"Words ought to be a little wild, for they are the assault of thoughts on the unthinking" - JMK
- NASA announces plans for a new rocket that will carry humans to Mars. I am not following it too closely, but my understanding is NASA budgets are under a lot of pressure - so I'm not sure how to interpret this with respect to the budget constraints. They are talking about putting people on Mars by 2025, which is in the middle of the range of Musk's schedule. Many people see space exploration as zero-sum, which is a view I simply don't understand. I'm excited to see at least two projects - one public and one private - moving forward over the next decade.
- I haven't jumped into this "Social Security as Ponzi Scheme" debate, but this post by David Henderson caught my eye. He seems to balk at the idea that Krugman was refering to Social Security as a Ponzi scheme as him being "cute". I don't see what's so hard to accept about that. Krugman (and Samuelson) both obviously referred to it as a Ponzi scheme. However, they both obviously consider it sustainable and a good idea. Isn't the "being cute"/"being clever" the obvious interpretation? Social Security has elements that are obviously like a Ponzi scheme, otherwise we wouldn't be talking about this. However, it has two things that a Ponzi schme doesn't have: (1.) transparency, so everyone is aware of the structure and able to debate it and reform it, and (2.) a built in growth guarantee because market economies do a good job growing over time (which is why economists are so pro-market!). Difference number 1 comes in handy when the parameters associated with difference number 2 change over time. So yes, it's "like a Ponzi scheme" and that's a good, clever attention getter. But it's unlike a Ponzi scheme in a lot of important ways too - and the ways in which it is unlike a Ponzi scheme are exactly what have made it a great social insurance program in the twentieth century. Will we continue to want to use it as a social insurance program? Maybe not - but that's for future generations to decide. When Krugman said this the "cute" observation made for interesting commentary. At the time he didn't have likely Republican nominees seriously considering the dismantling of the program!
- I debated whether I should share this Onion piece with my thoughts: "New Study Finds Women Should Only Be Making 20 Cents Less On Dollar Than Men", because of how sensitive the issue can be. I've worked a lot on disparity issues over the last several years - mostly racial disparities, but some on gender disparities too. One of the interesting things to me is how people think about raw vs. adjusted parity. When you see an employment or earnings gap, there's a very good instinct to think it's all illegitimate. I think for the most part that's true - but we have to remember that it is illegitimate in at least two ways. At least a portion of these disparities are problematic simply because of problems in equity - we treat blacks different from whites or women different from men. But in circumstances of complete equity in the variable of interest, we are likely to still see disparities in that variable of interest because of disparities in other causal variables. Education as a determinant of wages is the obvious example. Even if we achieve "equal pay for equal work", there's no reason to rest on our laurels and no reason to expect that that amounts to the elimination of racial or gender disparities that we're concerned about. Equal pay is conditional on equal work, but disadvantaged groups may not be producing "equal work" because of earlier disparities in child nutrition, home life, education, etc. A lot of people make the mistake of thinking either (1.) that all disparities are due to inequity and discrimination, or (2.) if we achieve "equal pay for equal work" that is satisfactory. Disparities need to be thought of as a pervasive social phenomenon. They don't occur in just one variable of interest so the logic of "holding everything else constant" isn't necessarily meaningful as a social goal.
Trade, Jobs, and Inequality Video
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