Kevin Drum - April 2011

FEMA's Ups and Downs

| Sat Apr. 30, 2011 3:28 PM EDT

The New York Times on FEMA's response to the tornadoes that ripped through the South last week:

It has been the deadliest natural disaster on American soil since Hurricane Katrina. But the government response to the tornadoes that devastated the South last week has, at least in the first few days, drawn little of the searing criticism aimed at federal agencies back in 2005.

....FEMA officials contacted the White House about the need for a federal emergency declaration even before Alabama had submitted a formal request that evening, said Art Faulkner, the state’s emergency management director. It was quickly granted....In Alabama, as in other affected states, the Democratic White House was winning early praise from state, local and Congressional leaders of both parties.

Shall we roll the tape? Under Bush Sr., FEMA sucked. Under Clinton, FEMA was rehabilitated and turned into a superstar agency. Under Bush Jr., FEMA sucked again. Under Obama, FEMA's doing great and responding quickly.

I know, I know, we're not supposed to politicize natural disasters. Not when that politicization makes Republicans look bad, anyway. So I'll just let you draw your own conclusions from these four data points. I report, you decide.

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The Zero Profit World

| Sat Apr. 30, 2011 11:49 AM EDT

Matt Yglesias:

In a fully competitive market, products should be sold for the marginal cost of producing a unit. And in the software world, the marginal cost of producing a unit is zero. Therefore, in the long run software should be free and nobody should make a profit.

This is an odd use of the word "should," I think. And rather than being an argument for free software1, it's really more of an argument that either (a) economic "efficiency" is overrated or (b) fully competitive markets are overrated. If nobody ever got to make a profit, after all, the world would be a pretty dreary and backward place.

But then, I suppose I'm biased. The marginal cost of producing blog posts is indistinguishable from zero, and I'd just as soon make more than zero dollars producing them. So I'm not really a fan of long run profits trending to zero, even in the nonprofit world.

1For reasons that escape me, this argument is almost always employed as a criticism of industries like software and music that have very low marginal costs. I suspect ulterior motives.

Wedding Day Cat Blogging - 29 April 2011

| Fri Apr. 29, 2011 2:09 PM EDT

So you think the royal wedding has been overexposed? Don't be silly. The overexposure has only barely begun! And today, the cats and I do our part to keep the royal media extravaganza going, with a tsotchke assist from my sister.

On the left, Inkblot is celebrating the great day — and demonstrating his serene confidence in his own masculinity — by wearing a lovely royal tiara. Majestic looking, isn't he? And aside from being made out of plastic, it's just like Kate's! Except for all the parts that aren't. On the right, Domino is royalty percatified, surrounded by my sister's treasures. Unlike Inkblot, who's generally willing to plonk down wherever you put him (for a while, anyway), Domino doesn't really like being told what to do. This meant that her picture took a little while longer to set up. Basically, I had to wait for her to go to sleep somewhere and then start piling stuff up around her. That only worked for a few minutes, but a few minutes was all I needed.

So anyway, happy royal wedding day! It's a bank holiday in Britain, and I declare the rest of the day a cat holiday in America. Go pet a cat!

Washington's Rose Colored Glasses

| Fri Apr. 29, 2011 1:11 PM EDT

After reviewing a few of the latest follies on Capitol Hill, Jon Chait concludes that the Beltway chattering classes have become obsessed with the federal deficit because, as far as they're concerned, the economy is fine and we don't really have to worry about it anymore:

The view that the deficit represents a uniquely high priority, and that we should prioritize it over economic growth even during the greatest economic crisis since the Depression, has been deeply embraced by economic and political elites in both parties. And it's hard to disconnect this from the fact that, for those elites, the economic crisis is over.

Moments later, Catherine Rampell posts this result from a recent Gallup Poll:

Sure enough, where you stand depends on where you sit. If you have a job and you're earning good money, the economy doesn't look great, but it doesn't look that bad either. If you don't have a job and/or you're not earning much, the economy continues to look pretty sucky.

And the Beltway folks? They all have jobs and they all earn considerably more than $75,000. To them, the economy probably looks almost peachy. It's no wonder they can afford to focus all their attention on what the federal deficit is going to look like in the year 2030.1

1Plus, this focus is politically useful for Republicans. That always helps with the chattering classes too.

