Matt Bruenig trashes his fellow progressives

Sometimes it’s best to just cut your losses after making a silly mistake.  Matt Bruenig has decided to double down on some deeply flawed arguments, which I criticized in an earlier post.  He begins by showing that he knows nothing about my blog, and ends by demonstrating that he knows nothing about my views on libertarianism. But let’s focus on the middle part:

The primary thrust of Sumner’s post is to say that, because I do not have a libertarian-wired brain (read: smart brain), it doesn’t occur to me that poverty-reducing transfer programs can have dynamic effects that also affect the market poverty rate. Although Sumner’s psychoanalysis is creative, it sadly misses the mark. Here I am in 2013, with my progressive-wired brain, somehow getting my head around the idea of dynamic effects that heretofore only libertarians have understood:

So I tried to give him the benefit of the doubt, by assuming that he merely overlooked dynamic effects problem, just as one of my professors at Wisconsin did when I pointed out the mistake back in 1974.  But Bruenig now says he knew about the problem, and still made the deeply silly claim that income minus transfers is a good proxy for what market incomes would look like in an economy without welfare.  (BTW, he later quotes me suggesting that a libertarian brain did not mean smart brain, so his aside here is puzzling, unless you assume he doesn’t care about accuracy.)

So if welfare didn’t exist the millions of poor people who live off of welfare would do what?  One possibility is that the poor would do what they actually did before the welfare state was created, they’d work much harder than the rich.  Don’t the progressives always tell us that in the bad old days the rich aristocrats did little work, and the poor worked extremely long hours, because they had to do so to survive?  In Bruenig’s view the people who currently have no income, and live off of welfare, would continue to have no income if welfare was cut off.  And how exactly would they survive?  And why would they behave differently from the way the American poor actually did behave before the welfare state?  No answer is provided.  And don’t progressives always tell us that in the bad old days workers had no Social Security, and usually worked until they dropped dead?  Is that argument also no longer valid?

Using market poverty (sometimes called pre-tax, pre-transfer poverty) as a comparator for disposable income poverty (sometimes called post-tax, post-transfer poverty) is extremely common in comparative welfare state literature, which I am sure Sumner has no familiarity with. It’s not used because the economists and economic sociologists who operate in that field have never realized that dynamic effects are possible. It’s used because it’s the best measure available to capture the effect of transfers on poverty and cross-country comparisons do not reveal high-transfer countries to have higher market income poverty rates than low-transfer countries (even though their disposable income poverty rates differ dramatically).

So now he tries to smear the reputation of other progressive economists, by claiming that they are also in denial about the importance of dynamic effects.  As far as poverty rates among high transfer countries, does anyone seriously believe the Nordic countries are a good comparison for the US, or even for Portugal?  Algan and Cahuc have showed that the welfare state is endogenous, and that it is more generous in places where dynamic effects are weaker.  So Bruenig’s cross sectional argument proves nothing.  Time series effects and common sense are enough to show how absurd it is to assume that the welfare does not significantly affect reported market income.  (Another problem with Bruenig’s claim is that people on welfare may have unreported income.)

The War on Poverty, as you probably know, was a massive smashing success. From 1967 to 2012, the disposable income poverty rate fell from 26% to 16%, a decline of 38.5%. During that same period, the market income poverty rate increased from 27% to 29%. Over the course of those years, transfer programs reduced poverty by a total of 1.2 billion people-years.

You’ve got to love the precision of the 1.2 billion people-years, and the optimism of his post title “Cutting Poverty is Super Easy.”

But nonetheless doubts creep in.  After all, 45 years is a long time.  What happened to the well-being of the poor in the 45 years before the highly successful “War on Poverty?”  Obviously the data Bruenig cites don’t have much persuasive power unless the poor made much less progress before the War on Poverty.  After all, if the War on Poverty were a “smashing success,” then you’d expect the lives of the poor to improve more rapidly than the general improvement you see in any growing economy.  But here’s my problem.  For years the progressives have been bombarding me with exactly the opposite argument, that poverty fell very rapidly from 1922 to 1967, but that the gains of lower income people slowed sharply after the 1960s.  So which is it?  How do we know that poverty didn’t fall just as rapidly before the war on poverty, say from 36% to 26%?  No data is given for the previous 45 years.  As far as “market income poverty” rising after 1967, that’s exactly what the conservatives would have predicted in 1967, and it’s exactly the effect the left would have denied in 1967.  The left would have predicted that civil rights gains and improvement in access to education in the 1960s would increase the market incomes of the poor. But now evidence of bad “dynamic effects” is twisted into evidence of the success of the War on Poverty!  The view seems to be “Look at the huge increase of in the number of the poor who don’t work at all—and imagine how much worse off they’d be without all that welfare!!”  And we are supposed to take this argument seriously? You have to give progressives some points for creativity.  They can turn data that looks like a sow’s ear into a silk purse.

