Archive for the 'Bad Reasoning' Category

The Match Game

Published
by
Steve Landsburg
on August 25, 2010
in Bad Reasoning and Statistics
. 22 Comments

Robin Hanson reports that success in marriage is quite uncorrelated with the match between your personality traits and your partner’s. Your traits matter (it pays to be happy, for example) and so do your partner’s, but the combination makes no difference. In other words, being a happy person (or an extrovert, or a stickler for detail) affects the quality of your marriage in exactly the same way whether you marry Ruth Bader Ginsberg or Lady Gaga. (This applies specifically to personality traits, not to religion, politics, wealth, intelligence, etc.)

Edited to add: The original version of this post misstated the result; I’ve changed a few words in the preceding paragraph so it’s accurate now.

From this, Robin concludes:

If you want a happy relationship, be a happy person and pick a happy partner; no need to worry about how well you match personality-wise.

NO!!!! That’s not the right conclusion at all, and it’s worth understanding why not. Suppose we lived in a world where personality matches had a huge effect on the success of marriages. In that world, why would two people with clashing personalities ever choose to marry? Presumably because there’s some special value in the match — like, say, an extraordinary mutual attraction — that overrides the personality clash.

So a survey of married couples — which is exactly the sort of evidence Robin is reporting on — is not at all a random sample of couples. Instead, it consists, for the most part, of couples with matched personalities on the one hand, and couples with mismatched personalities who are exceptionally well suited to each other for some other reason on the other hand. It’s not too surprising to find similar success rates in those two classes of couples. The third class — the couples with mismatched personalities and no redeeming match characteristics — never gets married and therefore never gets surveyed.

Conclusion: The results Robin quotes are perfectly consistent with a world where personality matching doesn’t matter — but also perfectly consistent with a world where it matters very much.

Continue reading ‘The Match Game’

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LocoVore Followup: A Blast From the Past

Published
by
Steve Landsburg
on August 24, 2010
in Bad Reasoning and Economics
. 22 Comments

By way of followup to yesterday’s post on locavores, I present this letter to the editor of Science, written in 1976 by Harvard economist Robert Dorfman. You can think of Earl Cook, to whom Dorfman is responding, as the Steven Budiansky of his time.

The article by Earl Cook, “Limits to exploitation of nonrenewable resources”, is extremely informative. In fact, I should like to assign it to my class except that it is marred by an egregious fallacy. Since this fallacy has been turning up repeatedly in writings about environmental and natural resource problems, I wish to call it to the attention of Science readers.

The mistake has to do with the nature of social cost. Cook, for example, writes “To society … the profit from mining (including oil and gas extraction) can be defined either as an energy surplus, as from the exploitation of fossil and nuclear fuel deposits, or as a work saving, as in the lessened expenditure of human energy and time when steel is used in place of wood … “. A number of other authors also equate social cost with the expenditure of energy.

Continue reading ‘LocoVore Followup: A Blast From the Past’

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Loco-Vores

Published
by
Steve Landsburg
on August 23, 2010
in Bad Reasoning and Economics
. 52 Comments

bugsSteven Budiansky, the self-described Liberal Curmudgeon, thinks there’s something wrong with the locavore movement, and says so in the New York Times. But he misses the point just as badly as the locavores themselves.

The locavores, in case you don’t follow this kind of thing, are an environmentalist sect who make a moral issue out of where your food is grown — preferring that which is local to that which comes from afar. For example, as Budiansky puts it, “it is sinful in New York City to buy a tomato grown in California because of the energy spent to truck it across the country”.

Ah, says Budiansky, but let’s look deeper — the alternative to that California tomato might be one grown in a lavishly heated greenhouse in the Hudson Valley, and at a higher energy cost. This leads him off on a merry chase through what he calls a series of math lessons, adding up the energy costs of growing and transporting food in different locations. The implicit recommendation seems to be that when you’re choosing a tomato, you should care about all the energy costs.

