Author Archive for Steve Landsburg

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It’s Official


     

The enemy — he is ourselves. That is why it is idle to talk about preventing the wreck of western civilization. It is already a wreck from within. That is why we can hope to do little more now than snatch a fingernail of a saint from the rack or a handful of ashes from the faggots, and bury it secretly in some flowerpot against the day, ages hence, when a few men begin again to dare to believe that there was once something else, that something else is thinkable, and need some evidence of what it was, and the fortifying knowledge that there were those who, at the great nightfall, took loving thought to preserve the tokens of hope and truth.

— Whittaker Chambers
Letter to W.F. Buckley, August 5, 1954

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The Dream Ticket


She hasn’t asked me, but I know who Hilary Clinton should choose as a running mate.

She should choose Jeb Bush. Then she should immediately issue this statement:

Continue reading ‘The Dream Ticket’

Trading in Fallacies

Under quite general conditions, free trade pacts lead to higher average real incomes in every participating country. The argument for this proposition is simple, incontrovertible, and entirely non-controversial among those who have taken a few minutes to understand it. This stands in contrast to the arguments for, say, Darwinian evolution or anthropogenic climate change, which rely on vast bodies of evidence that most of us will never digest. Your opinions on evolution and climate change almost surely rely at least in part on the testimony of experts. Free trade is different. It doesn’t matter what the experts say, because you can check each step in the argument for yourself.

Educated people know this. So when they want to throw up roadblocks in the way of free trade, they don’t say silly and obviously false things like “free trade will make us poorer”. Instead, they say silly things like “Sure, free trade will make us better off on average. But there are still both losers and winners!” From this, they want us to conclude either that free trade is not a good thing, or that at the very least, the winners should compensate the losers.

This strikes me as an extraordinarily dishonest way of arguing, because pretty much nobody ever argues this way about anything else, even though every policy change in history has created both winners and losers. In fact, every human action has both winners and losers. When Archie takes Betty instead of Veronica to the ice cream shoppe instead of the movies, both Veronica and the theater owner lose out. It does not follow that all human actions are wrong, or immoral, or should be discouraged by law, and it does not follow that all human actions should be followed by compensation to the losers. What, then, is so special about free trade?

The problem is confounded by the fact that with free trade, unlike many other policies, the winners are often poorer than the losers. When Americans lose their $30 an hour jobs making air conditioners so that they can be made by $20-an-hour foreigners, the big losers are Americans whose wages fall from $30 to $20. The big winners are Americans who can now for the first time afford air conditioning. Most of those people are probably making less than $20 an hour. (On this point, see also here.)

For those who insist on repeating the old “What about the losers?” refrain, I’ve prepeared a little quiz to test your moral consistency:

  1. In 1998, a new grocery store opened in my neighborhood, offering better food at lower prices than the old grocery store. This is generally perceived to have been a good thing overall, but at same time it was bad for the owners of the existing grocery store.
    1. Does this mean that the new grocery store should have been prohibited from opening?
    2. Does this mean that the winners — i.e. my neighbors and I — should have compensated the losers — i.e. the proprietors of the old grocery store — for their losses?
  2. In 2005, I stopped going to the barber and started cutting my own hair. My friends think my hair looks better now, and there’s a general perception that the change has been a good thing overall.
    1. Does this mean that I should be required to return to my barber?
    2. Does this mean that the winners — i.e. my friends and I — should have compensated the loser — i.e. my ex-barber — for her losses?
  3. In 2008, Google introduced the Android operating system to compete with Apple’s iPhone monopoly. This is generally perceived to have been a good thing overall, but at the same time it was bad for Apple’s shareholders.
    1. Does this mean that Google should have been prohibited from developing the Android system?
    2. Does this mean that the winners — i.e. everyone who purchased an Android, and everyone who got his iPhone a little cheaper thanks to the competition — should have compensated Apple’s shareholders for their losses?
  4. In 1863, Abraham Lincoln signed the Emancipation Proclamation, ending slavery in the United States of America. This is generally perceived to have been a good thing overall, but at the same time it was bad for slaveholders.
    1. Does this mean that Lincoln should not have freed the slaves?
    2. Does this mean that the winners — i.e. the freed slaves — should have compensated the losers — i.e. the slaveholders — for their losses?
  5. In 2008, Bernard Madoff was arrested and his ongoing Ponzi scheme was cut short. This is generally perceived to have been a good thing overall, but at the same time it was bad for Bernie Madoff.
    1. Does this mean that Madoff should not have been arrested?
    2. Does this mean that the winners — i.e. the Madoff victims — should have compensated the losers — i.e. Madoff and his co-conspirators — for their losses?

