BRIEFLY NOTED: For 2021-06-02 We
Things that went whizzing by that I want to remember...
First:
Over at Project Syndicate, I am trying to think about what China’s best options are right now:
Project Syndicate: Xi Jinping’s Historic Mistake: ‘American actor John Cena’s groveling apology to China for calling Taiwan a “country” suggests that globalization has gone horribly wrong, delong observes… <https://twitter.com/ProSyn/status/1400015812719628296> <https://www.project-syndicate.org/commentary/xi-jinping-quest-for-centralization-destined-for-failure-by-j-bradford-delong-2021-06>
Very Briefly Noted:
Maggie Fox: Messenger RNA Vaccines: Now Proven Against Coronavirus, the Technology Can Do so Much More<https://www.cnn.com/2021/06/01/health/mrna-vaccines-covid-future/index.html>
Jared Brock: Bitcoin & Ethereum Are Dead (& Their Honest Investors Know It): ‘More countries will ban BTC and ETH…. [With] Central Bank Digital Currencies… several hundred countries become direct competitors with BTC and ETH… <https://medium.com/surviving-tomorrow/bitcoin-and-ethereum-are-dead-and-their-honest-investors-know-it-a36ee97df89d>
John Holbo: The Totalitarian Temptation & All That: ‘DeLong links to Matthew Yglesias linking to Damon Linker linking to my old… How gratifying! I was thinking of writing it all out again…. But they’ve saved me the trouble… <https://crookedtimber.org/2009/03/27/the-totalitarian-temptation-and-all-that/>
Prof. Feynman: ’Meanwhile, inside the box, Schrödinger’s cat plans its revenge… <https://twitter.com/ProfFeynman/status/1398115620390981634>
Matthew Yglesias: Free Markets Are Creating a Major Free Speech Problem <https://www.slowboring.com/p/china-speech>
Sarah Green Carmichael: Return to Work: What’s the Point of the Office Again?: ‘The workplace offers the opportunity for social display, not improved productivity…. What’s the point of the office? “That’s the right question,” says Alexandra Samuel, co-author of “Remote, Inc.” “And any organization that isn’t asking that question is going to run into trouble because every employee’s thinking it”… <https://www.bloomberg.com/opinion/articles/2021-05-26/return-to-work-what-s-the-point-of-the-office-again>
One Video:
der8auer: Unreal Precision-Analyzing a Single TSMC 7nm Transistor <https://www.youtube.com/watch?v=EKb3OAoGeIw>:
Paragraphs:
Janet Yellen is doing a very good job:
Jeff Cox: Yellen Says the Government Is Operating Like It’s 2010, Calls for More Aggressive Spending: ‘Treasury Secretary Janet Yellen called on congressional leaders to get more aggressive in spending. In inflation-adjusted terms, Yellen said the budget hasn’t really increased since 2010. She noted that several areas of her department remain significantly underfunded…
On the history of the weblog Lawyers, Guns, & Money:
Robert Farley: Behind the Blogging: ‘Scott, DJW and myself founded LGM on May 31, 2004…. The site rapidly found a small but non-trivial audience, and became a small part of the bigger blogospheric conversation…. That small audience grew over time, making it psychologically possible to continue contributing to the site even at a time when there were no noticeable financial or professional reasons to do so…. Over the years Simon, Dave, the other Dave, Shakes, Vacuum, Melissa, Dan, Charli, Chris, Christa, Elizabeth, Abigail, Steve, Bean, Katie, and the dearly missed SEK have also helped made this site what it is today…. Ads and donations are both part of what makes this site function, and all of us here deeply appreciate any contribution you can make…. Speaking for myself, apart from my kids and my teaching I feel like LGM is the most important contribution that I have been able to make. It has always been an honor…
LINK: <https://www.lawyersgunsmoneyblog.com/2021/05/behind-the-blogging>
The world before the Great Dark Age:
Nicholas G. Blackwell: Ahhiyawa, Hatti, & Diplomacy: Implications of Hittite Misperceptions of the Mycenaean World: ‘The Hittite Tawagalawa Letter…. Hattušili III (ca. 1267–1237 b.c.)… complained to the king of Ahhiyawa about a Hittite renegade named Piyamaradu… alludes to an existing nonaggression pact between Hatti and Ahhiyawa modeled after the well-known Hittite-Egyptian contract…. The Tawagalawa Letter thus suggests a gross miscalculation by Ḫattušili of Ahhiyawan power. Based on their dealings with Near Eastern empires and particularly Egypt, the mid–13th-century Hittites developed an image of the Mycenaean state as more formidable than the reality.213 The Ahhiyawan king failed to resolve the Piyamaradu situation not because he had formed an alliance with the Hittite renegade, but because much of the eastern Aegean was simply not under his control…
LINK: <https://www.jstor.org/stable/pdf/10.2972/hesperia.90.2.0191.pdf>
Certainly Friedman and Friedmanesque policies had next to no constituency either within professional Republican politicians or those calling themselves economists after 2005. Hayekians and Schumpeterians all—so much so that Bernanke was ushered out of the party for trying to apply the Milton Friedman playbook. Krugman has an explanation, and it makes logical sense. But given that Friedman had managed to walk the tightrope, why couldn’t his successors do so:
Paul Krugman (2013): Milton Friedman, Unperson: ‘What I think is really interesting is the way Friedman has virtually vanished from policy discourse… This is hardly what you would have expected not that long ago, when Friedman’s reputation bestrode the economic world like a colossus…. Greg Mankiw declared Friedman, not Keynes, the greatest economist of the 20th century…. Ben Bernanke concluded a speech…. ‘Regarding the Great Depression. You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again…’ So what happened?… Friedman… was… trying to straddle two competing world views… an avid free-market advocate… [who] was also a macroeconomic realist, who recognized that the market definitely did not solve the problem of recessions and depressions. So he tried to wall off macroeconomics from everything else, and make it as inoffensive to laissez-faire sensibilities as possible…. [But] if markets can go so wrong that they cause Great Depressions, how can you be a free-market true believer on everything except macro?… American conservatism… had no room for any kind of interventionism, not even the sterilized, clean-room interventionism of Friedman’s monetarism. So Friedman has vanished from the policy scene…