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Pop Quiz

Published
by
Steve Landsburg
on July 22, 2010
in Bad Reasoning, Economics and Puzzles
. 45 Comments

Commenting on this essay by former Intel chief Andy Grove, Tyler Cowen writes that “Only he who first shows he understands comparative advantage has license to partially reject it.”

Hear hear. When someone says “I understand comparative advantage, but in this case it doesn’t apply”, or “I understand comparative advantage but in this case it is overridden by other considerations”, my experience tells me that you can be nearly sure you’re talking to someone who does not in fact understand comparative advantage.

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Ultimately Simple

Published
by
Steve Landsburg
on July 20, 2010
in Bad Reasoning and Economics
. 31 Comments

Stop me if you’ve heard this one. A subject (called the proposer) is placed in an isolation booth and given ten dollars to divide between himself and the stranger in the booth next door. The stranger (called the responder) can accept or reject the division. If he accepts, they each take their shares and go home. If he rejects, they each go home with nothing.

In experimental plays of this ultimatum game, responders tend to reject splits that are substantially worse than 50-50. This is offered as some kind of reproof to the principles of economics. After all, the responder is turning down free money.

But so what? Continue reading ‘Ultimately Simple’

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A Pencil in the Eye

Published
by
Steve Landsburg
on July 19, 2010
in Bad Reasoning, Current Events, Economics, Paul Krugman and Policy
. 28 Comments

Okay, if Paul Krugman is going to keep on writing the same column twice a week every week forever, then I am going to keeping on objecting to it forever, though not, I promise, twice every week.

A couple of bullet points from his latest:

  • In response to the priorities of Senator John Kyl, Krugman writes: “So $30 billion in aid to the unemployed is unaffordable, but 20 times that much in tax cuts for the rich doesn’t count.” Oh, for goodness’s sake. $30 billion in aid to the unemployed might or might not be good policy and 20 times that much in tax cuts might or might not be good policy; that’s beside the point here. The point is that these are quite entirely separate issues and one’s position on the first need not dictate one’s position on the second. Aid to the unemployed is costly. Tax cuts are not. Didn’t I just say this?

    • Continue reading ‘A Pencil in the Eye’

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Toy Stories

Published
by
Steve Landsburg
on July 6, 2010
in Bad Reasoning, Paul Krugman and Policy
. 33 Comments

toysPaul Krugman is at it again, casting aspersions on everyone who opposes extended unemployment benefits while offering absolutely no positive argument for those benefits. Let me explain what would count, to an economist, as a positive argument.

There’s no question that extending benefits would be good for the currently unemployed, and no question that it would be bad for those who are called on to foot the bill. Economists usually deal with that kind of conflict by asking what policy you’d prefer if you had amnesia, and and didn’t know your own employment status. (You can read a lot more about this approach to policy analysis in Chapter 16 of The Big Questions.) The amnesiac is an impartial judge who is forced to care about everyone, because he/she might be anyone.

Continue reading ‘Toy Stories’

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For Heaven’s Sake

Published
by
Steve Landsburg
on June 29, 2010
in Bad Reasoning, Belief and Religion
. 39 Comments

HuckabeeMAHere’s Mike Huckabee, quoted in The New Yorker:

If somebody asked me, How do I get to Heaven, I would tell them that the only way I personally am aware of is faith in Christ, because I believe the New Testament. That’s the only map I got. Somebody says, Well, I got a different map. O.K.! You know what? If it works, I’m not going to argue with you.

Well, that makes sense. If somebody asked me, How do I get to Mount Rushmore, I would tell them that the only way I personally am aware of is Route 90, because I believe in Google Maps. Somebody says, Well, I got a different map. O.K.! You know what, if it works, I’m not going to argue with you. Unless, of course, I actually care whether you make it to Mount Rushmore or not, in which case I might take the trouble to defend my map.

