I think most young Democrats see Blair and Clinton as far right-wingers. Consider that when Barack Obama ran for President, he was against gay marriage, and by the time he left office his Administration was pushing trans-gender bathrooms. Consider that President Clinton took pride in balanced budgets and gave thought to fixing entitlement programs*, and now we have Larry Summers and Jason Furman writing that with interest rates so low the government should do a lot more borrowing and spending. And of course, socialism is now a yeah-word and capitalism is a boo-word among Democratic politicians.

After Munich, Winston Churchill said,

for Czechoslovakia and in the matters which were in dispute has been that the German dictator, instead of snatching his victuals from the table, has been content to have them served to him course by course.

I cannot support a moderation that amounts to serving the left’s victuals course by course. Get the Overton window to stand still, or maybe move it back to the right a couple of notches; only then we can talk about moderation.

*one of the event’s panelists, I believe it was Damon Linker, suggested that Clinton was getting ready to propose entitlement reform until a certain #metoo episode weakened him politically