Archive for the Category Misc.

 
 

Nevermind

In a recent post I discussed the astounding 31 point gender gap between men and women on the marijuana legalization question.  Chris Ingraham left this comment:

I’d note that in the exit polls of the most recent ballot measures on marijuana in FL, OR, and AK, the gender gap on support for those measures was much, much smaller – in the neighborhood of 5 points or so. I’d be hesitant to draw too many conclusions from a survey conducted two years ago.

Florida looked at a slightly different question (medical marijuana) and both DC and Alaska are unusual “states.”  So I dug up the Oregon exit polls, which show that Chris is right.  Men favored legalization 58 to 42 while women favored legalization by 52 to 48, a gap of 6 or 12 points, depending on how it’s measured.

So unfortunately my previous post on this topic seems to have been based on false information. There probably is a gap, but it’s not that large.  It’s certainly wrong to generalize by saying “women oppose legalization.”  They split pretty evenly, especially if you assume the national figures would be a couple points lower for legalization, as compared to liberal Oregon.

Update:  Commenter Steve breaks it down by married and unmarried.  The gender gap in Alaska is all in the unmarried, and is slightly larger for the unmarried in Oregon.

Breakout

The new jobs numbers provide one more bit of evidence in support of the claims I’ve been making in this blog:

1.  Job growth in the first 10 months of 2014 was almost 2.3 million, roughly the amount for the entire 12 months of 2012 or 2013. Thus the total for 2014 will end up being about 400,000 more than the average of the previous two years.  That may reflect the expiration of extended unemployment benefits.  Ditto for the still sluggish nominal hourly wage growth (stuck at 2.0%.) The household survey (less reliable) shows nearly 2.6 million jobs so far this year.

2.  I’ve often referred to the fact that since the beginning of 2013 the unemployment rate has been falling at 0.1% per month, and will continue to do so. It did so again in October, down from 5.9% to 5.8%. That means we are only 4 months from the Fed’s definition of “full employment.”

3.  Some have pointed to the low employment/population ratio as evidence that we are not recovering.  After being stuck in the trading range of 58.2% to 58.8% from October 2009 (when unemployment was 10.0% (exactly 5 years ago)) to February 2014, we finally have a decisive breakout on the upside:

Screen Shot 2014-11-07 at 9.31.11 AM

We also have a breakout for average weekly hours, which were stuck in the 34.3 to 34.5 range for years:

Screen Shot 2014-11-07 at 9.30.11 AM

New claims for unemployment as a share of the workforce keep hitting all-time lows.  Never in all of history did workers have less need to fear layoffs.

No Fed chairman ever had an easier job that Janet Yellen has right now.  Normally you want to tighten before nominal wage growth accelerates.  But in this case the Fed can wait for nominal hourly wage growth to accelerate from 2.0% to 2.5% before tightening, as the 2.0% figure is too low to hit their inflation target.  So the Fed merely needs to wait until wage growth accelerates.  No need to read the tea leaves.

(BTW, when I say “tighten,” I mean raise the fed funds target–policy is already tight.)

The last two years disproves several theories:

1.  In January 2013 unemployment was still 7.9%, and many conservatives were pessimistic about the prospect for monetary stimulus to lower unemployment. They claimed we had “structural problems.”  Now unemployment is 5.8% and still falling fast.  We had a demand shortfall—in early 2013 wages hadn’t fully adjusted to the huge plunge in NGDP growth in 2008-09, and slow recovery.

2.  Liberals claimed “austerity” in 2013 would slow the recovery.  Exactly the opposite happened.

3.  Liberals also claimed that ending extended unemployment benefits would not reduce unemployment (which was itself odd, because prior to 2008 liberals did believe that ending extended unemployment benefits would create jobs.)  In fact the 2008 liberals were right, job growth accelerated in 2014 without any acceleration in wages.  The acceleration was a “supply of labor-side” story.  So while the overall recovery since late 2012 is a demand-side story, the acceleration in job growth after the first of the year was a modest supply-side addition to the recovery.

Despite all this good news, we could have done much better with a more expansionary Fed over the past 6 years.  There are some “structural problems” in America, but they never had much to do with the near 10% unemployment rate of 2009-10.

PS.  Tim Duy has an excellent post demolishing the conservative argument that the Fed is creating growth with “inflation.”

PPS.  Here’s the steady fall in unemployment since January 2013.  In contrast, from January 2012 to January 2013 unemployment had only fallen from 8.2% to 7.9%, which is why so many people were pessimistic “structuralists” at the time.

Screen Shot 2014-11-07 at 9.51.20 AM

PPPS.  The employment-population ratio for the all important 25-54 age group also rose, and has regained 2 points of the slightly over 5 points lost during the Great Recession. There’s still some slack out there.