Continue reading ‘For Heaven’s Sake’

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Nonsense 4.0

Published
by
Steve Landsburg
on June 23, 2010
in Bad Reasoning
. 20 Comments

powerballThe most recent winning Powerball numbers were 9,30,31,50,54,39. But a month ago, nobody would have placed any significant probability on those exact numbers coming up. What better illustration that questions about the future cannot be answered, even in the probabilistic sense?

If that made you scratch your head, your scalp will probably be rubbed raw before you’re finished reading Anatole Koletsky’s Wall Street Journal essay, excerpted from his book Capitalism 4.0. (Caveat: I have not read the book, so I’m not sure how much danger the rest of it poses to your scalp, or to your sanity.) Mr. Koletsky’s “proof” that some questions “cannot be answered, even in a probabilistic sense” is this:

In 1980, nobody would have put any significant probability on computer sales exceeding car sales by a factor of 10 to 1.”

But that’s not all! There’s also this:

Continue reading ‘Nonsense 4.0′

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You Can’t Keep a Good Straw Man Down

Published
by
Steve Landsburg
on June 22, 2010
in Bad Reasoning, Economics, Paul Krugman and Policy
. 21 Comments

The artwork above is courtesy of Jodi Beggs, proprietress of the lively Economists Do It With Models site, who graced us with a visit in yesterday’s comments and expanded on those comments on her own page. (That’s me kicking Paul Krugman in the gut.)

Jodi objects to the tone, and in part to the substance, of my response to Paul’s recent attacks on the “deficit hawks” who oppose various spending programs that Paul happens to favor. I’d summarized his rhetorical technique as follows:

Continue reading ‘You Can’t Keep a Good Straw Man Down’

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There He Goes Again

Published
by
Steve Landsburg
on June 21, 2010
in Bad Reasoning, Economics, Paul Krugman and Policy
. 23 Comments

krugmanPaul Krugman sinks to a new low with this passage:

In America, many self-described deficit hawks are hypocrites, pure and simple. They’re eager to slash benefits for those in need but their concerns about red ink vanish when it comes to tax breaks for the wealthy. Thus, Senator Ben Nelson, who sanctimoniously declared that we can’t afford $77 billion in aid to the unemployed, was instrumental in passing the first Bush tax cut, which cost a cool $1.3 trillion.

Where to begin?

First, no economist—let me repeat that—NO economist, not even Paul Krugman on the days when he’s being an economist—would count a tax cut as a cost for purposes of policy analysis. A cost is something that consumes resources, not something that changes the ownership of resources. My Principles of Economics students all understand this; so, presumably, does the Nobel-prize winning author of a prominent Principles textbook. (A possible exception: You could call a present-day tax cut costly if it necessitates a future tax increase which, for some reason, is costlier to collect than the present-day tax. I guarantee you this is not what Krugman has in mind. If it were,the $1.3 trillion number that he highlights would be totally irrelevant to the actual cost.)

Next, unemployment benefits are costly, both insofar as they discourage recipients from seeking work and insofar as they necessitate taxes that discourage productive activity. The cost of $77 billion worth of benefits is not $77 billion, but it’s not zero either.

So unemployment benefits are costly and tax cuts are not. Which doesn’t mean that all unemployment benefits are bad or that all tax cuts are good, but it’s plenty adequate to absolve the hypocrisy charge.

But Krugman, as is his wont lately, appears committed to the following flat-out dishonest rhetorical agenda:

Continue reading ‘There He Goes Again’

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Environmental Economics

Published
by
Steve Landsburg
on June 17, 2010
in Bad Reasoning, Economics and Policy
. 24 Comments

oilspillWhen big companies (like, say, British Petroleum) wreak great havoc (like, say, by spilling millions of gallons of oil into the Gulf of Mexico), it can be good policy to make them compensate their victims (like, say, with a $20 billion claim fund). It can also be bad policy.

