Stable Genius Liberal

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The 2014 Electorate Was Really, Really Old

What’s so new about the Islamic State’s governance?

of the insurgencies that provided education and health care, nearly 72 percent of insurgencies provided education to civilians, and just over 71 percent of rebel movements provided health care. In other words, if an insurgent group provides social services, they are more likely to offer these services to civilians. Once an insurgency acquired territory, nearly 49 percent would ensure that the civilian population received education or medical care, consistent with recent research on rebel governance.

ISIS thinks education and health care are roles of government.

The takeaway from six years of economic troubles? Keynes was right.

Countries that took emergency measures to reduce public borrowing have mostly suffered weaker growth, as in the case of Britain from 2010 to 2012, Japan this year and the United States after the 2013 “sequester” and fiscal cliff deal. In more extreme cases, such as Italy and Spain, fiscal tightening has plunged them back into deep recession and aggravated financial crises. Meanwhile countries that ignored their deficit problems, as in the United States for most of the post-crisis period, or where governments decided to downplay their fiscal tightening plans, as in Britain this year or Japan in 2013, have generally done better, both in terms of economics and finance.

But this is the key quote:

Monetarism overturned the Keynesian fiscal consensus that prevailed from the 1930s to the 1970s, by introducing one simple assumption into the models that guided governments and central banks. The case for Keynesian fiscal stimulus in deep recessions was simply assumed away by asserting that interest rates could always be reduced sufficiently to stimulate private investment, discourage private savings and so restore growth. As a result, the private sector as a whole would never suffer for long from a shortfall in spending. Therefore government borrowing would never be needed to balance inadequate private demand.

As a result of these assumptions, interest rate decisions by central banks came to be seen as the only effective tool of macroeconomic management, while fiscal policy was relegated to a microeconomic supporting role. Tax structures and public spending levels were seen as supply-side issues influencing incentives and resource allocation, but the demand impact of government borrowing was largely ignored. Whether government borrowing expanded or contracted, interest rates would rise or fall to offset the Keynesian demand effects. Independent central bankers would manage macroeconomic demand with monetary policy, leaving governments to set taxes and spending plans to achieve political or supply-side objectives.

Worth a read.

Inflation Derp Abides

Jim Rogers declared that “we are all going to pay a terrible price for all this money-printing and debt.” And I asked the obvious question: How long has Rogers been predicting a printing-press-and-deficits disaster?
The answer is, a very, very long time. Here he is in October 2008 — six full years ago — declaring that we were setting the stage for a “massive inflation holocaust.”

What I expect is that inflation will be slightly higher than normal and the people claiming inflation holocaust for the past six years will act as if they were right all along.

A $20 an hour minimum wage really would cost a lot of people their jobs

The good news about Denmark is that their unemployment rate is only very slightly higher than the USA’s and was lower in the recent past. The Danish economy as a whole does a good job of keeping people employed, and it also does a much better job than the American economy of delivering high living standards for the poor. But mandating high wages for fast food workers has more or less the impact you would expect — low levels of fast food employment.

The standard response to raising the minimum wage is always why not a million dollars and hour as if that’s under consideration. $20 is too hight. Much to high. That doesn’t mean that $0 is the correct answer.

Anthony Weiner Still Doesn’t Understand How to Use Twitter

Weiner embarrasses himself again.

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This photo of Kim Jong Un looks like a still from a Wes Anderson movie – Vox

What the Neoreaction Doesn’t Understand about Democracy

The key conclusion to draw from the Mulligan study is that political competition doesn’t go away when you switch away from democracy; rather, it moves to the metapolitical level. Competition within political systems is a substitute for competition over political systems. When the former is stifled, the latter becomes more important, which is why nondemocratic rulers must take greater pains to prevent an overthrow of government than democracies do. There is no limit on the level of metapolitical competition under a dictatorship other than the state of technology available to the state and to its would-be usurpers.

Interesting read for those following the anti-democracy crowd.

Pro Big Corporate IRS: Agency Guts Whistleblower Program, Leaves Billions on the Table

It’s widely known among tax professionals that the US does little in the way of tax enforcement, and the little that it does do is directed against individuals and small businesses. What is not so widely known is how deep the institutional bias is in the IRS in favor of letting big corporate tax cheats get away with it. Conventional wisdom is similar to the rationalization of weak enforcement at the SEC: that the agency is afraid that if they go after big companies, they’ll have the penalties and fines challenged in court, and they’ll often lose by virtue of being outgunned by better lawyer…It turns out that the picture is vastly worse than that. In 2006, recognizing that the IRS was losing over $450 billion a year in revenue to tax evasion, Congress mandated that the agency establish a whistleblower office and pay whistleblowers 15% to 30% of amounts recovered from their filings. Unfortunately, as a whistleblower from the IRS’ Office of the General Counsel in New York has revealed, the IRS at its highest levels is opposed to implementing the policy.

Obama Is a Republican

Obama has governed as a moderate conservative—essentially as what used to be called a liberal Republican before all such people disappeared from the GOP. He has been conservative to exactly the same degree that Richard Nixon basically governed as a moderate liberal, something no conservative would deny today.

I would dismiss this as yet another attempt to recast a former president as centrist in the eyes of history. Almost every former president could be called centrist if you cherry pick. But this is a well written article and worth reading.