Scoring: If your answers were mostly “no”, and if you are nevertheless skeptical of free trade pacts, you’ve got some explaining to do.

Continue reading ‘Trading in Fallacies’

And the Winner Is….

Several commenters on yesterday’s post have asserted (in every case without evidence or argument) that the benefits of free trade — that is, lower prices for consumption goods — tend to accrue disproportionately to the wealthy.

Okay, the people I see shopping at Wal-Mart don’t strike me as particularly wealthy, but maybe I’m mistaken. Maybe the commenters are right and it’s the rich, not the poor, who care the most about affordable goods. Maybe Bill Gates would be devastated if he had to pay 50% more for a washing machine, but Joe Sixpack would just kind of shrug it off. I guess that makes sense if Bill spends his million dollars a month as fast as it comes in, while Joe always seems to have half of his thousand-dollar monthly paycheck left over.

Could be. But I hope the people who say they believe this will have the decency never to tell me that we can stimulate the economy by transferring income from the rich to the poor, because the poor are more likely to spend it.

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Trumponomics

trumpFollowing the latest round of drivel from Donald Trump, this might be a good time to review the standard textbook case for free trade. (You’ll also find this spelled out in The Big Questions .)

Suppose American manufacturers sell 1000 widgets a year to American consumers at a price of $9 each. Now, thanks to a new free trade agreement, foreign manufacturers can sell widgets to American consumers at $6 each. Let’s try to account for all the different ways that Americans are affected.

1. American manufacturers have two choices: They can match the foreign price of $6, or they can go do something else. If they match the foreign price, they lose $3 per widget (compared to what they were making before). If instead they go do something else, they lose at most $3 per widget. We know this, because they always have the option of matching the foreign price and therefore won’t choose any option worse than that. Therefore, the loss to American manufacturers is at most $3000. (In fact, under very mild assumptions, which almost always hold, the loss is surely less than $3000, but we won’t need to know that here.)

2. Existing American consumers — the ones who were going to buy those 1000 widgets anyway — pay $6 per widget instead of $9 per widget, and therefore collectively save $3000.

3. Some Americans who were unwilling to buy widgets at $9 will happily buy them at $6, and will be happy with their purchases. This is an additional gain to Americans.

Bottom line: American producers lose at most $3000. Existing American consumers gain $3000. New American consumers gain something too. Therefore the gains to Americans must exceed the losses to Americans.

Continue reading ‘Trumponomics’

Quickie

A quick question for my friends who vote Democratic and support much stricter gun control:

If, one year from today, Donald Trump is the head of the government, will you really want that government to have a monopoly on automatic weapons?

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Clintonomics

Hillary Clinton Campigns In Iowa, Meeting With Small Business OwnersAre you a corporate employee who wishes that your income were tied more closely to your employer’s profits?

I have good news for you: There’s an easy way to make that happen. Take 10% (or 5% or 20%) of your wages, and use them to buy corporate stock.

Are you a corporate employee who *doesn’t* wish that your income were tied more closely to your employer’s profits?

I have good news for you, too. You don’t have to buy additional stock if you don’t want to.

Hilary Clinton, however, wants to change all that. She wants to force you into a profit sharing arrangement that is, for all practical purposes, equivalent to forcibly converting part of your salary into corporate stock. If you were planning to do that anyway, this will make no difference to you. If you weren’t planning to do it anyway — if, for example, you preferred to diversify your risks by investing your wages in some other industry — then, of course, this will make you worse off.

(I trust that none of my regular readers is silly enough to respond that Clinton’s plan is much better than buying stock, because you get the profit-sharing in addition to your existing salary. But for the benefit of the occasional drive-by reader, this is not possible. Market pressures insure that your total compensation is equal to the value of what you produce for the company, and if one facet of that compensation goes up, then another must go down.)