A.C. Pigou taught us that we get better outcomes when decisionmakers bear the costs of their actions. Ronald Coase taught us that Pigou’s lesson cuts two ways. The shrimp boats that are sitting idle today are sitting idle partly because BP decided to drill in the gulf, but also partly because the shrimpers chose to operate in the vicinity of an oil rig. In this case, making BP feel the costs of its own decisions entails insulating the shrimpers from the costs of theirs.

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Bad Logic — Or Bad Arithmetic?

Published
by
Steve Landsburg
on June 15, 2010
in Bad Reasoning, Economics, Paul Krugman and Policy
. 15 Comments

In a blog post on what he calls the “Bad Logic of Fiscal Austerity”, Paul Krugman lays the following calculation before the public:krugman

Let me start with the budget arithmetic, borrowing an approach from Brad DeLong. Consider the long-run budget implications for the United States of spending $1 trillion on stimulus at a time when the economy is suffering from severe unemployment.

That sounds like a lot of money. But the US Treasury can currently issue long-term inflation-protected securities at an interest rate of 1.75%. So the long-term cost of servicing an extra trillion dollars of borrowing is $17.5 billion, or around 0.13 percent of GDP.

Yes. That’s the long-term cost of borrowing an extra trillion dollars. (Actually, the cost is even lower than Krugman says it is.) But the long term cost of spending an extra trillion dollars is somewhere in the vicinity, of, oh, about a trillion dollars, or about 7.4% of GDP.

Now you might argue that if some of that spending puts unemployed resources to work, then the true cost of spending a trillion is somewhat less than a trillion, but Krugman, at least here, does not attempt to make that argument. Nor do I expect that even Paul Krugman would dare to argue that an adjustment for unemployed resources could reduce the cost of government spending by roughly 98%.

Krugman is right when he says that borrowing is cheap. But the issue isn’t borrowing; it’s spending—and spending is expensive. It appears that like the President, Krugman wants to divert your attention from spending to borrowing so he can dismiss legitimate concerns without even acknowledging them. It’s a cheap trick. Don’t let either of them get away with it.

Edited to add: In fairness to Krugman, he appears to be imagining that the trillion is never paid back, so that the cost of spending it is simply the debt service of 17.5 billion per year forever. But his column makes it sound like the cost is a single one-time payment of 17.5 billion, which is absurd.

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Nanny Nanny Boo Boo

Published
by
Steve Landsburg
on June 7, 2010
in Bad Reasoning, Current Events, Economics and Policy
. 40 Comments

I guess this is why I never got that call from the New York Times.

To be a Times contributor, you apparently have to write like Mara Gay, who penned these lines for a front page article last week:

New York may soon become the first state to offer employment protection for nannies.

The state Senate passed a bill of rights for domestic workers this week, a measure that would require employers to offer New York’s approximately 200,000 household workers paid holidays, overtime pay and sick days.

Supporters say the step will provide needed relief to thousands of women — and some men — who are helping to raise the children of wealthier New Yorkers without any legal workplace rights beyond the federal minimum wage.

Now, you see, if I had been writing this article, it might have opened more like this:

Continue reading ‘Nanny Nanny Boo Boo’

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Maple Tree Economics

Published
by
Steve Landsburg
on June 3, 2010
in Bad Reasoning, Current Events, Economics and Policy
. 20 Comments

mapleIn his speech at Carnegie-Mellon yesterday, the President lamented the growth of federal spending and proposed to attack the problem partly by letting the Bush tax cuts expire. Can you say non sequitur, boys and girls?

Now as it happens, I’ve got this maple tree in my yard that’s been growing much too fast for my tastes. In fact, it’s been growing far faster than I have. But inspired by the president, I’ve found a solution. I’m going to stock up on E.L. Fudge Double Stuf cookies so I can grow faster than the maple.

