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October 13, 2008

Comments

I'm a big admirer of Krugman. Though I don't always agree with him, he's one of the voices I trust.

He was also promoting the bailout solution very early on that Paulson had to be browbeaten into.


He was also promoting the bailout solution very early on that Paulson had to be browbeaten into.

Which bailout solution are you talking about? The original Paulson TARP plan, the modified Dodd-Frank-Paulson TARP plan, or the way that the latter is now under pressure to morph into something more like the British plan?

IIRC Krugman was always in favor of something like the British plan, always against the original Paulson TARP plan, and grudingly in favor of the Dodd-Frank-Paulson plan on the basis that it was a crappy plan but the best that anyone could expect to make it through Congress on short notice and time was of the essence.

I could be wrong on this of course :-).

BTW Congrats to Prof. Krugman - hopefully our next Treasury Secretary as well as a Nobel Laureate. Some prize huh? Congratulations Professor - and oh by the way, please fix the global economy for us. By next Tuesday if you don't mind.

You think the Nobel Committees are trying to send the world, and our GOPers in particular, a message. First Gore, then Krugman. Who's next? Might be a little early, but the Embryonic Stem Cell researchers?

First Gore, then Krugman. Who's next?

Don't forget Carter, whose selection was also clearly intended as a rebuke to the Bush Administration.

LeftTurn - I was talking about the "British-style" plan. AFAIK, Krugman supported the Dodd-Frank-Paulson plan based on the premise that unlike the original TARP plan, it gave the Treasury the power to inject capital in return for partial ownership. In other words, it sucked, but it left the door open to do it correctly.

I've been wondering, LeftTurn -- do you have some training in economics?

If were naming recent Nobelists whose selection can be seen as rebukes to the Republicans, mention should be made of Pinter as well. Also, in a completely non-parallel but still somewhat related story, it was nice on Wednesday when one of the frst things Chalfie did after winning the Chemistry Nobel was to use the press attention to announce that he was endorsing Obama, making the score 63 Nobelists for Obama to none for McCain. I wonder if Krugman will now endorse - although I believe that it would violate his New York Times contract.

Krugman as Treasury Secretary--that's the kind of daydream that could not only have me voting for Obama, but actually feeling kinda good about it, at least in some ways. Not that I know of any evidence Krugman would be interested in the job. Is he considered a serious possibility, TLT, or were you just daydreaming too?

Two things.

First, Gore and Carter won a Nobel Prize.

Krugman won a Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel.
While it is certainly an honor to have won, it is not the same thing.

Second, I agree with the folks saying that this award is more a reflection of Krugman's truth-to-power stance of the last decade than the paper he wrote.
Admittedly, I don't have nearly the breadth of knowledge regarding academic economic literature and its importance, but that is my intuition.


DJ,

An amusing sidelight: in a panel discussion on the meltdown Krugman suggested an equivalence between liberal reaction to the prospect of Phil Gramm as Treasury secretary and conservative reaction to himself in that role.

@david kilmer

No formal training - just a lot of self-education as an outgrowth of my interest in history, and conducted with a high level of motivation because my employer's business is exposed to the ups and downs of Residential and CRE construction spending.

@Donald Johnson

Re: Krugman as Treasury Sec.
Just daydreaming - not dishing inside dirt.

I know that he was a Hillary partisan during the primaries but it seems to me that Obama is willing to seek out talent regardless, and Prof. Krugman seems to me to be a very good choice right now because the T. Secty is going to be a key position in the next administration and much more overtly political than in some other administrations past given the immense power and authority vested in that spot by the Frank-Dodd-Paulson TARP plan.

I don't think it is a good idea to keep picking Wall St. investment bank people (like Paulson) for that position - we need somebody who can look at that industry from the outside, not an insider. The distinctly superior bailout plan coming from London (vs. Washington) underscores that point IMHO.

Thanks, TLT.

On Krugman's worthiness, Crooked Timber and Marginal Revolution have some things up about that.

And for SF fans, especially Gary, there's a link in a CT thread to a paper that Krugman wrote on the economics of interstellar trade. It's a pdf file. Also, Krugman is going to participate in an upcoming CT seminar on Charlie Stross's work.

Link

Krugman won a Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel.
While it is certainly an honor to have won, it is not the same thing.

A victory for pedantry everywhere.

Second, I agree with the folks saying that this award is more a reflection of Krugman's truth-to-power stance of the last decade than the paper he wrote.
Admittedly, I don't have nearly the breadth of knowledge regarding academic economic literature and its importance, but that is my intuition.

