Thursday, May 31, 2012

Mobility vs. Portability

A CNET column, speculating on the future of Facebook and its theoretical successors, comments,
The company doesn't get mobile -- never has. Young as he is, Mark Zuckerberg was raised on the Web, on computers. Remember him saying in 2010 that the company didn't have an iPad app because the iPad "isn't mobile, it's a computer"? Facebook just plain missed it.
I think there's a language disconnect here. A notebook computer is "mobile" in the sense that you can take it with you and use it from remote locations. Zuckerberg wouldn't argue with that - he just might use a different word, like "portable". While it's fair to point out that an iPad uses iOS, an operating system designed for mobile devices, due to the much larger screen size the experience of using apps on an iPad can be quite different than the experience on an iPhone. Facebook's platform and profits come from the browser, not the app. If Facebook produces a half-hearted app, inspiring people to use their browser to get a full or even adequate experience, Facebook makes more money both through advertising and by the advancement of its platform. If it allows you to take full advantage of the social world of Facebook via an app, but cannot effectively monetize the app or support social gaming through the app, it's harming itself.

That is to say, Zuckerberg is correct to be concerned about Facebook's becoming "just another app", when he needs to to be a platform.

Recent rumors of Facebook's interest in acquiring Opera may relate to its difficulty gaining traction on tablets and mobile devices. Opera doesn't have much traction on the desktop, but it might be feasible to create a heavily Facebook-flavored browser that would take the place of a hobbled Facebook app on mobile devices, including tablets. If you get people to spend 20% of their online time in your proprietary browser looking at your own content, and get them used to accessing the rest of the Internet through your browser instead of the default browser that comes with the device, you are much better positioned to monetize mobile traffic than if you're "just another app".
Meanwhile, a generation of kids my son's age and older are living their lives solely on mobile devices -- tablets and phones and whatever iterations the future holds. For them, Facebook will be something their parents do, and it's still fundamentally a Web-based experience. It's likely to hold little appeal to them -- and somewhere out there, entrepreneurs thinking along the lines of, say, Dave Morin at Path (ironically, a former Facebooker) are working on products that are born mobile, that skip the Web entirely, that live in the world the next generation lives in.
It makes no more sense to pretend that the entire world is mobile than it does to pretend that the entire world is sitting at a desk in front of a traditional, desktop computer. A big part of Facebook's success has been its ability to be inclusive - getting people who barely even use a computer to sign up in order to see photos of distant friends and relatives. No doubt, being the next, big, hot idea among the younger generation or on the mobile platform can translate into profit and success. We've all heard about Instagram. But a future with a hundred "Instagrams" vying for your attention on mobile devices is one of fragmented social media, something quite different than what Facebook offers.

I expect that the actual business plan behind apps "that skip the Web entirely" is to go the way of Instagram, to get snapped up by one of the giant players for a quick, significant profit, not to reinvent the online social world as a mobile-only environment. My guess is that no small number of them will let you register and log in through your Facebook account - in no small part because they're apps and Facebook is a platform.

One last thing,
Simply put: the world is going mobile, it's hard to make money on mobile, and no one is feeling that more painfully than Facebook.

But someone will figure it out. Someone always does, and there's always money to be made where the people are. It just won't be Facebook.
Am I the only person who has a problem with the conceit that someone "always" figures out how to monetize online information? If an edition of a newspaper is worth $2 in print, 5 cents when read via a browser, and a cent when read via a mobile device, is the proper conclusion that the newspaper "figured out" how to monetize its online and mobile content, or would it be more accurate to say that some types of content cannot be monetized in the online world at a level that sustains their historic business model? The reality is this: when faced with new business realities some businesses and industries find ways to evolve and make money, others go the way of the stagecoach company and village blacksmith.

Monday, May 28, 2012

The Grass is Always Greener....

You know what's amazing to Michael Gerson? That the Republican saviors of the party who ran for office and tore each other apart, often revealing themselves in the process to be deserving of little more than rubber noses and clown paint, no longer look as good as the wunderkind who haven't yet gone through the wringer.
Former Florida governor Jeb Bush, Sen. Marco Rubio, New Jersey Gov. Chris Christie and Sen. Rob Portman are among the more accomplished, knowledgeable, ideologically balanced political figures in American politics. The same could not be said of Rick Perry, Herman Cain or Michele Bachmann.
Gerson is smart enough to acknowledge that it's "easier to appear qualified and dignified" when you're untested, but fantasizes,
But there is more at work in this obvious stature gap. Part of the explanation is structural. Presidential candidates are largely self-selected, which favors ambition and self-regard above, well, all other traits. A vice presidential field results from a party’s consensus on talent and competence.
So... J. Danforth Quayle, George H.W. Bush, Dick Cheney... no ambition or self-regard, simply the best their party had to offer (like Spiro Agnew). If Gerson believes the same holds true in both parties, I wonder if he's still crying in his coffee about Al Gore's disappearance from the national stage, or if he dreams of an alternate universe in which John McCain had not picked the stellar, non-self-promoting Sarah Palin and had instead picked the stellar, non-self-promoting Joe Lieberman as his running mate.

Gerson is engaging in a typical sort of wishful thinking, never mind the actual facts, in which we can easily predict which of a party's rising stars will be a presidential candidate four years from now. Because four years before-the-fact everybody knew that Bill Clinton and Barack Obama would be their party's nominees. If, that is, "everybody" means "nobody". Just like four years before-the-fact everybody knew that Jeb Bush would run for President, but he lost his first run for governor, his brother won in Texas and.... Yep, it's all 100% predictable.

Gerson hopes that, of all people, Mitt Romney chooses Chris Christy as his running mate. Odds are that, if he's not muzzled, by the end of the campaign they would be measuring him for the clown suit and rubber nose that Romney's primary competitors worked so hard to earn. Gerson likes Christie's bombast, and the fact that he's not a moron:
At the same time, Christie would represent a move to the ideological center. He is not a global warming skeptic. He supported an assault weapons ban in his state. He is an immigration moderate and has friendly relations with New Jersey’s Muslim community.
Actually, support for an assault weapons ban puts Christie not in the center, but to the considerable left of Obama. Acknowledging science, that immigration has both pro's and con's, and that not all Muslims are evil? It merely means that his IQ is at or above room temperature. Gerson's damning his party of choice with faint praise.
What other choice would cause Republicans to pray for 10 vice presidential debates?
They can pray for ten, they would get one. With Joe Biden, trademark bemused smile on his face, not getting even slightly ruffled by Christie and calling him out on such things as... his mediocre jobs record and the massive deficit his state now faces. And even if we were to fantasize that Christie would somehow "put Biden in his place", in the same manner that Lloyd Bentsen put Dan Quayle in his, remind me what impact that debate had on the Presidential contest again? Oh yes... absolutely none.

Sunday, May 27, 2012

How Facebook Might (or Might Not) Life Up to the Hype

Once upon a time there was a company called AOL that had a proprietary platform, something of a walled garden, and had many thousands of paid subscribers. It took down the walls, introduced its subscribers to the larger Internet, went public, got an insanely high stock valuation, merged with Time Warner and... the rest is history.

Once upon a time there was a company called Facebook that created a walled garden, invited many thousands of free subscribers to join, played games with the height of its walls - low enough to get search engine traffic, high enough to keep members from exporting their data to use on competitors' sites - but was primarily interested in pulling its members away from the larger Internet in favor of devoting most or all of their attention to its proprietary platform, went public, got an insanely high stock valuation (and yes, despite it's being a "flop" that valuation remains insanely high) and....

Will history repeat itself?

Today, with his portrait on the opposite side of the electronic page from a box that encourages his readers to log into the site using Facebook, and which touts content that is popular on Facebook, Ross Douthat complains that Facebook is an "illusion". He makes some good points about Facebook and the illusion of online community, although he often does so in a way that's reminiscent of my personal feelings somebody who doesn't "get" the appeal of constantly reviewing a Facebook wall for updates. Douthat seems to have forgotten his own personal history as a blogger. The best inference is that Douthat understands the Internet as a vehicle for the exchange and discussion of ideas, and even for self-promotion (as long as there's a quid pro quo), but doesn't "get" the frivolous side.

