Mitt Romney

February 2nd, 2012

Two well-known journalists look closely at the probable Republican nominee.

Mr Romney strongly resembles two similarly unloved Democratic nominees from the recent past, Al Gore and John Kerry. These both suffered from the same characterisations that are applied to Romney – too wooden in person while too flexible in their views. Their supporters often argued that qualifications were what mattered. But ominously for Mr Romney, both lost winnable races because of their flawed personalities.  George W. Bush, on the other hand, was elected and reelected, despite his enormous substantive shortcomings, because ordinary people found it easy to relate to him at a personal level. They felt he wasn’t trying to be someone different from who he was.

Romney, Kerry and Gore are all, in a way, versions of the same political type. Statuesque, handsome, from privileged backgrounds and impeccably credentialed, they have no log cabin stories to humanise and ground them. Unlike a Lyndon Johnson, a Richard Nixon, a Ronald Reagan, a Bill Clinton, or a Barack Obama, they didn’t overcome humble origins or broken families. Mr Romney’s background is alien to most Americans not because he descends from polygamists but because his father was a governor of Michigan, an automobile company chief executive and a presidential candidate.

Jacob Weisberg, “Why Mitt Romney must take pride in his own perfection“, The A-List, Financial Times, 1 February 2012.

Mr Weisberg (born 1964) is author of The Bush Tragedy (Random House, 2008).

For four years now, Republicans have been demonizing Barack Obama for his alleged “otherness”—trashing him as a less-than-real American pushing “anti-colonial,” socialist, and possibly Islamist ideas gleaned from a rogue’s gallery of subversive influences led by his Kenyan father, Saul Alinsky, and the Reverend Jeremiah Wright. And yet Romney is in some ways more exotic and more removed from “real America” than Obama ever was, his gleaming white camouflage notwithstanding. Romney is white, all right, but he’s a white shadow. He can come across like an android who’s been computer-­generated to be the perfect genial candidate. When forced to interact with actual people, he tries hard, but his small talk famously takes the form of guessing a voter’s age or nationality (usually incorrectly) or offering a greeting of “Congratulations!” for no particular reason. Richard Nixon was epically awkward too, but he could pass (in Tom Wicker’s phrase) as “one of us.” Unlike Nixon’s craggy face, or, for that matter, Gingrich’s, Romney’s does not look lived in.

Frank Rich, “Who in God’s Name Is Mitt Romney?“, New York, 29 January 2012.

Frank Rich (born 1949) was employed by the New York Times from 1980 until June of 2011, when he left to become an essayist and editor-at-large for New York magazine. HT: The Browser

the cost of universal pensions

February 2nd, 2012

I have prepared notes on “Universality and the cost of basic pensions” for presentation at a meeting convened by HelpAge International, and thought that they might be of interest to at least some TdJ readers. These brief notes bring together my thoughts on means tests, and why I believe that they are almost always inferior to universal benefits.

A typical reaction to universal pensions is “That’s a great idea, but we can’t afford it, so prefer to give pensions only to those who need them”. This reaction appears to be common sense, but it is wrong. Means tests shift costs, but do not lower them because means tests are taxes on income or assets. They are paid by elderly citizens and, sometimes, their families. It is more efficient to fund basic pensions with general taxes paid by everyone. All taxes, with the exception of head taxes, distort choices. Of particular concern are taxes that discourage work and saving. Low taxes levied on an entire population are less distorting than high taxes levied on the elderly.

This is the efficiency argument for universality. It is valid even with costless and perfect targeting, with no stigma, no exclusion errors, no erosion of political support. It is a simple argument, yet often ignored because means tests are usually recorded as expenditure reductions rather than as tax collections. Framing is important. A message that means tests are taxes could appeal to voters across the political spectrum.

It is important to recognize that, even though universality is optimal, all means tests are not equally bad. Clear, simple rules are preferable to complex regulations that leave discretion to government bureaucrats. Rules matter more than whether the number disqualified by targeting is small (an ‘affluence test’) or large (a ‘means test’?). The term ‘affluence test’ is imprecise and adds nothing to our understanding of means tests.