At the end he tries to bait me into a debate over philosophy with some outlandish comments that he thinks will be provocative:

Second, libertarian brains desperately crave the feeling that they are super-logical and super-rational and that other brains don’t get it. Which is funny because libertarian political philosophy is the most logically incoherent political philosophy, perhaps ever. Lastly, libertarian brains generally (Nozick excepted) fail to realize that property is theft, which it is.

It’s fun to be “misunderestimated” by a deep philosopher like Bruenig. Especially by someone who thinks words “really mean” something, rather than that the meaning is merely socially constructed.  So I’ll take the bait.  I agree that property is theft.  Or at least I’m willing to grant permission to Bruenig to define words however he wishes.  So what next? Property is theft, where to we go from there?  That’s easy, we start thinking about what sort of theft to allow, and what sort to make illegal.  Let’s ban theft that reduces aggregate utility, and legalize theft that raises aggregate utility.  After all, words are just words, what matters is meaning.  So here’s my suggestion:

1.  We ban bad theft like burglary, slavery, and intellectual property rights for business practices.

2.  We legalize good theft like the privatization of Chinese and Cambodian communes, which prevented millions from starving to death.  Or stealing from the super rich with a progressive consumption tax and giving the money to low wage workers.

I wonder how Bruenig feels about theft?  Does he oppose all theft, or does he agree with utilitarian libertarians like me?

PS. I forgot to mention that he completely mischaracterizes my views on wealth inequality.  For instance here:

One of the more glaring versions of this creep [into non-monetary areas of blogging] is his armchair commenting on wealth inequality. Again and again, he has called wealth inequality data “nonsense on stilts” because it ignores the fact that wealth inequality is just a life-cycle phenomenon. This is straightforwardly false, but to know it’s false, you have to actually be familiar with the wealth data and ambitious enough to run some age-controlled wealth inequality calculations. Sumner is neither of those things.

Bruenig mischaracterizes my views in the post he links to in multiple ways.  I discuss the life cycle problem in the context of income, not wealth, and clearly explain that it’s not the only factor involved in inequality, which everyone agrees is true.  So what precisely is he objecting to?


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61 Responses to “Matt Bruenig trashes his fellow progressives”

  1. Gravatar of Danny Kahn Danny Kahn
    30. September 2014 at 11:22

    ” It’s not used because the economists and economic sociologists who operate in that field have never realized that dynamic effects are possible.”

    If this is the sentence that prompted the title of the post then I think you’ve misinterpreted it. He is saying that these economists have realized that dynamic effects are possible. Maybe you were referring to something else, i.e. the reason he does give for using market poverty as a comparison.

  2. Gravatar of ssumner ssumner
    30. September 2014 at 12:03

    Thanks Danny, there was a typo there. I just added “the importance of” to the key sentence after the quote.

  3. Gravatar of TallDave TallDave
    30. September 2014 at 12:32

    The WOP is a smashing success alright: smashed incentives, smashed work ethic, smashed families.

    But he’s right that eliminating true poverty is super-easy, in fact it’s so easy we did it a long, long time ago.

    the deeply silly claim that income minus transfers is a good proxy for what market incomes would look like in an economy without welfare

    Forget it, Scott, it’s Progressivetown.

  4. Gravatar of phillip phillip
    30. September 2014 at 12:50

    Your last quote creates the impression Bruenig called you a creep, which is not true.

  5. Gravatar of MattP MattP
    30. September 2014 at 12:59

    Scott, I am often surprised by the amount of flack you receive from some liberal/progressive commentators. My views on economic issues are definitely left-of-center, but you have always struck me as being fairly open-minded.

    We’d likely be much better off if the Republican Party relied on economists like you for advice. I mean Congress may actually be able to compromise on substantive reforms. That would be too easy though. Silly me.

  6. Gravatar of Alexei Sadeski Alexei Sadeski
    30. September 2014 at 13:09

    The goal is political control. The means are irrelevant.

    Perhaps I am too pessimistic.

  7. Gravatar of Morgan Warstler Morgan Warstler
    30. September 2014 at 13:57

    Scott,

    Let’s just say Poverty is now less than 5%. Assertion is the harder debate tactic.

    Show the Brookings chart, and require Bruenig to explain why consumption is the NOT correct measure of poverty. You see how he does #’s and logic, he’ll never get close to criticizing Brookings work.

    Don’t let him get away with “we can’t measure it well enough” – respond with “we surely can” and “here’s how to do more”

    But he’ll NEVER say ‘consumption is a bad measure of poverty” – and everyone will know if he doesn’t say it, he’s sidestepping the assertion.

    At that point, poverty is just 5%, it’s GICYB and see ya later.

    —-

    Kick some money into the kitty, we’re at $250 for Matt to debate me for 90 minutes.

    It’ll be a bloodbath.

    Matt won’t take any amount, it’ll ruin his proggie rep.

  8. Gravatar of Alexei Sadeski Alexei Sadeski
    30. September 2014 at 14:00

    Morgan,

    Did Mao debate Chiang Kai-shek?