Douthat focuses on companies that bring the old world into the electronic age,
It’s telling, in this regard, that the companies most often cited as digital-era successes, Apple and Amazon, both have business models that are firmly rooted in the production and delivery of nonvirtual goods. Apple’s core competency is building better and more beautiful appliances; Amazon’s is delivering everything from appliances to DVDs to diapers more swiftly and cheaply to your door.
He's derisive of companies, no matter how successful, that are largely or purely electronic:
Twitter is not the Ford Motor Company; Google is not General Electric. And except when he sells our eyeballs to advertisers for a pittance, we won’t all be working for Mark Zuckerberg someday.
Never mind that one of the companies that is most often cited as digital-era success is Google. Were Douthat to spend a bit of time wondering what it is that Amazon, Apple and Google have in common, and what Facebook hopes to achieve, a concept mentioned above, the platform, might come to mind. Google, Apple and Amazon are engaged in a pretty intense battle to capture the mobile and tablet market, to push their own interfaces for the rental and purchase of electronic entertainment, and to grab as much market share as they can. The goal is not to sell "our eyeballs to advertisers for a pittance" - it's to dominate the future market for the rental and sale of electronic information, entertainment and software, and to get a healthy cut from each sale.

Why does Amazon offer Prime content on its Kindle and not on its competitors' devices? Because it wants you to buy the Kindle. It wants to own the platform, not be an app on somebody else's platform. And that makes sense: why would you buy an app that you can only use through the interface of another app, when you can get the same app, optimized for the hardware you're using, for the same price through the OS-manufacturer's platform? When Facebook admits that it cannot get traction in the mobile market it's, in essence, admitting its failure (to date) as a platform. People will play Farmville, and the like, in their browsers and Facebook gets a cut of the virtual sales, but on a competitor's mobile device Facebook is "just an app" the use to check up on their friends.

A company that Douthat forgot to mention, once the giant of the computer world, is Microsoft. Another company that is struggling to capture a significant foothold in the mobile platform market, and pouring an incredible amount of money into entering that space. The "failed" IPO generated many billions of dollars for Facebook that can be used to help it try to better establish itself as a platform and to compete with the established platforms. But it's facing an incredibly tough environment in which its competitors have established products and track records, and in which despite many billions of dollars invested in software, search platforms, operating systems and the like, Microsoft continues to flounder.

Sometimes You Just Have to Wonder....

How many times can Tom Friedman say, in essence, the same thing without any apparent thought beyond, "If politicians do exactly what I think they should do, everybody will love them"? All Obama had to do was serve up Tom Friedman-endorsed entitlement cuts and austerity along with the stimulus program, drown out the right-wing media machine that deliberately distorts the facts and his record, and run a squeaky clean campaign that would make John Kerry's response to the Swift Boat liars seem effective, and... trust Tom Friedman, he'd win!

Given that he has all the answers to the nation's woes, and knows exactly how to persuade the people, get the opposition party to go along with his legislative initiatives, and win overwhelming electoral majorities, all I can say is that it's a darn shame Friedman is a pundit instead of the savior our nation so needs.

Friday, May 25, 2012

Accidentally Telling the Truth is Not a Gaffe

Or, at least, it shouldn't be. The reason the concept of the Kinsley gaffe, "A gaffe is when a politician tells the truth - some obvious truth he isn't supposed to say."[3]", resonates is that the media does an atrocious job of informing readers and viewers when a politician is lying.

A while back I took part of an online quiz on a "fact checking" site, in which they asked readers to estimate how many... Pinocchios, flaming butt cheeks, or something like that... they assigned to various statements by politicians. The pointlessness of the exercise was best illustrated by the rating of a statement by Rick Santorum as being mostly false. The statement was one of opinion. Had the scale been the "Chauncey Gardner" garden rake scale, the person doing the rating would have been free to editorialize that the comment was so dim-witted and disconnected with logic that it ranked as a "hit in the face with a garden rake so hard that your zombie head gets knocked off", that would be fine. One opinion against another. Even if the rationale is, "That's such a baseless opinion that I can't believe Santorum holds it," it remains your opinion that he's lying as opposed to being ignorant or obtuse.

When self-professed fact-checkers stop checking the facts and start assessing the degree to which a politician may be shading the truth, they're no longer engaged in fact-checking. It's a perfectly legitimate function of the press to point to a statement that neatly avoids key issues or problems and to point out that it's not the whole story, but that's a different tasks than fact-checkers claim to be performing. It's interesting to me, also, that fact-checkers will use "Pinocchio" scales or a "pants on fire" meter, but they shy away from actually using the term "lie". You don't have to bring it out for every nuanced statement, but when a politician tells a real whopper why not tell it like it is? Instead, we have gasbag commentators who don't hesitate to call up down and the truth a lie, when they're talking about the other side, while the mainstream media at times passively "reports" on the controversy.

Here, Charles Pierce catches Mitt Romney in a "Kinsley gaffe",
Halperin: Why not in the first year, if you're elected — why not in 2013, go all the way and propose the kind of budget with spending restraints, that you'd like to see after four years in office? Why not do it more quickly?

Romney: Well because, if you take a trillion dollars for instance, out of the first year of the federal budget, that would shrink GDP over 5%. That is by definition throwing us into recession or depression. So I'm not going to do that, of course.
So... by pumping a whole lot of money into the economy and propping up state governments, the stimulus did what, Mitt? Once you agree on the conceptual framework you need to provide something more than bombastic rhetoric - whenever the other party does something it's different... and wrong - and start explaining how you are being consistent in your positions. Or at least, that's what should happen. But it won't. And Romney knows it won't, which is how he manages to get away with saying, "Up" on Monday, "Down" on Tuesday, "Sideways" on Wednesday, and "I don't remember what I said on any prior occasion, but I agree with whatever it was" on Thursday.

Romney is a walking caricature of everything people say that they hate about politicians. And yet....

So how about this? How about having the mainstream media stop chuckling when a politician "tells the truth" and instead congratulate him for being honest about a difficult issue, and pushing him to state how the sudden introduction of reality into his rhetoric affects his stated policies and future plans?

Monday, May 21, 2012

Actual Value vs. Potential Value and the Facebook IPO

The biggest thing Facebook had going for it, going into its IPO, was the perception that it not only has a wealth of data that similar companies lack, it has the potential to transform that data into a phenomenal money-making machine. Its current performance does not justify a $100 billion + valuation, or even half of that amount. The hope was that enough investors would gamble on its potential to produce and sustain a valuation that is not supported by the numbers or by any known business plan held by the company.

If you wanted a sign that Facebook has no plan to generate the earnings necessary to support its proposed (or present) stock market valuation, you need look no further than its acquisition of Instagram. It makes sense for a company, seeing a threat on the horizon, to act quickly and proactively. But the amount paid, the promise to Instagram users to maintain it as a separate service, and the fact that Facebook was not able to mitigate the threat of Instagram by any means other than acquiring it, all serve to highlight its vulnerability. Not in terms of its mass of users, the extension of its platform and login system into third sites, and other such actions that do reflect commendable foresight and capability by the company's leadership. If you believed before that acquisition that Facebook's position is so dominant that it cannot be upset by a start-up, or that Facebook has clear focus on a single platform and won't end up fragmenting its platform and distributing its focus and resources on multiple properties, that acquisition should have made you reconsider.

And that's without mentioning the most obvious reason to believe Facebook lacks a plan to generate the revenues that would justify its valuation: The fact that no such plan has been implemented. I don't want to sell Facebook short (no pun intended) but I can't think of a better time for Facebook to have demonstrated its capacity to generate massive profits than over the past year. Instead it appears to be demonstrating that each additional user it acquires actually costs it money. To draw that conclusion on the available data would be premature, but it's not an impression I personally would have wanted to leave room for, going into an IPO. It reminds me of the comments I heard from an analyst, talking up Facebook's future, by suggesting that the company has enormous capacity to expand in China and India. Well, I'm sure it does, but how is that going to generate profits?

Reuters reports,
Facebook Inc's underwhelming debut on Wall Street increases the pressure on the social networking giant to deliver stellar growth - a novel situation for Chief Executive Mark Zuckerberg, who has been clear he is more interested in building products than making money.
If the lead-up to the IPO didn't pressure Facebook to deliver stellar growth, why would the present situation? Facebook is "only" worth $76.3 billion? Its key shareholders will "only" be able to spend their profits over sixteen to twenty lifetimes instead of thirty or so? Go ahead - put me under that kind of pressure. I dare you.

The second part of that statement, to me, is an echo of the hype we've been hearing ever since Facebook was worth fifteen... no, thirty... no, fifty... no, one hundred billion dollars. Zuckerberg is saying "Gamble on me, gamble on the future of this company, gamble on the idea that with phenomenal amounts of money available we'll build some jaw-dropping products." If you're buying Facebook stock with something else in mind, you simply haven't been paying attention. In a sense it's fair for the article to point out that Facebook is a profitable company and that many other multi-billion dollar companies of the current Internet bubble are gushing red ink, but that's simply a reflection of the hubris of the bubble. Facebook is "worth" $76 billion or so because of that profit - if it were gushing red ink, it might only be "worth" $40 or $50 billion to the same set of investors.

