Well, you could lower your prices. Or you could work on providing better service. Or you could send over a couple of guys who are really good at convincing people it’s not in their interest to compete with you.

Or say you run a personnel company that brings foreign workers into the United States. And say you’re worried about competitors who cross the border without your help. One option is to try doing a better job. Another is to send over about 1500 guys with unmanned aerial vehicles, new forwarding operating bases and $14 million in new communications equipment to tamp down the flow.

President Obama, with support from both sides of the political aisle, will be signing a bill today that allocates $600 million for “border security”. According to CNN, “The bill is funded in part by higher fees on personnel companies that bring foreign workers into the United States”.

I imagine the personnel companies will consider it money well spent. Let’s not lose sight of how ugly this is.

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Here’s a data point: On Friday, Hewlett Packard’s CEO Mark Hurd resigned unexpectedly — and pretty much instantly the value of HP stock dropped by about $10 billion. If we assume Hurd would otherwise have been around for another 10 years or so, that means shareholders think his departure will cost the company about a billion dollars a year. Which, incidentally, makes his $30 million or so in annual compensation look like a hell of a bargain.

Now maybe some part of that $10 billion reflects expected short-term losses due to the turmoil of an unplanned transition. But even if that turmoil were to cost HP a full month of revenue (which seems like a pretty extreme assumption), that’s still less than a billion — leaving over $9 billion to represent the difference between what the market expected from Hurd and what it expects from his successor.

This doesn’t mean Hurd is that much better than anyone who could run HP, but it might mean he’s that much better than anyone HP is likely to hire. Most of the world’s best executives are already occupied. Hurd’s replacement will come from the second string. So (insofar as we are reckless enough to extrapolate from this one data point), it appears that there’s a huge gap between the very best and the almost-very-best. Like in baseball, where the 1000 or so major leaguers are, well, in an entirely different league from the 1000 best minor leaguers.

If this kind of gap is the norm, then there’s a huge cost to diversity-for-the-sake-of-diversity in positions that require extraordinary talent. Do you really want to settle for a distant second best just so you can fill your Albanian quota?

Coincidentally, the news from HP comes just as President Obama is seeking a replacement for departing economic advisor Christy Romer. It’s been reported that the President believes it’s important to hire a woman.

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The issues are pretty much identical. Here is the District Court’s reasoning in the California case (this is the Court’s summary of the plaintiffs’ position, which the Court endorses):

The Due Process Clause provides that no “State [shall] deprive any person of life, liberty, or property, without due process of law.”…
The freedom to marry the person of one’s choice is a fundamental right protected by the Due Process Clause and…Proposition 8
violates this fundamental right because: 1. It prevents each plaintiff from marrying the person of his or her choice; 2. The choice of a marriage partner is sheltered by the Fourteenth Amendment from the state’s unwarranted usurpation of that choice…

The Equal Protection Clause provides that no state shall “deny to any person within its jurisdiction the equal protection of the laws.” US Const Amend XIV, § 1…Proposition 8 violates the Equal Protection Clause because it: 1. Discriminates against gay men and lesbians by denying them a right to marry the person of their choice whereas heterosexual men and women may do so freely; and 2. Disadvantages a suspect class in preventing only gay men and lesbians, not heterosexuals, from marrying.

For the record, Prop. 8 does not prevent gay men and lesbians from marrying. All it does is restrict them to marrying people they’d prefer not to marry. With that in mind, it should now be very easy to write the forthcoming Title VII decision. All that’s necessary is to alter a phrase here and there:

The Due Process Clause provides that no “State [shall] deprive any person of life, liberty, or property, without due process of law.”…
The freedom to hire the person of one’s choice is a fundamental right protected by the Due Process Clause and … Title VII
violates this fundamental right because: 1. It prevents each plaintiff from hiring the person of his or her choice; 2. The choice of an employee is sheltered by the Fourteenth Amendment from the state’s unwarranted usurpation of that choice…

The Equal Protection Clause provides that no state shall “deny to any person within its jurisdiction the equal protection of the laws.” US Const Amend XIV, § 1. According to plaintiffs, Title VII violates the Equal Protection Clause because it: 1. Discriminates against bigots by denying them a right to hire the person of their choice whereas non-bigots may do so freely; and 2. Disadvantages a suspect class in preventing only bigots, not non-bigots, from hiring.

(In fact Title VII does not prevent bigots from hiring any more than Prop 8 prevents homosexuals from marrying, but I’m trying to maintain a strictly parallel structure here.)

Of course Title VII interferes with the hiring decisions of many people who are not bigots, but on the Prop 8 precedent, the effect on bigots should be sufficient to invalidate the law.