Krugman won the John Bates Clark Medal back in 1991, well before he became popularly known as a critic of the Bush Administration. Check out the list of recipients- it's pretty short, and pretty impressive. Quite a few have gone on to the Nobel (or the BoSPiESiMoAN, if you prefer).
Krugman 1, Intuition 0

"Krugman won a Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel.
While it is certainly an honor to have won, it is not the same thing."

It wasn't established in Alfred Nobel's will, but it is regarded as a "Nobel Prize."

Thus the headline: "Krugman Wins Economics Nobel."

Is there some distinction you're making beyond the fact of the faintly different title, and the fact that it was added on?

Thanks for the pointer, Donald. The paper made me laugh with the first sheet: "This research was supported by a grant from the Committee To Re-Elect William Proxmire."

I don't see a contradiction between Krugman being awarded the price for his scientific work and for speaking up. The latter could easily have influenced the timing. The former would be the justification for awarding the price in the first place (i.e. the committee considers Krugman worthy).

And having now read Krugman's paper, I'll thank you again, DJ, since it was so funny and pun-filled.

Wow. Cool.

Nobel prizes are funny: the Physics, Chemistry, Medicine and Economics prizes are all in subjects I honestly don't have a clue about, so I can't really evaluate the worthiness of the recipients at all, but suppose the people giving out the awards know what they're doing.

The Peace prize is obviously political, and while there are a lot of worthy recipients, there are also a lot of unworthy ones, so I don't really care.

And in the field were I can claim some actual expertise, literature, I still can only really evaluate maybe 10% of the recipients, yet the selections strike me as rather idiosyncratic in general and I would never consider reading a book or rating it more highly because the author got a Nobel prize.

So the whole procedure every year doesn't really interest me very much, but it can provide some mild entertainment value.

"The Prize in Economics is not a Nobel Prize. In 1968, Sveriges Riksbank (Sweden's central bank) instituted "The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel", and it has since been awarded by the Royal Swedish Academy of Sciences, Stockholm."

I have had multiple posters respond to a spelling error on this site, so I would expect folks here to accept a correction gracefully, rather than respond with rudeness.
I did not point this out to diminish Krugman's accomplishment, which should have been clear from the post.

Regarding the academic work for which he earned the prize, thank you Donald Johnson for directing me to CT and MR. I admire Krugman a great deal, and find it reassuring this was not simply a political statement.

novokant, I know some biology, so two of the Nobel prizes are easy:
Physiology Or Medicine is awarded to neither about 80 of the time, but instead to research in Biology.
Chemistry is awarded to research in Chemistry or, about half the time, in Biology. The Chemists hate this.

Andrew, you're right, of course, that it's a Nobel Memorial prize rather than a Nobel prize, but because it is also awarded from the hands of the Swedish King the conflation is pretty successful. It was priceless to see Gary Farber come out against the picking of nits, though.

I've always wondered how Math folks feel when the Fields Medal is described as "the Mathematics equivalent of a Nobel Prize" rather than just letting it stand on its own merits, without comparison.

80 s/b 80%. Sorry.

Simple: the Fields is harder to get.

"I have had multiple posters respond to a spelling error on this site, so I would expect folks here to accept a correction gracefully, rather than respond with rudeness."

Who was rude to you? We should scold them.

I feel obligated that while Gary does not hesitate to request proper spelling and grammar, his personal comportment is impeccable, so far as I can recall. He frequently corrects errors, but he is not frequently rude to errers.

I am happy to acknowledge that Gary Farber was not whom I was referring to as rude, nor can I recall him ever being rude in response to my infrequent posts here over the last several years.

"He frequently corrects errors"

I correct spelling of proper names.

Beyond that, it's rare and exceptional, and takes a specific reason, for me to comment on grammar or spelling or punctuation or usage, actually. I'd be constantly busy, otherwise, to little point other than to be annoying.

As a rule, I make a specific point of avoiding spelling flames even with most trolls: it's too easy a cheap shot.

Only if someone is unendingly subliterate while bragging about their educational status or intelligence will I point out how inconsistent their writing is with their claims.

But I do have a thing about people getting people's names right. I have two reasons for being fussy about that one thing: one is that it will interfere with Googling, but the main reason is that it seems disrespectful to me to get people's names wrong.