  9. Gravatar of Morgan Warstler Morgan Warstler
    30. September 2014 at 14:14

    Alexi

    Neither of those guys were selling Che T-shirts. As such, I’d be very nervous about winning (living).

  10. Gravatar of Brian Donohue Brian Donohue
    30. September 2014 at 14:36

    Scott,

    Excellent blogging sir. I’m not sure you should self-identify as a libertarian- you seem eclectic and non-ideological to me. Kind of a rationalist. Anyway…just words, right?

    And now that you’re on the map of ‘rationalists’, I suspect you may draw a new audience. The online ‘rationalist’ community is pretty sure of itself on economic matters, poor dears.

    Your work on this Earth is still at an early stage.

  11. Gravatar of ssumner ssumner
    30. September 2014 at 14:50

    Phillip, Thanks for pointing that out, I added a clarification.

    Thanks Matt and Brian.

    Morgan, You’d have an easy time debating him.

  12. Gravatar of Morgan Warstler Morgan Warstler
    30. September 2014 at 15:27

    Scott, it isn’t about beating him. He’s what we used to call fodder on the debate circuit.

    It’s about taking his schtick out of commission for good. Only cross exam on video will get it done. Then it can be embedded via bot directly into the tweet stream of any unique who ever comments to him on Twitter.

    Personally I’m looking forward to a world of oppo & negative attack ads for political bloggers rather than candidates. :)

  13. Gravatar of Philippe Philippe
    30. September 2014 at 15:45

    morgan, the point you made above about ‘consumption poverty’ is the first rational point I’ve seen you make in opposition to Matt Bruenig. If you were to debate him and you started coming out with might-makes-right stuff about ‘hegemons’ you would lose by default, simply for failing to make a meaningful argument which contained a logical train of thought.

  14. Gravatar of Grandpa Sumner At It Again | MattBruenig | Politics Grandpa Sumner At It Again | MattBruenig | Politics
    30. September 2014 at 16:14

    […] statistical analysis was off. It wasn’t and still isn’t. After posting my response, Sumner has another really bizarre post about the topic, which I will address […]

  15. Gravatar of Morgan Warstler Morgan Warstler
    30. September 2014 at 16:21

    Phil, you simply don’t know how good I am :)

    There’s no one who argues against hegemony IRL, it’s an uncomfortable fact, stated publicly, anyone who hears you say it, shrugs and accepts it. It sits between Death and Taxes on the facts of life scale.

    Education system is unfair!

    Yep. Because THE PRIZE is giving you kids unfair advantages. The opponent is either a person who GIVES THEIR KID advantages (lose) or someone who WISHES they could (lose).

    All wind gone from sails.

    Now Phil, I’m telling you this BECAUSE if you don’t accept it as true, you will not be able to make policy to improve lives. You simply become the peanut gallery.

    Imagine yourself an anthropologist with lots of emotions… who is living amongst the apes Phil, do you go over and tell the apes how to not be apes?

    No.

    If you truly care, you abandon your anthropology hat and try to drag a few of the weak ones to safety, try to scare off a couple of the bigger ones.

    This is what making policy is like… you have to think things like “I’ll plant some more banana trees, and show them how to use a new tool”

    You have to ever so gently shift things without getting your arms torn off.

    There’s always better policy than the status quo Phil, but to ensure you aren’t just feeding your own ego, you have to limit your mental cycles to things that the hegemony will accept.

  16. Gravatar of Philippe Philippe
    30. September 2014 at 16:43

    all you need to pass new laws is a sufficiently large number of votes. The population group you keep referring to as ‘the hegemony’ is, according to your description, a minority. It follows logically that the majority could bring into being new laws, even if most of your ‘hegemony’ didn’t agree with them.

    But then again this line of thinking involves basic logic, which is usually replaced in your arguments by incoherent emotive ranting.

  17. Gravatar of Becky Hargrove Becky Hargrove
    30. September 2014 at 16:58

    Bruenig:
    “Market income is a broadly meaningless concept because there is little or no extremely little market income without government institutions. The economy is a government program.”

    Argh.

  18. Gravatar of Morgan Warstler Morgan Warstler
    30. September 2014 at 17:01

    Phil,

    “all you need to pass new laws is a sufficiently large number of votes.”

    Votes happen inside hegemony bc they allow them. Politics is a side show. And saying that, doesn’t make you cool, or strike a blow against it, it does however make you more likely to either give up (lots do) or make smarter policy (few do).

    My deeper question Phil is whether arguing “property is theft” ends in changing a law (as you somehow suggest) or the slaughter of the least intelligent, least competent people. Because it sure sells a lot of guns to people who can afford to buy them..

    But let’s say you still like to say it, it feels good to say it… then the thing you just gave as a “negative” word become a “positive” word.

    We don’t discard property Phil, we simply endorse some kinds of theft (see Scott above).

    I’m not trying to be a downer here Phil, I’m trying to optimize how you spend your brain cycles to improve plight of poor.

