11 August 2011

liberal ideas

I've noted before that there are some empirical differences between libertarians and liberals (in addition to the goals part). And that's certainly a problem when trying to get across problems with rent controls or social welfare programmes or the impact of unions.

But occasionally there's just fucking stupid.

Now. Of these ideas..
1) I agree in principle that we should be expanding visas for immigration, especially for highly educated people, and even for people who want to start companies and not just work for Microsoft or Google. I've got no problem with that. And it's even possible that this would grow the economy in raw GDP terms. But the idea that it could magically hire hundreds of thousands of people, or even millions is completely ludicrous. First, not all of those startup companies will succeed, many will probably fail, probably not for reasons like they had bad products, but more that they lacked proper marketing for the open market, or the problem that good engineers or software designers probably don't make very good businessmen. At least not all the time. But here's the real kicker: what sort of Americans who don't have jobs right now... can do the sort of jobs that would be created by this policy? Isn't your purported goal to reduce unemployment (see previous topics)? I have no doubt this would "create jobs", or at least relocate those jobs from China or India or even Canada or Europe to the US. And yay us. But the idea that there are millions of college educated people who can do coding or tech work, and that these people are just sitting around unemployed is just completely asinine. There isn't a college educated unemployment problem for the most part. There IS an unemployment problem, but almost all of those people were factory workers, administrative assistants, and construction workers. Good luck teaching them all how to design websites. Seeing as I've met some of these people (who don't have jobs and are trying to re-educate to get a new one), I'll have to tell you that you'll probably also have to teach most of them some rudimentary mathematics first before you can start in on machine code. So basically this is a programme to create a lot of upper-middle class jobs and a few janitorial or secretary slots for some small businesses that last long enough. Maybe some construction or electrical work too. Not terrible, but not exactly recognizing where the problem is.

2) Continue to give money to state and local governments. Kleiman to his credit identifies part of the problem here as "some local governments will be corrupt or inefficient". I'd be more comfortable giving money to help out some cops and teachers if state and local governments didn't have bad habits of spending their valuable tax money on extensive pensions, bad teachers and bad cops who cannot be rid of, or worst of all, boondoggle infrastructure or construction projects designed to get photo ops or names in papers. Hooray for that new stadium. Too bad we had to lay off a bunch of regular honest state workers (people) to build it on the public's dime (or raise taxes to get the bonds to do so). Things like this. If a case can be made that there are structural constraints on the money being expended in this way and that state and local budgets have to be brought into control (over long-term) by slashing useless programmes or curtailing marginal ones (prison overpopulation for instance, often caused by imprisoning non-violent vice criminals), then this isn't terrible on its own. Kleiman is also correct that with budget balancing required precisely during counter-cyclical arrangements that the lender of last resort would have to be the federal government. Which is fine to some extent. But here's part of the deal, suppose it's not a national crisis and it's just California or North Carolina or whoever going broke. Should we all act to bank them? I say no. If a state has overextended its public policies such that it is going bankrupt trying to maintain them, then one consequence should be that it should have to look hard at curtailing its public policies (or raising revenues to pay for them, and risk sending people and businesses to other states in some cases). The basic problem is that there's a liberal assumption that what people want is more government. To an extent this is true. The "People" do want the programmes that are promised them (mostly). What they don't want is to have to pay for it. They want someone else to do that, and usually convince themselves that they're not paying for it (see: keep your government hands off my medicare!). Liberals/progressives on economics have succeeded mostly by forgetting to send people the bill telling them how much glorious programme XYZ costs, and then conservatives (and liberals) have managed to convince them that programme ABC (say, foreign aid or the department of education or even defence procurement) is full of waste and abuse and fraud and costs a lot of money. When it actually costs a fraction of XYZ, the untouchable things like entitlements or defence/security/anti-crime spending. There is a lot of waste to go around, sure, but it's not enough to save us the "good stuff". And its not enough to say that oh shame, teachers and cops will lose their jobs! to convince us to keep spending money on government. Some of them should lose their jobs because some of them are costing us more in headaches and failures than is worth it to their profession and to their public function. The problem is more that it won't be just the assholes and incompetents who get kicked out the door.

3) NIH funding is fine, for what it's worth. You get from this human capital and potentially useful research in medicine and science that you can do something with later as a society funding it. So it's not a useless public works policy. But... again. What sort of employment are we getting? Ahh yes. Because that 1-2% of post graduate educated people or 4-5% of college graduates who don't have jobs will certainly help resolve the employment problems for the 15-20% of teens or 20-25% of high school dropouts and so on. Remind me again why you guys don't like trickle down economics? Maybe there's a percentage of such people who do have jobs but don't have "good jobs" and they'd trade up. But just how many science majors and math wizards and computer programmers are out of work, and how many English majors or artists or what not are?

4) Taxing corporate revenues is always a popular meme for you guys. I'd prefer eliminating the corporate income taxes personally and just going straight after dividend/bonus incomes as regular income (no capital gains either, income is income). That said, you were onto something here talking about the banks (before trying to kill job growth by increasing corporate taxation further). What they could do instead is put a negative interest rate on excess reserves, enough to offset any gain from buying government bonds. That would move the money out faster and start loaning or capital development at least. Money would again be in circulation. And the government would no longer appear to be in the banking sectors pocket. Of all the things here, this is the only one that would have any prayer of implementation even under a 60 vote Democratic Senate, mostly because it relies only on the technocratic Federal Reserve to implement and Congress has no say. This is the other problem with all of this. Good luck getting a modestly favorable immigration bill through or more NIH funding, or additional "stimulus" funding for state and local governments through Congress. Liberals had trouble enough doing anything like this with a 59-60 seat Senate and a House majority of Democrats. It's not happening at all with a GOP House majority and enough Senators to filibuster, and in a couple of these cases, Obama even isn't likely to back the idea (I haven't bought the conservative hype that he's some sort of wacko-liberal from the extreme left. Mostly because I've met people on the extreme left.)

5) The one liberal "job creation" proposal I'd take seriously is to do something like the infrastructure bank. Except only for repairs or upgrades to existing infrastructure (there's a ton of this out there to fix highways or upgrade the power grids and sewer lines or put up smart traffic lights, etc). No boondoggle HSR lines, no natural gas or ethanol subsidies, nothing fancy, flashy, and thus stupid. Just the unsexy work of filling potholes and making sure bridges don't collapse. This would have the effect of giving lots of people who are unskilled labourers something to do in the short run. And this where the bulk of the unemployment problem comes from. We can't design programmes that assume that our unskilled labour force can suddenly and magically do advanced metric statistical analysis or treat medical illnesses. Sorry, but our schools have been fucked for long enough that we don't have lots of people like that who could learn how, even after two-three years of recession already to entice them to train. Most Americans are... well they're idiots. It'll take a while to learn that "stuff", if ever in most cases. We can't go back and fix the structural problems with their education growing up now. So we're left with a bunch of half-educated dimwits who can however learn to fix cars or fill in potholes or wire a house or unclog a drain or type up reports or answer phones, etc. It's not the end of the world. But it's also not as simple as "hey I know, let's fix a non-existent problem for other smart people and then they'll hire all these other folks". Because truth be told, they may not being going back to India or China if these sorts of ideas were somehow magically available to be done, but they damn sure will be hiring some of them instead. I would anyway.
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