And some just drive me crazy with weariness. (Ghandi! Tolkein! Azimov! Leguin! Ayres!)

Otherwise, if someone writes something that I find incomprehensible, or at least highly confusing, I might query what they mean, or point out that they seem to me to be incomprehensible, and there are a few people I'm friendly with whom I might make an occasional suggestion to as regards clarity, or a clear error that significantly distorts the meaning of what they're trying to say.

But otherwise I don't, in fact, comment on most usage errors.

Neither are my own comments remotely free of solecisms, typos, or awkwardness; it is just hasty comment writing, often while tired or distracted, after all. We all make typos.

For the record. (That's a sentence fragment! Acceptable colloquially!)

But I do wish everyone could remember that an ellipsis has three dots only, and it only gets an additional period to end a sentence. It's a specific punctuation mark, not just a series of random dots you can pick the number of depending upon your mood.

:-)

"And some just drive me crazy with weariness. (Ghandi! Tolkein! Azimov! Leguin! Ayres!)"

You forgot Olmstead!!

Since this is the closest thing we have to a currently active thread on econ/finance, let me toss out the latest installment on a topic I’ve been grinding an axe regarding for weeks now – the Big Lie that Freddie and Fannie were the prime cause of the mortgage crisis. Keep in mind that 2004-2006 were the key years in the expansion of mortgage credit and lowering of lending standards.

McClatchy: Private sector loans, not Fannie or Freddie, triggered crisis

Key statistics:

• More than 84 percent of the subprime mortgages in 2006 were issued by private lending institutions.

• Private firms made nearly 83 percent of the subprime loans to low- and moderate-income borrowers that year.

• Only one of the top 25 subprime lenders in 2006 was directly subject to the housing law that's being lambasted by conservative critics.

and

Between 2004 and 2006, when subprime lending was exploding, Fannie and Freddie went from holding a high of 48 percent of the subprime loans that were sold into the secondary market to holding about 24 percent, according to data from Inside Mortgage Finance, a specialty publication. One reason is that Fannie and Freddie were subject to tougher standards than many of the unregulated players in the private sector who weakened lending standards, most of whom have gone bankrupt or are now in deep trouble.

During those same explosive three years, private investment banks — not Fannie and Freddie — dominated the mortgage loans that were packaged and sold into the secondary mortgage market. In 2005 and 2006, the private sector securitized almost two thirds of all U.S. mortgages, supplanting Fannie and Freddie, according to a number of specialty publications that track this data.

In 1999, the year many critics charge that the Clinton administration pressured Fannie and Freddie, the private sector sold into the secondary market just 18 percent of all mortgages.


Unfortunately ThatLeftTurn, I don't think that article will make a dent in the public consciousness. It seems that the cable news/financial networks have been full of talking heads pushing the notion that it was those blasted poor/black people who caused this mess. I'm guessing that over the next few years, a lot of other media folk will take their lead from those outlets and recycle the same garbage until the narrative becomes unassailable.

I know that there are tons of problems with the fairness doctrine, but is there any chance that an Obama-backed FCC could push for an accuracy doctrine? You know, something to the effect that you can't broadcast stuff for which you lack a good faith basis to believe is true.

LeftTurn: "No formal training - just a lot of self-education as an outgrowth of my interest in history, and conducted with a high level of motivation because my employer's business is exposed to the ups and downs of Residential and CRE construction spending."

The reason I asked is that I remember you mentioning Robert Axelrod, and I thought you might have some insight on an economic question that's been bugging me. I'll ask it anyway, in hopes that you or someone else here can enlighten me.

On some other recent ObWi thread that I can't locate, someone mentioned that no economist really believes that the free market can operate independently of government intervention (the issue of public goods/externalities was cited, I think). Given this supposedly widespread acceptance of market fallibility, and given the limited ability of "classical" theories to account for some of the qualities of boom-bust cycles, I was wondering whether the idea of the market as a complex adaptive system was widespread.

I hit the web to answer that question, and I wasn't able to find anything definitive. I found some foundational sorts of papers from ten years ago. I also assume that Mandelbrot's arguments about market failures tend in that direction (though I don't think Mandelbrot talks about complex adaptive systems explicitly).

Anyway - As a computer person who's trying to educate himself about economics, it seems like such a rich metaphor that I'm puzzled by the fact that I'm not coming across anyone who is using it, and I'm curious about why that might be.

Any ideas?

...hopefully our next Treasury Secretary....