…. continued here.

A typical reaction to universal pensions is “That’s a great idea, but we can’t
afford it, so prefer to give pensions only to those who need them”. This reaction
appears to be common sense, but it is wrong. Means tests shift costs, but do not
lower them because means tests are taxes on income or assets. They are paid by
elderly citizens and, sometimes, their families. It is more efficient to fund
basic pensions with general taxes paid by everyone. All taxes, with the exception
of head taxes, distort choices. Of particular concern are taxes that discourage
work and saving. Low taxes levied on an entire population are less distorting
than high taxes levied on the elderly.

This is the efficiency argument for universality. It is valid even with costless
and perfect targeting, with no stigma, no exclusion errors, no erosion of
political support. It is a simple argument, yet often ignored because means tests
are usually recorded as expenditure reductions rather than as tax collections.
Framing is important. A message that means tests are taxes could appeal to voters
across the political spectrum.

It is important to recognize that, even though universality is optimal, all means
tests are not equally bad. Clear, simple rules are preferable to complex
regulations that leave discretion to government bureaucrats. Rules matter more
than whether the number disqualified by targeting is small (an ‘affluence test’)
or large (a ‘means test’?). The term ‘affluence test’ is imprecise and adds
nothing to our understanding of means tests.

Bill Ayers on the Tea Party

February 1st, 2012

I’m writing this book right now called Pallin’ Around, and the subtitle is: “Talking to the Tea Party.” And frankly I find talking to the Tea Party exhilarating, I love it. ….

[T]he Tea Party, if you want to call them working class, you know, a working-class insurgency from below, they are a mass of contradictions; they don’t have a single consistent viewpoint; but part of their impulse is to be wary of government. I’m wary of government. Part of their impulse is to dislike and be worried about the rich. I’m that way too. So I don’t find them to be as atrocious as most people do, as your liberals do. I’m not a liberal. ….

There are things about classic liberalism that obviously I’m drawn to and I bet all of you are as well. Those are things like liberty, freedom, the Bill of Rights. But the reason that I reject the label is that I grew up cutting my teeth against the liberals. I wasn’t part of John Kennedy’s vision of the world, or Lyndon Johnson’s. I thought of them as anti-Communist imperial monsters. ….

Obama doesn’t disappoint me, because all during the campaign he said, I’m a pragmatic, middle-of-the-road, compromising politician. The Right said, He’s lying, he’s a socialist who pals around with terrorists, he’s a secret Muslim and blah blah blah. That was their line. The liberals all said, He’s winking at me, I can feel him winking in my direction. He wasn’t winking. He said exactly who he was and he’s lived that out perfectly.

So you can be disappointed but only if you thought he was something that he said he wasn’t! Every politician—FDR, Lyndon Johnson, Abraham Lincoln, Barack Obama—they’re all conservative by nature. ….

An Interview with Bill Ayers“, The Point 5 (Spring 2012)

Bill Ayers (born 1944) is a retired professor of education at the University of Illinois in Chicago. He is best known for his activism in the 1960s and 70s and for co-founding the Weather Underground, a revolutionary group that bombed public buildings to protest US involvement in Vietnam. Ayers has written a memoir of his activist years, Fugitive Days (Beacon Press, 2001; Penguin, 2003). During the 2008 US presidential campaign, Barack Obama was accused of “palling around with terrorists” because of his contacts with Professor Ayers in Chicago. Click on the link above to read more from the interview.

HT: The Browser

Charles Dickens

January 31st, 2012

We live in hard times, and all the indications are that they may get much, even very much, harder. No one, at any rate, would take a bet that they won’t.

The number of children in America claiming subsidized meals in school has shot up; the homeless are increasing by the hour; the formerly prosperous are laid off without so much as a thank you; the young struggle to find any work at all; beggars are making a comeback on the streets of cities as if they had been hiding all these years, waiting for the right moment to emerge from their subterranean lairs into the world above.