Also of course, bigots are held in considerably greater disregard than homosexuals, at least in the circles that I prefer to travel in. But equally of course, the Fourteenth Amendment is designed specifically to protect the rights of people who are held in great disregard.

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Start with the theory: We learned long ago from Milton Friedman (who might have learned it from Irving Fisher) that a little bit of deflation is a good thing. That’s because deflation encourages people to hold money, and people who hold money aren’t buying stuff, and when other people don’t buy stuff, there’s more stuff left over for you and me.

There are a couple of other ways to see this, though they all come down to the same thing. Here’s the first: falling prices are good for buyers and bad for sellers, but that all washes out. It washes out in the aggregate because each gain to a buyer is offset by an equal and opposite loss to a seller. And it more or less washes out for each individual, because each of us sells roughly as much as we buy (including the sale of our labor.) But over and above all that, deflation enriches the holders of money, because their money increases in value as it sits around. That part is pretty much (may Milton’s ghost forgive me for putting it this way) a free lunch.

Yet another way to see it is this: The only way to hang on to a dollar is to resist spending it, so the cost of keeping a dollar in your pocket is a dollar’s worth of forgone consumption. That’s the cost to you. But the cost to society of your holding a dollar is zero, because it costs us essentially zero to print that dollar up for you. Whenever an activity is costlier to you than it is to society, you’ll tend to do too little of it. (That’s why not many people spend their Sunday mornings picking up litter in the park.) Therefore people hold too little money. That means we ought to subsidize them to hold more, and deflation does exactly that.

So in that sense deflation is desirable. But a lot of commentators, including a few who are not economic ignoramuses, seem to be taking it for granted that deflation is something to fear. Which means they must see some offsetting disadvantage. And I’m not at all sure what they have in mind.

In this connection, you’ll hear the phrase “liquidity trap” a lot. A liquidity trap is simply a situation where interest rates are so close to zero that people are willing to hold vast amounts of money. As a result, when the authorities (wisely or unwisely) flood the market with money to encourage spending, it doesn’t work, because people just hang on to the new money. It’s alleged that this is some sort of a problem. But in reality, it’s a wonderful wonderful thing, because it means that the authorities can print money (at essentially zero cost) and use it to fund government operations like Social Security and Medicare without worrying about any of the usual consequences (at least until the liquidity trap eases and people start trying to spend that new money, at which point the government can simply call the money back in by selling bonds and destroying the proceeds). In a liquidity trap, government operations are effectively free.

(To put this another way: The government spends a penny to print up a dollar bill, uses that dollar bill to buy a widget, and the seller of the widget is perfectly happy to hold on to the dollar bill rather then demand any real resources in return. That’s total win-win.)

So much for theory. Now to the practical issue: Even if deflation is a bad thing, we know how to solve it. Print enough new money and people will eventually start spending it. It’s alleged that no matter how much you print, it can all just fall into the liquidity trap, and it’s alleged that this is what happened in Japan over the past decade. But I am sure the Japanese just didn’t try hard enough. Liquidity trap or not, I guarantee you there’s a central banker in Zimbabwe who knows how to fight deflation. If we really get into trouble, all we have to do is hire him.

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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?
• And Krugman goes on: “On paper, solving America’s long-run fiscal problems is eminently doable: stronger cost control for Medicare plus a moderate rise in taxes would get us most of the way there.” In the words of a certain Nobel laureate, this passage makes me want to stick a pencil in my eye. It’s like saying “Getting my family budget under control is eminently doable: fewer caramel macchiatos plus more trips to the ATM would get us most of the way there”. Yes, cutting spending will help. No, moving money around won’t.

  Like it or not, the government can always raise taxes and therefore always has a claim on your wealth. You are the government’s ATM. Making a withdrawal today (by raising your taxes) means there will be less available to withdraw tomorrow. Raising taxes does not make the government richer. Didn’t I say this already?

• Yes, I know, a bunch of silly Republicans (along with a bunch of silly Democrats) have gone around saying the deficit is all that matters, which implies that a tax increase can offset a spending increase. Yes, silly people are silly. But the existence of silly people is not enough to justify additional spending. For that, you’ve got to, you know, attempt to justify the additional spending.

Sometimes a caramel macchiato is worth the cost and sometimes it’s not. Sometimes an unemployment benefit is worth the cost and sometimes it’s not. We have useful ways of thinking about these things. Some people say: “You know, that macchiato is expensive but it’s worth it.” Others say: “I don’t think that’s a very wise expenditure right now.” Paul Krugman says: “AHA! So a caramel macchiato is unaffordable, but you still haven’t visited the ATM!” And I say: How’s that again?