Very unlikely. Krugman had a brief glimpse of the policy-making process in the 1990s and concluded it was not his scene. He wrote about this years ago; can't find a link just now, but the notion that he wanted a Washington job is just nonsense. Obama supporters got that badly wrong. Krugman preferred Clinton because he thought her healthcare ideas were better and because he reckoned Obama didn't understand just how vicious the Republicans would be. He was wrong on at least one count and maybe both, but I'm sure personal ambition had nothing to do with it.

As to why he got the prize this year: I reckon if politics had any influence, it was only in the sense that he would have got it years ago if he wasn't so outspoken. Krugman was a big name in trade theory when I was doing my masters, long before I ever heard of George W. Bush.

How about Larry Summers for Treasury Secretary? He's a jerk, but he's smart.

Turb -

I worked in broadcasting in the days of the fairness doctrine. Conscientous broadcasters really did work at it. Those that didn't generally just skipped news and public affair programming, or bought packages from AP, UPI or other sources and played them at 3am on Sundays.

The other important thing to remember: because cable does not use the "public" airwaves, it is free from most FCC, congressional or other restraints even if fairness, say, were to be re-instituted. There is nothing that can be done to make Fox News (as opposed to local over-the-air affiliates) or MSNBC (ditto) be centrist and fair.

If Rush's ratings go in the toilet, or Air America's go flying, then the market will correct the problem. Otherwise I fear we are stuck.

"You know, something to the effect that you can't broadcast stuff for which you lack a good faith basis to believe is true."

Whom would you define as being within the set of people upon whom this should be enforced, and whom it would not? By wattage? Does internet radio get a pass? Low-frequency FM? Mp3s? Public access cable?

Or are you just calling such enforcement upon those currently subject to FCC jurisdiction? In which case, it would seem to have only minimal effect, anyway.

I ask while setting aside the question of defining "accuracy" on troublesome or controversial questions.

efgoldman, thanks for reminding me about the FCC not having jurisdiction over cable; don't know how I forgot that.

Gary, please consider the suggestion withdrawn.

I was wondering whether the idea of the market as a complex adaptive system was widespread.

AFAIK this is an idea which has been kicking around for ages (i.,e. more than a decade) but nobody to my knowledge has produced a grand synthesis of it, in the way that Mandlebrot took the ideas of Poincaré and Minkowski and others and wrapped them all up in a coherent package which was easy to grasp.

You might want to ask in the comment threads over at nakedcapitalism where the idea of a systems theory approach to understanding market dynamics is currently popular – in part because that blog seems to attract a lot of scientists and engineers from fields well outside the narrow scope of finance, so there is more cross disciplinary discussion there (one of the reasons it is one of my favs) compared with other finance blogs like say ftalphaville. If you can catch Richard Kline who is a frequent participant, he may be able to give you a good answer and pointers to some primary and secondary literature on the subject.

For lack of anything better, I would start looking in the literature on behavioral economics, maybe starting with Thaler and then branching out from there to see what you can find.

"Gary, please consider the suggestion withdrawn."

It's an understandable fantasy in the "if I were dictator, and people were happy with my dictatorship" category.

But if that were the case, I'd be tempted to go to the root problem, and require people to be licensed and pass my tests before being allowed to parent children.

(Note: not a serious suggestion.)

Kevin, I assume Krugman's glimpse into the policy machinery was in the 80's when he worked on the Council Of Economic Advisors under Reagan (ah, the days when the Republicans valued professionalism as well as ideology).

Very unlikely. Krugman had a brief glimpse of the policy-making process in the 1990s and concluded it was not his scene.

Yeah I'd read that Krugman wasn't very keen on taking a policy shop job. Others have said that before and were actually playing coy, but I'll take it that he means it sincerely unless evidence to the contrary comes to light.

However I think it is one thing to contemplate the dreary prospect of a govt. job in the abstract, and rather another thing to have the President-elect on the other end of the telephone telling you "In my carefully considered opinion supported by the advice of others, I think you're the best person for the job, and in a moment of national crisis, I need you and your country needs you."

Saying no to that, and with one of the more persuasive coalition building leaders we've seen come down the pike in a while pitching the job to you, would take a rather higher level of willpower IMHO.


How about Larry Summers for Treasury Secretary? He's a jerk, but he's smart.

No thank you. His track record in understanding the unfolding of the debt crisis has been poor, IMHO.

