Kevin Drum

A Place For Nothing, and Nothing in Its Place

| Thu Aug. 19, 2010 12:29 AM EDT

The latest on the airline front:

American Airlines, in the quest for more non-ticket revenue, on Wednesday began charging customers who want to sit in the first few rows of coach on domestic flights.

Customers who pay the fee, which ranges from $19 to $39, will be among the first to board, giving them a chance to snag coveted overhead bins. As passengers carry on luggage to avoid baggage fees, overhead space has become harder to find.

To summarize, then: (1) Airlines spent years hassling customers about their carry-on bags and persuading them to check their luggage instead. (2) After that finally started to work, they suddenly began charging for checked luggage. (3) As customers scurried to adapt once again, overhead space disappeared. (4) So now they begin charging for early boarding to avoid the crush of bags in the overhead bin.

Has there ever before been an industry that's so actively tried to piss off their entire customer base? You almost have to admire it in a Bizarro-capitalism kind of way.

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First, Assume a Can Opener.....

| Wed Aug. 18, 2010 3:57 PM EDT

Matt Steinglass reviews a proposal from Simon Johnson and James Kwak to put our fiscal house in order:

First, introduce a value-added tax and lower the ceiling on the mortgage interest deduction from $1m to something more reasonable....Second, carbon pricing, either a carbon tax or cap-and-trade....Third, introduce a Financial Activities Tax, which could raise 0.5% to 1% of GDP.

....And finally—here's the tough one—entitlement reform. As Messrs Johnson and Kwak say, Social Security needs to be tweaked a bit as it goes from 4.8% to 6.2% of GDP with the aging of the population. Medicare and Medicaid, on the other hand, need major reform to figure out how to stop paying for medical care that doesn't make people healthier, while reducing costs on what we do buy. This is a book-length issue on its own and all we can do is note the necessity of doing it.

So, that last one seems like a doozy, but the other three look entirely reasonable. There's no reason why a rational political system shouldn't be able to tackle such reforms in a non-ideological and collaborative fashion. Nothing of that sort has happened in my lifetime, so far as I can remember, but there's a first time for everything.

Hold on. I'm a big fat tax-and-spend liberal, but even I have a hard time swallowing this. Adding three big new taxes and slashing the home mortgage deduction is "eminently doable" but tackling Medicare reform is a "doozy"? Seems like there's a pretty big thumb on the scale here.

Krugman and the Bubble

| Wed Aug. 18, 2010 1:06 PM EDT

On his blog today, Paul Krugman reprints a chart of housing prices rising like a hockey stick in the mid-aughts and then hits back against critics who say the bubble couldn't have been predicted:

Given this kind of picture — and given the fact that the late-80s rise in southern California was, in fact, a bubble — how could you not be very worried? And when you looked at the rationalizations for high housing prices being given at the time, it was obvious that they were questionable.

Sorry: the evidence just screamed bubble. No excuses for those who didn’t want to hear it.

OK. But did Krugman call the bubble? My recollection from his NYT columns, anyway, is that he didn't really get concerned about it until mid-2005, which was only half a year before the market peaked. If the evidence was screaming bubble any earlier than that, why wasn't he screaming too? Or was it happening somewhere other than his columns?

Lefties: Time to Brush Up On Energy Awareness

| Wed Aug. 18, 2010 12:14 PM EDT

I like to help out my conservative buddies now and again — it's just the kind of guy I am — so here's this month's shot in the arm for righties. You know how you're always getting annoyed about self-righteous greens lecturing you about what you should and shouldn't do to conserve energy and save the planet? Well, apparently you're right. They don't know what they're talking about. A team of researchers recently conducted a survey of how much people know about energy use (cans vs. bottles, turning off lights vs. turning down the heat, etc.) and correlated the results with various personal characteristics. Here's what they learned:

Surprisingly, participants’ self-reported environmental behaviors scale always had a negative coefficient and was significant in three of the five tests, indicating that participants who reported engaging in a greater number of proenvironmental energy-related behaviors had less accurate perceptions.

Italics mine. The table below shows the full results. Basically, positive numbers are good and negative numbers are bad, so the key is to look for things where the numbers are positive or negative across the board. The most accurate perceptions about energy use, it seems, are held by numerate, conservative homeowners who don't bother trying to save energy. On the other hand, participants' NEP score, which is a reflection of environmental attitudes, was largely positively correlated. So what you really want are numerate, conservative homeowners who care about the environment but not enough to actually bother doing anything about it.