Can we at least be this honest? When, going into an IPO, a company expresses "that 'we don't build services to make money; we make money to build better services' and refer[s] to the company's 'social mission'", that company may well make the coolest stuff in the world but it has little to nothing in the pipeline that it expects to generate revenues that would justify its proposed valuation? I'm prepared to be surprised, even shocked, by an announcement that upsets my expectation and proves the genius of the speculators. But....

Sunday, May 20, 2012

Education Policy Facepalm

Over the past decade the trend has been to push more and more educational content into kindergarten. The historic emphasis of kindergarten was to socialize children to be away from home, behave in class and play with their peers, tasks that became less important as increasing numbers of children transitioned from full-time childcare to often part-time kindergarten. In that sense, it's not unreasonable to transform kindergarten into something more relevant to today's kids.


As today's kindergarten starts to look more and more like yesterday's first grade, we create a context in which many kids are not yet at a stage of cognitive development at which they can master the material presented to them in kindergarten. So what's the solution?
Everard is among a growing number of parents, educators and some early-childhood experts urging Michigan lawmakers to change the date by which kids can enter kindergarten. Michigan currently requires kids be 5 by Dec. 1 to enroll, one of just a few states with such a late cutoff date.

It's an almost annual debate in Lansing, but although previous efforts have failed, the quest this year is gaining steam, largely because of the growing recognition that the kindergarten curriculum has become much more demanding -- and because of fears that Michigan kids won't be able to compete with children from other states.
So the "solution" to having age-inappropriate material in kindergarten is to exclude kids from kindergarten until they reach the age at which they historically would have entered first grade? Next, let's rearrange the deck chairs on the Titanic!

Saturday, May 19, 2012

Which Voters are Getting What They Want?

Charles Pierce has taken apart most of David Brooks' exposition on "The Age of Innocence", but I think that the following claim deserves some attention:
Leaders today do not believe their job is to restrain popular will. Their job is to flatter and satisfy it. A gigantic polling apparatus has developed to help leaders anticipate and respond to popular whims. Democratic politicians adopt the mind-set of marketing executives. Give the customer what he wants. The customer is always right.

Having lost a sense of their own frailty, many voters have come to regard their desires as entitlements. They become incensed when their leaders are not responsive to their needs. Like any normal set of human beings, they command their politicians to give them benefits without asking them to pay.
I don't think that there's any way to dispute how poll-driven politics has become. Mitt Romney personifies the worst of that phenomenon - if you want to know what he thinks about an issue, all you have to do is check the latest poll and you'll find that he has undergone a heartfelt transformation from his previous stated opinions and now agrees, with every fiber of his being, with the position he believes will help him win the election. Don't ask him what he said on prior occasions because he may not remember the position he took - but rest assured, whatever it was, he stands by it.

Brooks suffers from the standard beltway pundit's obsession with Social Security and Medicare, so I expect that if pushed on the issue he would point to those two government programs as proof of his latest imagined transformation of human nature. But Medicare and Medicaid were created in 1965, a mere three years after Brooks' imagined peak of American civil society, by which time Social Security had been in effect for thirty years. The good, wholesome voters of the past asked for and received those programs from enlightened politicians who respected the way government was supposed to work - unlike the self-interested voters of today who merely ask that those programs be continued, or at least not too badly devastated. Shame!

Brooks thus complains about how workers "want great lifestyles without long work hours." (Alas, we cannot all be New York Times columnists.) "They want dynamic capitalism but also personal security." If you could accomplish that, would it not be a good thing? "European welfare states go broke trying to deliver these impossibilities." Um, yeah, rather than legislating a shortened work week, supporting unions, and offering a broad social safety net, it's a darn shame this country isn't more like Germany.

Seriously, though, if workers want short work weeks and politicians do exactly what workers want, why don't we have a shorter work week? Why do we have, instead, more jobs being classified as "exempt" such that workers can be salaried with no cap on their weekly hours? Why isn't the minimum wage higher? Why do middle class voters pay any taxes at all - who, after all, wants to pay taxes? Brooks shares a common sentiment about populism and describes the slippery slope that should be resulting from that populism, but where can we actually see that slippery slope in action?

Meanwhile, we have had poll-driven promises from both political parties, and most notably from the Republican Party, for decades. All of the Republican litmus test issues are poll-driven. Yet when in office, even when they hold all three branches of government, the Republicans tend not to deliver on those issues. Worse, even though their voters say they want a balanced budget, the Republicans habitually break the bank. The reasons for that are obvious - the Republican Party is interested in winning elections. By becoming the "pro-life" party, the Republicans can push that issue in every election. But if Congress and the President were to deliver, pfft - gone. Yes, we get lots of populist, poll-driven promises in their campaigns, but if it's not an issue the party actually cares about you simply cannot expect that anything will get done - and should expect the opposite if it's an issue that can be recycled from election to election.

Brooks is, in effect, confusing the bread and circuses with the actual work of government. Brooks could find plenty to criticize in the actual workings of government, and how the system has become skewed to the incredible advantage of wealthy people (like him) but... nah, easier to blame the plebs.

Kathleen Parker's Continued Embrace of Race-Baiting

It's good that we have Kathleen Parker around to remind us of the fine distinction between racism and race-baiting. As we all know, Obama's race makes it more difficult to frame attacks on him despite his shortage of (as Parker puts it) "blood equity". The shame, apparently, is that the proponents of the ad aren't doing something more respectable, like offering insipid arguments that question the President's testosterone levels or imply that he's a (pussy) cat.

Parker argues,
Raising Wright now would have been a serious miscalculation and would have been interpreted as attempting to inspire racial animus. But it is unfair to smear Davis as a racist, as some have suggested. He obviously created a proposal based on his sense that this would appeal to Ricketts, who said upon viewing the rejected ­McCain ad: “If the nation had seen that ad, they’d never have elected Barack Obama.”
By the same token, a politician who cynically embraced the Republican "Southern Strategy" cannot be assumed to be racist by virtue of his actions. It's all but a given that many of them were cynical opportunists. Parker argues, Parker's editorial neatly elides any reference to the proposal's description of the President. Charles Blow is not as charitable:
“The metrosexual black Abe Lincoln has emerged as a hyper-partisan, hyper-liberal, elitist politician with more than a bit of the trimmer in him.”...

The proposal was racially charged, and its authors knew it. So they called for the enlistment of “an extremely literate, conservative African-American” as a spokesman to defend it. This should raise the hackles of black Republicans. There is a base that sees them as able to do racial damage while protecting the party from racial blame.
Given her own history of attacks on the President's masculinity, Parker can be presumed to be fully on board with trying to characterize him as a metrosexual. I am not sure if the President's blood is "full" enough, though, for the Lincoln comparison - we can only hope Parker shares her thoughts on that point. But here's the thing: if this isn't about race and race-baiting, what's the word "black" doing in there?

Parker whines,
The leaking of the document and the prominent display of the story have been a boon to Obama. They provided yet another welcome distraction, as well as a helpful fundraising tool, and smeared Romney by association.
If Romney is correct, the hurt from the leak of the plan is far less than that which he would have suffered from its execution. And as for guilt by association, although you and I might hesitate to make that argument, didn't Parker just get through telling us that in her view it's fair game?

The Wright Way and the Wrong Way

I've read a lot of commentary on the silly notion of a bunch of wealthy right-wingers that it would be sensible to attack the President based upon the footage of Reverend Jeremiah Wright's fiery sermons - footage we all saw four years ago. Never mind that there's no evidence that the President endorses Wrights views or attended the sermons at which the contentious remarks were made. There is a pervasive myth that McCain somehow would have won the 2008 race had only he been willing to attack Obama on race issues, and the apparent idea is to run a "Who are you going to believe - me, or your lying eyes" campaign depicting the President as an angry black man who has spent a lifetime merely pretending to be the calm centrist you see before you.

A lot of the commentary on Romney's effort to shut down that proposed campaign argues that Romney wants to keep the election focused on the economy, or sees potential in alienating moderate voters who may well be offended by race-baiting ads. And perhaps both of those theories are correct. But I see little evidence in Romney's own statements that he wants to limit the debate to the economy - the focus on the economy seems instead to come from his inability to gain traction on any of the other issues he's raised, such as the confabulated "apology tour", the missile treaty with Russia, his incorrect prognostications on the auto industry bailout, and the like.