Warren Terra,

Yes it was the Reagan administration. He wrote wrote about in 1998:

It was, in a way, strange for me to be part of the Reagan Administration. I was then and still am an unabashed defender of the welfare state, which I regard as the most decent social arrangement yet devised. I am also unable to pretend to respect "policy entrepreneurs", the intellectually dishonest self-proclaimed experts who tell politicians what they want to hear. The Reagan Administration was, of course, full of people who hated the welfare state and had very little interest in the truth. But the summer of 1982 was a moment of near-panic among the Reaganauts, as the recession and the debt crisis seemed to threaten catastrophe. They not only hired Feldstein, they gave him the freedom to bring in a politically incorrect team of whiz-kids (which included Larry Summers and Greg Mankiw) in the hope that he could turn things around. By 1983, with a recovery well under way, the political types were back in charge and Feldstein was ostracized for worrying publically about the budget deficit; but that came later.

Washington was first thrilling, then disillusioning....

After a little while, however, I began to notice how policy decisions are really made. The fact is that most senior officials have no idea what they are talking about: discussion at high-level meetings is startlingly primitive. (For example, the distinction between nominal and real interest rates tends to be regarded as a complex and useless bit of academic nitpicking). Furthermore, many powerful people prefer to take advice from those who make them feel comfortable rather than from those who will force them to think hard. That is, those who really manage to influence policy are usually the best courtiers, not the best analysts. I like to think that I am a good analyst, but I am certainly a very bad courtier. And so I was not tempted to stay on in Washington.

He was also touted as a likely chairman of the Council of Economic Advisers in 1992, but:

In fact, however, key advisers to Clinton knew me from way back, and the memories were not friendly. Immediately after the election, Robert Reich – the same policy entrepreneur I had attacked in 1983 – was named head of the economic transition team. And to my dismay, it quickly became clear not only that I would be excluded from influence, which didn't bother me too much, but that the Clinton Administration was going to systematically prefer policy entrepreneurs to real experts. In particular, it became apparent that the dominant ideology of the new administration would be what I call "pop internationalism", a foolish analogy between international trade and corporate competition. And because no first-rate economists would or could accept this doctrine, the key positions were filled by second-rate people.

I did not take this development gracefully. I said what I thought, in letters and interviews. And of course the press -- as always deferring to a new President, and impressed by his articulateness -- ridiculed my complaints, ascribing them to sour grapes over not having received an appointment myself. A few months later everyone was complaining about the quality of the new Administration's personnel, but there is no memory in these matters; I was more or less disgraced, and my public profile was and still is much lower than at its peak.

People have forgotten how critical he was of the Clinton administration. Of course he never savaged them the way he savages the Republicans, but then pop internationalism is just silly whereas the Bush Doctrine is criminally insane.

My reading of this account is that he’s really not the Washington type. But of course that was ten years ago and as TLTIABQ says, Obama can be very persuasive.

Speaking of the FCC and cable, hasn't Congress in recent years considered legislation which would give the FCC jurisdiction over cable content? I seem to recall a Brent Bozell-backed piece of something or other because he and his cohorts were appalled by cable original programming like "Nip/Tuck" and the like.

Unfortunately ThatLeftTurn, I don't think that article will make a dent in the public consciousness.

Then freaking say it louder until it sinks into the "public's" pointy heads.

Do we always have to just roll over and play dead?

Bookmark the cite. Email it to your friends. Talk about it at the water cooler.

And somebody get TLTIA a megaphone.

I know that there are tons of problems with the fairness doctrine, but is there any chance that an Obama-backed FCC could push for an accuracy doctrine?

If you're uncomfortable with the government enforcing a requirement for equal time for different opinions, you should sure as hell be uncomfortable with the government evaluating who's telling the truth and who isn't.

Although I never, ever expect to see it in force again in my lifetime, I'm a fan of the Fairness Doctrine because it puts a wider range of ideas in the marketplace, where they can battle it out on the merits.

My reaction to the state figuring out who's telling the truth, who sincerely believes what they are saying, and who is arguing in good faith is DO NOT WANT.

I support your motivation here, Turb, but I think in practice this would be nothing but trouble.

Thanks -

I was wondering whether the idea of the market as a complex adaptive system was widespread.

Just out of curiosity -- if folks *don't* think of the market as a complex adaptive system, what do they think of it as?

What could it be *other* than that?

Or is your question more about, since it basically is a complex adaptive system, whether folks use more modern techniques for analyzing and considering those systems in reasoning about the market?