The February bicentenary of the birth of Charles Dickens, then, could hardly come at a more appropriate moment in economic history, for Dickens was the revealer, the scourge, the prose poet, of urban destitution—a destitution that, in our waking nightmares, we fear may yet return.

Theodore Dalrymple, “Hard Times Again“, The American Conservative, 23 January 2012.

So begins a fascinating essay on Dickens by English writer ‘Theodore Dalrymple’, the pen name of psychiatrist and retired prison doctor Anthony Daniels (born 1949). Click on the link to read the full essay.

HT: The Browser

free courses, from MIT

January 30th, 2012

This is a exciting news. MIT is launching MITx, a not-for-profit virtual university, with a wide range of free, open-access courses. For a small fee, students will be permitted to sit an exam at the conclusion of a course and, if they pass, receive a certificate of successful completion.

MITx is the next big step in the open-educational-resources movement that MIT helped start in 2001, when it began putting its course lecture notes, videos, and exams online, where anyone in the world could use them at no cost. The project exceeded all expectations—more than 100 million unique visitors have accessed the courses so far. ….

Beginning this spring, students will be able to take free, online courses offered through the MITx initiative. If they prove they’ve learned the material, MITx will, for a small fee, give them a credential certifying as much. ….

[This] could make the university the global nexus of online higher education, which is the way most people are likely to access higher learning in the future. In the hunt for the best and brightest students around the globe, MIT won’t need to guess who’s in the top 1 percent of 1 percent—it can simply pick them out of the millions of students who will enroll in MITx.

Meanwhile, it will be fascinating to watch MITx mint a brand-new form of academic currency. What happens when it enters circulation? Will other universities accept it as transfer credit, or employers as proof of skills? How will those credentials affect the fast-growing market for online credits and degrees, much of which is driven by the expensive for-profit sector?

Kevin Carey, “MIT Mints a Valuable New Form of Academic Currency“, The Chronicle of Higher Education, 22 January 2012.

MIT is the famous Massachusetts Institute of Technology, which is physically located in Cambridge, Mass. The university answers common questions about MITx here.

One question that I had was “Will MITx offer MIT degrees?” The answer is “No. MIT awards MIT degrees only to those admitted to MIT through a highly selective admissions process.”

A follow-up question I had was “Will MIT accept MITx credentials as transfer credit toward a degree?” The MIT FAQ does not answer this question. Kevin Carey seems to answer it when he writes “there should be little confusion between credentials issued by MIT and MITx. The latter won’t dilute the value of the former.” By implication, the answer is “Don’t count on MIT accepting MITx credentials for credit!”. This makes the experiment all the more fascinating.

HT: The Browser

class warfare and taxes

January 28th, 2012

US journalist Christopher Caldwell looks at President Barack Obama’s call for a minimum 30% tax on those earning more than $1m a year.

Mitt Romney, a Republican candidate for US president, released his tax returns this week. They showed that he had paid just $3m on his 2010 income of $21.6m, which is just the tip of his quarter-billion-dollar iceberg of wealth. Mr Romney, in other words, is paying taxes at a lower rate than most of the middle-class Americans he seeks to rule. And this inequity is made possible in part by a special rule on “carried interest” that taxes the earnings of managers of private equity, such as Mr Romney, at the super-low capital gains rate of 15 per cent. ….

When Mr Obama and his fellow Democrats held the presidency, the House and a filibuster-proof majority in the Senate, they could have eliminated the carried interest accounting rule in a single afternoon. It remains in the tax code because Mr Obama’s party – which, let us not forget, holds the allegiance of 19 of the richest 20 postcodes in the US – wanted it there.

Christopher Caldwell “Class warfare need not be taxing“, Financial Times, 28 January 2012.

Mr Caldwell (born 1962) is a senior editor at The Weekly Standard, a neoconservative opinion magazine.

Cuba’s economic reforms

January 28th, 2012

“We’re giving Etecsa a bit of competition,” says Michael Franco, who has regular takers for the iPhones he sells for $400 and no complaints about the government’s 50 per cent tax rate either. “Fifty per cent of what? It depends how much you declare.”

