• Oh Yes, American Industries Are Much More Concentrated Than They Used to Be

    Tyler Cowen is skeptical that there are very many sectors of the US economy that have become more concentrated:

    Or ask yourself a simple question — in how many sectors of the American economy do I, as a consumer, feel that concentration has gone up and real choice has gone down? Hospitals, yes. Cable TV? Sort of, but keep in mind that program quality and choice wasn’t available at all not too long ago. What else? There are Dollar Stores, Wal-Mart, Amazon, eBay, and used goods on the internet. Government schools. Hospitals. Government. Did I mention government?

    This is very un-Tylerlike. Off the top of my head, here are a dozen more:

    1. Airlines
    2. National accounting firms
    3. Telephone companies
    4. Search engines
    5. Household appliances
    6. Drugstores
    7. Health insurance companies
    8. Banks
    9. Hardware stores
    10. Bookstores
    11. Beer
    12. Supermarkets

    Note that high concentrations don’t necessarily mean less consumer choice. Amazon has wiped out nearly the entire bookstore industry, but my choice of books from Amazon alone is probably better than my choice from all my local bookstores combined two decades ago. The problem with highly concentrated industries is that they have too much pricing power; they inhibit innovation; and they wield too much influence over policymaking. Consumer choice is a red herring, and the sooner we focus our attention on other aspects of oligopoly the better off we’ll be.

  • Senate Republicans Hate Donald Trump

    Alex Edelman via ZUMA

    In the New York Times today, Alexander Burns and Jonathan Martin have a piece about the relationship between Mitch McConnell and Donald Trump. It’s—how do the kids put it?—complicated. Basically, McConnell can barely stand the sight of the guy: “In a series of tweets this month, Mr. Trump criticized Mr. McConnell publicly, then berated him in a phone call that quickly devolved into a profane shouting match.” What’s more, it turns out that lots of other Republican senators feel the same way. In fact, apparently senators kept calling them back even after the article was published to throw in their two cents:

    I guess ten words is about what I’d expect. But which ten? Let’s think about this:

    1. fantastic
    2. everyone
    3. failing
    4. disaster
    5. repeal
    6. replace
    7. premiums
    8. deductibles
    9. state lines
    10. ???

    I can’t think of ten. Sorry. Am I missing one?

     

  • There’s No Simple Way to Unite the Democratic Party

    Alex Edelman via ZUMA

    Riffing off a recent Elizabeth Warren speech, David Atkins says that Democrats can easily stop their internal bickering. There is, he says, “no contradiction between winning back some of the white working class that defected to Trump, and achieving social justice on the issues of importance to Black Lives Matter activists.” We just have to take everyone’s concerns seriously:

    The war within the left is based on false choices and straw men. There is no need for conflict if both sides are acting in good faith. Leftists who dismiss “identity politics” as an irrelevant distraction need to be sidelined, as they are not dependable allies of the Democratic Party’s true base. Center-leftists who eschew economic populism and worker empowerment in defense of the Wall Street-dependent donor class in the dream of an identity-blind faux meritocracy of oppression must also be sidelined.

    ….If Democrats listen to Warren, they can quickly and easily bury the hatchet, advance in unity toward common goals, and win back power at the state and federal level. Hopefully her advice didn’t go entirely unnoticed.

    If it were really that easy, I think this whole problem would have been solved a long time ago. Unfortunately, there are still moderate lefties out there who Democrats need to win—not to mention moderate moderates who they also need. These are the kind of people who are OK with increased regulation of banks, but not with a full-bore Bernie assault on the entire financial system. Likewise, there are moderates who support social justice campaigns, but think that Black Lives Matter goes too far. If the answer is to boot everyone like this out of the Democratic Party, it’s going to be a pretty small party that’s left over.

    Warren’s speech sounds nice. But speeches are meaningless. You can always make a speech sound nice by picking and choosing what issues you address. The problems start as soon as you begin taking questions and folks demand answers to the hard problems that you delicately tiptoed around.

    I wish the fighting on the left were merely rhetorical, but it’s not. It’s substantive. As with all movements, there are moderates and there are extremists and there are people in-between. And they really and truly believe different things. Talented politicians like Ronald Reagan and Bill Clinton can paper over these differences to some extent, but not for long. Eventually, voters are going to start asking the tough questions, and then you have to take sides. That’s when the fighting starts all over again.

    POSTSCRIPT: There’s a good example of this in Warren’s speech, where she says this:

    A few weeks ago, I saw an op-ed in the New York Times from a so-called Democratic strategist titled, “Back to the Center, Democrats.”…We’ve been warned off before. Give up, keep your heads down, be realistic, act like a grown-up, keep doing the same old same old.

    But here’s what’s interesting: instead of lots of ferocious back-and- forth and piling on, this time, no one cared. Big yawn. Why? Because the Democratic Party isn’t going back to the days of welfare reform and the crime bill.¹ It is NOT going to happen.