Thanks -

"Although I never, ever expect to see it in force again in my lifetime, I'm a fan of the Fairness Doctrine because it puts a wider range of ideas in the marketplace, where they can battle it out on the merits."

I don't think it did; it was the opposite in its reductiveness; it divided everything into only two sides, and two sides only. That's a very bad way to model the universe.

The following is an interesting rant that I stumbled on which criticizes the entire discipline of economics. I'm sympathetic to the notion that economics is largely ideology masquerading as science, as that was my impression based on my grand total of one semester of exposure to the subject (and I was just a centrist Democrat then). Clearly I have a solid basis for holding an opinion.

I do wonder, though, if the rant is accurate. As an outsider I don't know if I'm like a creationist who suspects that all this evolutionary nonsense is ideology masquerading as science. I see people making this kind of claim from time to time. Max Sawicky's defunct blog used to have guest posts along these lines.

Rant

" As an outsider I don't know if I'm like a creationist who suspects that all this evolutionary nonsense is ideology masquerading as science. I see people making this kind of claim from time to time. Max Sawicky's defunct blog used to have guest posts along these lines."

It is characteristic of my writing style, such as it is, that this sounds like Max Sawicky's blog carried attacks on evolutionary biology. Well, no. I meant that there were radical critiques of mainstream economics posted there from time to time.

"Just out of curiosity -- if folks *don't* think of the market as a complex adaptive system, what do they think of it as?

A curious social amalgam which, like many previously observed distributive systems, favors the powerful and dismisses the future as an externality.

it divided everything into only two sides, and two sides only.

I take your point, Gary, and it's a good one, but two is still more than one.

In any case, I think it's kind of moot.

IMVHO, the idea that the broadcast spectrum represents a public asset, that folks who are licensed to broadcast on it are stewards of that asset, and that they therefore are under a positive obligation to present ideas that touch on public life in a fair and judicious manner is, these days, laughably quaint.

The Fairness Doctrine may not have been all that effective in reaching its goal, but at least the goal itself was useful and worthwhile. I'd be hard pressed to say anything has improved in its absence.

Thanks -

My reaction to the state figuring out who's telling the truth, who sincerely believes what they are saying, and who is arguing in good faith is DO NOT WANT.

So, does that mean you don't accept courts? Or do you wish to abolish all Internal Affairs departments in law enforcement agencies? Do you want to eliminate Inspector General offices in federal agencies? Will the Government Accounting Office be spared your wrath?

In all seriousness, figuring out what is true can be enormously difficult for a government agency to do, especially if it must do so in a consistent, independent, and politically unbiased manner. It may well be impossible. But government entities make complex determinations in other contexts every single day.

I support your motivation here, Turb, but I think in practice this would be nothing but trouble.

I think you're correct. The basic idea as I described it is nuts. I've thought up a simpler version with a narrower scope; it still probably has too many bugs in it to be workable.

The basic idea is to offer tax breaks to entities that informed the public on complex issues (i.e., those which require specialized knowledge) and were willing to substantiate their education efforts with written justifications for the validity of their claims. Companies that don't participate get no tax break. The size of the break is related to how many people you reach, and how much time you spend informing them.

Justifications might include citations of agency reports, or written endorsement by credentialed experts (just like you see in court rooms). These justifications would have to be posted publicly at the time of broadcast. The government would allow suits for truthfulness against those entities taking the tax breaks that could become class actions.

Think Fox was lying when it claimed that Climate Change was a liberal fantasy and justified it by citing some kook professor? Sue 'em and let the courts sort it out. Don't trust the courts to make these determinations? Then we have far bigger problems than what goes on TV, don't we? Worried about religious whackjobs running a legal denial of service attacks against PBS and anyone else who claims the Earth is older than 10K years? Let them sue and let the courts do their usual case consolidation thing; let them apply the standard penalties for nuisance suits and abuse of process. The nice thing about this is that defendants can rely on previous cases so you don't have to prove that climate change is accepted by many scientists every single time you air a segment that makes that claim.

"So, does that mean you don't accept courts?"

Courts, in many cases, use juries, not judges. But we also use both knowing they're imperfect, because we don't have a better alternative. In the case of free speech, we have other alternatives, which many think better.

"Do you want to eliminate Inspector General offices in federal agencies?"

They mostly investigate wrongdoing and corruption, rather than attempt to determine abstract points of truth between non-guilty parties. The analogy is strained.

"Will the Government Accounting Office be spared your wrath?"

