1.  “If we set up no smoking sections on airlines, then eventually you won’t be able to smoke at all on airlines.  Then they’ll ban smoking in restaurants, then bars, then offices, then spaces outside offices, then hotel rooms and apartment complexes.  Then they’ll start going after sugary drinks.”

“Don’t be ridiculous.”

2.  “If we legalize homosexuality, then eventually they’ll ask for gay marriage.”

“Don’t be ridiculous.”

I’m old enough to recall these slippery slope arguments, and I lived long enough for them (and many others) to come true.  I have no idea what the future will look like, except that I’m pretty sure it will look ridiculous from our perspective.  And that’s fine; it’s their world, not ours.

This post is motivated by a Ilya Somin piece in the Washington Post:

Perhaps because efforts to separate the Confederacy from slavery are so implausible, defenders of keeping Confederate monuments in place increasingly resort to slippery slope arguments. Here’s Donald Trump making the case earlier today:

“I wonder, is it George Washington next week?” Trump asked….

He went on to make a slippery slope argument — equating Confederate general Robert E. Lee with presidents like Washington and Thomas Jefferson, who were slave owners…

“So, this week it’s Robert E. Lee,” Trump said. “I notice that Stonewall Jackson is coming down. I wonder is it George Washington next week, and is it Thomas Jefferson the week after? You know, you really do have to ask yourself, where does it stop?”

In fairness, the slippery slope argument is sometimes advanced by more intellectually serious advocates than Trump. It is wrong, even so. The argument fails because there are obviously relevant distinctions that can be made between Washington and Jefferson on the one hand and Confederate leaders on the other.

On the issue of Confederate statues, I agree with Somin.  But on the slippery slope argument I agree with our sleazy, lying, white nationalist President.  They will eventually come after Washington and Jefferson.  Washington is my favorite President, but he was also a slave owner. That’s not a small insignificant flaw; it’s a massive moral failure, far worse than anything Dennis Hastert was accused of.

I don’t favor re-naming the Washington Monument, nor do I think eating meat is immoral, but I fully expect future generations to decide that eating (non-test tube) meat is immoral, and I expect them to rename the Washington Monument.

Our current world is our business, and the ethical standards adopted by the future world is their concern.  That’s the real problem with slippery slope arguments.

Most people thought the answers was yes.  I thought it was no.  Here’s a question for the zero bound worriers.  If the zero bound was holding back the Fed during 2009-15, then what’s been holding back the Fed over the past 20 months? Inflation is still below target.

Ignacio Morales set me an interesting graph from JP Morgan, which shows the correlation between global NGDP growth and growth in global profits:
Notice that the correlation seems particularly strong since 2009.

Ben Southwood sent me a ECB study by Luca Gambetti and Alberto Musso, which shows that the ECB’s asset purchase program worked via many different channels. Here’s the abstract:

This paper provides empirical evidence on the macroeconomic impact of the expanded asset purchase programme (APP) announced by the European Central Bank (ECB) in January 2015. The shock associated to the APP is identified with a combination of sign, timing and magnitude restrictions in the context of an estimated time-varying parameter VAR model with stochastic volatility. The evidence suggests that the APP had a significant upward effect on both real GDP and HICP inflation in the euro area during the first two years. The effect on real GDP appears to be stronger in the short term, while that on HICP inflation seems more marked in the medium term. Moreover, several channels of transmission appear to have been activated, including the portfolio rebalancing channel, the exchange rate channel, the inflation re-anchoring channel and the credit channel.

Ben Klutsey pointed me to a Larry Summers piece in the FT:

Historically, the Fed has responded to recession by cutting rates substantially, with the benchmark funds rate falling by 400 basis points or more in the context of downturns over the past two generations. However, it is very unlikely that there will be room for this kind of rate cutting when the next recession comes given market forecasts. So the central bank will have to improvise with a combination of rhetoric and direct market intervention to influence longer-term rates. That will be tricky given that 10-year Treasuries currently yield below 2.20 per cent and this would decline precipitously with a recession and any move to cut Fed funds.

As a result, the economy is probably quite brittle within the current inflation targeting framework. This is under-appreciated. Responsible new leadership at the Fed will have to give serious thought to shifting the monetary policy framework, perhaps by putting more emphasis on nominal gross domestic product growth, focusing on the price level rather than inflation (so periods of low inflation are followed by periods of high inflation) or raising the inflation target. None of these steps would be easy in current circumstances, but once recession has come effectiveness will diminish.