    Slogans don’t matter, policy ideas the hegemony will support do.

  19. Gravatar of Philippe Philippe
    30. September 2014 at 17:20

    If the majority of the population supported and passed new laws, which most of the minority population group you refer to as ‘the hegemony’ disagreed with, what are you saying would happen?

  20. Gravatar of Philippe Philippe
    30. September 2014 at 17:22

    also, the idea that the entire wealthiest 30% of the population all share the same views, and those views are the same as yours, is utterly stupid beyond belief.

  21. Gravatar of Major.Freedom Major.Freedom
    30. September 2014 at 17:29

    It’s equally utterly stupid to believe the poorest 30% of the population all share the same views such that you and other progressives constantly talk about what “the poor” want and/or should have.

  22. Gravatar of TravisV TravisV
    30. September 2014 at 17:40

    Matt Bruenig:

    “Grandpa Sumner At It Again”

    http://mattbruenig.com/2014/09/30/grandpa-sumner-at-it-again

  23. Gravatar of Philippe Philippe
    30. September 2014 at 17:42

    I don’t constantly talk about what the poor want or should have.

  24. Gravatar of Major.Freedom Major.Freedom
    30. September 2014 at 17:47

    TravisV:

    Ugh, the only mistake Sumner made was feeding that logic denying troll.

  25. Gravatar of Paul Zrimsek Paul Zrimsek
    30. September 2014 at 17:50

    “Market income is a broadly meaningless concept because there is little or no extremely little market income without government institutions. The economy is a government program.” And so Bruening’s argument– which depends critically on market income’s being a meaningful concept– disappears (in Douglas Adams’ phrase) in a puff of logic.

    The other inadvertently damaging admission is the one about Social Security being far and away the most important transfer. Yet it’s precisely here that ignoring dynamic effects produces the silliest result: we learn that we’ve reduced senior poverty to much less than it would be in a counterfactual world where the government collects payroll taxes as it does now, and promises workers the same post-retirement income it does now– but surprises them, once they’ve already retired, by not delivering any of the money. Such a triumph!

  26. Gravatar of Major.Freedom Major.Freedom
    30. September 2014 at 17:53

    Philippe:

    “I don’t constantly talk about what the poor want or should have.”

    The image a poor man walking onto land owned by a wealthy land baron and eating an apple, only to be told he ought otherwise starve to death, frames virtually everything you write.

    Yeah, you write about it constantly. Constantly doesn’t have to mean every second of everyday. I mean colloquially.

  27. Gravatar of Philippe Philippe
    30. September 2014 at 18:07

    “The image a poor man walking onto land owned by a wealthy land baron and eating an apple, only to be told he ought otherwise starve to death, frames virtually everything you write.”

    that’s a thought experiment used when talking with you about your beliefs regarding property rights and your general ancap ideology.

    it has nothing to do with talking about what the poor want and should have.

    If you haven’t understood, talking about an imaginary person who picks an apple from a tree doesn’t mean I am saying poor people want apples.

  28. Gravatar of Mike Sax Mike Sax
    30. September 2014 at 20:14

    “Over the next decade, the poverty rate fluctuated between 11.1 and 12.6 percent, but it began to rise steadily again in 1980. By 1983, the number of poor individuals had risen to 35.3 million individuals, or 15.2 percent.”

    Well that fits in with the liberal narrative that with the rise of Reaganism we’ve seen the safety net gouged which would account for a rise in poverty.

    What Scott doesn’t get is that the War on Poverty was advoated by LBJ in the late 60s but was called off pretty quickly with the election of Nixon. As we’ve had 30 years of conservative policies a rise in poverty doesn’t in any way ’embarrass’ liberals-certainly ‘ending welfare as we know it’-gutting TANF was not an idea from the Great Society.

    So the GS was never really tried, but was rather shelved.

    Morgan I don’t know if your offer for a 90 minute debate extends beyond Bruening but I’ll gladly debate you or any other conservative in public for as long as you want.

  29. Gravatar of Major.Freedom Major.Freedom
    30. September 2014 at 21:19

    Philippe,

    I don’t think you’re being upfront with yourself.

    I think you believe the poor just want to eat other people’s apples, so to speak.

    I don’t see you ever mentioning anything resembling a poor person wanting to just have economic freedom, equality under the law, and to be able to make a life for himself. To you it’s poor people need to be able to steal just a few apples or else they’ll die.

    You choose to debate anarcho-capitalists by way of this thought experiment precisely because that is the image you hold as humane justice. You chose to spend your time that way. It is on your brain.

  30. Gravatar of Major.Freedom Major.Freedom
    30. September 2014 at 21:26

    Mike Sax:

    The war on poverty was not “called back.”

    Inflation adjusted welfare payments per person has grown since the late 1960s. Just because it was a failure, that does not entitle you to blame Republicans. That is textbook partisan hackery.

    Did you know that today, almost 1 in 4 people (in US) are recieving “disability” transfer payments?