HT: Garrett McDonald

 

 

 

 

 

The mother of all gender gaps

Commenter Floccina sent me the following interesting finding, from Michele Martinez Campbell:

A fascinating new national poll from Quinnipiac University shows that men and women disagree markedly on the question of marijuana legalization.  While men surveyed strongly favor legalization by a margin of 59 to 36 percent, women oppose it by a clear majority of 52-44 percent.  This 15-point gender gap in support for marijuana legalization –let’s call it the “pot gender gap” — is not quite as large as the 20-point gender gap in support for President Obama in the 2012 presidential election, but it is striking.  What’s most interesting, though, is how it confounds the expectations set by the voting gender gap.  In voting, women trend more liberal and Democratic, while men trend more conservative and Republican.  Yet with the pot gender gap, we see women taking the more conservative, law-and-order approach.

I was a bit puzzled by this claim, as those numbers seem to indicate a 31 point gender gap, the way I usually calculate the gap.  There is an alternative method that would yield a 15 point gap.  However when you follow the link to the supposedly larger 2012 election gender gap, you get the following, from Jeffrey Jones:

PRINCETON, NJ — President Barack Obama won the two-party vote among female voters in the 2012 election by 12 points, 56% to 44%, over Republican challenger Mitt Romney. Meanwhile, Romney won among men by an eight-point margin, 54% to 46%. That total 20-point gender gap is the largest Gallup has measured in a presidential election since it began compiling the vote by major subgroups in 1952.

That uses the approach I am more familiar with. But by that approach, the drug gap is actually 31%, which makes the drug legalization gender gap far larger than the biggest presidential election gender gap ever recorded.  A 31 point gap is mind-boggling by itself, but it’s even more astounding when you consider it reverses the normal liberal/conservative split between men and women.  This fact would tell us a lot about politics, if we bothered to pay attention.  Instead all you see in the media is endless generalizations about the left and the right, as if the views of African-Americans on social issues, for instance, could be understood simply by noting the fact that they tend to vote Democratic.  People are really complicated.

NarcoLaw’s best guess (an informed guess, but a guess nevertheless) is that female opposition stems from questions about the impact legalization will have on public health, crime and the social fabric.

I think the health/social fabric worries are wrong—but defensible.  But the crime argument isn’t even defensible.  Of course that’s just one person’s “best guess,” it would be interesting to get better data.  Why isn’t this issue being intensively studied?  What are the gender gaps on government invasion of privacy (TSA/NRA/CIA, etc?)  What is the gender gap on immigration?  I have no idea what the gap is on many of the most important issues facing our country, and no reason to think it correlates in any particular way with how each gender votes. (Democratic pols are supposedly more likely to support legalization.–but is even that true?  Is there any data?)

BTW,  I have many commenters in both the liberal and conservative camps.  But they almost all seem to favor drug legalization.  And I’d guess over 90% are male.  There are entire realms of our political reality that are almost invisible in the blogosphere.

PS.  There are also some big gender gaps in academics, which are just as perplexing as in drug legalization.  For instance, women get higher grades in college, despite getting lower average scores on SATs.  This might reflect some sort of difference in cognitive styles.  Let me throw out a hypothesis (and feel free to scold me for sexism if appropriate.)  Is it possible that men approach the issue from more of a “legalistic” perspective.  I.e. “legalizing drugs doesn’t mean one endorses their use.”  And women might approach the issue from a more “contextual” framework; “while legalization doesn’t necessarily endorse their use, it implicitly connotes the fact that society regards drug use as ‘OK’.”   It seems to me that women are at least slightly more likely to say things like “so what you are really saying is . . .”   Another thought is that men might be more individualistic; “no one can tell me what I can or cannot do,” whereas women might be more used to thinking in a social context; “how does this impact the family?”  These might all be stereotypes on my part, but the gender gap is certainly very real; 31 points is way outside the margin of error for a public opinion poll.  Marijuana is illegal in America mostly because women want it illegal.  Just to be clear, I am not trying to pick on women here.  My views on other issues like use of military force and reproductive rights are more “feminine” than masculine.

PPS.  A gap that big cannot be accounted for by the fact that somewhat more men than women use illegal drugs.  Or by the fact that women care more about children.  Do dads want their sons to get addicted?  And do moms really want their sons to go to prison?

PPPS.  Off topic, I love this Sunstein post on Hayek.

Go ahead Barack, choom one for old times’ sake

There wasn’t much good news last night, although I guess we can applaud the public employee unions in Wisconsin getting spanked for the third consecutive time.  And I’d love to see the look on the faces of all those anti-supply-side economics reporters as Brownback won by 4 points after “wrecking” the Kansas economy.  But there was one clear bright spot–pot was legalized in Oregon, Alaska and DC, all three of the locations where the referendum was on the ballot.  (The failure of medical marijuana in Florida indicates that full success will require the dying off of a few more old people.  ”One funeral at a time . . . “)

After last night Barack could probably use a joint.  Now that it’s legal in DC, I see no reason for him to abstain.  (Actually DC only partially legalized pot, selling it is still illegal.)