The President raises the real problem of excessive spending so that he can misdirect your attention to the phony “problem” of excessive government debt—that is, an excessive gap between spending and tax revenues. This is very like my raising the real problem of my overlarge maple tree in order to misdirect your attention to the phony “problem” of an excessive gap between the height of the maple and the size of my waistline—giving both me and the President equally flimsy excuses to do exactly what we wanted to do in any case, namely gorge out on junk food or let taxes rise.

Continue reading ‘Maple Tree Economics’

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That’s Rich

Published
by
Steve Landsburg
on May 24, 2010
in Bad Reasoning, Current Events and Rants
. 31 Comments

“It’s now crystal clear what the Tea Party stands for” says Frank Rich midway through a column that makes it crystal clear what Frank Rich stands for, and it isn’t pretty.

Whatever you may think about the 1964 Civil Rights Act as a whole, it indisputably narrows property rights by allowing politicians to dictate the policies of private businesses. Not only is it perfectly reasonable to find that at least a little disturbing, it’s perfectly unreasonable not to find it a little disturbing—even if your ultimate judgment is that it’s a necessary means to a desirable end. Even avid supporters of the Patriot Act ought to acknowledge that it raises legitimate concerns about privacy, even avid supporters of capital punishment ought to acknowledge that it raises legitimate concerns about false convictions, and even avid supporters of the Civil Rights Act ought to acknowledge that it raises legitimate concerns about property rights.

Frank Rich, who equates Rand Paul’s expression of those concerns with nostalgia for the Confederacy, thereby makes himself as scurrilous as those who equate reservations about the Patriot Act with being “on the side of the terrorists”. The “gotcha” game is bad enough when a single thoughtless remark becomes the pretext for dismissing an entire movement. Here the pretext is a single thoughtful remark.

If we are to discredit everyone who is capable of subtler thought than Frank Rich, then there is no hope for the level of public discourse.

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The English Patient

Published
by
Steve Landsburg
on April 20, 2010
in Bad Reasoning, Current Events, Economics and Policy
. 31 Comments

whiteheadA friend living in England (the philosopher Jamie Whyte, actually, whose writing has graced this very blog) sends along a little vignette for the benefit of my American readers who see European health care systems through rose colored glasses.

A 64 year old breast cancer survivor suffering severe back pain is told she’ll have to wait five months for an appointment with an orthopedic surgeon through the National Health Service (NHS). She therefore (and perfectly legally) chooses to pay 250 pounds (about 385 dollars) for a private appointment. He puts her on a waiting list for surgery to remove a cyst from her spine, surgery which is routinely covered by the NHS. But the NHS decides that since she can afford 250 pounds for a private appointment, she can also afford 10,000 pounds (over 15,000 dollars) for private surgery. They therefore deny to provide her the surgery for which she’s been paying taxes her whole life.

This was not an isolated incident; until recently, cancer patients were routinely denied further NHS treatement after privately purchasing lifesaving drugs that are not available through the NHS.

More details here. It’s worth reading the comments, where readers excoriate the patient for “queue jumping” because she used the price system to signal her high demand for medical services. Note that nobody complains about “queue jumping” in the market for, say, oranges, because oranges are not rationed by government bureaucrats and therefore do not generate queues.

The lesson, I think, is that once an inefficient bureaucracy becomes entrenched, a certain fraction of the electorate becomes incapable of imagining anything better. In this case, that fraction seems to have forgotten first that some people need medical care more desperately than others, so that “queue jumping” can be desirable, second that private payments to doctors actually call forth more medical care and therefore shorten queues, and third that maybe it would be better to have a system that didn’t require queuing in the first place.

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Unhappy Reasoning

Published
by
Steve Landsburg
on March 31, 2010
in Bad Reasoning and Rants
. 31 Comments

happyIn a New Yorker essay, Elizabeth Kolbert takes at face value the widely reported statistic that “the average level of self-reported happiness, or subjective well-being, appears to have been flat going all the way back to the nineteen-fifties, when real per-capita income was less than half what it is today”. Proceeding from the assumption that these self-reports tell us something about actual happiness, Kolbert, proceeds to muse on the policy implications, quoting ex-Harvard president Derek Bok with approval:

If rising incomes have failed to make Americans happier over the last fifty years, what is the point of working such long hours and risking environmental disaster in order to keep on doubling and redoubling our Gross Domestic Product?