    Over 40 million people on foodstamps?

    The war on poverty is continually expanding, and like all wars, is causing destruction in its wake.

    You’re blinded by your ideology.

  31. Gravatar of Major.Freedom Major.Freedom
    30. September 2014 at 21:30

    Mike Sax:

    Your philosophy of man is a projection of your self-image: Man is in general a stupid and helpless animal who cannot deal with the cruel world, so we need a strong mommy style government, i.e. a left wing, welfare driven government.

    Your ethic is counter-productive because it is based on initiations of force against innocent people. It is a denial of human reason. You want guns, which of course you’re too cowardly to use yourself to bring about what you want from others.

  32. Gravatar of Saturos Saturos
    1. October 2014 at 00:09

    MF, maybe what Philippe actually thinks is that poor people want to be less poor? Just throwing that out there. Wouldn’t want to call anyone a troll, though.

  33. Gravatar of Morgan Warstler Morgan Warstler
    1. October 2014 at 02:42

    Cross posted bc Matt will delete – feel free to use Scott :)

    Good lord, Sunner has a clear stance on poverty:

    1. Transfer programs are great.

    2. US Poverty is only 4%.

    3. The only true correct measure of poverty is consumption. I repeat 4%.

    He’s super clear about it here, and it should give you a better understand of what you got lulled into:

    http://www.themoneyillusion.com/?p=24126

    ——-

    The issue Matt is that your argument is at cross purposes:

    You want to say cash transfers work! (so we do more of them)

    BUT, if the War on Poverty took us from 35% to 4%, than we won’t need to do much more will we?

    So you made a conscious choice to use a bad definition of poverty, one that leaves PLENTY of space for more transfers that need to be done. (you really think very little of your audience)

    And then you obscure that bad choice,, but not focusing directly on what Brookings, myself, Sumner, and anyone else who is confronted with directly:

    Real Consumption YOY is the only true measure of poverty. How many calories, atoms, etc. Even using nominal $ amounts screws it up.

    And to cut off your last exit, sure we can’t measure consumption of each poor person’s food, housing temperature, TV channels, free time, etc.

    BUT, we’re getting better at it, and we SHOULD AND OUGHT to want to use this measure, because justice, truth, and that’s what hegemony wants.

    You BEST argument is Transfers work! By 1960 standards we have NO POVERTY, and it’s time to raise our standards! But you have little faith in your readers.

    Brookings did a lot of work on the subject, and they faced the same conundrum you faced, but they chose to be honest…

    “Just to be clear, the notion that the consumption-based poverty rate nearly reached zero percent does not mean that the war on poverty is won. After all, the poverty rate was originally set back in the early 1960s, and although the poverty line has been adjusted upward by the rate of inflation over time, it has not been adjusted for the amount of economic growth that has occurred. All poverty lines are set in the context of the society’s overall level of income: thus, a very low-income country the poverty rate per person might be set at $1.25/day or $2/day, while in the United States, the poverty rate for a family of 3 is around $16-$17 per person per day. One can argue that because the U.S. economy has grown dramatically in the half-century since the poverty level was set, the poverty line should be higher. But still, it’s worth knowing that the U.S. has made progress in terms of the existing poverty line-when using more appropriate standards of well-being like consumption or broader definitions of income”

    And we all know Matt, your just a kid with some very basic stats, doing some very basic math, and you need to get a certain policy outcome, “MOAR Transfers!”

    We all know Matt that Rawls would require the able bodied poor to work. He said so directly.

    And we all know Matt, that you know you are beat here.

    And throughout the day you’ll need to come delete this comment :)

  34. Gravatar of Philippe Philippe
    1. October 2014 at 02:50

    You were doing so well until: “because justice, truth, and that’s what hegemony wants”.

  35. Gravatar of Morgan Warstler Morgan Warstler
    1. October 2014 at 02:58

    “If the majority of the population supported and passed new laws, which most of the minority population group you refer to as ‘the hegemony’ disagreed with, what are you saying would happen?”

    Phil:

    1. You mean majority of likely voters voted for X…. Which places hegemony firmly in control. We COULD force people to vote. We don’t. We COULD have a Parliamentary Democracy. We don’t. We COULD have Treasury run the Fed, we don’t. We could not have enshrined A ton of negative rights into the Bill of Rights. We didn’t.

    2. I’m not claiming to speak for the hegemony on everything, I’m saying the binding principle of the hegemony the thing that they agree on NOT AS VOTERS, but as potential revolutionaries, is that THEY GET TO OWN THEIR STUFF.

    3. Yes, if you somehow convinced the bottom half, many of whom do not vote, to vote to do something that the folks who OWN EVERYTHING (all the real estate, pay all the taxes, run the schools and churches and hold all the elected offices, they would take EXTRAORDINARY MEASURES to keep you at bay.

    What kind of extraordinary measures? whatever it takes. It won’t take much though, bc well – all those things we COULD have done and did not do – they make it almost impossible for your simple majority to change anything as meaningful as property.

