Economics or sociology?

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Abby M. McCloskey writes,

Our social fabric is fraying, and people are losing a sense of purpose, dignity, and connection to one another. This too has implications for economic health. It is the strength of families and communities, not the broader economy, that is at the root of economic opportunity.

This goes along with the theme that I see emerging, which is that sociology is becoming more important than economics. To me, the widening of cultural gaps is very important. Those of us who live in affluent areas are really out of touch with much of the country in a way that was not as true fifty years ago. As I have said, back in 1965 at a Cardinals game, one would find people of all social classes sitting in the same section of the ballpark. That is not true any more.

McCloskey’s suggestions include

a voluntary national-service program. The activities would not be limited to military service but would include service in every venue, from childcare to eldercare to addiction recovery to environmental cleanup. While voluntary service is traditionally thought of as something for 18- or 19-year-olds, it could presumably be offered as a one-year program that anyone could participate in once in their lifetime for a set stipend of $30,000 or $15 an hour. The federal government would pay the stipend, or perhaps provide some other type of benefit, such as a credit for college costs, at that level. Instead of creating a large new federal agency to provide these service opportunities, citizens could partner with existing nonprofits or city-based projects. Indeed, such a program need not be a national one, but one that cities and communities could spearhead themselves.

She suggests starting with a trial pilot, rather than a full national program.

Even though service would be voluntary rather than obligatory, I am not on board with this suggestion. I don’t like to define “service” as working for a non-profit. Instead, if the goal is to help people feel useful and connected, I would look for ways to increase employment in general, including in the for-profit sector. Instead of a full stipend, the Federal government could offer a subsidy–perhaps a one-year exemption from the payroll tax.

Also, as one puts together a package of policies, it is important to keep in mind some fundamental trade-offs. For example, deep means-testing imposes high marginal tax rates, which impede upward mobility. See my essay on the UBI.

But in any case, this involves throwing economic solutions at sociological problems. My guess is that even if the economic ideas are well considered, the problems will confound economic policy. Of course, policies that are based on normative sociology (the study of what the causes of problems ought to be) will do even worse.

Business plan for a new elite university

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Frederick M. Hess and Brendan Bell write,

What is needed. . .is a place where serious scholars can have the space to pursue questions and subjects that don’t fit the progressive orthodoxy at today’s most prestigious institutions of higher learning. We need an incubator where promising young intellectuals could pursue their research without being forced to conform to the prevailing ideology, and where they can find the scaffolding — employment, funding, networks, and publication outlets — to enable them to achieve independent viability. What is needed is an ivory tower of our own.

Their goal is to set up a secular institution to compete with the Progressive religious seminaries. They put together a business plan for a new elite university that would host roughly 5000 undergraduates and 1500 graduate students. Their calculations suggest that such an enterprise would run at an operating loss of $50 million per year and also require $1.5 billion in initial capital to acquire land and build facilities.

Recently, I read Building the Intentional University, a book about the Minerva University, edited by founders Stephen M. Kosslyn and Ben Nelson. Their goal is not to ape existing universities but to redesign undergraduate education from scratch to make it more effective and less costly. I find this a more interesting project, although I am have some qualms about their approach.

In my opinion, if you are motivated to learn about something, you can find online resources that will be at least as good as what college students get, and perhaps better. I say that the future belongs to auto-didacts. Moreover, as William Gibson is reported to have put it, the future is here–it’s just not evenly distributed.

Seemingly related, from Scott Beauchamp,

perhaps the most subversive act is to learn without the authoritarian “assistance” of the typical modern university

Cultural mixing watch

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Elisabeth Braw writes (WSJ),

For a model, look to Finland. For nearly six decades, the Finnish government has offered the National Defense Course, a quarterly boot camp for leaders from the armed forces, government, industry and civil society. “The beauty is that every sector of society is present,” explains retired Lt. Gen. Arto Räty, a former director of the National Defense Course. “Yes, the course is run by the armed forces, but it’s not a military course. It’s a national security course.”

Without the course, many of the participants would never cross paths. The course has allowed Finland to bridge the national-security gap between civil society and the armed forces that exists in most other developed countries.

Recall that in my annotation of the Cowen-Andreessen-Horowitz podcast. I wrote

In the case of government and tech, I think that the highest potential for mixing is in applications related to the military and to security.

Behavioral meta-economics

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From my essay on Pascal Boyer’s Minds Make Societies.

Concerning economic inequality, Boyer writes,

… the economy or society as a whole is construed as a gigantic collective action, to which everyone contributes in one way or other, and from which they may receive rewards.
… humans do not generally believe that any individual’s contribution could possibly be hundreds or thousands of times greater than anyone else’s.

This reinforces the instinct that economic inequality must be derived from power rather than from merit.

You might call this behavioral meta-economics. Like behavioral economics, it looks at human inclinations to commit errors. But what I mean by behavioral meta-economics examines human inclinations to commit errors in assessing markets and large-scale society.

The challenge that economics teachers face is helping their students to understand and overcome behavioral meta-economics. Although he did not use that term, I think Scott Sumner’s post expressing doubts about the value of teaching behavioral economics is derived from a view that teaching behavioral economics might be counterproductive in getting students to overcome their behavioral meta-economics.