Or something. Anyway, conservatives did better. Savor your victory, righties. (Via Felix Salmon, who links to a rather breathless Register summary of the study.)

Drowning in Email

| Wed Aug. 18, 2010 11:24 AM EDT

Felix Salmon is unhappy with Google:

Yesterday afternoon, I started wondering why my steady stream of emails seemed to have come to a halt. It didn't take long to get the answer: emails to me were being bounced back to their senders as undeliverable, on the grounds that my Gmail account was over quota. Naturally, I immediately paid Google the $5 they wanted to upgrade to 20 GB of storage from the free 7.5 GB.

What follows is a long post about Google's annoying ways, and I sympathize. But what I'm really curious about is the amount of space apparently used by Google mail. I just checked my mail directory, and it uses 3 GB of space for 110,000 emails (including the associated full-text index files). So either (a) Felix has nearly 300,000 emails in his archive or (b) Google uses a really inefficient storage algorithm for email.

Probably the former. Which is an impressive bucket of email. But I guess it's not surprising. I've got eight years worth of email archived, but the fact is that I delete about 90% of the email I get these days because most of it is auto-generated press releases and so forth. If I didn't bother doing that, I'd probably be well over 7.5 GB too and pushing half a million emails.

That's....disturbing. In the past eight years I've received half a million emails. And I'm probably a piker compared to some. It's amazing that we keep up at all, isn't it?

Our Economic Paradox Continues

| Wed Aug. 18, 2010 10:42 AM EDT

Tyler Cowen says there are three ways that declines in consumer demand can make itself felt, but I'm just going to focus on the first two:

  1. A general decline in spending.
  2. A disproportionate and permanent demand decline for the more income- and wealth-elastic goods, a category which includes many consumer durables and also luxury goods.

The first, he says, can be addressed via stimulus. The second can't. For what it's worth, this is a distinction that's been eating at me for a long time too. One of the things that was clear after the housing bust and the financial collapse of 2008 was that Americans were simply consuming too much. Relative to the rest of the world consumption needed to go down, but in the short term this would be so economically disastrous that we couldn't allow it to happen right away. The Wall Street bailout and the stimulus bill really were necessary.

But our current account deficit, after shrinking a bit in 2009, has started to grow again, and in the long term we can't keep this up. International trade and money flows have to start balancing out eventually, and that means less consumption from the U.S. and more from countries like China.

This has been the contradiction at the heart of fiscal and monetary policy for the past two year. Do we damn the torpedoes and stimulate now, simultaneously swearing on a stack of Bibles that we'll restrain ourselves after we've gotten back on our feet? Or should we gulp hard, work through the pain all at once, and get our economy back on a sustainable track now? Back in 2008, I remember concluding that the trend level of consumption in the U.S. needed to drop 5-10% at some point, and obviously that hasn't happened yet. What's more, even if we wanted to make it happen we're constrained by the policies of export-oriented economies like China's, which have to take the other side of the deal and increase their consumption considerably. That hasn't happened either.

So I still don't know how this all ends. Trying to adjust to a big drop in the trend level of consumption seems suicidal at the moment, and for that reason further stimulus seems like a good idea. But even while acknowledging that, I still wonder when and how we're going to get ourselves back to a sustainable level of economic activity. I don't think the answers are any easier today than they were two years ago.

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Republicans Split on the Mosque?

| Wed Aug. 18, 2010 9:43 AM EDT

Today's front page hed in the LA Times declares:

New York mosque debate splits GOP

I laughed when I read that. What's the score? Joe Scarborough in favor of the mosque and every other Republican in the country opposed? I guess that's technically "split," but you'd need Superman's microscopic vision to suss it out.

But it was better than I thought. There's Joe, of course, but also Grover Norquist. And Chris Christie — sort of. And Michael Gerson. And some congressional wannabe named Chris Gibson. And Kathleen Parker. It's true that Norquist has a Muslim wife and Christie hedged absurdly and Gerson is mostly concerned about tactical electoral issues. Still, that's politics. And half a dozen conservatives is better than none. Who knows? Maybe there's a small campaign for decency forming on the right. Perhaps it will give a few others the courage to speak out too.