    Bill Clinton campaigned on both those things and he won the presidency. But when he actually followed through, a lot of lefty Democrats rebelled. Nevertheless, Clinton won reelection by a huge margin. Warren is correct that the Democratic Party has moved left on these issues since Clinton’s presidency, but she’s not correct that this means moderates no longer exist. They do, and Democrats still need them to win.

    ¹Actually, I don’t think that’s why nobody cared. It’s because the op-ed was by Mark Penn, and nobody cares about Mark Penn anymore.

  • Facts or Anecdotes? Pick One and Stick With It.

    Photo: JϋRgen BäTz/DPA via ZUMA, Chart: Millennium Development Goals: Child Malnutrition 2006

    Here’s a quiz for you. Which of these articles about, say, starving children in Africa is likely to get the widest readership?

    1. A piece that tells the story via description and personal anecdotes.
    2. A piece that tells the story via facts and numbers.
    3. A piece that combines the two.

    Some of us respond to numbers, while some of us respond to stories about people, so the common-sense answer is option C. That should rope in everyone.

    In fact, it turns out that C is the worst possible option. Nobody likes it. The numbers people get tired of all the personal stuff, while the tender-hearted people are put off by all the numbers. It turns out that you have to pick one or the other and just accept that you won’t reach everyone.

    I learned this years ago, and I don’t remember where. However, I was reminded of it by an interview with Paul Slovic, who has done loads of research on the limits of human compassion. I’ve had this interview saved for a while because I’ve been meaning to write something related to it—and eventually I will!—but there was one particular bit that’s pretty fascinating. Here is Slovic:

    We have an experiment of helping a starving child. A certain percentage of people help [by donating money to the kid]. Then we have another condition with a different group, same child, same situation, except we put the numbers of the statistics of starvation next to her picture, and the donations dropped in half.

    I wonder how universal this is. Is it always a bad idea to mix anecdotes and data? Slovic chalks up his experimental result to “pseudo-inefficacy,” meaning that the numbers make the problem look so big that people just give up, figuring that their donation will never make any difference. However, I suspect it’s something more general than that. There’s something about numbers that actively turns off people who respond most strongly to anecdotes. And vice-versa, perhaps. It would be interesting for Slovic to run his experiment in reverse: begin with a simple, punchy bit of data about starvation, and then add the picture of the child. Do donations still drop?

    If this is indeed a fairly general finding, it should affect the way advocacy journalists work. Instead of trying to write (or film or record) comprehensive pieces designed to move everyone, they should always write two separate pieces. One contains lots of troubling anecdotes with only a few simple numbers, while the other lays out the fact-based case for action, with only brief mentions of real-world suffering. More work, perhaps, but it’s also likely to make more difference.

  • “Despacito” Is…OK, I Guess

    This weekend, I read a Voxsplainer by Alex Abad-Santos about this summer’s mega-megahit, “Despacito.” What’s the deal?

    Quite simply, “Despacito” is magic….chord progressions and melody….American listeners and even artists seem to be burned out on [the electronic dance music sound] and are craving something new….intimate vocals, and shifts away from high-energy choppy vocal synths and swirling drops….“Despacito” is a scorcher of a tune — the experts I talked to all agree.

    Alternatively, here is Wikipedia’s more restrained description:

    It is a reggaeton-pop song composed in common time with lyrics about having a sexual relationship, performed in a smooth and romantic way.

    I’m going to preface this with my usual disclaimer: I don’t know much of anything about music, and what I do know is limited to Top 40 classical and Top 40 classic rock. Anyone who takes music seriously should just ignore what I have to say.

    Which is this: I’ve listened to “Despacito” many times over the past month. I wanted to give it a fair try, since it often takes a few listens to really get into a new song. But no matter how many times I listen, it only seems…OK. I don’t hate it or anything. But a scorcher of a tune? I just don’t get it. The tune seems distinctly ordinary. I haven’t found myself humming it in the shower. I haven’t added it to my playlists. It’s just…OK.

    I’m genuinely curious about this. “Despacito” didn’t become a megahit by appealing to music afficianados. It became a hit by appealing to millions of teenagers with no more knowledge of music than me. What do they hear that I don’t? In particular, what do they hear in the tune that I don’t? I’m as susceptible to a tune with a great hook as anybody, but I just don’t feel it. Is it really an addictive earworm for most people?

    I assume my audience is not exactly the perfect group of people to ask about this. Still, you go to war with the audience you have, not the audience of plugged-in teenagers you wish you had. Anyone have anything to say about this?

  • Can “Medicaid For All” Save Obamacare?

    Zach D Roberts/NurPhoto via ZUMA

    Hawaii Sen. Brian Schatz says there’s been a silver lining to Republican attempts to repeal Obamacare:

    “One of the unintended consequences of the Republicans trying to cut Medicaid is they made Medicaid really popular,” Sen. Schatz said in an interview. “This conversation has shifted. There was a time where Medicare was really popular and Medicaid was slightly less popular. What this ACA battle did was make both of them almost equally popular.”