Continue reading ‘Clintonomics’

Applied Economics

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Consistency Check

Donald Trump, objecting to the President’s post-Orlando call for stricter gun control, says that the president has “no clue”. Why? Because “The shooter was licensed…So he would have passed the test that the president would have thrown up there”.

Instead, Mr. Trump tells us that the lesson of Orlando is “We can’t let people in”. Of course, the Orlando murderer was a natural-born U.S. citizen, so he would have passed the test that Mr. Trump would have thrown up there.

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Killer Instincts

So help me out with this.

1) Correct me if I’m wrong, but I feel sure that it’s not uncommon, when a guy is murdered for a pair of shoes, or for the 23 cents in his pocket, that we tend to read commentary about how this murder is made particularly tragic and/or reprehensible by the fact that the killer gained so little.

2) The murder of schoolteacher Katie Locke is being widely condemned as particularly tragic and/or reprehensible because the killer had sex with her corpse, which was apparently his goal all along.

Do you see my problem here? How can a good outcome for the killer make a murder both better and worse?

Alright, let’s ask what the key difference is. Here’s one: Robbing a corpse (or a soon-to-be corpse) is a zero-sum game. What the robber acquires comes from the pockets of the heirs. Sex with a corpse is probably a positive-sum game; it’s unlikely to interfere with anyone else’s plans.

Unfortunately, that only makes things even more unsettling. It leads to this syllogism:

  1. People feel better about a murder when they learn that the killer stole $10,000 from the heirs as opposed, to, say, 23 cents. This suggests that they care more about the killer than they do about the heirs, who could be pretty much anyone.
  2. People feel worse about a murder when they learn that the killer got some satisfaction even if it came at nobody’s (additional) expense. This suggests that they care a negative amount about the killer.

Put all that together, and these people must be pretty much seething with hatred for the world at large.

Or to put this another way: It appears (taking the murder as given) that people want killers to achieve their goals when and only when those goals are achieved at someone else’s expense. That’s pretty much the definition of “anti-social”.

Continue reading ‘Killer Instincts’

Consistency Check


Should we presume that the race or ethnic heritage of a judge is likely to affect that judge’s rulings?

Donald Trump thinks so. So does Supreme Court Justice Sonia Sotomayor, who says this:

I, for one, do think there is a disadvantage from having (five) Catholics, three Jews, everyone from an Ivy League school.

A different perspective can permit you to more fully understand the arguments that are before you.

And:

I would hope that a wise Latina woman with the richness of her experiences would more often than not reach a better conclusion than a white male who hasn’t lived that life.

I have three questions for my readers:

  1. Is Trump’s opinion an instance of despicable racism?
  2. Is Sotomayor’s opinion an instance of despicable racism?
  3. Did you give the same answers to questions 1 and 2?
  4. If your answer to question 3 was “No”, do you want to rethink this?

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Promise Keeping

So apparently last week, while my attention was directed elsewhere, Donald Trump attempted to attract the support of conservatives by promising to choose all of his Supreme Court appointments from a short list of candidates who he believes conservatives will find appealing.

Regardless of what you think of those individual candidates, there is absolutely no reason this gambit should garner support from conservatives for the simple reasont that the promise is not enforceable. This would be a problem with any politician, but particularly with Trump, who has never felt any qualms (or even, as far as I can see, any embarrassment) about shifting his positions 180 degrees from one day to the next.

But there’s a way to fix that problem, and it’s available not just to Trump but to any politician with credibility issues. Let him issue a list of specific promises (such as “All of my Supreme Court appointments will come from this list”) and then put the bulk of his personal wealth in an escrow account, to be returned to him if he loses the election or if he serves and keeps his promises — and to be paid to someone else if he’s elected and breaks those promises. The named beneficiary could be, for example, the U.S. Treasury, or — if the candidate is particularly concerned about attracting the votes of traditional Republicans — the Republican National Committee.

Continue reading ‘Promise Keeping’

History Repeats Itself

In 1991, when David Duke, late of the Ku Klux Klan, ran for governor of Louisiana against the famously corrupt incumbent Edwin Edwards (who was subsequently sentenced to ten years in prison on a racketeering charge), the state was flooded with bumper stickers that said:

Vote for the Crook.  It's important.