Wait a minute, now. Self-reported happiness has been flat for fifty years despite rising incomes. Self-reported happiness has also been flat for fifty years despite dramatic increases in leisure and environmental quality. (Since 1965, the average American has gained about six hours a week of leisure—the equivalent of seven vacation weeks a year.) So why aren’t Bok and Kolbert asking why we bother to come home from the office, take vacations, and clean our air and water?

Continue reading ‘Unhappy Reasoning’

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Krugman versus Krugman

Published
by
Steve Landsburg
on March 7, 2010
in Bad Reasoning, Economics, Outrage and Paul Krugman
. 34 Comments

I don’t usually post on Sundays, but this letter to the New York Times from the indispensable Don Boudreaux is too priceless to pass up.

Edited to add: I don’t always read Krugman’s column, but since Don’s link sent me there today, I can’t resist noting one more outrage: Krugman thinks that extending estate tax relief to the top .25% of estates is a policy “on behalf of” that .25% of the population, as opposed to a policy on behalf of everyone who benefits from capital accumulation, higher wages and economic growth.

Or more precisesly, he doesn’t think that. But he says it.

Click here to comment or read others’ comments.

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Getting Serious

Published
by
Steve Landsburg
on February 4, 2010
in Bad Reasoning and Policy
. 48 Comments

leswaasCongressman Donald Schwerbitz, who represented South Dakota back in the 1960s and 70s, was a visionary environmentalist who sponsored the first legislation designed to reduce our national carbon footprint. It was Congressman Schwerbitz who recognized that carbon emissions are caused primarily by breathing, and he proposed to cut those emissions in half by requiring every American to wear a device that plugs up one nostril.

Continue reading ‘Getting Serious’

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Debt and Taxes

Published
by
Steve Landsburg
on February 1, 2010
in Bad Reasoning, Policy and Politics
. 56 Comments

deb
When I teach economics, I try to drive home the lesson that words are supposed to mean something coherent. If you want to be rewarded for stringing together a bunch of empty phrases, you should go take an English class.

I was therefore maximally sympathetic to the poor XM radio host (I think it was Pete Dominick but I’m not sure) who was stuck interviewing a man named John Sakowicz last Friday. Sakowicz, who hosts his own radio show in northern California, was there to warn about the dangers inherent in our growing national debt. He was very clear about this much: the debt and its associated dangers are massive, explosive, perhaps even apocalyptic. He was entire unclear, however, about exactly what those dangers are.

Continue reading ‘Debt and Taxes’

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A Quick Economics Lesson

Published
by
Steve Landsburg
on January 27, 2010
in Bad Reasoning, Economics and Policy
. 93 Comments

I am opposed to all taxes on interest, dividends and other forms of capital income. Supporters of these taxes keep making the same fallacious argument. The purpose of this post is to shame those people out of ever making that argument again. (They are, of course, free to make other arguments.)

The fallacy I have in mind goes like this: First, economics teaches us that everything should be taxed at the same rate to avoid unnecessary distortions. Second, QED.

With appropriate caveats, the first part is true. The problem is with getting from there to the second part.

Continue reading ‘A Quick Economics Lesson’

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n Guilty Men

Published
by
Steve Landsburg
on January 20, 2010
in Bad Reasoning and Policy
. 29 Comments

jury

Whenever I ask about the reasoning underlying some legal principle or another, my friend the law professor is always quick to remind me that “there is no such thing as legal reasoning”. So it is with William Blackstone’s famous doctrine that it’s better for ten guilty men to escape than for one innocent to suffer. Why ten? Because that’s the first number that happened to enter Blackstone’s head; that’s why.

