May 31, 2006
I highly recommend Daniel Gross's takedown of Greg Mankiw's prescriptions for what economically ails us. I'd add that in addition to endorsing the blue-state penalization plan that ends the deductibility of state and local taxes, it's worth noting that another idea from the President's tax commission, ending the deductibility of employer-based health insurance, is curiously absent from Mankiw's op-ed. Strange, a the rationale is precisely the same for both tax changes. Mankiw writes that "[u]nder current law, if one town enacts high local taxes to finance a municipal pool while a neighboring town does not, the first town gets a federal subsidy at the expense of the second. That outcome is neither efficient nor equitable." Meanwhile, under current law, if an employer purchases health insurance, he gets a federal subsidy at the expense of an individual purchasing health insurance. It's not clear why subsidizing employer-based health insurance at the expense of individuals is equitable or efficient, but it a) cuts against corporations and b) is politically popular in places Republicans need votes, so Mankiw doesn't mention it.
Via Fred Jones, this is hilarious.
Note to self: Don't fuck with Media Matters.
Link of the Day
Dean Baker explains why those "consumer confidence" numbers the media puts so much stock in the news always touts doesn't matter.mean so little.
• You can't "make" internships paid positions. You can outlaw internships, which will transform some fraction of them into jobs and do away with the rest. You'll also find it tricky to distinguish between volunteering (can I "volunteer" with The American Prospect for a summer?) and the now-outlawed category of unpaid internships. My guess is neither Kamenetz nor my readers want The Nation to stop providing internships, they just want law firms to pay their interns. Problem is, you can disentangle the two. That there already exist some paid internships simply proves that institutions who value the work and can afford the expense are paying.
• There's some belief that the primary worth of internships is through unpaid labor to employers. I'm skeptical. It's rather inefficient to be cycling through series of young laborers, retraining new sets with every season. Hiring one person who can become experienced and proficient at the work and remain for a sustained period of time is likely a better deal.
As it is, I'd guess the main benefits of internships are 1) for employers to discover new talent and 2) for interns to discover if they like the profession/workplace. But they can only serve that function when many different applicants can occupy short-term positions, which is not a particularly efficient way to manage paid spots. Force employers to pay interns and most of them will simply cease hiring interns, particularly for those internships which fulfill the try-before-you-buy function I'm identifying. This is a long way of saying internships exist because they are unpaid. Otherwise they'd be a massively inefficient allocation of resources, and the spots would dry up. The American Prospect, which has four new interns starting tomorrow, simply couldn't afford to pay them. We're not even hiring a new writing fellow this year. Would it really be a better outcome if these kids couldn't try out magazine work?
• Internships are massively class-biased. The answer, however, isn't to kill internships, but to make interning financially feasible down the income ladder. Many colleges already do this, allowing students to apply for grants and stipends. Liberals should want to extend these opportunities to try more vocations and find a fulfilling workplace, not limit them. And since when are we against new and exciting subsidy programs!?
It's also worth noting that internships aren't necessarily making various jobs more class-biased than they already are. Everything in our society is class-biased, and given that colleges tend to subsidize internships for their low-income students, the real choke point is in getting to college, not in the DNC's summer interns program. But that shouldn't distract from the above graf. If the problem is internships, kill them off. But if the problem is their financial burden for the poor, fix that. Don't throw out the baby with the bathwater and such.
• Haven't internships always been around? They were just called apprenticeships before.
• Kamenetz's argument that internships will fundamentally reorient the worker-employer relationship by making the worker overly grateful and less sympathetic to unions is literally one of the oddest arguments I've ever heard. Low wage workers have always been the most fertile ground for unions, while high wage workers have seen little need for further bargaining power. Interns, in any case, aren't future low wage workers. There's a reason SEIU is worried about Wal-Mart rather than Goldman-Sachs.
Misreading High Fidelity
During an otherwise provocative post on Fight Club, Amanda offers up a fairly serious misreading of Nick Hornby's High Fidelity. She characterizes Laura, Rob's ex-girlfriend, as representing adulthood by being dull. Where they met as 24-hour party people, she's now a lawyer. Where Rob clings to his rundown record store and dingy flat, she's begun transitioning out of young adulthood and into a more affluent, traditionally professional lifestyle. Where Rob lacks direction, she's found success. Laura, Amanda writes, has "one major quality, which is that she’s dull." This makes the book "not only lazy and sexist, it ends up concealing the very real struggle to get by in the capitalist system that is the genuine source of the modern man’s (and woman’s) malaise."