If somebody’s still got a warehouse full of those things, it might be time to pull them out.

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Right Again

goldwaterWe already knew that Barry Goldwater was a man of vision, but who until now recognized the clarity with which he managed to foresee, fifty-three years in advance, the election results of April 26, 2016?

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Small World

globeToday, in a moment of idleness and nostalgia, I tried Googling an old girlfriend I haven’t seen or heard from in decades. She has a very common name, so she’s hard to Google. I’ve tried a few times in the past, and have always failed.

Today, though, I found her. A few minor clues helped me pick her out from the dozens of others with the same name. There wasn’t much. I still don’t know where she lives, and I still don’t know if she has a family. The one and only thing I’ve learned is that she was the screenwriter for two short films, both by the same director.

So of course I Googled that director. The first hit was a list of all his movies, in order of their rankings on IMDB, with cast listings for each movie. The top-billed cast member on the top-rated movie was — (drumroll!) — my son-in-law.

No, there is no conceivable connection between the ex-girlfriend, who I lost touch with when my son-in-law was something like an infant, and the son-in-law himself. No, the ex-girlfriend never lived in the city where I and the son-in-law live now, or in any other city he’s lived in. Yes, I was vaguely aware that my son-in-law was involved with moviemaking as a serious hobby, and somewhat more vaguely aware that he might have done some acting as part of that hobby. That’s all I’ve got.

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Crossword Results

The results of the latest crossword contest:

Paul Epps and Alan Gunn submitted perfect solutions and therefore tied for first place.

Dan Christensen ran a close second with two incorrect letters, both in 15 across, and John Faben ran a close third with three incorrect letters, all in 35 across (which is too bad, because I’m rather fond of 35 across).

All four have earned signed books of their choice ( The Big Questions, The Armchair Economist, Fair Play, or More Sex is Safer Sex) — if you’re a winner, email me your selection and mailing address.

I’m electing not to post the solution in deference to others who might come along and prefer no-spoilers. But if there’s debate about a particular entry or two, I’m happy to engage.

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Quick Crossword Update

I realize I’m overdue to announce the winners of the crossword contest from last week. I promise to get to this before the weekend!

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Robin Hanson!!

If you happen to be in the Rochester, New York area, you’ll want to know that the esteemed Robin Hanson, proprietor of the endlessly fascinating Overcoming Bias blog will be delivering the Lawrence Goldberg Memorial lecture, based on his new book The Age of Em this Monday, April 18, at 7:30 PM in Dewey 1-101 on the University of Rochester campus. The general public is warmly welcome.

(Click poster to enlarge.)

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Monday Puzzle

Have at it:

Click on the image to solve the puzzle. You’ll see a “save” button in the upper left in case you want to save your work and return to it later, and a “Submit” button if you want to submit your solution for judging. The three closest-to-perfect solutions will be acknowledged in this space and will receive appropriate rewards after the passage of a decent time interval (the length of which will be determined partly by the speed at which solutions arrive, but ought to be about a week).

Please try to keep spoilers out of the comments.

The rules are basically London Times rules:

  1. In most cases, there are two clues next to each other, one a straightforward definition and the other involving some wordplay. Part of your job is to figure out where one clue ends and the other begins. Example: “You could worship this mad dog” is a clue for GOD — “You could worship this” being the straight definition and “mad dog” being the wordplay. (Either could come first).
  2. Unlike in many American cryptics, there is sometimes a small connecting word that is not properly part of either clue.
  3. Internal punctuation means nothing. A question mark at the end of a clue is usually an acknowledgement that the clue is pretty lame. An exclamation point at the end usually means that the two clues overlap each other.
  4. Unlike in many American cryptics, not all clues are required to follow the above rules. There might be a few that deviate substantially, but in every case, once you know the solution, you ought to be able to say “Aha! I see how that’s a clue for that!”.

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An Algorithm For An Automated Meritocracy

A Guest Post

by

Bennett Haselton

A 2006 study by Matthew Salganik and his co-researchers at Princeton suggests that a huge amount of effort is wasted in many different areas of human endeavor, and the resulting outcomes are far less than optimal — but that there is a simple algorithm that could fix both problems.