Stay tuned for more Godel, more Darwin, and a little less Krugman.

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I realize that some will criticize the NAACP for over-reacting here, or for mis-reacting. But cut them a break. You don’t see them doing anything truly loonytunes, like, say, commanding the amorphous Tea Party movement to “expel the bigots and racists in your ranks or take full responsibility for all of their actions.” Right?

A hat tip to our frequent commenter Ken B. for pointing me to the video.

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In the videotaped sentencing hearing, which you can see in its entirety below, the judge seems bemused by the prosecutors’ choices but unmoved by the defense attorney’s attempt to raise a constitutional objection. The defense attorney, not entirely unreasonably, pretty much loses it.

Michelle Lyn Taylor is now serving a life sentence and will have her first shot at parole ten years from now. Does this strike any of you as reasonable?

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So why the singular focus on teachers? The answer, of course, is that unlike plumbers or cab drivers or pharmaceutical workers or computer programmers, teachers, through their unions, were major contributors to the Obama campaign.

All victorious politicians engage in the unsavory practice of diverting spoils to their most vigorous supporters at everyone else’s expense. In this, the current administration may be no more blameworthy than any other. But I’m pretty sure that sending out the chair of the Council of Economic Advisors to defend these political payoffs marks a new sort of low. Traditionally, the Council is composed of first-rate academics whose job is to give good counsel and remain above the political fray. Shame on the President for debasing that noble mission, and shame on Christy Romer for going along with it.

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Just about a year ago, a team of scientists reported that Betelgeuse—the bright red star in Orion’s shoulder—appears to have shrunk by about 15% since 1993. That would mean the diameter’s been shrinking at about 1200 miles an hour for all that time.

Such shrinkage—if it’s really happening (it’s hard to be sure)—could be the precursor to a supernova explosion, which would be way cool. The mathematician John Baez computes that a supernova Betelgeuse might be roughly as bright as the full moon, or maybe up to three times as bright.

Surprisingly, it took almost a year for this information to be widely reported on the Internet, but in the past few weeks, a number of sites have cropped up touting the upcoming supernova, and, as you might expect, a few prophecying doom. You can ignore the doomsayers; at a distance of 600 light years, Betelgeuse is too far away to hurt us.

Browsing the various science forums (such as Discover’s), I’m struck by how often the following simple question comes up: Given that Betelgeuse is 600 light years away, is it or is it not true that it would it would take 600 years for us to notice any explosion? Or to put this another way: If the sky lights up with a new moonlike object tomorrow night, does that mean the explosion took place 600 years ago?

A pretty good answer—and the one that’s being given on all those science forums—is “yes”. But that can’t be exactly right, at least not for all of us, because at any given moment some of us are sitting in our living rooms while others are driving on the Interstates. Relativity tells us that if we’re moving relative to each other, then we must disagree about the times of distant events.

How much do we have to disagree? By about a half an hour, if I’ve done my arithmetic right. If you, standing on a street corner, say the explosion took place at noon on June 9th of the year 1410, then the driver of the car who has just run over your toes at 70 miles per hour (heading in the general direction of Betelgeuse) must say the explosion took place at 11:30AM on the same day. A half hour is not a lot (though it’s more than the few fractions of a second most of my friends have guessed), but here at the Big Questions, we aim to be precise in every detail.

Edited to add: It’s clear from the comments that I should have been clearer about what I’m assuming. My assumption (which I’d thought I’d stated but now see that I didn’t) is that you (and your friend) see the explosion at the exact moment when he’s running over your toe. You then each calculate how long ago the explosion must have taken place. Your conclusions will differ by half an hour.

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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:

New York state may soon become the first state to restrict employment opportunities for nannies.

The state Senate passed a bill this week that would prohibit New York’s approximately 200,000 household workers from accepting any position that does not include paid holidays, overtime pay and sick days.

Opponents say the step will bring unnecessary hardship to thousands of women—and some men—who have found employment because of labor markets that operate freely, except for constraints imposed by the federal minimum wage.

A more neutral observer might have noted that this bill, if passed, will be good for some of those nannies who retain their jobs, bad for the many nannies who will be driven out of the business, and extremely good for people like Ai-jen Poo, director of the National Domestic Workers Alliance, who will represent the winners and can conveniently ignore the losers. Instead, Ms. Poo is quoted, without apparent irony, as calling the measure “a huge step forward in reversing the long history of exclusion that domestic workers face.”

Query: Are the editors at the Times genuinely oblivious to this kind of bias? Or do they just not care?

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