 

I recently read by a paper by Laurence Ball, which advocated the use of a “high pressure economy” to bring the unemployment rate down to low levels. I’m generally opposed to that sort of policy, as I believe it leads to a procyclical monetary policy—high inflation during booms and low inflation during recessions. That makes the business cycle more unstable.

I initially assumed that it was a recent article, but rereading the piece I saw it was actually from March 2015. That provides slightly more justification for an expansionary monetary policy, but it also raises another interesting question. Consider this prediction:

FOMC members want to accommodate this return to long-run equilibrium while avoiding an overheating of the economy that would push inflation above target. Based on FOMC statements, it appears likely that the Fed will pursue its goals by raising short-term interest rates above their current near-zero levels at some point around the middle of 2015.

This essay argues that a different path for monetary policy would be better for the economy. The Fed should seek to push the unemployment rate well below 5%, at least temporarily. A likely side effect would be a temporary rise in inflation above the Fed’s target, but that outcome is acceptable. To push unemployment down, the Fed should keep interest rates near zero for longer than is currently expected, certainly past the end of 2015.

Notice that Ball thought it would take high inflation to push unemployment down below 5%.  Instead, unemployment has fallen to 4.3% with inflation actually remaining slightly below the Fed’s 2% target (currently it’s closer to 1.5%).

I’ve never believed in “hysteresis” theories that claim unemployment can get stuck at high levels due to a lack of aggregate demand.  I think this theory was based on a misdiagnosis of the European labor market after 1980, where the high unemployment that was assumed to be labor market slack was actually caused by statist labor market regulations.  In the US, the unemployment rate will fall back to the natural rate regardless of whether the Fed pushes inflation above their 2% target.  Thus it’s better for the Fed to focus on stable NGDP growth, and let the labor market take care of itself.

If you want more jobs (and I do), then advocate supply-side labor market reforms.

PS.  A recent piece by Paul Krugman points out that the fall in unemployment to 4.3% also refutes claims made during the recovery period that the high unemployment was partly “structural”.  I was also skeptical of the structural unemployment claim, but even I did not expect unemployment to fall quite this low.

HT:  David Lapidus

. . . or is the world getting dumber?  Maybe it’s just old age on my part—not keeping up with the changing times.  But I can’t shake the notion that a few years ago the world starting getting dumber.  Last year I focused on the Trump campaign, as when he promised to pay off the entire national debt in 8 years, and when asked how responded “trade”.  But it goes far beyond Trump; consider the recent Google controversy.  Here are the remarks that got James Damore fired:

At Google, we’re regularly told that implicit (unconscious) and explicit biases are holding women back in tech and leadership. Of course, men and women experience bias, tech, and the workplace differently and we should be cognizant of this, but it’s far from the whole story.

On average, men and women biologically differ in many ways. These differences aren’t just socially constructed because:

• They’re universal across human cultures
• They often have clear biological causes and links to prenatal testosterone
• Biological males that were castrated at birth and raised as females often still identify and act like males
• The underlying traits are highly heritable
• They’re exactly what we would predict from an evolutionary psychology perspective

Note, I’m not saying that all men differ from women in the following ways or that these differences are “just.” I’m simply stating that the distribution of preferences and abilities of men and women differ in part due to biological causes and that these differences may explain why we don’t see equal representation of women in tech and leadership. Many of these differences are small and there’s significant overlap between men and women, so you can’t say anything about an individual given these population level distributions.

. . . I strongly believe in gender and racial diversity, and I think we should strive for more.

A few remarks:

1.   I agree with almost the entire set of remarks (there’s lots more.)  If anything, I’m to the right of Damore—I weakly believe in gender and racial diversity.  I’m told that people who express these views get hounded and shamed on the internet.  I just endorsed them—will this happen to me? (I doubt it.)

2.  I can no longer work at Google.

3.  Last year, I was repeatedly told that I did Trump bashing to appear more fashionable to my colleagues at Bentley, or at DC cocktail parties (even though I didn’t teach at Bentley and don’t attend DC cocktail parties.)  OK, if I’m trying to appear PC, then why do I publicly endorse the supposedly racist and sexist views that got a Google employee fired?  Just asking.

The truth is I don’t give a damn what anyone thinks of my political views. I usually refrain from posting on race, sex, and gender because America is mentally ill when it comes to those topics, and its almost impossible to have an intelligent conversation with a crazy person.