See previous.

"But government entities make complex determinations in other contexts every single day."

But should they do it where they don't absolutely have to? I don't think one has to be a crazily extreme libertarian to find that questionable.

And it's not as if the Governmental Truth Board would convince those determined to believe otherwise on any given issue, anyway. Would not plenty of folks simply dismiss results counter to their ideology as a product of the government being captured by The Bad People? (Or, to put it another way, there are few cures for stupidity.)

But that's not determinative, since certainly some people would find the findings significant. I'm just, speaking for myself, hardly convinced this is really a solution all that much better than the problem it would ostensibly solve.

I'm good with the cliche of the cure for bad speech is more good speech. It's not a cure-all, either, but it might have fewer unintended consequences. And at least they wouldn't be the fault of the government, which result would seem to incur additional marginal costs in increased resentment of the government, and yet further decrease in the credibility of government.

The basic idea is to offer tax breaks to entities that informed the public on complex issues (i.e., those which require specialized knowledge) and were willing to substantiate their education efforts with written justifications for the validity of their claims.

Personally, I'd settle for putting the Congressional Research Service publications online with a Google search appliance on the front end. The CRS already does the homework and writes up their findings, you could host the site up for public consumption for less than the average Congressional office probably spends on beer Friday.

You can get a lot of them through the FAS, but you have to actually know they're there in the first place.

IMO, they're pretty damned good as informed, well written briefings on a pretty wide range of topics.

A lot of other existing government agencies also host information clearinghouse type sites for their areas of specialty. Department of energy, CBO, and the census are examples that I've used pretty often.

Sue 'em and let the courts sort it out.

Not to beat a tired old horse into the ground, but seriously, the provisions under Fairness were much, much, much simpler and less expensive.

But, it's a brave new world, so sue away.

Thanks -

Personally, I'd settle for putting the Congressional Research Service publications online with a Google search appliance on the front end.

There's plenty of correct information available; that's not the problem. The problem is that people can go on TV, spout utter nonsense (like tax cuts always pay for themselves and then some!), stupidify the public and get away with it. Making some CRS reports available won't change that dynamic at all (even though it seems like a good idea in general).

Not to beat a tired old horse into the ground, but seriously, the provisions under Fairness were much, much, much simpler and less expensive.

True. And they ensured that the fairness doctrine lacked sufficient legitimacy to remain politically viable. The fairness doctrine failed in that regard. Simple, cheap, elegant solutions that lack legitimacy rarely persist.

As for expense, well, an informed electorate is a public good, right? The marketplace of ideas will not produce an informed electorate. It will produce an electorate that knows all sorts of things that aren't so, one whose heads are filled with pleasant sounding lies. I think that to the extent that large media organizations make the electorate dumber, they impose a negative externality on society at large: they make extra cash by feeding people lies but everyone is worse off. We often expect government to compensate for externalities and it seems like government could do the same here. Yes, taking a hit on taxes costs government money, but an ignorant electorate is awfully expensive, yes?

Courts, in many cases, use juries, not judges.

So? I never said anything about reliance on judges alone. I don't see what point you're trying to make.

In the case of free speech, we have other alternatives, which many think better.

Who exactly are these many? When did they vote and why do you speak for them? I have a better idea. If you want to say 'I think they're better' just say that instead of inventing a faceless multitude you claim to speak for.

In addition, we use courts to deal with questions of free speech all the time, yes?


"Will the Government Accounting Office be spared your wrath?"

See previous.

I don't think the previous comment applies at all. The GAO does not "mostly investigate wrongdoing and corruption"; in fact, it often "attempts to determine abstract points of truth between non-guilty parties".

"But government entities make complex determinations in other contexts every single day."

But should they do it where they don't absolutely have to? I don't think one has to be a crazily extreme libertarian to find that questionable.

What does "absolutely have to" mean? Does the government absolutely have to run family courts? Is the EPA absolutely necessary? Does the government absolutely have to run the GAO? Surely we could survive without either of these things. The standard for government action has never been "is this absolutely necessary". As I mentioned to russell, I think a better standard involves looking at externalities and stepping in in cases where their cost to society is large.

And it's not as if the Governmental Truth Board would convince those determined to believe otherwise on any given issue, anyway. Would not plenty of folks simply dismiss results counter to their ideology as a product of the government being captured by The Bad People? (Or, to put it another way, there are few cures for stupidity.)