    The window of debate is very small. Folks complain about it all the time.

    They are right to complain.

    But once you admit it, and complain about it, turning around and arguing that the forces that limit that window can be overturned by a simply majority of voters who don’t have a pot to piss in, is not good faith.

    It is wistful, naive, and admirable only if you are a high school kid.

    Eventually, you have to actually pass policy that helps poor, and if you insist that nothing inside the window of debate helps the poor, yo are just a man with a low IQ.

  36. Gravatar of Major.Freedom Major.Freedom
    1. October 2014 at 03:17

    Saturos:

    Of course I won’t disagree with that, but I was referring to HOW “the poor” can get wealthier.

    There are wants as goals, and wants as means.

  37. Gravatar of Philippe Philippe
    1. October 2014 at 03:32

    Morgan, your thoughts are very confused.

    you’re saying that if the majority of the population supported laws which most of the wealthiest 30% of the population disagreed with, most of the weathiest 30% would start breaking the law and going on a violent rampage against the rest of the population? What would they do exactly? Start attacking police stations and army barracks? Shooting people in the street?

    As I said, it’s stupid and absurd to think of the wealthiest 30% as a homogenous block who all hold the same political views. Let’s say half of the wealthiest 30% of the population was united with the majority in supporting the creation of new laws, whilst the other half of the wealthiest 30% was opposed to them. In this case, the majority would be able to pass the new laws. It should be obvious from this that your idiotic jabbering about having to get ‘the hegemony’s’ agreement doesn’t make any logical sense. There is no such thing as a homogenous top 30% who always vote the same way.

  38. Gravatar of Philippe Philippe
    1. October 2014 at 03:39

    “THEY GET TO OWN THEIR STUFF”

    that’s a tautology. By definition you own your property. All you’re saying is “my property is my property”, i.e. repeating yourself. What is your point exactly? Do you think you are arguing against people who want to abolish all private ownership? As far as I’m aware your sworn enemy Matt Bruenig is a fan of nordic style social democracy, rather than propertyless anarchy.

  39. Gravatar of ssumner ssumner
    1. October 2014 at 05:57

    Mike Sax, So you are saying Bruenig is wrong?

  40. Gravatar of Morgan Warstler Morgan Warstler
    1. October 2014 at 05:58

    Phil, 40%+ of this country spend multiple years in the top 20%. (73% spend at least one year in top 20%.

    And as a group they have a high propensity to vote. WHY? because they view this whole thing as “theirs” – they disagree about lots of stuff, but they do NOT disagree about “hey we all own all this stuff” – because Phil, they DO OWN ALL THIS STUFF.

    The current system of property benefits them directly. And they know it. And they like it that way. And they are willing to say “well democracy isn’t all that it’s cracked up to be” if it outputs things they DO NOT LIKE. Period. The end.

    If it comes down to Property vs Democracy, Democracy will lose, the people who own everything will say, nah, I like being a Republic.

    The ONLY reason you don’t see this all around you, is because so many of the have nots DO NOT VOTE.

    Not to get Dem GOP on this topic but:

    http://cookpolitical.com/story/5776

    And if you want to see the mask come off, go out and get them all to vote! And not for President, but for all t he PRIMARY and MID TERMS as well – otherwise hegemony will thwart their will via elections.

    But man man, what part of America’s history gives you the sense that “property is theft” is a winning political campaign to turn US Nordic?

    (crickets)

    Until then, you’ll apparently cling to an illusion that Democracy in America is your saving grace.

  41. Gravatar of Philippe Philippe
    1. October 2014 at 06:16

    morgan, obviously some countries have more egalitarian economies than others, so the idea that it is not possible is simply stupid.

    If there was a popular shift towards supporting more egalitarian economic policies, are you suggesting that a minority of wealthy people who opposed it would seek to overturn democracy through some sort of violent coup d’etat? Because it sounds like that’s what you are saying.

    “what part of America’s history gives you the sense that “property is theft” is a winning political campaign to turn US Nordic?”

    Ask Matt, not me. I thought you agreed with him on that.

  42. Gravatar of Mike Sax Mike Sax
    1. October 2014 at 07:32

    Major Freedom I always get two for the price of one with you-you offer all kinds of armchair psychonalysis into my psyche that is all quite wrong-there’s nothing helpless about me and anyone who knows me knows that’s more ‘nonsense on stilts.’

    I don’t believe that people are helpless but just because people are capable of overcoming adversity doesn’t mean we as a society should subject them to as much adversity as we can as if that’s somehow good for their character.

    I mean we can have a society and economy that the mainstream econoimsts call ‘sub pareto optimal’ and this doesn’t mean that no one will be able to prosper-just that we could still improve society to the point where more people can.

    If man can deal with the cruel world that doesn’t mean we shouldn’t make it less cruel where we can.

    Moving from your attempts to explain me to me you’re simply wrong about the welfare state continuing to expand.