On the other hand, one thing Romney does not have working in his favor is his religion. Despite his making a strong effort to minimize the differences between Mormonism and Christianity, evangelical voters continue to have a problem with him. It's difficult to distinguish to what degree their problem arises from his having, in the past, been sympathetic to gay rights, taken strong pro-choice positions, and having otherwise endorsed positions at odds with those held by religious social conservatives, as opposed to his faith, but it is fair to say that it was discomfort with Romney that buoyed Rick Santorum's campaign despite his obvious weaknesses as a candidate.

Romney has wrapped up the nomination process, and the polls thus predictably show that evangelical voters are lining up behind him. (Who else are they going to vote for?) Let's just say, this would be an awkward time for Romney to effectively make it "fair game" to attack a candidate based upon what he may have heard in Church. Given the nature of the Mormon priesthood and Romney's personal family history, there is little doubt that he has been exposed to religious teaching and preaching that many Americans would find alien and that, strictly speaking, evangelical voters would regard as dooming the believer to hell.

Wednesday, May 16, 2012

Americans Elect and the Disconnect Between Policy and Politics

A few weeks ago when I read Thomas Friedman's editorial, "Down With Everything", there was a lot to like. There was an overt recognition that our nation's political problems arise in large part from structural problems, particularly with the U.S. Senate, and (although omitting discussion of the problems that would result from trying to diminish the input and influence of special interests) how powerful special interests have an undue influence on policy. Friedman also acknowledges the role of government and regulation in creating the nation's economic success.

The editorial, though, reflects Friedman's (dare I say) anti-democratic tendencies. He loves magic men - individuals he perceives as able to transform governments, institutions and popular movements - and there's virtually nothing that he doesn't seem to believe could be improved by finding a Steve Jobs or a Nelson Mandela to bring about reforms that Friedman himself cannot articulate - but which we are to assume would fix (or perhaps, more modestly, significantly improve) whatever is wrong. He has shied away from proposing a "magic man" solution to the problems of the United States, perhaps because in his heart he realizes that such an approach is inherently anti-democratic, or perhaps because he recognizes that "magic man" arguments work best when people don't know much about either the proposed leader or the organization or movement he would supposedly transform. But he does love his super committees:
If we are to get out of our present paralysis, we need not only strong leadership, but changes in institutional rules,” argues Fukuyama. These would include eliminating senatorial holds and the filibuster for routine legislation and having budgets drawn up by a much smaller supercommittee of legislators — like those that handle military base closings — with “heavy technocratic input from a nonpartisan agency like the Congressional Budget Office,” insulated from interest-group pressures and put before Congress in a single, unamendable, up-or-down vote.
Filibuster reform has never been high on Friedman's list of priorities. But supercommittees and "up or down votes"? He loves them. Even if it means pretending that a committee has succeeded when it failed... that is, if a report that comes from the committee's leaders accords with Friedman's own notions of good policy.

On one hand, you might think that Friedman is suggesting that the problem is institutional, and that what we really need to do is to find a way to get our government to focus less on politics and more on policy. The problem with that argument, it would seem, is that Friedman's own policy goals (which are most commonly articulated in the form of massive cuts of Medicare and Social Security) are impeded less by factionalism and more by democracy. George W. Bush's (terribly misguided) proposal to partially privatize Social Security failed not because he couldn't have mustered enough votes, but because too many Senators recognized that they would not be reelected if they supported the changes.

Simply put, an era of supercommittees would do little to insulate Congress from wealthy and powerful special interests. Those interests would help define the scope and power of the supercommittees and limit the scope of their authority. What they would do is allow Members of Congress to tell their constituents, "It's not my fault that these cuts went through - I didn't vote for them." Such an approach does nothing to remedy the institutional problems that, in Friedman's view, necessitate the foisting off of every difficult issue to such a committee, nor do they do anything to educate the public as to why reforms - even reforms that are unpopular or that will detrimentally affect the voter - represent good or even necessary policy. It does little, perhaps nothing, to reduce the power of the special interests that so heavily influence government, instead creating a context in which special interests will battle to influence the supercommittee process. And to the extent that it allows the government to move forward even when a majority of legislators are not willing to act responsibly, it effectively divorces their decision-making from the goals, priorities and interests of their constituents. Also, as with the committees that currently exist in Congress, powerful voices on supercommittees will themselves become targets for lobbying.

Friedman also makes the assumption that supercommittees will always work for good - by which I mean that they will always advance the policies that Friedman personally supports. Although some, at times most, Members of Congress may demagogue about the importance of issues that Friedman regards as inconsequential, or advocate policy reforms that Friedman regards as misguided, Friedman seems to believe that they will never be able to either control the creation of a supercommittee on one of those issues or that a majority of a supercommittee's members will focus on irrelevancies or advance bad policy.

To some degree, Friedman's wishful thinking is borne of a history in which supercommittees have been created to address a specific, genuine problem, with members selected in a manner that makes it pretty clear whether the committee will succeed and what its conclusions will be. But the less consensus there is for any given policy solution, and the more supercommittees you create to bypass the normal legislative process, the more examples of incompetence, outside influence, and even corruption you will find. It's a simple truth of bureaucracy - open, democratic processes are apt to seem messy and disorganized, whereas closed, non-democratic processes are apt to be more efficient but less responsive. As we move in the direction of "every important decision shall be decided by supercommittee", we move toward a closes, non-responsive, non-democratic form of government.

Friedman seems to recognize the importance of having a government that can form good policy, although he shares the natural human tendency to define "good policy" as "policies I, personally, think are good." But to the extent that his proposed solutions to political gridlock aren't anti-democratic, they tend to focus on introducing more politics into the equation. I'm sure Friedman believes that by introducing third parties with additional ideas - ideas he once again assumes will correspond with his own - their ideas will resonate with the public, cause the other political parties to see the light, and cause powerful special interests who have kept those policies from being implemented to fade into the woodwork. Having lived in a couple of nations with multiple political parties, and having seen the political processes of many others, I think that concept of how a third party would work is naive.
Here is how [Americans Elect] will work.... First, anyone interested in becoming a delegate goes to the Americans Elect Web site and registers. As part of that process, you will be asked to fill in a questionnaire about your political priorities: education, foreign policy, the economy, etc. This enables Americans Elect to put you in contact with others who share your views so you can discuss them and organize together. Then you will be invited to draft a candidate or support one who has already been drafted and to contribute to the list of questions that anyone running on the Americans Elect platform will have to answer on the site.

“The questions, the priorities, the nominations and the rules will all come from the community, not from two entrenched parties,” said Ackerman.

Any presidential nominee must conform to all the Constitutional requirements, as well as be considered someone of similar stature to our previous presidents. That means no Lady Gaga allowed. Every candidate will have to post in words or video his or her answers to the platform questions produced by the Americans Elect delegates. In April 2012, the candidate pool will be reduced to six through three rounds of voting. The six, assuming they all want to run, will then have to name their running mates. The only rule is that a Democrat must run with a Republican or independent, and a Republican with a Democrat or independent.

“Each presidential candidate has to pick a running mate outside of their party and reaching across the divide of politics,” said Ackerman.
So the idea was not truly to open up the nomination process to non-traditional candidates - somebody you might want to run the nation but who had eschewed politics - for fear of a "Lady Gaga"-type nomination. And bipartisanship was fetishized to the point that a Presidential candidate would have to pick somebody from the other political party - presumably again somebody with a sufficient political résumé to be firmly associated with the other of the two major political parties - a policy that demonstrates no apparent understanding of the history of the Presidency and why we moved away from having a separately elected Vice President. And these Republican-Democratic teams would stand as something unique and apart from the Republican and Democratic teams they would be running against because... bipartisanship!

Commenting on the failure of Americans Elect, Daniel Larison observes,
Americans Elect failed because it stood for almost nothing, and what it did stand for (bipartisanship, mindless “centrism”) are things that the people who vote for third party candidates dislike or don’t value as something desirable in itself. Americans Elect is a financially opaque, unaccountable organization that pretends to be a vehicle of transparency and political accountability. It has no program or agenda, and it cannot identify substantively where the government has gone wrong under the current two-party system. All that it is capable of doing is complaining that members of the two parties are insufficiently chummy and collaborative, and it has presented this message at a time when there is not much confidence in either major party.