Writing 200 years after Blackstone, Emory Law School professor Alexander Volokh surveyed the history of alternatives to “ten” in a charming essay called n Guilty Men. The bottom line is that a great many alternatives have been offered, almost never with anything approaching a justification.

Continue reading ‘n Guilty Men’

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Wind Production

Published
by
Steve Landsburg
on January 11, 2010
in Bad Reasoning, Economics and Paul Krugman
. 34 Comments

Once upon a time in America, whenever an administration spokesman spouted economic nonsense, you could rely on Paul Krugman for a sneer, a blast of outrage, and frequently an imputation of the basest motives. That time ended on approximately January 20, 2009. Today Krugman sleeps at the wheel while administration press spokesman Robert Gibbs spews forth the following:

I think it’s safe to say that for quite some time, when it came to building the solar panels and the wind towers and the wind turbines and a lot of the manufactured equipment for clean energy, we had a number of foreign countries that were doing much better in addressing that demand than we were. And as the President has said often, the type of demand for these components in manufacturing is only going to increase as we seek solutions to our energy problems.

And we have to ask ourselves as a country, are we going to create those jobs and create those components, or are we going to import those components from overseas? The President believes that we have an opportunity to lead the world in this type of manufacturing.

Nobody in the Bush administration ever displayed more economic ignorance, but Krugman was all over those guys every time they came close. Now he lets it slide. So let me do his job for him:

When the domestic demand for a product increases, the law of comparative advantage tells you to import more of it, not less. If it is in fact true that “the type of demand for these components is only going to increase” then American manufacturers might want to start producing them, but American consumers will certainly want to import more of them, and any attempt to circumvent that is a good way to make Americans poorer.

(For those following along in their economics textbooks: The world supply and demand for, say, wind turbines, must be more elastic than the domestic supply and demand, so a demand shift has a smaller effect on the world price than the autarkic domestic price and so must increase the foreign comparative advantage—or decrease the domestic comparative advantage, if any.)

For goodness’s sake—if Barack Obama or Robert Gibbs discovers that he really likes bananas on his Cheerios, is his first thought that he’d better start growing bananas, or is his first thought that he’d better figure out where to buy them? That’s the kind of question Paul Krugman used to ask. I miss him.

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What Went Wrong

Published
by
Steve Landsburg
on January 5, 2010
in Bad Reasoning, Economics and Policy
. 29 Comments

At Big Think, a consortium of bloggers (including me) have been invited to submit questions for use in video interviews with major players in the financial crisis. I posed a question to Mark Zandi, the chief economist at Moody’s, who had recently said this:

“It’s no coincidence that the great recession ended just as the stimulus package began providing its maximum economic benefit.”

My question was:

How do you know?

Here, from the video, is Mr. Zandi’s answer:

Continue reading ‘What Went Wrong’

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Of Jerks and Bullies

Published
by
Steve Landsburg
on December 18, 2009
in Bad Reasoning, Book, Economics and Policy
. 18 Comments

Over at National Review Online, John Derbyshire starts off with some kind words about The Big Questions, and then goes off on an ill-considered screed about immigration. First, by all means let’s quote the kind words:

Steven’s new book, The Big Questions, has a lot of good things in it, as one would expect from an author who proudly declares himself a math geek. His explanation of Heisenberg’s uncertainty principle (pages 135–141) is a model of clarity in the popularization of science. His geometrical illustration of a Talmudic rule on the division of an estate (pages 205–213) shows the mathematical imagination at its best.

Landsburg is an economist by profession — a professor of economics, in fact — and has the economist’s insight that many matters commonly discussed in terms of morality can be reduced to cold arithmetic: “When things are priced correctly, there’s no need to moralize about them.” He gives some illuminating examples.

But then things take a darker turn:

Continue reading ‘Of Jerks and Bullies’

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