In Salganik’s experiment, users of a music-rating site were divided at random into eight artificial “worlds”. All of the users in all eight worlds had access to the same library of songs, which they could download or recommend to their peers, but they could only recommend songs to other users in the same world. Also, each user could view the number of times that a song had been downloaded, but only by other users in the same world.

The goal was to see whether certain songs could become popular in some worlds while languishing in others, despite the fact that all groups consisted of randomly assigned populations that all had equal access to the same songs. The experiment also attempted to measure the “merit” of individual songs by assigning some users to an “independent” group, where they could listen to songs and choose whether to download them, but without seeing the number of times the song had been downloaded by anyone else; the merit of the song was defined as the number of times that users in the independent group decided to download the song after listening to it. Experimenters looked at whether the merit of the song had any effect on the popularity levels it achieved in the eight other “worlds”.

Continue reading ‘An Algorithm For An Automated Meritocracy’

Political Strategy

It now seems likely that:

  • In order for either Ted Cruz or Marco Rubio to become the Republican nominee, he must first consolidate the anti-Trump vote, which is to say that either can succeed only if the other drops out.
  • Cruz and Rubio have approximately equal chances of driving each other out.
  • Each would prefer to drive the other out sooner rather than later — i.e. before Trump wraps this whole thing up anyway.

Given that, it seems like one of the following two things should happen at tonight’s debate:

    Either:

  1. Cruz, after making an eloquent case against Trump and explaining why he thinks it’s important to keep Trump out of the White House, turns to Rubio and offers to flip a coin right on the spot. The loser drops out of the race and the winner takes on Trump.
  2. or

  3. Rubio, after making an elegant case against Trump and explaining why he thinks it’s important to keep Trump out of the White House, turns to Cruz and offers to flip a coin right on the spot. The loser drops out of the race and the winner takes on Trump.

This gives each of them only a 50% chance of survival. But if they’ve already each got only a 50% chance of survival, that’s no loss. And it substantially increases the value of survival, because it gets things over with now instead of a month from now.

If I’m wrong in saying that each currently has a 50% chance — if instead, say, Cruz has a 60% chance and Rubio a 40% chance or vice versa — then they can flip an appropriately weighted coin.

Continue reading ‘Political Strategy’

Antonin Scalia

scaliapicMy favorite Scalia story is from Ted Cruz’s book A Time for Truth. This took place in 1986, when the departure of Warren Burger had created a vacancy on the Supreme Court, and it was clear that attorney general Ed Meese would be President Reagan’s most influential advisor on choosing a nominee. According to Cruz:

Everyone knew that two of the stars on the conservative side, and thus possible nominees, were Robert Bork and Scalia, both on the D.C. Circuit. So one day Scalia was walking in a parking garage at the appellate court when two U.S. marshals stopped him. “Sorry, sir,” one of them said. “We’re holding this elevator for the attorney general of the United States.”

Scalia pushed past them, entered the elevator, and pressed a button. As the doors closed, Scalia shouted out, “You tell Ed Meese that Bob Bork doesn’t wait for anyone!”

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How to Be Reasonable

Listening to Season One of NPR’s podcast Serial, which is the story of a real-life murder case, I came away about 80% sure that the defendant was guilty and 100% sure that I’d vote to convict him. This got me to pondering whether my standards for reasonable doubt (apparently less than 80% in this case) are in fact reasonable.

So I wrote down the simplest model I could think of — a model too simple to give useful numerical cutoffs, but still a starting point — and I learned something surprising. Namely (at least in this very simple model), the harsher the prospective punishment, the laxer you should be about reasonable doubt. Or to say this another way: When the penalty is a year in jail, you should vote to convict only when the evidence is very strong. When the penalty is 50 years, you should vote to convict even when it’s pretty weak.

(The standard here for what you “should” do is this: When you lower your standards, you increase the chance that Mr. or Ms. Average will be convicted of a crime, and lower the chance that the same Mr. or Ms. Average will become a crime victim. The right standard is the one that balances those risks in the way that Mr. or Ms. Average finds the least distasteful.)

