You Ought to Have a Look: “Sustainability” Not Sustainable

You Ought to Have a Look is a feature from the Center for the Study of Science posted by Patrick J. Michaels and Paul C. (“Chip”) Knappenberger. While this section will feature all of the areas of interest that we are emphasizing, the prominence of the climate issue is driving a tremendous amount of web traffic. Here we post a few of the best in recent days, along with our color commentary.

This week, as Pope Francis announced the Vatican will host a climate change summit later this month focusing on “sustainable development,” the conventional wisdom of “sustainability” came under fire.

For example, New York Times’ report Eduardo Porter penned an article “A Call to Look Past Sustainable Development” with this provocative introduction:

The average citizen of Nepal consumes about 100 kilowatt-hours of electricity in a year. Cambodians make do with 160. Bangladeshis are better off, consuming, on average, 260.

Then there is the fridge in your kitchen. A typical 20-cubic-foot refrigerator—Energy Star-certified, to fit our environmentally conscious times—runs through 300 to 600 kilowatt-hours a year.

American diplomats are upset that dozens of countries—including Nepal, Cambodia and Bangladesh—have flocked to join China’s new infrastructure investment bank, a potential rival to the World Bank and other financial institutions backed by the United States.

The reason for the defiance is not hard to find: The West’s environmental priorities are blocking their access to energy.

Porter’s article announced the release of “An Ecomodernist Manifesto”—a work by a collection of “scholars, scientists, campaigners, and citizens” who “write with the conviction that knowledge and technology, applied with wisdom, might allow for a good, or even great, Anthropocene.”

Sounds interesting.

How the Fed Ended Up Fueling a Subprime Boom

Plenty of writers have claimed that the Federal Reserve fueled last decade’s subprime boom by holding interest rates too low for too long after the dot-com crash. But hardly anyone has tried to explain why the Fed did so.

Yours truly has taken a stab at it, together with my former student (and now eminent Market Monetarist) David Beckworth and my former University of Georgia colleague (and current Özyeğin University faculty member) Berrak Bahadir. Here is our just-published article in the Journal of Policy Modeling.

Our argument, in brief, is that the Fed blew it by not treating the exceptionally high post-2001 productivity growth rate as warranting an upward revision of the Fed’s interest-rate target (as neoclassical theory would suggest). Instead, Fed officials believed they could maintain a below-natural interest rate target without risking a corresponding increase in inflation.

We supply lots of evidence supporting our interpretation and, thereby, supporting the view that excessively easy Fed policy did indeed contribute substantially to the subprime boom. We also show how nominal gross domestic product targeting would have prevented this outcome, and that it would have done so to an even greater extent than strict adherence to a Taylor Rule.

Readers familiar with my arguments favoring a “productivity norm,” as presented in Less Than Zero and elsewhere, will understand the claims made in our paper as a specific application of those more general arguments.

The publishers have kindly allowed us to make the article available here without a pay wall for a brief period only, so consider saving it if you might want to have it for longer.

[Cross posted from]

“Charity Is in Its Nature Essentially Civilizing”: In Defense of Herbert Spencer

Ian Millhiser has responded to both my defense of Herbert Spencer and one from Reason’s Damon Root. Unwavering in his belief that Spencer was a monster, Millhiser has doubled down on his claim that Spencer advanced a kind of “genocidal libertarianism.” Millhiser has rightly retreated, however, from boldly claiming, without evidence, that Rand Paul is a fan of Herbert Spencer. I thank him for his response, and I offer a few more thoughts on Spencer here.

First, it’s clear that Millhiser is an active and vehement opponent of libertarianism. He seems to believe–although I don’t want to put words in his mouth–that libertarianism is inherently “genocidal,” regardless of whether it’s advocated by Spencer, Ayn Rand, Friedrich Hayek, or Milton Friedman. So, on one level, Millhiser’s reaction to Spencer is simply a reiteration of his distaste for libertarianism and, insofar as that is the source of Millhiser’s discontent, I’m not going to try to argue with him that libertarianism isn’t inherently a cold, heartless philosophy. The possibility of that debate being productive is long passed.

But is there something particularly odious about Spencer’s brand of libertarianism, as Millhiser seems to think? Spencer writes with the peculiar verve of a 19th-century British intellectual, coming from the same milieu as anthropologists who would blithely discuss the “savage and uncivilized mongoloid and negroid races.” Similarly, Spencer would insouciantly attack the lazy, shiftless, and incompetent.

