Assault of Thoughts - 2/4/2011

"Words ought to be a little wild, for they are the assault of thoughts on the unthinking" -JMK

- First - I have to say it's really odd for me to write a post promoting a doubling of NASA's budget and then have people write "In almost all areas, the private sector has been the cause of breakthrough technologies. It leads the public sector in research and development by leaps and bounds". Let's leave aside for a minute the fact that it's not clear at all that this is true for space exploration. Why does the private sector spring to people's minds when I write positively about NASA? I expect commercial space exploration will grow tremendously in the coming decades. In all likelihood it will be much more substantial than NASA. It's like people who juxtapose the transcontinental railroad with railroads that had less public support - as if Lincoln and the rest of them somehow had an animosity towards non-public railroads! What gives? I don't get this piece of the libertarian mind that thinks the private sector is somehow threatened simply because the public sector is doing something. A big part of the reason why I support a bigger NASA budget is that I fully expect private sector activity to grow with it. If NASA puts a man on Mars, do you honestly think this will make it less likely for private companies to put a man on Mars? No! It would make it more likely. This Ricardian crowding out hokus pokus has an incredible strangle-hold on the modern mind.

- Daniel Little discusses persistent racial inequality in the US. The persistence of this issue suggests it might not be an entirely microeconomic problem. Microeconomic problems tend to equilibrate, and they don't always appear so persistently across the nation and across time. It could be legal, cultural, etc. - but it could also be macroeconomic. Persistent poverty raises lots of macroeconomic red flags. I talk about the macroeconomics of the black community here. It's still stewing in the back of my head - I think this could be a profitable approach to the problem.

- Mark Thoma reflects on an old Krugman post about why macroeconomics is so important, and Richard Baldwin reflects on a new Leijonhufvud statement on what macroeconomics should be.