    Schatz wants to take advantage of that by allowing states to add a Medicaid option to Obamacare’s exchanges. However, his proposed legislation also does this:

    The Schatz bill would also raise Medicaid’s payment rates to doctors and hospitals to match those of the Medicare program. Currently, the Medicaid prices are 72 percent of those that Medicare pays — which in turn pays less than private insurers. Raising Medicaid prices to be equal would likely lure more doctors to participate in the program — but also make Medicaid (and the premiums to buy into Medicaid) significantly more expensive.

    Yes, this would raise the cost of Medicaid a lot. It would also—I think—make Medicaid a more generous program than Medicare. Even liberal states like my home state of California probably wouldn’t buy into Schatz’s program under these circumstances. It’s just too expensive. We spend about $40 billion on Medi-Cal, and upping reimbursement rates to Medicare levels would probably cost something on the order of $10-15 billion. In a state budget where bitter fights break out over health care costs of $500 million, this is a nonstarter.

    I suspect a smarter approach would be to raise Medicaid reimbursement rates slightly. Maybe to 75 percent of Medicare. And then work on raising them again a few years from now. Realistically, it’s hard to see any other way to get states to buy into this idea.

  • How Will Afghanistan “Defray” the Cost of the War?

    I heard this line during Donald Trump’s Afghanistan speech tonight, but I was distracted and wasn’t quite sure what he had said. But now the transcript is available, so here it is:

    In this struggle, the heaviest burden will continue to be borne by the good people of Afghanistan and their courageous armed forces. As the prime minister of Afghanistan has promised, we are going to participate in economic development to help defray the cost of this war to us.

    That zipped by mighty quickly, didn’t it? Let’s rewind and pause a bit. What exactly does Trump mean? What does he plan to extract from Afghanistan to help “defray” the cost of the war?

  • Inside the White House: How Trump Took Command to Get the Afghanistan Plan He Wanted

    Mohammad Jan Aria/Xinhua via ZUMA

    When Donald Trump took office, he asked his generals for a new plan in Afghanistan. Here is how I imagine things have gone since then:

    March
    GENERALS: Not much more we can do. Maybe a few additional troops. Push harder on Pakistan. Stop worrying so much about civilian casualties.
    TRUMP: Try again.

    April
    GENERALS: Not much more we can do. Maybe a few additional troops. Push harder on Pakistan. Stop worrying so much about civilian casualties.
    TRUMP: Not good enough.

    May
    GENERALS: Not much more we can do. Maybe a few additional troops. Push harder on Pakistan. Stop worrying so much about civilian casualties.
    TRUMP: You have to do better.

    June
    GENERALS: Not much more we can do. Maybe a few additional troops. Push harder on Pakistan. Stop worrying so much about civilian casualties.
    TRUMP: Goddamit, I want to kick some ass!

    July
    GENERALS: Not much more we can do. Maybe a few additional troops. Push harder on Pakistan. Stop worrying so much about civilian casualties.
    TRUMP: Fine. Where’s my speechwriter?

    August
    TRUMP: Today I am announcing a bold, new plan for total victory in Afghanistan. We will stop talking about troop levels. We will stop coddling Pakistan. We will unleash our military. And we will win.

    There really isn’t a whole lot we can do in Afghanistan. The Pentagon knows this. After all, a few years ago they had upwards of 100,000 troops there—compared to 8,000 right now—and it barely budged the needle. They’ve been pushing on Pakistan the whole time, but if they push too hard we’ll lose our drone bases there and be in even worse shape. And looser rules of engagement just enrage the Afghan populace and provide the Taliban with recruiting material. It’s a no-win situation. All we can do is keep on training the Afghan army and cross our fingers. Maybe eventually the government will have enough support and the army will have enough discipline to maintain order without us.

    Or we can pull out. If we do that, the Taliban will take over in short order and that’s politically unacceptable. No American president wants to be the guy who “lost Afghanistan.”

    So we just stay there forever, fighting a low-level war meant to contain the Taliban—barely—and not get too many US soldiers killed. That’s what Bush did. It’s what Obama did. And it’s what Trump is doing.

    UPDATE: In other words, this, from the Washington Post:

    President Trump was frustrated and fuming. Again and again, in the windowless Situation Room at the White House, he lashed out at his national security team over the Afghanistan war, and the paucity of appealing options gnawed at him.

    ….Trump’s private deliberations — detailed in interviews with more than a dozen senior administration officials and outside allies — revealed a president un­attached to any particular foreign-policy doctrine, but willing to be persuaded as long as he could be seen as a strong and decisive leader.

    As long as it makes him look good, Trump doesn’t really care what we do in Afghanistan.