As is often the case, the public is way ahead of the politicians on pot legalization.

(And don’t spoil the fun by telling me the law has yet to be implemented.)

Update:  I missed the big story; California voters downgraded all types of drug possession from a felony to a misdemeanor, which will free thousands of innocent people who are currently imprisoned in America.  Great news!  (The effort received funding from both liberal and conservative business tycoons.)

PS.  My own state legalized casino gambling last night.  Over the last few decades Massachusetts voters have repealed rent control statewide, rejected progressive income taxes, decriminalized marijuana and legalized casino gambling.  Also the first state with gay marriage.  Not yet a libertarian paradise, but moving in the right direction.  Now if only Kansas would catch up to Massachusetts, and reject progressive income taxes.

PPS.  FWIW I favored a GOP Senate and Democratic House for immigration reform reasons. Obviously I didn’t get my wish.

PPPS.  Conservative Alaska legalized pot in an off year dominated by GOP voters.  But lawmakers in very liberal Hawaii have rejected even the milder decriminalization.  Otherwise pot is effectively legal for users on the entire West Coast, as anyone can get a medical marijuana license in California.

Kevin Erdmann on capital income, rental income and labor compensation

Kevin Erdmann has three very interesting posts.  Three posts back he showed that the rise in the income of capital that has recently been discussed by people like Paul Krugman and Brad DeLong is not quite what you might expect:

We start with Profit (the blue line at the bottom).  I have extended the time frame further back.  The green line represents all returns to corporate capital, both to debt and equity.  The debt portion peaked in the early 1980′s when corporate leverage was at its highest.  When we make this correction, we find that corporate returns to capital have been flat for 40 or 50 years.  If we add in proprietors’ income, we find that returns to capital have been flat or declining for a century.  From 1929 to about 1985, there was a trend of profit claims moving from proprietors to creditors.  From 1985 to the present, there was a trend of profit claims moving from creditors to equity owners.  But, there is no trend of increasing total returns to capital over the past 30 years.

And, when we take the longer view, there really isn’t so much of a trend in private fixed investment either, especially considering that investment continues to recover from the recent recession.  Investment is well above the levels of the 1950s.  Investment as a share of GDP ranged from 10-12% until the 1970s.  Since then, the range has moved up to 11-14% and is currently 12.3%.

There is nothing to see here.

So we have more corporate profits (return on equity) and less interest income from corporate debt, with no significant change in the total return to corporate capital. So why is labor’s share of income falling?  From two posts back:

First, this is a little tricky, because 60% of American households own their homes.  So, in effect, this is a measure of rent we are paying ourselves.  Or, put differently, this is a measure of the income share we capture because home ownership tends to provide excess returns.

The trend in Compensation has dropped from about 57% in 1970 to about 53% – a 4% drop.  But, the trend in Rent + Compensation has dropped from about 59% to 57%.  Rental income explains about half the drop in Compensation Share, and in fact, accounts for more than all of the drop in Compensation Share since the previous low point in 2006.

To the extent that Rental Income supplements Compensation, this income is probably distributed mostly to middle and upper-middle class households.  So, both the level and the distribution of household Compensation Share are probably helped by reducing excess returns to Rental Income.

So a big part of it is the rise in the share of national income going to rents.  But that’s not all—from his most recent post:

This means that since 2008, Compensation income is being displaced by net Rental income.  For households that rent their residences, this means that real income has been reduced by rent inflation.  For households that own their residences, this means that real income has been reduced by rent inflation, but has been replaced by Rental Income.  So, policies that are keeping home prices down are benefitting households that own their homes at the expense of households that don’t.  All households look like they have lower real incomes.  However, real income of home owning households is understated because the high inflation of their imputed rent is being deducted from their compensation income and is being re-constituted as capital income.

The third graph shows relative nominal changes in Compensation and Rental Income since the 4th Quarter of 2008.  Nominal Compensation has increased $1.2 trillion since the end of 2008.  Rental Income has increased by $350 billion.  For home owning households, their experienced real incomes have increased by $350 billion more than what their statistical compensation levels are showing, because this rent inflation generally is not affecting their cash flow.

Non-homeowning households have experienced rent inflation as measured, and the gains from that rent are generally accounted for as reductions in their real incomes, relative to nominal incomes, and as profits to firms in the real estate industry.

The housing shortage is reducing the Compensation share of national income through both mechanisms – home owners and renters.  One path goes to Rental Income and doesn’t really affect real household incomes and the other goes to profit and does really affect real household incomes.  Both represent a shift in total income to generally higher income households.

The irony is that so many people seem to agree that rising home prices, by making homes less affordable, are hurting lower income households.  If we don’t put the clamps down on the banks, they will just drive us right over another speculative cliff, so the story goes.  Sadly, the tight regulatory and monetary regime that comes out of this flawed reasoning is the thing that is actually hurting low income households.

These three posts are packed with fascinating information.  I’d read them in reverse order, from the older to the more recent.