Successful third party candidacies have to tap into discontent with something specific about the incumbent, or they have to represent a more radical challenge to both parties. To the extent that it has a political position, it is the opposite of radical, and it has floundered because its backers don’t really disagree with Obama about very much in terms of policy. It an organization of Tom Friedmans with ballot access.
I think Larison is on to something about the circumstances under which third parties can emerge, particularly in the context of our system which is structured toward two dominant parties. But I think it's also fair to note that it's naive to posit that adding a third political party to an election is going to reduce the level of politics in government, any more than the panoply of Republican candidates in the recent nomination contest helped that party focus on key policy issues. The idea that a Presidential ticket split between two political parties is going to be the least politically contentious of the three (presumably) leading partnerships is interesting. I personally can't see how you could have two candidates who were more than nominally aligned with the two major political parties who would not be doing more explaining away of policy differences than elucidation of shared policy goals throughout the campaign and in the debates.

Fundamentally, adding another pairing of candidates to the presidential race (even if you assume that they will resonate to a greater extent than any of the other third party candidates who already appear on the ballot) does not seem to me to be an opportunity to shift the focus of the race from politics to policy. I don't share Friedman's certitude that the best policy decisions are reached by compromise between the two parties - that reflects, to me, Friedman's mistaken bifurcation of political views into two dominant camps, never mind how fractured those camps often are, and a mistaken belief that the two major parties are so completely correlated with and representative of conservative and liberal ideology that any compromise they fashion will be acceptable to both groups. Frankly, if it were that easy we wouldn't need supercommittees to protect elected politicians from being responsible for the actions of Congress. To me, Friedman seems to be among those who focus on the political horse race, assume that the campaigning and demagoguery are about policy formation not political victory, and thus believe that adding more politics to the fray will somehow lend itself to better policy formation. I would expect that, at best, the third party Friedman envisions might not make things worse, but better? I see no reason to expect that.

Paul Krugman has a criticism of Americans Elect that isn't entirely fair to its proponents:
So why Americans Elect? Because there exists in America a small class of professional centrists, whose stock in trade is denouncing the extremists in both parties and calling for a middle ground. And this class cannot, as a professional matter, admit that there already is a centrist party in America, the Democrats — that the extremism they decry is all coming from one side of the political fence. Because if they admitted that, they’d just be moderate Democrats, with no holier-than-thou pedestal to stand on.
Although perhaps Obama's proposed "grand bargain" on the deficit, rejected by the Republicans, should have established his crediblity with this particular group, the reason why "professional centrists" don't see themselves as Democrats, and see the Democratic Party as a part of the propblem, is that they tend to advocate both balancing the budget (now!) and the position that it's impossible to do so without massive cuts to Social Security and Medicare. Although for entitlement reform, when push comes to shove the Republican Party is more words than action, the Democratic Party is the primary defender of both Social Security and Medicare. (Never mind that, just as last time, you could get the Democratic Party to sign on to the modest reforms necessary to stabilize Social Security for the indefinite future, and that only the Democrats have introduced serious cost-cutting measures to Medicare as opposed to the Paul Ryan "unlikely to ever happen" privatization plan.)

When President Obama took office, the Democratic Party had a golden opportunity to demonstrate that it was a mature, capable and responsible political party, able to implement sound solutions to serious problems. Instead, just as it did during Clinton's early years, it proved fractious, unwilling to boldly tackle the big issues, and susceptible to extortionate demands from a handful of legislators who held deciding votes. When you hear prominent Democrats talk about healthcare reform you do not hear explanations of how they might have achieved a better bill - you hear complaints that the issue should have been deferred or abandoned. Extremism may not be the problem among Democrats, but opportunism, avarice and politics remain.

Still, that's not problems you're going to resolve by introducing a third "bipartisan" party.

Krugman optimistically expresses,
Americans Elect was created to appeal to this class of professional centrists — which meant that it was doomed to go nowhere. Because outside that class, the large number of people who believe in all the good stuff the centrists claim to favor are, you know, going to vote for Obama. The large number of people who don’t believe in any of that are going to vote for Romney.
The problem here is that a lot of centrists don't believe that President Obama is going to advance the policy goals they favor. They may not have any more confidence in Romney, perhaps less, but if they believe that entitlements are out of control they have seen three years of Democratic inaction on Social Security and cost-saving measures for Medicare that, at present, remain theoretical. As much as they may believe that President Obama would implement some sound policy reforms if presented with a blank slate, they recognize that he is at heart very conservative in his approach to reform. His most dramatic reform, the Affordable Care Act, is a modest echo of ideas of the Heritage Foundation and of his Republican opponent in the coming election. I think there would be appeal to voters who want to see the formation and implementation of good policy, to have a third party candidate who they believed could deliver what they want - what the country needs.

The problem for Americans Elect is that there is no reason to believe that they would deliver. That serious candidates would sign on, that the forced pseudo-bipartisanship of the ticket would be either genuine or helpful. That the contribution to an election would be anything more than adding more politics, more sound and fury, instead of bringing more attention to the most serious policy issues and the most credible responses to those issues. Were the focus on issues, not politics, Americans Elect could do something very different - attempt to articulate the issues, propose solutions, and ask candidates from across the nation to endorse those solutions. It could then articulate which candidates it most supported in any given race based upon the candidates' response. But alas, that would be a lot more work, a lot less fun, and may serve to highlight how it's less a matter of partisanship between the parties that's impeding progress, and more a matter of voters wanting to derive significant benefits from government without having anybody be asked to pay the bill.

It sounds like much more fun to create a website through which we'll supposedly find ourselves a magic man and call that a solution.

Sunday, May 13, 2012

Ever Since Charleton Heston Gave Soylent Green a Bad Name....

It was healthy, nutritious, and people seemed to like it, but then Heston got all bent out of shape about it....

In the New York Times, Philip Boffey asks what would happen if "pink slime" meat were called something other than "pink slime". You know, like the industry's preferred "lean finely textured beef", but certainly not an objectively fair name such as "ammonia-washed meat scraps". He argues,
At first consideration, lean finely textured beef is admittedly not all that appetizing. It is derived from the fatty scraps that remain after steaks and roasts are carved out of a beef carcass. The fat is spun off and any pathogens in the remnant are killed off with that small amount of ammonia. But the truth is this product does not differ greatly from the rest of ground beef, which is also mostly scraps and remnants.

As for how it tastes, we conducted a test at the Times cafeteria and in my home kitchen of ground beef patties, some in which pink slime made up 15 percent and others without it. Four of our testers, including me, preferred the burgers with pink slime. I found it more tender. Three others preferred the burgers without. No one found any of the burgers slimy.
The first part of the argument is not unreasonable, but it's fair to ask how contaminated, fatty, and meat-free a scrap should be before he would argue that it should no longer be considered appropriate for having the fat "spun off", being rinsed in ammonia, and being mixed into other food of less ignoble origins. But for the fact that repurposing that near-waste material for people is more profitable than other uses, it would likely be used in animal feed or pet food. And when you look at the origins and processing of "pink slime" meat, the answer of those who advocate its (preferably secret) inclusion in human food products would presumably be "never" - as long as the ammonia rinse were sufficient to kill the pathogens, they are fine with its inclusion in products intended for human consumption.

The question of how it tastes is peripheral to the reason people object to its inclusion in their food. As some have pointed out, there are products that are part of foods we often eat that are every bit as disgusting, and in some cases much more disgusting, than ammonia-rinsed, finely ground beef scraps. Mechanically separated chicken comes to mind - and has a taste and texture that is harder to hide. The author's implication that at a 15% mix, most people won't notice the inclusion of "lean finely textured beef" in their burgers, and might even prefer it, is fair, but that's not really why people object. When people learn that offal-tainted cutting room scraps are being ammonia-washed and put back into their food, the reaction of disgust comes from that part of the brain that tries to keep us safe and healthy. "But some amount of dung makes its way into all ground beef, and the ammonia wash makes this safer," isn't the sort of argument that is apt to overcome the natural revulsion. A more likely reaction is, "How about we try to clean up the production so that don't need to have this discussion about comparative levels of dung contamination in our food supply," or perhaps just, "Ew."

Frankly, in terms of the preservation of the species, I think that the natural reaction people have to "pink slime beef" is a more healthy one than "As long as the ammonia wash kills off the E. coli it's fine by me."

Friday, May 11, 2012

Your Agreement With the President is Not Rare

Or, at least, I hope not.

Although far from novel, I have no real objection to somebody noting that they have found common ground with a person with whom they usually disagree. Some saying about a stopped clock comes to mind....

But I do take more of an issue with such an expression when it is seemingly made in earnest. In the blog post linked above, law professor Ilya Somin - who is smart enough to know better - writes what he appears to believe:
President Obama’s recent announcement that he supports gay marriage is yet another addition to the short but distinguished list of issues on which the President and I agree.