4. Damore’s statement actually seems quite moderate and non-controversial.  As far as I can tell, even noted Harvard psychologist Steven Pinker would agree with the gist of what he said.

5.  The (male) leadership at Google is extremely smart.  I’m pretty sure that deep down they agree with Damore.  Clearly he was fired to appease Google’s critics.

6.  I suppose it’s always been true that people have been fired for expressing non-PC views.  In the 1950s, advocating communism might have gotten you fired.  But this somehow seems different.  Communism was an abhorrent system that only a few extremists favored.  Damore’s views are politically moderate and held by a large proportion of the US population.  Of course being a moderate doesn’t prevent you from working at Google, it just forces you to keep your views to yourself.

7.  This sort of left-wing PCism run amok is Donald Trump’s best friend—it converts moderates into conservatives, as people seek a supportive tribe.

8.  America’s mainstream press is also part of the problem.  Consider this Business Insider piece:

His memo goes to show that there is a right way and a wrong way to debate an issue. The right way to discuss controversial topics at work is to do so respectfully.

Here’s an easy rule-of-thumb to remember: You should generally steer clear of any remarks that evoke sentiments of “you people.” In other words, don’t make personal attacks on people or groups of people — keep it civil.

As Pichai wrote in his memo, “People must feel free to express dissent.” Indeed, the Google CEO acknowledged the importance of calling into question the company’s trainings, programs, and ideology.

Where Damore crossed the line was by suggesting a group his coworkers are biologically ill-suited to their work.

This is so laughably inaccurate that it’s almost libelous.  Damore never claimed that his coworkers are biologically ill-suited for their job.  Even if it were true that women were less good at tech work than men, on average, it would not imply that the specific women hired by Google were incompetent.  But it’s even worse than that; Damore alludes to the possibility that biology merely leads to different “preferences”.  After all, men and women score about the same on IQ tests, but I wouldn’t be the first person to note that, on average, men seem more inclined to like working with things whereas women, on average, seem to have a preference for working with people.  A difference that shows up at about age . . . I don’t know, maybe age 1?  (Or even Chinese age 1, zero in the West.)

9.  This sort of PCism seems to be spreading like a plague.  It’s closest 20th century parallel (noticed by my wife a decade before I noticed) is China’s Cultural Revolution, where people were told they should be ashamed of themselves if they had a privileged background.  Another similarity is that many of the victims are liberals, not even “guilty” of the absurd “crimes” they are accused of.

10.  The growing stupidity of the world seems international.  Recall Berlusconi in Italy, or the new right in Eastern Europe.  In the 20th century, the Nazis and communists were horrible, but at least you had a sense that they wanted to appear respectable to outsiders.  The communists in particular seemed to actually want to convert others to their cause.  ISIS and Boko Haram simply want to kill you and rape your daughters.  They don’t even try to appear appealing.  Some of the statements by North Korean’s leader are so stupid they are laugh out loud funny.

11.  Even the arts are affected.  I’m told that white authors are no longer allowed to included non-white characters in their novels.  It’s almost like an over-the-top, right-wing parody of PCism from the 1990s that has come true.  And you liberals need to keep in mind that this particular form of insanity, far more stupid than anything Trump says on his worst day, is coming from the political left.  Trump is merely offensive, in a standard neanderthal right-wing sort of way.  The left shows far more creativity, even in their stupidity.

Last year I focused on (OK, was obsessed with) Trump because he actually got the nomination.  If it had been Jeb Bush and Bernie Sanders I would have directed my scorn at the Dems.  And Sanders wasn’t all that far from gaining the nomination—if it had been up to white voters he would have been the nominee.

So why does the world seem to be getting dumber?  Maybe 200 TV channels and the billion internet channels have dislodged the elite from their gatekeeper function and empowered average people.  Who can forget this bit from the film American Splendor:

Mattress Guy 1: So how smart is she?

Mattress Guy 2: I don’t know. I guess she’s about average.

Mattress Guy 1: Average? Hey, man. Average is dumb!

PS.  For a much more intelligent take on this issue, read Scott Alexander.

PPS.  Last year I was considered “deranged” for arguing that Trump’s personality slightly (and I emphasize slightly) increased the risk of nuclear war. Now the US stock market has become similarly deranged after Trump’s “fire and fury” tweet.