Here (I think) is what’s going on: A weak penalty has very little deterrent effect — so little that it’s not worth convicting an innocent person over. But a strong penalty can have such a large deterrent effect that it’s worth tolerating a lot of false convictions to get a few true ones.

In case I’ve made any mistakes (and it wouldn’t be the first time), you can check this for yourself. (Trigger warning: This might get slightly geeky.) I assumed each crime has a fixed cost C to the victim and a random benefit B to the perpetrator. For concreteness, we can take C=2 and take Log(B) to be a standard normal distribution, though the results are pretty robust to these particulars. (Or, much more simply and probably more sensibly, take B to be uniformly distributed from 0 to C — the qualitative results are unchanged by this.)

Continue reading ‘How to Be Reasonable’

Advice for Ted Cruz

I’m typing this a few hours before the Iowa Republican Debate. By the time you read it, you might know whether Ted Cruz chose to ignore this advice.

Cruz’s opposition to ethanol subsidies is apparently a problem for him in Iowa. It shouldn’t have to be. The whole point of opposing inefficient subsidies is that if we eliminate enough of them, we can all be better off.

So what Cruz ought to do is introduce a bill eliminating a long list of subsidies, ethanol among them — together with Planned Parenthood, NPR, the National Endowments for the Arts and Humanities and I’m sure it wouldn’t be hard to find another hundred or so — and then emphasize to Iowans that the net effect of the entire package, which takes away their ethanol subidies but also relieves their tax burden, will be to make them richer. A collateral benefit is that he can then argue that the same bill makes New Hampshirites, Nevadans and South Carolinians richer, and if he succeeds in getting the nomination, that it makes Americans generally richer.

As a general rule, I do not understand why politicians take politically risky stands without this kind of bundling. It seems like good politics, and I’m sure it’s good policy.

Ethanol and NPR are of course small potatoes. One could of course do the same sort of bundling with big issues, and politicians of course sometimes do this. But why don’t they do it with both the small stuff and the big stuff?

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A Voter’s Guide to Thinking

Scott Adams (the Dilbert guy) offers a Voter’s Guide to Thinking that is so good I am going to reproduce it in its entirety:

  1. If you are comparing Plan A to Plan B, you might be doing a good job of thinking. But if you are comparing Plan A to an imaginary situation in which there are no tradeoffs in life, you are not thinking.
  2. If you see quotes taken out of context, and you form an opinion anyway, that’s probably not thinking. If you believe you need no further context because there is only one imaginable explanation for the meaning of the quotes, you might have a poor imagination. Sometimes a poor imagination feels a lot like knowledge, but it’s closer to the opposite.
  3. If a debate lends itself to estimates of cost (in money or human suffering) and you aren’t willing to offer an estimate in support of your opinion, you don’t yet have an opinion.
  4. If you are sure you know how a leader performed during his or her tenure, and you don’t know how someone else would have performed in the same situation, you don’t actually know anything. It just feels like you do.

    Continue reading ‘A Voter’s Guide to Thinking’

The Death of Real Business Cycle Theory

Wasn’t there this idea going around that we could explain business cycles through intertemporal substitution of labor supply? (Without the jargon, this means that people work less in times when they are less productive and more in times when they are more productive, so small shocks to productivity — due to random things like weather — tend to have much bigger effects on output.)

Well, it rained here on Wednesday and Thursday of last week, so my roofers spent most of the day pressed up against the garage door trying to stay dry and waiting for little breaks in the rain so they could get something done. On Saturday and Sunday, the weather was beautiful and they didn’t show up. Now it’s Monday and they’re back to work.

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Spacetime Tells Matter How to Move

Here, in honor of the hundredth anniversary of the General Theory of Relativity, is a very nice visualization:

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Family Values

Followup to last night’s debate:

Didn’t Rubio essentially disqualify himself when he said he’d prioritize his job as a parent over his job as President of the United States?

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Debate Blog

Heard only a little of the undercard, but I do have some comments on it. But I’ll add those later.

Re the main debate (I’ll add to this every twenty minutes or so till the debate is over): (Note this is live-blogging, hence not always carefully thought through).

Continue reading ‘Debate Blog’