Cubans wonder about selling their houses – to foreigners of course, as no Cuban has sufficient capital although, paradoxically, only resident Cubans are allowed to buy.

“Judging from the Norwegian who bought next door for his Cuban wife, my house is probably worth $300,000,” says Nelly Sanchez who is thinking of downsizing from her four bedroom because her three children live abroad.

John Paul Rathbone, “Freedom comes slowly to Cuba“, Financial Times, 28 January 2012.

colonising the moon

January 28th, 2012

Even by the grandiose standards of Newt Gingrich’s ideas, this was a big one. “By the end of my second term, we will have the first permanent base on the moon,” the presidential hopeful promised.

He may have tried to reflect the glory of a genuinely grandiose president. In 1961 John F. Kennedy announced the goal “before this decade is out, of landing a man on the moon and returning him safely to earth”. But why Mr Gingrich, who is busily trying to appeal to the Tea Party, would try to compare himself with a Democratic party icon is anyone’s guess. ….

There is one similarity between the Tea Party darling and the president of 50 years ago: both have been accused of a predilection for women who were not their wives. Beyond that, Lloyd Bentsen’s words to another Republican trying to reach the White House ring true: “You are no Jack Kennedy.”

Fly me to the moon“, Financial Times editorial, 28 January 2012.

the Inquisition

January 27th, 2012

The Vatican’s Inquisition records are kept mainly in a palazzo that is now the headquarters of the Congregation for the Doctrine of the Faith. For four and a half centuries they were closed to the public. Suddenly, in 1998 the Vatican opened the archive to outside scholars like Vanity Fair editor Cullen Murphy. In this essay, he explains what he has learned, and how the mindset of the Inquisition is with us today.

Looking at the Inquisition, one sees the West crossing a threshold from one kind of world into another. Persecution acquired a modern platform – the advantages afforded by a growing web of standardised law, communications, administrative supervision and controlled mechanisms of force. It was run not merely by warriors but by an educated elite; not merely by thugs but by skilled professionals. Every subsequent outbreak of persecution, political or religious, has been abetted by these same forces. They ensure that the basic trajectory of repression will always look remarkably the same. They suggest why persecution is so difficult to stop. And they help explain why the Inquisition template has translated so easily from the religious sphere into the world of secular governments and secular ideologies. Through the lens of the Inquisition we can glimpse the world we inhabit now.

When the Inquisition’s palazzo was built, in the mid-16th century, the Pope ordered words to be carved in a marble scroll over the front door – a kind of mission statement – establishing the building as a “bulwark against heretical depravity”. The words are gone now, removed by French troops during Napoleon’s occupation. It’s easy enough to remove some words – harder to erase a legacy.

Cullen Murphy, “Inside the heresy files“, New Humanist 127:1 (January/February 2012).

HT: The Browser

Cullen Murphy’s book God’s Jury: The Inquisition and the Making of the Modern World (Houghton Mifflin Harcourt, 2012; Allen Lane, 2012) was published in New York and London.

job satisfaction, sniper edition

January 26th, 2012

Research in Canada has also found that snipers tend to score lower on tests for post-traumatic stress and higher on tests for job satisfaction than the average soldier.

“By and large, they are very healthy, well-adjusted young men,” says Peter Bradley at the Royal Military College of Canada, who is studying 150 snipers in Afghanistan. “When you meet them you’re taken by how sensible and level-headed they are.”

Stephanie Hegarty, “What goes on in the mind of a sniper?“, BBC News Magazine, 25 January 2012.

Not what I expected. The article, interesting throughout, focuses on the story of a particular well-adjusted sniper, Chris Kyle, who officially killed 160 people (his own estimate is much higher) during four tours of duty (2003-2008) with the US Navy Seals. Iraqi insurgents named him “The Devil of Rahmadi” and put a $20,000 bounty on his head.

Chris Kyle wrote a book about his experience, American Sniper (William Morrow, 28 December 2011), and was interviewed on 5 January 2012 by BBC World Service (Outlook). The interview can be downloaded here.