Post-modern relativism makes us balk at these absolute terms. In modern politics we tend to think more about the conditions into which people are born rather than their personal responsibility. Discussions of the “deserving poor” and “undeserving poor” are now largely uncouth.

But to Spencer, as to most 19th-century political and social theorists, the distinction mattered. Like many modern libertarians and conservatives, Spencer was very concerned that profligate and indiscriminate assistance for the poor would incentivize bad behavior. Although many on the left loathe the idea that welfare can create bad behavior, most people understand that concern. To anyone who’s ever had to cut off ne’er-do-well friends or family from further charity in order to help them out, those concerns make sense.

Big Governments Are Vastly More Dangerous to the Citizenry than Big Corporations

It’s hard to prove or disprove statements of broad social sweep, but we do know one thing: Nicholas Nassim Taleb will not defend his assertion that big corporations are “vastly more dangerous” than big governments.

With notable frequency, people assume that I’m a reader of Taleb’s books. Evidently my thinking and his align in important ways. It’s made me mildly interested in reading him, though time constraints (or time mismanagement) have not yet allowed it.

My minor affinity with Taleb caused me to focus just a little more than I otherwise would have on a tweet of his the other day.

That premise really caught my eye. What is the relative danger posed by governments and corporations? Are corporations “vastly more dangerous”?

I’d thought that the jury was pretty much in on that question. With hundreds of millions killed outright by government action in the 20th century alone, the quantum of death and destruction wrought by governments is almost certainly greater than corporations’ destructive work.

Like any tool, corporations are dangerous. Death and injury is a byproduct of their delivery of food, shelter, transportation, entertainment, and every other want and need of consumers, because they often miscalculate risk or just make stupid mistakes.

Public Opinion Data Finds the “Missing” Libertarians and Communitarians in America

In light of “libertarianish” Sen. Rand Paul’s recently announced candidacy for president, the New York Times’ Paul Krugman veered into public opinion to make a bold claim that most Americans are either liberal or conservative and little else.

He explains that in theory there could be more than simply liberals and conservatives. For instance, if political attitudes were structured along multiple dimensions like along economics and social issues, that would produce at least four different ideological groups:

  • Liberals (economically and socially liberal)
  • Conservatives (economically and socially conservative)
  • Libertarians (socially liberal and economically conservative)
  • “Hard hats” or communitarians (socially conservative and economically liberal)

Yet, without referencing data, he asserts that in practice few people exist in the libertarian or “hard hat” (or communitarian) boxes. His graphic is pasted below:

Is Krugman’s estimate accurate? A growing body of literature overwhelmingly suggests that it isn’t. (For instance see here, here, here, here, here, also see here, among others.)

For this reason, it’s not surprising that statisticians and academics used survey data in response to Krugman to demonstrate that Americans are more complicated than just red and blue. For instance, Nate Silver at FiveThirtyEight cross-tabs support for wealth redistribution and same-sex marriage to show about a quarter of Americans fit in the libertarian box: oppose income redistribution and support marriage equality.

However, one could argue that by this definition, based on only these two questions, Paul (who indirectly instigated this debate) may not even be categorized in the “libertarian” box.

Perhaps a more precise way to measure this is to use multiple issue questions to derive a measure of each person’s ideology on economic issues, and multiple questions to estimate their ideology on social issues, and then use their scores as coordinates to map them across the four quadrants.

Figure 1 uses survey data from the American National Election Study Evaluations of Government and Society Survey 2 (EGSS 2). I average responses to several questions about economics to create an “economic issues scale” scaled from liberal to conservative. Similarly, I use questions about immigration and religion for a “social issues scale” scaled from liberal to conservative. (All question wording is found in the footnotes below.) Thus, each respondent is assigned an “economics” and “social” ideology score used to map their ideological coordinates and placement in one of the four boxes.

Figure 1 reveals a complicated electorate with 19 percent in the libertarian bucket (economically conservative and socially liberal) and 20 percent in the “hard hat” box (economically liberal and social conservative). This is a far cry from Krugman’s estimate of “basically empty” boxes.

Where Do The People Live, Politically Speaking?