Iraq Update

| Tue Aug. 17, 2010 11:02 PM EDT

Anthony Shadid of the New York Times reports that American officials are finally getting worried about the long impasse that's prevented the formation of an Iraqi government five months after parliamentary elections were held. However:

In the end, many officials expect an eventual agreement on some sort of consensus government so inclusive as to be woefully weak, unable to assert itself and beset by stalemate over the laws necessary to shape post-American Iraq.

Smells like victory!

The gist of the article is that American planners never had a clue about what they were doing, Iraqi politicians have been feckless and conniving, and regional politics is relentless at turning everything into a quagmire. In other words, the entire venture was fubar from the beginning. But you probably already knew that, didn't you?

Healthcare Back in the Day

| Tue Aug. 17, 2010 6:34 PM EDT

Recently I've been inventorying a bunch of old Golden Age comics that I inherited from my father, and last night I happened to run across an ad for Tootsie Rolls from a 1941 issue of Feature Comics. So for your amusement, ladies and gentlemen, I present "Healthcare in the 40s." Enjoy.

Rating LA's Teachers

| Tue Aug. 17, 2010 3:31 PM EDT

Later this month, the Los Angeles Times plans to publish a database of teacher performance in the LAUSD. Their metric is something called "value added," which projects a student's performance based on past tests and then compares it to actual results at the end of the year. It's designed to control for things like poverty levels, the quality of the students, social factors, and so forth. The initial database will include only third through fifth grades and only teachers who have taught 60 or more students.

Over at Democracy in America, Roger McShane acknowledges that test scores are an imperfect way of evaluating teachers, but he's still pretty unimpressed with the appeal from A.J. Duffy, president of United Teachers Los Angeles, to boycott the Times over their decision:

Mr Duffy's reaction fits with a broader resistance to more formal evaluation methods by teachers unions across the country. And that has coincided with extensive union efforts to defend teachers who are obviously failing our students. If the education-reform debate has come to seem like an attack on teachers, it is in large part because of the unions' misdirected passion and priorities.

There is no perfect way to evaluate teachers, but that is true of many jobs. (Should The Economist judge me on how much traffic this post gets? How much ad money it generates? How sharp the analysis is? Can that even be measured? How should each be weighted?) The problem is that the big teachers unions have not been credible participants in the conversation about reform, resisting efforts to incorporate test scores in the evaluation process, and fighting the consequences that must accompany bad evaluations. For its part, the Times plans to publish an online database with ratings for more than 6,000 elementary-school teachers based on test-score data. That is not fair to the teachers, who deserve a more comprehensive evaluation. But who is to blame for the absence of one?

Is this a fair reaction? I don't live in Los Angeles and don't follow its affairs closely, but there's at least one thing I can say about this: every single person I know who does follow LA politics, both liberal and conservative, thinks the LAUSD is a complete disaster. Obviously some of this is simply because LA has all the usual pathologies of urban school districts: it's huge, it's heavily poverty-ridden, it's fantastically expensive to build new schools, and virtually all the middle class parents who normally drive concerns over quality have long since abandoned it for private schools. Still, even beyond that LA seems to be almost uniquely bad.

So should the Times be doing this? Regardless of LA's specific problems, I think so. The data is public, and either you believe that the press should disseminate public data or you don't. I do — despite the fact that I know I'd be pretty unhappy to be one of the teachers included in this project.

In any case, I'll be curious to see what the reaction is. Obviously you're going to get a bell curve of performance. So the question is: how far down the bell curve do you have to get before you think a teacher ought to be dismissed? I suspect that most people have pretty unrealistic notions here. In the white collar private sector I'd guess that maybe one in twenty people is ever let go for performance reasons, but parents who look at the Times database are probably going to be disturbed by any teacher in the bottom quarter or so. But what do you do about that? Somebody's kids have to be taught by below-average teachers, and that's all a teacher at the 25th percentile is: below average, not an incompetent dullard.

Unfortunately, there's one likely reaction to the Times project that will be entirely non-positive: the most active, engaged parents will aggressively use the database to make sure their kids get the best teachers possible while the poorest, most distracted parents will barely even know it exists. The former already have the smarts (and the income) to shop around for the best schools, and now they'll have the tools to shop for the best teachers within each school. As long as they get those teachers, they won't care much about all the other classes, and primary education in LA will become even more stratified than it is now.

That might not happen. I'm just guessing here. But one way or the other I hope the LAUSD is prepared for this. Once this data is out, the fight to get the best teachers will be in full swing with a new school year just weeks away. It might not be a pretty sight.