    Republicans came to power soon after LBJ so they are to blame. Did you not hear about ‘the end of welfare as we knew it?’ in 1996?

    After that was passed TANF which is the main source of ‘welfare’ in America was greatly reduced.

  43. Gravatar of Mike Sax Mike Sax
    1. October 2014 at 07:50

    “Inflation adjusted welfare payments per person has grown since the late 1960s. Just because it was a failure, that does not entitle you to blame Republicans. That is textbook partisan hackery.”

    Why is it ‘hackery’ if I blame Republicans but not when you and Sumner blame liberals? It’s all just pot-kettle.

    Now on ‘welfare payments’ why don’t you define what you mean by ‘welfare.’ I know in the mouth of folks like you that’s the ultimate curse word but we really have very little welfare in the US both compared to other first world nations and in absolute terms.

    The only meaningful welfare is TANF and that was gutted in the 90s true under Clinton but he just bought into a bad Republican idea because of the politics.

    As for food stamps they have been gutted during the Lesser Depression-just when they are most needed. So there is no expanding war on poverty but rather a continuing war on the poor by people like you.

  44. Gravatar of TallDave TallDave
    1. October 2014 at 07:55

    If man can deal with the cruel world that doesn’t mean we shouldn’t make it less cruel where we can.

    The actual policy looks more like “let’s be cruel to more productive people and generous to the less productive, on the grounds this will reduce overall misery” but coercive utopianism only works on very limited scales, if at all, due to incentive problems (see for example Communism).

    And again, see the graph on means-tested welfare spending, and the description of how the poor actually live. The architects of Great Society never dreamed of a welfare state this generous.

    Under the leftwing definition of “poverty” only Communism (or an equally radical redistribution scheme) can eliminate poverty, no matter how well the poor actually live. It’s increasingly hard to see that as being a bug rather than a feature.

  45. Gravatar of TallDave TallDave
    1. October 2014 at 08:13

    I know in the mouth of folks like you that’s the ultimate curse word but we really have very little welfare in the US both compared to other first world nations and in absolute terms.

    Here’s a few for comparison. Really, only tiny Norway spends significantly more than we do.

    http://www.steynonline.com/6179/beyond-europe

    New Zealand $12,252
    Australia $13,819
    Spain $14,771
    Canada $16,655
    Italy $16,811
    Germany $17,263
    United Kingdom $18,155
    France $18,866
    United States $19,266

  46. Gravatar of Mike Sax Mike Sax
    1. October 2014 at 15:46

    Scott my point is not to defend or criticize Bruening, I never said that. If he or you or anyone else says that the welfare state has expanded over the last 35 years they’re simply wrong.

    He does point out that there are different issues: one is the level of poverty another is middle class stagnation.

    Only if one believes in 100 percent crowding out can it be true that a ‘pure market economy’ will have no more poverty than one with a welfare state.

    As I mentioned above the U.S. welfare state is relatively small in any case and it has gotten a lot smaller the last 3 decades. Food stamps have been cut by 40% during the Lesser Depression

  47. Gravatar of Mike Sax Mike Sax
    1. October 2014 at 16:16

    Sumner vs. Matt Brueing on the impact of welfare on poverty http://diaryofarepublicanhater.blogspot.com/2014/10/scott-sumner-sinks-to-matt-brueings.html

  48. Gravatar of Decisive Victory in the Grandpa Sumner Saga | MattBruenig | Politics Decisive Victory in the Grandpa Sumner Saga | MattBruenig | Politics
    1. October 2014 at 16:17

    […] never seen someone get as thumped as Sumner in this weird exchange (him, me, him, me, him). It’s gotten a bit complicated now, as he’s shifted his position so many […]

  49. Gravatar of Mike Sax Mike Sax
    1. October 2014 at 16:20

    Scott you have asked me if I can read but in rereading Brueing I think you’re the one who can’t read. He didn’t trash any economists progressive or otherwise here. To paraphrase yourself in the past, read it again.

    “Using market poverty (sometimes called pre-tax, pre-transfer poverty) as a comparator for disposable income poverty (sometimes called post-tax, post-transfer poverty) is extremely common in comparative welfare state literature, which I am sure Sumner has no familiarity with. It’s not used because the economists and economic sociologists who operate in that field have never realized that dynamic effects are possible. It’s used because it’s the best measure available to capture the effect of transfers on poverty and cross-country comparisons do not reveal high-transfer countries to have higher market income poverty rates than low-transfer countries (even though their disposable income poverty rates differ dramatically).”

    You are misunderstanding what he said. He is not saying ‘dynamic effects are not used because sociologists in that have never understood dynamic effects are possible’ he’s saying they are aware of them but they aren’t important in estimating market poverty.

  50. Gravatar of Mike Sax Mike Sax
    1. October 2014 at 16:23

    So the point is not that these economists-you are assuming they are progressive, I guess you’re just following Krugman’s point that facts have a well-known liberal bias-don’t know about dynamic effects but rather that they do know about them but they aren’t important in estimating market poverty.