My review of Pascal Boyer

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I write,

Boyer writes,

… the economy or society as a whole is construed as a gigantic collective action, to which everyone contributes in one way or other, and from which they may receive rewards.
… humans do not generally believe that any individual’s contribution could possibly be hundreds or thousands of times greater than anyone else’s.

This reinforces the instinct that economic inequality must be derived from power rather than from merit.

I found Minds Make Societies to be highly valuable, and I am disappointed that it seems to have been mostly overlooked. Don’t overlook my review.

The Junger trade-off

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My latest essay begins,

Are the circumstances that promote material well-being the opposite of those that promote tight social connection? My take-away from listening to this fascinating discussion between Russ Roberts and Sebastian Junger is that such a trade-off does exist.

It seems that social connection is at its highest in small-scale groups facing hardship. That is the opposite of the recipe for prosperity.

Advice for the Republican Party

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1. from Brink Lindsey.

2. from me, responding to a piece by Yuval Levin.

Lindsey writes,

The challenge that faces any effort to reconstruct the American right is immense. The Republican Party at present is overwhelmingly under the spell of Donald Trump and seems determined to plumb the depths of intellectual and moral self-abasement in the service of a cult of personality. Between this point and the opportunity for any real renewal likely lies sustained electoral failure at the hands of the Democrats. Only repeated repudiation at the polls can break the hold of the populist demagoguery and extreme negative partisanship that has led the Republican Party so badly astray.

Brink proposes that the Republican Party should coalesce around ideas that he calls small-r republican. In the article, he sketches out what these might look like.

I do think that the Trump Presidency puts Republicans in a deep hole intellectually. At the same time, conservative intellectuals are in a deep hole electorally.

I can feel Brink’s pain. But I don’t think he has the solution.

Brink has some nasty things to say about President Trump and some snide things to say about libertarians. That tells me who he’s prepared to subtract from the Republican Party, so that he can feel better about supporting it. But whatever this might achieve in terms of crawling out of the hole intellectually, I don’t see how it can do anything other than put Republicans deeper in the hole electorally.

The slogan I adopt in my essay is,

I would like to see the Republicans adopt a more moderate tone and a more conservative agenda.

Social Justice and moral tribalism

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In a lengthy essay that is worth your time, James A. Lindsay and Mike Nayna write,

Sacred beliefs are ones that have been for moral reasons removed from the realm of skepticism and doubt because they’re viewed as too important to be subjected to these corrosive influences. Instead, sacred beliefs are effectively set aside from rational inquiry, which results in an expectation for them to be understood mythologically rather than literally, technically, or scientifically. The presence of sacred beliefs that cannot be questioned, challenged, or doubted—including their corollaries, even in minuscule ways—is a strong positive sign that a moral community is, in fact, a moral tribe.

Every community needs the enforcement of social norms. But I read the authors as saying that a moral tribe carries things further by requiring members to subscribe to a set of sacred beliefs. Traditional religions are examples of moral tribes, but a main point of the article is that we can have a moral tribe that shares only some but not all characteristics of traditional religions.

The conclusion of the article is that we ought to place the sort of constraints on the moral tribe of Social Justice that we place on religious groups. In particular, we should resist institutionalizing Social Justice.

That conclusion resonates with me. I have no desire to persecute the advocates of Social Justice. But I insist on having the right to question some of their beliefs.

I have no desire to persecute Christians, but I appreciate living in a society where any widespread movement by colleges or corporations to demonstrate “commitment to Christianity” or to mandate “Jesus training” would be vomited out of the system. That’s what I think should happen to “commitment to inclusion” and “diversity training.”

I will put some more excerpts below the fold, but I urge you to read the whole essay. Also, Handle’s comment on a different post might fit well here.

Continue reading →

Timothy Taylor gets a story wrong

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He writes,

There was a time, less than 20 years ago, when a major concern for the US government was how it would deal with the problems of paying off all government debt, which was projected to happen by about 2010. Alan Greenspan, then chairman of the Federal Reserve, made it a major point in his “Outlook for the federal budget and implications for fiscal policy” when he testified before the US Senate Budget Committee on January 25, 2001.

Tim tells the story as if this was a cognitive failure. Look at how hard it is to forecast! In hindsight, it looks like Greenspan’s crystal ball was cracked. Haha!

That is not the right story. It was a moral failure. I feel very strongly about this. Although I still consider Tim a great blogger, he muffed this one.

The context for Greenspan’s testimony was that newly elected President George W. Bush wanted to enact a big tax cut. One of the potential arguments against it was that it would cause the deficit to worsen. The responsible thing for Greenspan to do would have been to keep out of this issue, maintaining the political independence of the Fed. Instead, he waded in, with his ridiculous forecast, going so far as to say that it would cause dire problems for the Fed in the long run, because it would run out of government securities to buy. I hated that testimony from the moment it appeared. It was so craven (obviously, he was currying favor with the new President), so wrong on the economics, and so evil in its deception that I marked Greenspan as an irredeemable villain right then and there. I have not budged from that opinion.