I'll Be Back

The scene was set. We had a good party going and one of the hosts decided to go catch his breath as he was drowning in school work. Now I want to come back to the party, but, I'm afraid all my guests have left. Nevertheless, I will write. Let me explain why (if there is anyone reading this still).

This weekend my wife and I were walking and talking about the future. She is in planning mode, submitting all kinds of forms for residency and she asked a simple question, "Given what you want to do, what would be the best locations for me to apply?" I stumbled.

Why? Because that would imply that I knew what I wanted to do. I feel in these last semesters I've become a little bit lost. The zeal for economics is still there, but, I feel tired and uninspired. I have lost my sense of direction and now, more than ever, I need this blog.

Though I am busy, yet I will be back with a vengeance.  

Progressives and Race

I've written on this topic several times, and here, in NRO, comes someone more expert than I to discuss the connections between the Progressive movement and racial segregation in the in 19th and 20th century Sadly, two of the most prominent Progressives in this article were leading lights in the emerging Economics profession. However, the prize for most outlandish proposal goes to the sociologist who promoted forced labor camps for blacks. Yes, let's have more national discussions on race, and establish once and for all who established Jim Crow laws, disfranchisement, and educational segregation.

What is Poor?

Co-author Brad Hansen sent this link to the blog Pyromaniacs, which combines the statistics of a BBC video hosted by Hans Rosling, the blogger's own analysis of the U.S. data in terms of the complaints of the Occupy Wall Street Movement, and Chrisitian theology.

Brad asked if I had any further thoughts, and the blog suggests several. One thing that I think we ought to consider at the start is that the terms "income" and "wealth" are often used interchangeably, and they are not. (Part of the problem is that "poor" is popularly used as the opposite of both "wealthy" and "high income.") I believe that I recall reading recent data that income in the U.S. has become less equal but wealth has not. How could that be? There are several factors, including greater life-cycle disparities in income that don't translate into wealth disparities, problems with valuation of assets (wealth, such as home values or even wealth intangibles like the social wealth of living in a safe neighborhood), increasing differential returns from education, income statistics that don't capture all aspects of government income redistribution etc.. I'll try to check this out further, and maybe post some other thoughts.

David Brooks on Inequality

I have mixed reactions to David Brooks, but his article today on "inequality" was thought-provoking. Even here, we can see the cultural divides between Manhattan/Chevy Chase and "flyover country". Brooks asserts that's it's not acceptable to wear clothing with religious messages. I think if Brooks walked around Tennessee or Texas or Iowa more he might see that a lot of people have t-shirts with explicitly religious or, more neutrally, "I love First Church" type messages. Nevertheless, although the article is humorous, I think it raises interesting questions for Christians. It would make a good single-meeting Bible study resource. (Thanks to hotair.com for the tip on the article).

Rent

In a discussion in our Theory of Moral Sentiments Readings Group, we delved into Prof. Gordon Tullock's pathbreaking article in which he introduced the idea of rent seeking (although the name came later from Anne Krueger). One of the questions Gordon raised was how one would measure rent seeking. For the United States, I have long promoted a metric such as "Count the number of Nordstrom and Neiman-Marcus stores in the Washington DC metropolitan area and multiply by the a normalized difference of the excess increase in housing prices in the D.C. area compared to the rest of the United States." Just kidding. But consider the news yesterday that the Washington, D.C. metropolitan area which historically has manufactured virtually nothing, long ago quit growing (gasp) tobacco, and has no known natural resources other than mosquitoes, is now officially the wealthiest (actually, highest income) part of the United States. This Versailles-on-the-Potomac produces one thing: government. I think that it's interesting to consider there were many things that the U.S. government, some of them relatively well, with Washington remaining a relatively sleepy Southern town. The big changes in D.C. came with the ramp up of the New Deal, then The Great Society, and then the social regulatory programs of one of America's most economically liberal Presidents, Richard Nixon (sorry Republicans, but do the math: OSHA, EPA, wage and price controls, AMTRAK, Title IX, and so forth). The current administration has successfully pushed the Washington team over the goal-line. (As long as I am ranting, can you imagine any other part of the country as hypocritical as Washington D.C. having a professional football team named the "Redskins" in the midst of all of the political correctness that it imposes on the rest of the country? To think that Florida State had to fight to retain the name "Seminoles" which is an actual (both historical and living) proper name and not an ethnic slur like "Redskins", well ... I guess it's time to stop ranting.)

Indeed

From the New York Sun, a quote from the just-announced winner of the 2011 Nobel Prize in Economics, Thomas Sargent:

“Everyone responds to incentives, including people you want to help. That is why social safety nets don’t always end up working as intended.”

Could Not Have Said It Better

Brad Hansen, our co-author on Wise As Serpents, brought this video to our attention. It is part of the launch of a new initiative called povertycure.org which is designed to bring entrepreneurial solutions to issues of economic development, particularly in Africa. In the video, the narrator says that is it easy to have a heart for helping the poor, but harder to have the mind to do so. This is very much the motivation behind the FSU course on the Economics of Compassion. Best wishes to them in their efforts.