I agree that many people would not be convinced. The goal is not to convince everyone; that would be madness. Rather, the goal is to align the interests of large media organizations with society's interest in having an electorate that has been consistently lied to.

I'm good with the cliche of the cure for bad speech is more good speech. It's not a cure-all, either, but it might have fewer unintended consequences. And at least they wouldn't be the fault of the government, which result would seem to incur additional marginal costs in increased resentment of the government, and yet further decrease in the credibility of government.

I'm not sure government credibility can get much lower. Second of all, the courts are generally respected. Third of all, I expect that public interest in this sort of thing would be relatively low: we're talking about a tax break that corporations get. In much the same way that people don't really care about a million and one little industry specific tax breaks, I doubt they'd care about this one. I mean, you probably have strong feelings regarding mohair subsidies, but I don't think most people do.

As for more speech being the answer, I'm unconvinced. We don't accept that more speech is the answer when it comes to defamation. We don't accept that more speech is the answer when it comes to claims about medical efficacy or nutritional information or privacy violation.

I have no principled objection to threadjacking, but this is at least the second ObWi thread in the last few days to mysteriously become consumed with lengthy comments about the Fairness Doctrine. It seems to me if people so badly want to hash this stuff out that it is a recurring threadjacker, it really deserves an official thread if its own.

Just out of curiosity -- if folks *don't* think of the market as a complex adaptive system, what do they think of it as?

What could it be *other* than that?

In a general sense, nothing. But in a high-falutin' complexity theory sense, being a complex adaptive system entails a bunch of behaviors that people seem not to believe are intrinsic qualities of a functioning free market. High sporadic volatility, the tendency to crash, marked inefficiency, irrationality, non-linearity. Also, complex adaptive systems are very difficult to predict, to the point where "determinism" becomes a mushy and possibly meaningless idea. I'm sure many people would very much prefer to believe that the right theory would make markets predictable.

To me, though, the biggest consequence of thinking about markets as complex adaptive systems is that it makes you think about where the system properly ends and where the "external" begins. Governments and markets, for example, evolved together. Is it possible to have one without the other? When a government intervenes in a market, is it more like a physician intervening to "fix" an organism (with surgery or medication), or is it more like the limbic system signaling other parts of the organism to fix itself?

Questions like that are important, in my opinion, because their answers can shape what people understand to be the proper roles of markets and governments. If a government is the pre-frontal cortex of a market, would we consider intervention wrong, or would we simply see it as part of the natural operation of the entire system? Etc., etc.


BTW - Thanks for the leads, LeftTurn :). I'm already finding stuff on nakedcapitalism that I didn't know was out there.

david kilmer --

Thanks for the thoughtful reply, I appreciate it.

I have no principled objection to threadjacking, but this is at least the second ObWi thread in the last few days to mysteriously become consumed with lengthy comments about the Fairness Doctrine.

I think that's been done a couple of times. It's the beast that will not die.

Thanks -

russell,

Open CRS sounds like just the thing for you.

Holy cow, it's an early birthday present!

Q: How do you know that you're a total nerd.
A: When unfettered access to CRS white papers makes your day.

Many thanks Andrew, I appreciate it!

Thanks -

You are quite welcome.
When I was in graduate school and had more time to debate issues on blogs, I used Open CRS and EarthTrends all of the time. I am a nerd of the same stripe.

Cheers

Justifications might include citations of agency reports, or written endorsement by credentialed experts (just like you see in court rooms). These justifications would have to be posted publicly at the time of broadcast. The government would allow suits for truthfulness against those entities taking the tax breaks that could become class actions.

The immediate problem with this is, of course, that you'd get into the post-modern Republican chicanery with the very notion of "expert". You thought AEI was bad? Just wait until you see what this would engender...

"I am a nerd of the same stripe."

Obviously that's a communist red stripe!

The immediate problem with this is, of course, that you'd get into the post-modern Republican chicanery with the very notion of "expert". You thought AEI was bad? Just wait until you see what this would engender...

Yeah, I suppose in the worst case scenario we might end up with a media that makes its audience dumber, actively confuses, and leans right as an institution. That would be a disaster. It would also be what we have right now.

Note that my proposal allows lawsuits, leaving relatively little discretion to adminstiration figures. If Fox News wants to insist that there is no scientific consensus on climate change and is willing to cite some AEI hack, environmental groups should have no difficulty proving that in court.

Obviously that's a communist red stripe!

Da, Comrade Farber.

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