  51. Gravatar of ssumner ssumner
    1. October 2014 at 17:21

    Mike, You said;

    “Scott you have asked me if I can read but in rereading Brueing I think you’re the one who can’t read. He didn’t trash any economists progressive or otherwise here.”

    I was joking.

  52. Gravatar of TravisV TravisV
    1. October 2014 at 18:58

    This Hong Kong protest stuff seems to be having a significant market impact……

    http://www.bloomberg.com/news/2014-09-30/hong-kong-is-losing-premium-over-shanghai-s-stock-market.html

  53. Gravatar of TravisV TravisV
    4. October 2014 at 07:23

    What happened to Mark Sadowski????

  54. Gravatar of TravisV TravisV
    4. October 2014 at 08:54

    Bob Murphy: “Theory and Evidence That QE Pushes Down Long-Term Interest Rates”

    http://consultingbyrpm.com/blog/2014/10/theory-and-evidence-that-qe-pushes-down-long-term-interest-rates.html

  55. Gravatar of TravisV TravisV
    5. October 2014 at 07:48

    New links from Noah Smith, 10/2/14:

    http://noahpinionblog.blogspot.com/2014/10/thursday-roundup-1022014.html

  56. Gravatar of TravisV TravisV
    5. October 2014 at 18:02

    ???????? Joe Weisenthal:

    “We’re seeing much stronger growth than Europe, and both Japan and China (and much of the emerging world) are struggling. This is fundamentally why the dollar is so strong, because the Fed is getting closer to existing ultra-loose monetary policy, while the rest of the world is nowhere clear to that.”

    Read more: http://www.businessinsider.com/investors-are-all-talking-about-the-bifurcation-in-the-global-economy-2014-10

  57. Gravatar of TravisV TravisV
    6. October 2014 at 08:57

    Has anyone summarized this new Stiglitz paper?

    http://www.nber.org/papers/w20517

    “The paper argues that any theory of deep downturns has to answer these questions: What is the source of the disturbances? Why do seemingly small shocks have such large effects? Why do deep downturns last so long? Why is there such persistence, when we have the same human, physical, and natural resources today as we had before the crisis?

    The paper presents a variety of hypotheses which provide answers to these questions, and argues that models based on these alternative assumptions have markedly different policy implications, including large multipliers. It explains why the apparent liquidity trap today is markedly different from that envisioned by Keynes in the Great Depression, and why the Zero Lower Bound is not the central impediment to the effectiveness of monetary policy in restoring the economy to full employment.”

  58. Gravatar of Nick Nick
    6. October 2014 at 09:30

    Hey Travis,
    I don’t have anything on Stieglitz for you but I thought you might enjoy this from a Tim Duy on wage gains and unemployment:
    http://economistsview.typepad.com/timduy/2014/10/is-there-a-wage-growth-puzzle.html#comments
    He’s commenting on Justin Wolfers. He basically says he doesn’t agree with the Dallas Fed that 6% is key but he understands why they picked that number. He says the risk is for tighter than expected monetary policy. He seems to think the fed might be ‘falling behind their curve’. I don’t think he’s necessarily endorsing the curve they are choosing to use, though. If that makes any sense…
    Bill McBride at Calculated Risk briefly responded with an argument that wage gains will be modest above 5%, maybe even 4% unemployment:
    http://www.calculatedriskblog.com/2014/10/monday-fed-labor-market-conditions-index.html

  59. Gravatar of vikingvista vikingvista
    6. October 2014 at 21:04

    “property is theft”

    You are right to ask him what he thinks of theft, given that once grammatically (property is acquired by theft) and logically (some property is acquired by theft) corrected the phrase reduces to the rather uninteresting “theft exists”.

    But “property is theft” being perhaps the social science’s best known intentionally self-contradictory political slogan, it is hard to take seriously someone who believes that particular wording describes some meaningful philosophical truth rather than an evocative comfort for those who wish to placate their own desire to steal.

    I suppose you feel a desire to defend your positions against published attacks, but obviously anybody can get published these days. I hope you didn’t expend too much of your valuable time plucking this low hanging fruit.

  60. Gravatar of Scott Sumner Scott Sumner
    7. October 2014 at 09:04

    VV, Nice, I linked to that in my newest Econlog post.

  61. Gravatar of pyroseed13 pyroseed13
    8. October 2014 at 09:29

    Is Bruenig claiming that there is no other way to measure the effects of transfers on poverty other than the flawed measurements that he advocates? If so, then he is showing a stunning lack of imagination. Short of a randomized trial, one could attempt to estimate how much the poor would earn through working without these transfers and then compare it to their incomes after the transfers. Now given that we have minimum wages and regulations that restrict how many hours one can work, I suspect that such a study would actually understate the impact of a reduced welfare state on work. Nonetheless, I don’t think this measurement problem is as insurmountable as Bruenig thinks.

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