PPPS.  If you think I’m making up my claims about the publishing industry, read this:

One author and former diversity advocate described why she no longer takes part: “I have never seen social interaction this fucked up,” she wrote in an email. “And I’ve been in prison.”

Many members of YA Book Twitter have become culture cops, monitoring their peers across multiple platforms for violations. The result is a jumble of dogpiling and dragging, subtweeting and screenshotting, vote-brigading and flagging wars, with accusations of white supremacy on one side and charges of thought-policing moral authoritarianism on the other. Representatives of both factions say they’ve received threats or had to shut down their accounts owing to harassment, and all expressed fear of being targeted by influential community members — even when they were ostensibly on the same side. “If anyone found out I was talking to you,” Mimi told me, “I would be blackballed.”

Dramatic as that sounds, it’s worth noting that my attempts to report this piece were met with intense pushback. Sinyard politely declined my request for an interview in what seemed like a routine exchange, but then announced on Twitter that our interaction had “scared” her, leading to backlash from community members who insisted that the as-yet-unwritten story would endanger her life. Rumors quickly spread that I had threatened or harassed Sinyard; several influential authors instructed their followers not to speak to me; and one librarian and member of the Newbery Award committee tweeted at Vulture nearly a dozen times accusing them of enabling “a washed-up YA author” engaged in “a personalized crusade” against the entire publishing community (disclosure: while freelance culture writing makes up the bulk of my work, I published a pair of young adult novels in 2012 and 2014.) With one exception, all my sources insisted on anonymity, citing fear of professional damage and abuse.

None of this comes as a surprise to the folks concerned by the current state of the discourse, who describe being harassed for dissenting from or even questioning the community’s dynamics. One prominent children’s-book agent told me, “None of us are willing to comment publicly for fear of being targeted and labeled racist or bigoted. But if children’s-book publishing is no longer allowed to feature an unlikable character, who grows as a person over the course of the story, then we’re going to have a pretty boring business.”

Another agent, via email, said that while being tarred as problematic may not kill an author’s career — “It’s likely made the rounds as gossip, but I don’t know it’s impacting acquisitions or agents offering representation” — the potential for reputational damage is real: “No one wants to be called a racist, or sexist, or homophobic. That stink doesn’t wash off.”

Authors seem acutely aware of that fact, and are tailoring their online presence — and in some cases, their writing itself — accordingly. One New York Times best-selling author told me, “I’m afraid. I’m afraid for my career. I’m afraid for offending people that I have no intention of offending. I just feel unsafe, to say much on Twitter. So I don’t.” She also scrapped a work in progress that featured a POC character, citing a sense shared by many publishing insiders that to write outside one’s own identity as a white author simply isn’t worth the inevitable backlash. “I was told, do not write that,” she said. “I was told, ‘Spare yourself.’

Another author recalled being instructed by her publisher to stay silent when her work was targeted, an experience that she says resulted in professional ostracization. “I never once responded or tried to defend my book,” she wrote in a Twitter DM. Her publisher “did feel I was being abused, but felt we couldn’t do anything about it.”

HT:  Tyler Cowen, Scott Alexander

People didn’t believe me when I said I’d praise Trump for the good things he did. Well now it’s time.  Here’s the WSJ:

Arya Majumder would have celebrated his 19th birthday last month. Instead he died of cancer in 2010, his condition exacerbated by a scarcity of bone-marrow donors. . . .

Other families may be spared the same life-upending sorrow because last week the Department of Health and Human Services withdrew a proposed Obama -era regulation that would have prohibited compensation for bone-marrow donation. About 11,000 ailing Americans are currently searching the national marrow registry, hoping to find a compatible donor. This year at least 3,000 people will die waiting for a transplant. Others, like Arya, must settle for an inexact match, which can cause lifelong health complications or prove fatal. . . .

The 1984 National Organ Transplant Act prohibited payment for organ donors, and bone marrow was included, though it regenerates like blood, eggs or plasma. Represented by the Institute for Justice in 2012, the mother of three girls suffering from a condition known as Fanconi anemi, which often impairs bone marrow function, won a lawsuit against the federal government to allow compensation.

But the Obama Administration then wrote new rules to recriminalize payment for marrow, and HHS sat on the pending regulation for four years, leaving sick patients and their families in limbo. The regulatory uncertainty deflated the interest of entrepreneurs seeking to invest in much-needed marrow-supply services, as well as of top-tier researchers who wanted to study the effectiveness of compensation.

Great news for utilitarians!

HT:  Frank McCormick