Not to sure about that last, but whether capitalism births boredom strikes me as a thornier issue than I feel like engaging at 1 in the morning. Mischaracterizations of one of my favorite books, however, cannot go unchallenged. Laura may be dull, but Rob is duller. She, remember, rejected him. She broke up with his ass and shacked up with the cosmopolitan peacenik who lived nearby. She recreates the club he DJ'd at to give him a kickstart, offering him a rare chance at recapturing what made him interesting in the first place. She fucks him after her father's funeral. If Laura is dull, she's dull in a real way -- in the way that even the most fascinating personalities are after a couple years of cohabitation. She's rendered uninteresting not because she's a staid person -- Rob freely admits that she's smarter, kinder, better, prettier, and more successful than he is, and the book makes her out to be an infinitely more attractive partner -- but because he's familiar with her. And there's nothing diversionary or easy about taking on that dynamic.
Disney movies stop either at the cute meet or the glorious reconciliation -- High Fidelity starts after the relationship has lost its initial luster. Laura lives adulthood, but she represents commitment, monogamy. What's scary about her is that she isn't dull, it's that she's a good bet, that she's likely the best Rob will ever do. But accepting the better life she offers means sacrificing the higher highs and lower lows of singlehood. And that's hard to do. I know plenty of young adults who struggle mightily with exactly that choice, and taking it seriously isn't cowardice in the face of capitalism. Indeed, if Amanda, as she suggests, thinks an alternative economic model would solve the tradeoffs inherent in monogamy (or other arrangements), I fear she'll be rapidly and fully disappointed.
May 30, 2006
One Strike and You're Out
A piece I just did on why it so many 19-year-olds lack health care.
What's Right With Kansas
Former Republican Party chairmen are fleeing their party and allying with the Democratic guv. They may even create a unity ticket. Folks know what an unabashed Sebelius backer I am, so anything that brings her further political capital works for me. If she does end up running with a Republican, look for her to become even more hyped as a 2008 VP choice.
The War on "The War on Terror"
Right though Matt Stoller's riff on the inadequacy of the "War on Terror" metaphor may be, I don't care how big your lock is, them horses are way gone. Attempts to reframe the discussion will inevitably be cast as efforts to undersell the dangers of terror -- never a good box to be in. Hell, remember when Bush and Co tried to bring in their own new metaphor, the "Global Struggle Against Violent Extremism"? Even they can't climb out of this hole.
Of course, I'm assuming that Stoller is suggesting a less expansive label. Widening the War on Terror to the War on Scary-Looking Brown People would likely be wildly popular, but I'd cast a vote agin'. I would suggest, though, that the War on Terror is actually en route to becoming useful. I don't think that the definition of "terror" is actually as unclear as Matt makes it out to be. Folks have a pretty good idea of what's meant by "terror," which is "terrorist." It's been Bush's singular "genius" to bust out of the constraints imposed by his already expansive framework -- hence his attempt to reframe onto violent extremism (which Hussein could potentially be said to support) rather than terror. Democrats should be very pedantic about the war we should be fighting and very cross about the one we've actually ended up in. The War on Terror, though imprecise, would never have condoned Iraq. It was the GOP's sin to lose focus and start a whole other conflict. Democrats should point it out.
Why Steve Jobs Doesn't Listen
Every couple of months, you get an article demanding that iTunes start following the laws of economics and cease charging the same price for Shakira and The Coup. Occasionally, the record companies get into the act, leaking their unhappiness with a dominant service that doesn't allow them to jack 50 Cent's CD up to $16.99. There's a bit of tensin between the first group and the second, as the first wants to make less-heard artists cheaper so they can move more units while the second wants to make popular albums more expensive so they can reap more profits. Julian Sanchez, I think, critiques the economic logic both correctly in this post:
People are actually going to be a lot less price elastic than you might think, especially for the niche items. That is, suppose Quasi is selling a lot fewer albums than Kanye West. The normal market conclusion would be that Quasi should be priced lower to move more. But that's not necessarily the case, because most consumers aren't actually sitting there making the decision at the margin between Quasi and Kanye. Rather, the people who like Quasi are going to buy it whether it's at 99 cents or 50, and even if it were 10 cents, Quasi just ain't going to be most people's cup of tea. Conversely—and this is more speculative—the items at the top are likely to be stuff for which people have thinner preferences, and are therefore more price elastic. That is, a lot of people are going to download Eminem (or whatever) precisely because it's the hot track everyone else is listening to, but might be dissuaded by an extra 50 cents.
That still leaves record company greed, but I don't think that sort of impulse is particularly vulnerable to critique. You should read the rest of Julian's post though -- it's a surprisingly interesting look at the economics of electronic information.