The Limits of Nostalgia

| Fri Apr. 29, 2011 12:26 PM EDT

Megan McArdle responds to bouts of childhood nostalgia from Jim Manzi and Paul Krugman:

Maybe it's because I grew up later than either Manzi or Krugman; maybe it's because I grew up in Manhattan; or maybe it's because I'm a woman. Whatever the reason, what I notice about their idyll is how dependent it was on women being home. Home production looks very similar no matter who is doing it; one family may be having meatloaf, and another filet mignon, but the family meals still have the same basic rhythm of Mom in the kitchen for hours until the family comes to dinner. Families only need one car because Mom, who doesn't herself work, is available to drive Dad to work every morning before she heads to the grocery store. And the kids can play unsupervised because, of course, in this neighborhood--in all neighborhoods--there is a network of constantly watching eyes. Meanwhile, the poor people and minorities are somewhere comfortably distant, allowing young Paul and Jim to experience a world without want. I can tell you where all the inequality and fear and crime was; it was in the neighborhood where I grew up, and the neighborhoods elsewhere in the city that were much poorer and more dangerous.

I don't mean to sneer; I'm sure it was idyllic. And the income gains of the 1950s and 1960s were real. But the suburbs of the era were not created simply by the rise of the middle class. Their existence, in the way that Manzi and Krugman remember, was also completely dependent on other forms of inequality: of the ability to move away from social problems, which is harder now; of generations of women whose sole destiny was the kitchen. This produced a world in which most homes were, from the point of view of kids, basically the same: all of them contained a mom who spent most of her time cleaning the place or feeding its occupants, and the size and contents were naturally limited to the amount of stuff that Mom was personally willing to care for. It was a great world for kids. But not everyone was so lucky.

My childhood was largely similary to Manzi's and Krugman's, so I know what they're talking about. And I don't begrudge them their nostalgia at all. It's not necessary to insert a thousand-word caveat about racism and sexism and suburbanization every time you write affectionately about your childhood.

Still, Megan's caveat can hardly be repeated too often. It's buzzkill for sure, but whenever we talk about whether we'd prefer the past to the present if we had lots more money to make up for the lack of flat screen TVs (or whatnot), it's worth remembering that it's not just technological differences that made the past the past. It was also social differences, and for an awful lot of people those social differences are far more important. If you're black or gay or Hispanic or female, all the money in the world wouldn't make the 50s a great place to live your life.

Washington's Biggest Battle

| Fri Apr. 29, 2011 11:16 AM EDT

Zach Carter and Ryan Grim have a long but terrific piece in the Huffington Post today about the fight over debit card fees. It's a case study in the lobbying industry and the not-so-secret priorities of Congress:

The swipe fee spat is generating huge business for K Street: A full 118 ex-government officials and aides are currently registered to lobby on behalf of banks in the fee fight, according to data compiled for this story by the Sunlight Foundation, a nonpartisan research group. Retailers have signed up at least 124 revolving-door lobbyists.

....“Oh man, this is unbelievable. You’ve got the banking community, the financial community, pitted against the retail community,” says Sen. Mike Johanns (R-Neb.). “They’ve both been in my office and I’m a clear yes vote on this ... so you can only imagine those who are trying to figure this out or are still on the fence. They must be getting flooded.”

....“Every time we go in to an office and tell them we’re here to talk about interchange, they cringe,” says Dennis Lane, who makes regular lobbying trips to Washington and has owned a Massachusetts 7-Eleven for 37 years. “I think there’s been more lobbying -- there’s been more hours and minutes spent on Capitol Hill discussing interchange reform -- than there has been talking about a shutdown of the government.”

....While cable news was recently overwhelmed by coverage of budget negotiations and a possible government shutdown, many of the nation’s most powerful political players were focused instead on the Tester amendment -- and on a lobbying scrum that even boggles the minds of seasoned politicians. “It’s the biggest issue in Washington right now,” says a senior Treasury official who’s grateful it doesn’t fall within his scope of responsibility.

This is such a classic case of how things work on Capitol Hill. The issue itself is (a) pretty much unknown to the average voter and (b) worth absolute mountains of money to a very small, very influential segment of American industry, namely big banks and big retailers. This makes it the perfect lobbying issue: banks and retailers are highly motivated to spend mind-boggling sums of money on this, while voters barely even know this fight is going on.

The whole piece is worth a read when you have a few free minutes. When you're done (or maybe before you start), you should also read this short post from Adam Levitin that explains the actual technical issue with swipe fees aside from the fact that one group of millionaires is fighting a different group of millionaires over how to split up billions of dollars. It explains the policy piece of the story that Carter and Grim don't.

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Global Warming vs. You

| Fri Apr. 29, 2011 3:00 AM EDT

The New York Times ran a report yesterday about New Jersey residents who are outraged by new solar panels on utility poles that are ruining the bucolic splendor of their neighborhoods. Matt Yglesias takes a look at the accompanying photo and finds himself underwhelmed:

This is not a pastoral view disrupted by solar panels. It’s a view of utility polls, street lights, and overhead electrical wires—now with solar panels! It would be interesting to see if people actually preferred a pastoral view free of the accoutrements of electrification but I doubt anyone actually prefers that. Instead, the customary interjections of technology into the suburban landscape are normalized while any deviation from the postwar pattern is anathematized. Had people 100 years ago had this attitude, I suppose nobody would have telephone service or electricity at all.