Previous entries include creating a playoff system for college football, allowing gays and lesbians to serve openly in the military, ending the home mortgage interest deduction for high-income taxpayers (though I would go further and abolish the deduction for everyone), the president’s authority to forego defending federal statutes he believes to be unconstitutional, the legality of the targeted killing of Osama Bin Laden, the end of the NBA lockout, and that the Obama health care plan’s individual mandate is not a tax. Based on the above, it seems that the biggest areas of overlap between our worldviews are gay rights and sports. But the list is not completely exhaustive, since there are a few other issues where we also agree, but I don’t blog about them because they are too far outside my areas of interest and expertise.

A few issues? I suspect that, upon inquiry, you would find that the President holds such views as,
  • The President should work to uphold the Constitution;
  • Our nation benefits from capitalism;
  • Hitler and Stalin are among history's greatest villains;
  • Genocide is a bad thing;
  • Communism is a proven failure, that has caused significant harm to many societies;
  • Religious freedom is a good thing;
  • Racial discrimination is a bad thing;
  • Education is a good thing;
  • The state should recognize and protect the private ownership of property;
  • Government corruption is a bad thing;
  • People charged with crimes should be given due process;
  • Legal education is beneficial;
  • Women should have equal rights in the workplace;
  • People within our society should, as a general rule, attempt to live peaceful, law-abiding lives;
  • Cigarettes are addictive;
  • People should practice good personal and dental hygiene;
  • Despite its flaws, we have yet to develop a better system of government than democracy;
  • In an ideal world, we would have minimum public debt and would routinely balance the budget;
  • When you need to see a doctor, it's good to be able to afford to see a doctor;
  • Not everybody will become wealthy, but its good for as many people as possible to have the opportunity;
  • Early childhood education is important to future academic achievement;
  • Children should have safe, stable, non-abusive homes;
  • Government functions better when political parties cooperate and work toward sound policy outcomes....
I could, of course, keep going. My point is not that, by his own statement, Somin is either not sufficiently interested in or informed about Hitler, religious freedom and personal hygiene to form an opinion as to their merits, but that he's so focused on a handful of issues that he appears to have blinded himself to the enormous common ground he in fact shares with the President.

Kidding aside, Somin's final point also is the type of self-endorsement for which I don't much care - the implication that he only blogs about areas within his expertise - in essence an appeal to authority with himself as the authority.

I'm reminded of a comment a lawyer made, hearing another lawyer brag about his high success rate at trial. "If you're doing that well at trial it's because you're only litigating the cases you know you can win. You're not pushing yourself or your talents." Sometimes the stakes are such that caution is a good thing. Sometimes you don't want to roll the dice with a client's life. But if you're that cautious when it comes to expressing your opinion, you're not pushing yourself or testing your ideas. You also may not be quite the expert you imagine yourself to be, putting yourself at risk of having people read your blog posts and your self-congratulatory claim that you're an expert and reacting, "If that's his best thinking, no wonder he doesn't want to opine on other issues."

Also, with due respect to the fact that some people do hold special knowledge or well-honed analytical skills relevant to a particular subject or issue, quite often the "experts" are shooting from the hip. Not just the talking heads on television who pretend to be experts on every issue of the day, but also people who work within and specialize in a specific field, or leaders of government who insist that dramatic action is justified by information or intelligence they cannot reveal to the public. We've had some dramatic demonstrations of failure by the so-called "best and brightest" in recent years, and some remarkable incompetence in intelligence gathering and analysis leading up to the Iraq War. There's a reason "The Emperor's New Clothes" resonates as a story, even though it was a child, not a subject matter expert, who pointed out the Emperor's folly.
Update: I see that Ilya Somin has read this post, appending to his original complaint, which I suppose could constitute a lesson in "how to think like a lawyer:
A somewhat overwrought critique of this post takes me to task for supposedly being unaware of numerous largely noncontroversial things that Obama and I agree on, such as that genocide is evil or that Hitler and Stalin were great villains. I’m well aware of these areas of agreement, thank you. But this post was about issues on which Obama and I agree, which means questions that are controversial in modern American politics. The fact that Obama and I agree on many things on which there is an overwhelming national consensus isn’t relevant to that. We also agree that the Earth is round, and that the Sun rises in the East.
I guess Somin believes that the best defense is a weak offense?

First technique in thinking like a lawyer: Misrepresent your opponent's argument. Somin complains that I take him to task for "supposedly being unaware of numerous largely noncontroversial things that Obama and I agree on". Yet I explicitly stated,
My point is not that, by his own statement, Somin is either not sufficiently interested in or informed about Hitler, religious freedom and personal hygiene to form an opinion as to their merits, but that he's so focused on a handful of issues that he appears to have blinded himself to the enormous common ground he in fact shares with the President.
On top of that explicit statement, I also note that I was "kidding" Somin. There is simply no room for ambiguity. If Somin read my post, he knows his characterization of it is false.

Second technique in "thinking like a lawyer" Redefine your terms. Somin complains that he was speaking about "issues" and apparently that I should have guessed that when he says "issues" he means only "questions that are controversial in modern American politics". Yet in his own post, Somin refers to "sports" as one of the two issues upon which he and the President find common ground, belying the notion that he was referencing only "questions that are controversial in modern American politics".

Third technique in thinking like a lawyer: Pound the table, and perhaps people won't notice that you have changed the subject. I expect that if I were to actually list contentious issues for which Somin would presumably agree with the President, Somin would complain that the issues upon which he agrees with the President are not "questions that are controversial in modern American politics" - that the only "controversial" issues are those for which he differs from the President. For example, if he reads his own group blog Somin surely recognizes that gun control is "controversial in modern American politics" - so by insisting that he disagrees with the President on all "questions that are controversial in modern American politics" other than gay rights and sports is Somin stating that he advocates gun control?

Somin's "rebuttal" reinforces my position that he, and people who use similar rhetoric, miss the forest for the trees. The President, for example, proposed a deal last year to balance the budget through a set of tax increases and budget cuts, including significant entitlement cuts. Somin objects to balancing the budget? To any tax increase necessary to do so? To entitlement cuts? There was recent controversy over women's access to contraception, and whether an employer's religious objection should justify the exclusion of any medication or treatment the employer finds objectionable from a job-based health insurance plan. Somin truly takes the extremist position, that for example a Christian Scientist employer should be able to exclude blood transfusions and antibiotics from a health insurance plan? There are national politicians who would be happy to ban contraception - should we nonetheless treat the issue as not "controversial in modern American politics", or does Somin join the anti-contraception faction?

Somin's response reminds me of something I've been meaning to write about - the manner in which many people in our society confuse politics with policy. The horse race is more fun to watch than policy-making, but media focus on every major issue as a contest serves to exaggerate the differences between the parties. If a reasonably intelligent, issue-driven Republican were to sit down with Obama, I expect that they would find a lot of common ground and be able to quickly reach mutually acceptable compromise on some of the most controversial issues of the day. The problem is that in the present political climate, the Republican would insist that the meeting occur off the record and instead of embracing the common ground would instead issue rhetoric that sounds a lot like... what Somin wrote.

Can You Keep Up With the New Economy?

Paul Krugman has done a good job refuting the notion that the rise in unemployment over the course of the latest recession reflects a structural change, and that lends credence to his argument that efforts to stimulate the economy and get people back into the workforce are a viable response to the slow rebound of the employment market. That said, and with due credit to his argument that the comments of self-described "structuralists" like David Brooks echo claims made in the 1930's that history has proved to be wrong, there are some significant differences between "now" and "then".

Krugman has noted that increases in worker productivity reflect a healthy economy, are to be expected, and thus don't support the thesis that we will never again need as many workers. But the increases in worker productivity over the past century have made it considerably more difficult to create work for large numbers of people. Thanks to significant improvement in technology, infrastructure projects that once would have employed hundreds or thousands usually can now be completed by relatively small crews. Also, a century ago, lower-skilled manufacturing jobs could not be outsourced to foreign nations, nor could phone banks, data centers, and other lower- and moderately skilled service jobs be similarly outsourced. Globalization is not the reason for the loss of jobs during the recession, but it may be part of why the return of jobs is so slow, and I think it is pretty clear that it plays a role in shrinking wages for low- and moderately-skilled workers, and for the general flattening of middle class incomes. That is, even if not the cause of the problem, globalization complicates recovery.

Further, as technological change accelerates, workers can find that if they aren't constantly updating their skills their talents can become obsolete. And even if they are updating their skills there's no guarantee that they will have an easy career path, that their skills will continue to be relevant as new technologies come online, or that their jobs won't be outsourced, Many of the workers who are part of the chronically unemployed during the present recession will not return to the workforce, or will never again enjoy the level of income that they enjoyed before losing their jobs. I think it's a valid concern that we'll see the same pattern occur in future recessions and, for that matter, in smaller numbers even during the "good times". I'm not arguing that this is a new phenomenon, but (while hoping I'm proved wrong) that worker obsolescence is occurring and likely to continue to occur on a larger scale than we've seen in the past.

