Tuesday, May 8, 2012

Read Stuff, You Should

Happy Birthday to Chris Frantz, 61.

The good stuff:

1. A health care decision worth keeping an eye on: Sarah Kliff on the FDA's proposal to make several drugs over-the-counter, and why it's important.

2. Today's "ignore the electoral college for now, really really really" link is to a nice piece by Sean Trende. The substance is fine, but one petty nitpick: if you link to an article by "political scientists", the linked article shouldn't be by two economists (I don't know the article, but if it really did take a GOP electoral college "lock" seriously it certainly should not have).

3. I don't really agree with a couple paragraphs in the middle -- it centers on campaign finance -- but the rest of this Alex Pareene rant about rich people who believe foolish things is good fun.

4. And Jamelle Bouie is correct about parties, Congress, and democracy.


  1. Does Trende use "political scientist" as a general term for any political commentator, or perhaps any academic who comments on politics? It reminds me of when I used to work in the library as a shelver or "circulation assistant"--one of the lowest jobs there--and I discovered that almost everyone on the planet thinks people who do this line of work is a "librarian." (For example, the lady in Ghostbusters who gets scared by the library ghost is always identified as a "librarian," even in the credits, but what she's seen doing looks more like shelving. It's almost a universal misconception.)

  2. I'm not sure what you like so much about the Pareene piece. He ridicules the notion that "the ultra-wealthy are wealthy because they are smarter and work harder than everybody else, and that they are resented for this success" but if you substitute "most people" for "everybody else", the sentence is empirically true. The standards that must generally be met to get hired by Wall Street or hedge funds include making outstanding grades at the USA's most selective universities, which makes these people smarter than most people. And the hours worked in the financial services industry are generally longer than in most other sectors of the US economy. Envy of financially successful people also seems widespread in the US; I see that in my own family, among those that did not have top grades in college and graduate school, as I did, nor have they ever worked 70 hour weeks under intense pressure, as I do. They envy my income but would not want my lifestyle. I wonder, Dr. Bernstein, how many investment bankers and top hedge fund traders you know personally; it is not ridiculous to think that they have higher IQs and a greater willingness to work long hours than most people.

    1. @Anon -- leaving aside how people get into top schools and the extremely strong non-intelligence components of that ... I know a LOT of people in finance. My dad, formerly my mom, my brother, two uncles, my high school best friend, my husband's college friend. (Besides my acquaintances in finance, including at least thirty members of my high school class and at least a hundred from my college class.) They are great people! Who all complain about having to deal with conceited, lazy, unethical idiots who don't understand what they do all the time and get paid gobs of money to go home early on Fridays.

      I agree that there's envy of Wall Street salaries. I see it, for instance, from other professionals, who spent a couple hundred thousand dollars more on their medical or legal education than their Wall Street friends, and lost three or five-six years of working to that education, only to work the same punishing hours as the finance folks. Myself, I'm happy not to make as much money as my brother, but it is certainly absurd that he should make four or five times more!

    2. The Pareene piece IS good fun. Trenchant analysis it is not. But it is a fun rant to read.

    3. the classicist

      "Myself, I'm happy not to make as much money as my brother, but it is certainly absurd that he should make four or five times more!"

      Why is it absurd for someone who's less educated to make much more money? People aren't paid based on their inputs, but on how much their efforts are valued. If someone claims that I should buy his badly burned pies because more resources were used in their production than in pies that weren't cooked as long, I'd ask him to read this:


    4. (1) That's a very uncharitable and, if I may say, unkind way to read my comment. It's not because he's less educated, of course: it's because he's just pushing around papers, the same as I am.

      (2) It's absurd to claim that some people deserve to make three and five and ten times more than people in similar situations but different professions because they're that much more productive. It's just obviously false. I make more money than my in-laws because I teach at a college and they teach elementary school -- what, because teaching rich kids how to read and write papers is so much more socially useful than teaching poor kids how to read and write?

      (3) The way we got to my friends in finance making lots more money than people doing work of equivalent difficulty and (in the case of doctors, for instance) likely greater productivity and use to society .... is not that things got more meritocratic. People in finance and top officials at non-financial companies and people at the heads of other institutions too (very much including university presidents!) make more money because they have more control over how much they're paid. Starting people then make more money because that's now a prestige field. In other words -- yes, of course they're paid based on how their efforts are valued -- but it's not some impersonal force deciding that value, it's them and their friends. That isn't criminal but it's no cause for puffing yourself up, either.

      Just to mention again: everyone I know in finance thinks a lot of people in finance get paid a lot for doing nothing or doing harm. And in that it resembles all other fields of human activity.

    5. I have to agree with the classicist. The people who control the money have considerable say on who "deserves" to get the the money. And time after time, they conclude that they are themselves the most valuable members of society.

    6. the classicist,

      1) Yours is literally a Marxist view of economics... a pre-marginal utility view. It's a view that even liberal economists find risible. It's why I placed that link. Value has NOTHING to do with inputs. This is one of the reasons that every Communist society has been an impoverished hellhole.

      2) The similarity of the situations -- as you view it -- doesn't matter and the "productivity" of a given worker doesn't matter. Employers offer more for some work because that's what it's worth to them and what it costs to woo the employees they want. If they could get the work done the way they wanted it done for way less they'd pay way less.

      3) This is one of the key concepts in finance.
      If you owned some big business, you would be insane not to pay way more than a teacher is paid to get these numbers as close to correct as possible. If you think that bankers (for example) are screwing us, I agree. They are for obvious reasons better friends of this Progressive-bloated government than we are. Take that up with your liberal friends. If I ran the show we wouldn't be subsidizing their risky moves.

      But someone would still be paid way more than you to just "shuffle papers."

  3. Professor Bernstein,

    Bouie's piece makes me wonder why you don't link to Mike Munger, who covers similar ground much better. Is it because he's on the wrong team?

  4. Bouie is of course basically correct, but he should probably consider that Bob Kerrey does know that everything is political. Kerrey's just engaging in the ancient political-rhetorical strategy of professing non-political motives and disposition in order to gain support and power from a populace that deeply wants to believe that politics can be avoided.

  5. Really interesting discussion. What are you opinions on the BNP take a look...



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