LINK: <https://krugman.blogs.nytimes.com/2013/08/08/milton-friedman-unperson/>
Having something valuable may not make you rich: it may just make others brutalize you:
Mark Dincecco, James Fenske, & Anil Menon: The Columbian Exchange & Conflict in Asia: ‘Greater agricultural potential due to New World crops increased violent conflict after 1500. Rising caloric potential in a typical grid cell increased conflict by roughly its mean. The result holds across several New World crops and conflict types. It is largely driven by South Asia… a rapacity effect–increases in the gains from appropriation to Asian and non-Asian belligerents–as a mechanism. Population density, urbanization, and British imperialism significantly mediate the impact of the Columbian Exchange…
LINK: <https://warwick.ac.uk/fac/soc/economics/research/centres/cage/manage/publications/wp527.2020.pdf>
At its fundamental level, war is and has always been about (a) one group of people stealing stuff, (b) individuals acquiring status by demonstrating your personal bravery and competence, and (c) one group making some police somewhere behave as they wish, rather than as others wish—encouraging the use of German and discouraging the use of French, arresting people who send their taxes to Paris rather than Berlin, and changing the signs to read “Strassburg” rather than “Strasbourg”. And in the process wreaking a huge amount of devastation.
Noah Smith: The Future of war Is Bizarre & Terrifying: ‘On December 11, 1941… the Prince of Wales and the Repulse, a British battleship and battlecruiser… had both been sunk by Japanese aircraft…. Astute observers had been able to see the signs of the increasing importance of naval aviation in the years prior…. But somehow, when the moment came, Churchill was still shocked…. Military technology is a hugely important area of innovation, and yet it generally results in things getting blown up and society going to hell for a while…. We’ve been racing to invent new military technologies… like[ly to]… alter… the international balance of power in ways that make us more likely to try out the new weapons and see where things stand…. The autonomous, weaponized drone may replace the human infantryman as the dominant battlefield technology. And as always, that shift in military technology will cause huge social upheaval….. In the Second Nagorno-Karabakh War, Azerbaijan used drones—purchased cheaply and easily from Turkey and Israel—to crush… Armenian troops… [whose] tanks, missile launchers, artillery, and transport vehicles were sitting ducks for their foes’ cheap disposable drones…. This should be as big a wakeup call as the Battle of Taranto or the firebombing of Guernica…. The drones that won the war for Azerbaijan are traditional fossil fuel powered aircraft. Advances in Li-ion batteries have given rise to small, cheap, difficult-to-see, difficult-to-shoot quadcopters. Already, militaries are finding creative uses for these…
LINK: <https://noahpinion.substack.com/p/the-future-of-war-is-bizarre-and>
When a university department becomes an ideological cult:
Jagdish Bhagwati: ’[Chicago was] very Friedmanesque … The seminars seemed to oscillate between proving that elasticities were large with markets therefore stable, and formulating competitive hypotheses for apparently imperfectly-competitive industries and coming up with high enough R2s. Econometrics was the handmaiden of ideology: things looked imperfect to the naked eye, especially to that of Chamberlin and Joan Robinson, but they were ‘really’ not so and the world was ‘as if’ competitive…. Market imperfections were ‘demonstrated’ to be negligible and the imperfections rather of government intervention were the subject of active research…
The historical memory of pre-Revolution Haiti—and the strong desire to avoid institutions anything like those before the Revolution—hobbling Haitian economic growth in the twentieth century:
Craig Palsson: Small Farms, Large Transaction Costs: Haiti’s Missing Sugar: ‘In the eighteenth century, Haiti was the world’s leading sugar producer, but when cane surged in the Caribbean in the early twentieth century, Haiti produced none. Instead, the land sat idle while workers emigrated to work on sugar plantations. I examine the hypothesis that historical property rights institutions created high transaction costs for converting land to cane production. I collect new data on land-use from 1928–1950 and a proxy for transaction costs. The evidence suggests transaction costs impeded the land market from responding to the sugar boom…
(Remember: You can subscribe to this… weblog-like newsletter… here:
There’s a free email list. There’s a paid-subscription list with (at the moment, only a few) extras too.)
Concerning possible reasons that Friedman’s successors did not succeed in walking the same tightrope: it is not always easy to infer motives from results, but the Schumpeter-Hayekian project, like any (loosely) totalitarian polity, will always require fresh monsters to kill. Ultimately, Democratic presidents can appoint Fed chairs, too, which would in turn ultimately require that monetary policy, like fiscal policy, be neutralized as a possible source of discretionary intervention in the economy. The Free Market is a jealous god.