Figure 1

Note: ANES 2012 EGSS 2, each dot represents an individual respondent. The Social Issues Scale is coded left to right, liberal to conservative. The Economics Issue Scale is coded bottom to top, liberal to conservative.

More Duplication in Government

The Government Accountability Office (GAO) releases an annual report on government duplication, fragmentation, and overlap. Since 2011 GAO has highlighted 440 different actions that Congress and the president could take to reduce this wasteful spending. This week, GAO released its updated report and included an additional 66 actions.

Here is a sample of items from this year’s report:

  • Consumer Product Safety Overlap. GAO found that more than 20 federal agencies are involved with the oversight of consumer products. For example, the Consumer Product Safety Commission is responsible for overseeing the safety of children’s toys, but the National Institute of Standards and Technologies oversees toy guns. GAO noted that the current structure does not “leverage each agency’s expertise and therefore may not be the most efficient use of scarce federal resources.”
  • Nonemergency Medical Transportation. GAO found 42 programs within the federal government that provide nonemergency medical transportation. These programs focus on enrollees who are unable to provide their own transportation because of age, income, or disability. GAO noted that many of these programs target “similar beneficiaries … and engage in similar activities.” It noted that a coordination council was created to eliminate some of these issues, but the council hasn’t met since 2008. “Without proper controls, cost or ride sharing with other non-Medicaid programs could allow for improper payments for individuals who do not qualify for Medicaid,” GAO reported.
  • Serious Mental Illness. Eight federal agencies, overseeing more than 100 programs, support individuals with serious mental illness, with 30 of those programs “specifically targeting individuals with serious mental illness.” GAO estimated that the 30 programs spent $6 billion in fiscal year 2013. While rules are in place requiring the programs to coordinate their activities, GAO said that coordination was “largely absent.”

Debunking a Misleading Report on School Choice

Today, the left-wing Center for Tax and Budget Accountability (CTBA) released a misleading report on school choice programs in Indiana and elsewhere. Among its key findings include the following claims:

  • None of the independent studies performed of the most lauded and long standing voucher programs extant in the U.S.—Milwaukee, Wisconsin; Cleveland, Ohio; and Washington, D.C.—found any statistical evidence that children who utilized vouchers performed better than children who did not and remained in public schools.
  • According to the annual financial report of the Indiana Department of Education, Indiana spent $115 million on its voucher program in the 2014-2015 school year. In context, that means over $115 million of public, taxpayer money annually will be diverted from … the state’s public school system, and instead used to subsidize students attending private schools.

Both claims, while they contain elements of truth, are highly misleading.

Evidence for the Effectiveness of School Choice

To support its claim regarding the supposed lack of evidence for the success of school choice programs, CBTA points to a few studies of school voucher programs.

First, CTBA cites a longitudinal study of Milwaukee’s voucher program by researchers at the University of Arkansas, claiming that voucher students in grades 3-8 “performed statistically similar” to a matched group of district-school peers on standardized tests. Oddly, CTBA relies on the 2008-2009 findings, published in 2010, rather than the most recent 2012 report. In fact, as the study’s coauthor, Dr. Patrick Wolf, explains, the study found “school choice in Milwaukee has had a modest but clearly positive effect on student outcomes.”

First, students participating in the Milwaukee Parental Choice (“voucher”) Program graduated from high school and both enrolled and persisted in four-year colleges at rates that were four to seven percentage points higher than a carefully matched set of students in Milwaukee Public Schools. Using the most conservative 4% voucher advantage from our study, that means that the 801 students in ninth grade in the voucher program in 2006 included 32 extra graduates who wouldn’t have completed high school and gone to college if they had instead been required to attend MPS.

Second, the addition of a high-stakes accountability testing requirement to the voucher program in 2010 resulted in a solid increase in voucher student test scores, leaving the voucher students with significantly higher achievement gains in reading than their matched MPS peers.

In the final year of the study, voucher students in grades 3-9 performed about 15 percent of a standard deviation higher on standardized reading tests, “a modest but meaningful educational difference.” The achievement growth in math was not statistically significant relative to the achievement growth of the matched district-school students, but the study concluded that Milkwaukee district-school students were “performing at somewhat higher levels as a result of competitive pressure from the school voucher program.” And because the vouchers were worth about half of the cost per-pupil at the district schools, the study found that the voucher program saved the state nearly $52 million in fiscal year 2011.