A few years ago I remember reading about a local outcry over a cell phone company that wanted to put their transmitters on existing light poles instead of building a bunch of new towers. It was over in a neighborhood called Turtle Rock, which is one of Irvine's most upscale "villages" (yes, we really call them that). I got curious, and since it wasn't far away I drove over to take a look. And I looked and looked. Finally I found the offending light pole and looked some more. And there it was! I didn't see it at first, but sure enough, there was a small round doohickey attached to the pole about 20 feet up.

All I could do was shake my head. It was a light pole! And the transmitter was barely even visible. And it was 20 feet off the ground. How could anyone possibly care? But they did.

I'm perpetually astonished by the level of NIMBYism pretty much everywhere. I mean, objecting to a toxic waste dump or something, that I get. But people who live in 100% built environments are remarkably resistant to even the most innocuous changes in that built environment, let alone things that might potentially have a minor but real impact. It's just a huge battle every time.

And in the non-built environment this is becoming a huge problem too. We need solar power and wind farms. But solar is no good if it's built in the sunny Mojave Desert because it might impact tortoise breeding grounds. Wind farms are no good if they mar the view off Hyannis Port or kill too many migrating birds. Everybody wants change, but nobody wants that change to occur anywhere that might affect their own backyard or their own pet cause. This is hardly breaking news, I know, but one of these days we're going to have to decide which is more important: marring our views a bit or preventing the planet from baking to death. I vote for the latter.

Front page image: Colin Smith/Geograph.org.uk

Chart of the Day: Our Ballooning Healthcare Costs

| Thu Apr. 28, 2011 11:54 PM EDT

The chart on the right comes from the Kaiser Family Foundation, and it shows the growth in healthcare expenditures in five selected countries over the past 40 years. The United States, of course, has the highest spending, but it also has the highest growth rate. An accompanying table shows spending in 15 OECD countries, and in 1970, the U.S. spent 58% more than average. In 1990 we spent 86% more. In 2008 we spent 91% more.

There are individual countries that have had higher growth rates than us, but all of them started from a much lower base. And even at that, nobody beats us by much. Even though our spending is already the highest in the world, our growth rate is still one of the highest too. No matter how much we pay our doctors, pharmaceutical companies, hospitals, and insurance carriers — and we pay them far more than any other country — it's never enough. They always want more.

Joshua Bell's Toughest Challenge

| Thu Apr. 28, 2011 8:34 PM EDT

I don't really know much about music, but Mike Mechanic's interview with violin superstar Joshua Bell was pretty interesting. For example:

MJ: What's the most technically difficult piece you've ever performed?

JB: It's not always what seems hard. The Beethoven violin concerto is technically maybe the hardest because it's so exposed. The Tchaikovsky is more technically difficult; it's got more acrobatics, yet you can get away with more.

MJ: What do you mean, exposed?

JB: If you mess up the tiniest little thing in the Beethoven concerto, or the phrasing isn't just exactly perfectly executed—Beethoven brings out the worst in the best violinist. You almost never hear a satisfying performance, because it doesn't play itself. The Tchaikovsky is technically bombastic, but it kind of plays itself.

Interesting! And although I know all about million-dollar Stradivariuses, I'd never heard of Tourte bows. They go for a hundred grand, and just like the Strads, no one can make their equal anymore. Also interesting!

Keynes vs. Hayek, Round 2

| Thu Apr. 28, 2011 5:47 PM EDT

You remember "Fear the Boom and Bust," don't you, the rap throwdown between John Maynard Keynes and F.A. Hayek produced last year for EconStories.tv? It was great, and now its creators are back with "Fight of the Century: Keynes vs. Hayek Round Two":

At the risk of being a little meanspirited over a nonprofit labor of love, I'm wondering if I'm the only one who didn't really care much for this sequel? I was put off from the very beginning, which uses the exact same joke as the first video, except even more extreme. I was reminded of movie sequels that figure the only way to top the original is to feature even more car chases and even bigger explosions. Meh.

Beyond that, though, the actual content of the video just isn't as sharp as the first one. The production values are great, but the lyrics are kind of flat and there's not really any sustained economic argument from either of the characters. In the end, I think the producers just didn't have anything new to say. But they've got a ton of talent, and I hope that for their next video they ditch the Keynes vs. Hayek conceit and just do something completely new.