When you look at the big numbers, I agree with Krugman that there is no structural reason why we could not return to a level of unemployment roughly the same as that which we saw before the recession began. But I think that there are structural reasons why middle class wages are stagnating, why it will become more and more difficult for lower-skilled workers to enjoy middle class lifestyles, for reduced mobility between socio-economic classes, and for the increased difficulty workers are likely to face maintaining their skills and wages over the course of a career.

Thursday, May 10, 2012

Sorry, Romney, Some Things You Just Don't Forget

Although Mitt Romney has long personified the punch line to the joke, "How can you tell when a politician is lying," it remains worth commenting on his latest seeming prevarication:
Mr. Romney returned from spring break in his senior year to find that John Lauber, a quiet, offbeat type, had bleached his hair blond.

Mr. Romney, brandishing a pair of scissors, led other boys on a hunt for Mr. Lauber, teasing him and holding him down while Mr. Romney snipped off his long locks.

“As to pranks that were played back then, I don’t remember them all, but again, high school days, if I did stupid things, why, I’m afraid I’ve got to say sorry for it,” Mr. Romney, 65, the presumptive Republican presidential nominee, said in a Fox News Radio interview on Thursday.
I don't think I'm atypical in this regard: If I were confronted with a story of this type I would be able to clearly and unequivocally say, "That's false. It never happened." I'm not claiming that I was perfect as a teenager, or that I was never mean to a kid who didn't deserve it, but there are certain lines that I - and I dare say, any normal person - would remember crossing. The only way you would forget this type of "stupid thing" or "prank" would be if you engaged in that type of bullying so often that your episodes of bullying became indistinct.

Further, you have to have a certain character or disposition to engage in that type of act - if you were somehow confused about whether or not it happened, you should at least know yourself well enough to know if it is something you were at all likely to do. Romney's inability to defend his own character reflects that, in his case, it was.

If the defenses of Romney are to be believed, that this would have been atypical behavior from him, it's difficult to regard his denial - or his defense that this would be a "prank" or "stupid thing" that fit among his many others as opposed to being a particularly memorable incident of tormenting another human being - as credible.

In terms of the alternate defense, that "Even at his otherwise-strict school, pranks were tolerated with boys-will-be-boys indulgence", there may be truth to that. The continuation of that defense, that the concept of bullying was alien to that era, is nonsense, but there's no question that a lot of boarding schools, including elite ones, used to have an overt and deliberate culture of brutality and bullying. An acquaintance who attended an overseas, British-style all-boys boarding school in the same era recounts that physical brutality and hazing was part of the culture of the school, and was viewed positively by the parents who wanted to make sure their sons were either tough or toughened up. But Romney's not offering a "times were different" defense.

One of the other students who participated in the event doesn't believe the denial:
Phillip Maxwell, a lawyer in Michigan, who participated in the episode, recalled it in an interview on Thursday. “It started out as ribbing, sort of a pointed ribbing about his hair, but it very quickly became an assault, and he was taken down to the ground, pinned,” Mr. Maxwell said. “It all happened very quickly — it was like a pack of dogs.”...

On Thursday, his aides struggled to deal with the account, first telling The Washington Post that Mr. Romney had no recollection of it. Mr. Maxwell, however, said he was skeptical that Mr. Romney did not remember something that had haunted all of the other men involved, even years later.

I would think this would be seared in his memory,” said Mr. Maxwell, who identified himself as an independent who tends to vote Democratic. “Certainly for the other people that were involved, nobody has forgotten.”
So as you would expect, this was not part of the culture of the school or typical of the "pranks" of the day, but was a particularly dramatic episode of bullying. The Washington Post was able to reach "several classmates [who] confirmed the account". The only person whose memory isn't working, it would appear, is Mitt Romney.

Wednesday, May 09, 2012

Social Conservatism vs. Political Conservatism

In the context of ant-gay marriage amendments, Daniel McCarthy's argument represents the distinction between somebody who is actually politically conservative and somebody who is motivated by the brand of "social conservatism" in which government regulation of private adult conduct is desirable:
The tendency of democracy, in values conflicts as well as economic policy, is to look to short-term, easy fixes that aren’t fixes at all: temporizing measures that placate voters and keep power-seeking coalitions together, but that leave the larger forces of culture to work their logic without citizens even being conscious of what’s happening. Amending fundamental law to ban gay marriage when Americans have already created a culture that insists on equality — in all things but wealth — only turns constitutions into op-ed pages.
For somebody who is politically conservative, the idea of entrenching social mores into a constitution should be troubling.

Tuesday, May 08, 2012

David Brooks and the Hollow Man

As is his wont, David Brooks is telling us that there are two types of people - in this case, stupid people, and people like him. The type of person who doesn't think like Brooks?
Many people on the left are having a one-sided debate about how to deal with a cyclical downturn. The main argument you hear from these cyclicalists is that the economy is operating well below capacity. To get it moving at full speed, the government should borrow and spend more....

Unlike the cyclicalists, we structuralists do not believe that the level of government spending is the main factor in determining how fast an economy grows. If that were true, then Greece, Britain and France would have the best economies on earth.
Dean Baker calls Brooks out on his hollow man argument - his creating an opponent who does not actually exist, in order to more easily swat down an argument that nobody is actually making:
I don't know anyone who looks like cyclicalists that Brooks writes about. It would be good if he could toss out a few names for readers so that we know such people actually exist in the world and are not just Brooks' hallucinations.Since the views Brooks attributes to the cyclicalists are sufficiently bizarre, it is hard to believe that such people exist.

For example, he tells us that the cyclicalists believe:
"the level of government spending is the main factor in determining how fast an economy grows."
I have never come across anyone who had a view anything like this. I do know many economists, who argue that in a downturn more stimulus will lead to more economic growth, but this is nothing like the view that Brooks attributes to the cyclicalists. Does Brooks really think it is the same thing to say that more stimulus leads to more growth in a downturn and saying that government spending is the main factor determining growth in general? This is scary.
But we all know who Brooks is attacking in his column, don't we? Even if he doesn't name the name (or present either an honest or accurate summary of his argument)? In a stunning display of the Dunning-Kruger effect, he's going after Paul Krugman. Whether or not it's official policy that New York Times columnists aren't supposed to disparage each other on the Times' own pages (print or virtual), there's been quite a bit of back-and-forth between Brooks and Krugman, and Brooks seems to be chafing at the fact that he always comes out on the losing end of the argument. By not naming Krugman, Brooks gets another advantage - he can caricature and misrepresent Krugman's arguments and then, as an ostensible defense, claim he was speaking more broadly... you know, about the other unnamed people who aren't actually making this argument.

Meanwhile, Paul Krugman has published a note to (cough) himself, pointing out the absurdity of the structuralist argument that Brooks endorses. Krugman observes,
Anyone who says something like “If deficit spending were the route to prosperity, Greece would be in great shape” should be immediately considered not worth listening to. People in my camp have repeated until we’re blue in the face that the case for fiscal expansion is very specific to circumstance — it’s desirable when you’re in a liquidity trap, and only when you’re in a liquidity trap. I know that some people like to project their own crudity onto others, but what they’re actually demonstrating is their own ignorance.
Brooks identifies three structural problems that he believes are impeding the economic recovery:
  1. Productivity Increases: "Hyperefficient globalized companies need fewer workers. As a result, unemployment rises, superstar salaries surge while lower-skilled wages stagnate, the middle gets hollowed out and inequality grows." The first argument is ridiculous - Brooks thinks this is the first time in history that technology has improved or worker efficiency has increased? Or that it's somehow different from all the other times when exactly the same thing happened? And who are the "superstars" Brooks imagines to be making out like bandits? The rent-seekers he later describes - because it really seems like the biggest gains have been by those who have manipulated the system or who have survived their own incompetence by the grace of government handouts.

  2. A Lack of Skilled Workers: "The United States, once the world’s educational leader, is falling back in the pack. Unemployment is high, but companies still have trouble finding skilled workers." Brooks presents no evidence in support of this claim. The actual problem appears to be that companies aren't hiring, and those that are hiring want to get "skilled workers" at bargain rates. I've seen little evidence that jobs offering competitive wages aren't getting plenty of qualified applicants. It's fair to also note that huge numbers of jobs have been lost domestically due to the availability of cheap unskilled overseas labor - it's not that domestic workers can't do those jobs, it's that the jobs are no longer in this country.

  3. Rent-Seeking: "Over the decades, companies and other entities have implanted a growing number of special-interest deals into the tax and regulatory codes, making it harder for politically unconnected, new competitors, making the economy less dynamic." Which is, of course, the result of policies endorsed by David Brooks and the Republican Party.

Brooks also complains that "Running up huge deficits without fixing the underlying structure will not restore growth", which is not the argument anybody is actually making. What somebody who actually cares about the problem might observe is that the economy can benefit if the government demonstrates fiscal responsibility when the economy is strong and engages in deficit spending when the economy is weak - and positions itself to stimulate the economy that is up against the zero bound. The overt policy of the Republican Party and of David Brooks is the opposite - engage in absolute fiscal recklessness, running up huge deficits when the economy is strong, and leaving the nation unable to afford to fix the mess created by those policies during recessionary periods.

Stimulus spending would not fix the problem, but it can soften the blow. It's a bit like using raw eggs to seal holes in your radiator when you break down in the middle of the desert - you know it's not idea, you know it's not a permanent fix, but it can get you out of a bad situation much more quickly and with much less harm than is otherwise likely to result. More stimulus spending that prevented layoffs at the state level could have had a significant impact on the unemployment rate, and with more people working and consuming the rest of the economy was more likely to rebound. Although Brooks seems to find these concepts to be elusive, they're actually quite obvious. Dean Baker points to history:
...Brooks gives us the line freshly drawn from the 1935 Washington Post:
"Then there are the structural issues surrounding the decline in human capital. The United States, once the world’s educational leader, is falling back in the pack. Unemployment is high, but companies still have trouble finding skilled workers."
If you think you have seen this one before, that's because you've seen it before, and heard it repeated endlessly in all sorts of contexts. Here's the Washington Post in 1935:
"unemployment may run into the millions, but as the iron, steel, and metal-working industries improve, a scarcity of skilled workmen is developing, states the magazine Steel this week."
There are clear market signals of the sort of mismatch of jobs and skills that Brooks describes. We should see sectors of the economy where there are large numbers of job openings relative to the number of unemployed workers. We should see sectors where the average workweek is increasing rapidly. The logic is that firms who cannot find additional workers make the existing workforce work longer. And most of, we should sectors of the economy where wages are rising rapidly.

People who believe in markets would look for this evidence before making bold assertions about employers being unable to find qualified workers. By contrast, Brooks just makes this assertion with no evidence whatsoever.

Our economy has some structural problems, particularly in terms of health care costs, and many states have only addressed serious problems with their budgeting in the face of economic catastrophe. Structural problems exist and can be addressed. But Brooks' "structural" issues are, for the most part, as vaporous as the "cyclicalists" he imagines oppose him. Where do Brooks and his "structuralists" stand on the Affordable Care Act, the most serious legislation this nation has ever passed to try to address healthcare inflation?

Brooks attempts the Beltway version of "reasonableness", which is to say that our nation should prioritize dismantling the social safety net in the interest of... I guess that would be justifying the next round of tax cuts for the rich. Although Brooks states,
Mitt Romney and Representative Paul Ryan understand the size of the structural problems, but their reform plans are constrained by the Republican Party’s single-minded devotion to tax cuts.
The criticism is less of the focus on tax cuts and more of their unwillingness to actually state the social spending cuts they would make. Brooks' argument is inherently dishonest, first because Romney has run away, screaming, from any suggestion that he be specific with his actual plans, and second because Ryan's "plan" is an economic catastrophe in the making - if the structural problem is that our deficits are too large, Ryan's plan makes things worse. If Brooks is going to pretend that he cares about education and allowing the unwashed masses to get a sufficient education to compete with his elite rent-seekers "superstars" for decent jobs, Ryan should not be his hero. Ryan's beholden to the rent-seekers.

Dean Baker responds,
Finally Brooks concludes by telling us:
"make no mistake, the old economic and welfare state model is unsustainable."
This should prompt a really big, "huh?" Brooks had just been touting the German model. Germany certainly has a much more generous welfare state than the United States, even if it has been rolled back somewhat in the last decade. We could also look to Netherlands and the Nordic countries, all of whom have much more generous welfare states than the United States, yet don't in any obvious way appear to be on an unsustainable growth path. It's not clear what point Brooks thinks he is making.
Krugman comments on the absurdity of trying to fix the long-term economy instead of focusing on the short-term, pulling out Keynes' famous observation, "In the long run we are all dead".
Anything along the lines of “we need long-run solutions, not short-run fixes” may sound sophisticated, but it’s actually just the opposite.
He's right - particularly in our political system. Brooks cannot reasonably claim that our government is so beholden to special interests that it harms the economy and then pretend that those special interests will disappear from the political scene the moment that the budget is balanced. We know exactly what happened the last time we had a budget surplus, don't we? As long as the present Congress cannot bind future sessions of Congress to follow its budgets and policies, the only budget that matters is the next one.

When people claim we need some sort of overarching budgetary plan that extends over decades, and that nothing short of that is sufficiently "serious" to address our nation's economic woes, they're betraying an ignorance of even recent history - the manner in which the G.W. Bush Administration squandered the surplus with an express attitude of "deficits don't matter", and the manner in which events that are outside of our control, whether in the form of a terrorist attack, a war, a global economic meltdown, or something else, can throw a monkey wrench into the most carefully constructed long-term economic plan. They're also displaying abject ignorance of how our political system functions (some might say malfunctions). Yes, long-term plans and projections are helpful, but if you care about fixing things you need to look at what is happening right now, and any actual, observable trends.

I'll note in closing that Brooks' distinction between "cyclicalists" and "structuralists" is a false dichotomy. You won't find a single person conversant with economic issues who cannot identify structural problems in the economy, and (other than, perhaps, Brooks) you won't find a single such person who emphasizes structural problems as the root cause of our economic malaise who doesn't recognize that economies go through cycles.

Outsourcing on Bipartisanship

It's tempting to quote the whole thing, but instead... Go read Daniel Larison's comments on bipartisanship in politics, President Obama, and Obama's slow reaction to Republican obstructionism.

Don't Bet on Vaporware

Unless, of course, you have money to lose.

I keep seeing articles suggesting that ordinary investors should not try to purchase Facebook stock at the time of its IPO. You know, as if an ordinary investor will have the opportunity. Facebook is selling a small amount of stock, not because it needs the money but because it has too many shareholders to remain private. It is clearly hoping that by keeping the offering small the shares will be picked up by investors who see the company as worth a roll of the dice - in three years will they be Google or will they be MySpace?

The thing about Facebook is that for years now we've been told that their data will allow them to sell advertisers high-value advertisements, targeted based upon exceptionally granular demographic information, resulting in high conversions. CJR offers a reminder of what that presently means, in practice. Ads do not appear to be well-targeted, ad revenues are dropping, and any suggestion that it can grow its income to justify its present, ostensible valuation (as opposed to identifying and implementing new income streams - the type of revenue streams we've been promised will inevitably appear because of the amount of traffic and data that Facebook enjoys) is simply not credible. It's more credible, I suppose, than the similar valuation of Internet companies during the first Internet bubble, due to improved online advertising technologies, but not by a large margin.

The recent action that should have investors scratching their heads about Facebook is the acquisition of Instagram. Not in the sense of "CEO's Gone Wild". To some degree you have to credit Facebook for seeing a potential competitor on the horizon and buying it before it became much more costly - recognizing that such acquisitions are a gamble. It was Facebook's promise to own and manage Instagram without folding it into Facebook that was telling. If Facebook can only maintain its dominant position by acquiring upstart social networks, it's going to be buying a lot of small companies for a lot of money.

If Facebook can only keep the users of acquired social networks happy by maintaining them separately from Facebook, even if it offers a level of integration by allowing people to log in to all of its services through their Facebook account, it's headed toward an expensive form of fragmentation, having to support and maintain a lot of marginal or obsolete properties - or at times cut their losses and make users angry. Facebook's strength is in being Facebook, singular, not in being an agglomeration of sites. And let's not forget we're actually talking about a platform war - you don't want to reduce your operations to an app on somebody else's platform, and you certainly don't want to reduce it to a panoply of apps. You want to be the platform.

A year ago Facebook released numbers that, although not justifying its pie-in-the-sky valuation, were impressive. More recently they have reported that they have more users than ever - and that their profits have declined. Neither that nor the potential fragmentation of their platform is the type of thing that I would be looking for in an investment. But heck - if I were getting an annual fee and a percentage of the profits to invest your money (or your pension's money) I can see why I might roll the dice.