Things to Read on the Evening of January 30, 2015
Must- and Shall-Reads:
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: What This Morning’s U.S. Wage Numbers Mean: “Employment cost index only up 0.6% in the past quarter, putting it up 2.2 percent over the year. Consistent with inflation well below 2%. If you think the US labor market is anywhere near capacity, you expect wages to be growing at 3.5-4%. They’re growing at 2.2%. There’s nothing in these wage data to give the Fed any confidence that inflation is going to drift back up towards its target anytime soon. The good news in these wage data is that this is the economy telling us that it can generate plenty more jobs without hitting bottlenecks. A thought on the Phillips Curve: Perhaps wage data are telling us that both the long-term unemployed & those out of the labor force matter.” -
: Slavery or Technology? From Politics: “Since then sufficient material resources are necessary for every household, the means of procuring them must certainly be part of household management, for without the material necessities it is impossible to live, let alone live well. All the arts share the property that the proper tools must be available if they are to be properly proper conducted. So is it in the art of managing a family. Now of tools, some of them are alive and others are not. With respect to the pilot of the ship, the tiller is not alive, the sailor is alive. In many arts the necessary tools include servants. Property in general is a tool for living. An estate is a collection of such tools. And a slave is a living tool. A tool that can take care of its own self is a more valuable one than any other tool. Suppose if every tool could, at command, or from discerning its owner’s desires, carry out its tasks (as the story goes of the automatons of Daedalus; or what the poet tells us of the serving-carts of Vulcan, ‘that they rolled of their own will into the gathering of the gods’), so that the shuttle would then weave and the lyre play of itself. Then the architect would not want living servants, or the owner want living slaves…” -
: Whitewashing the Crazy, Fed Edition: “How does one report on politics when a significant wing of the political spectrum is… stark raving mad?…. There’s a temptation to soft-pedal the crazy…. Matt O’Brien notes that Ted Cruz has now joined the ‘anti-Fed crazy train’…. [But] Alan Rappeport [of the New York Times who]… does… convey… how crazy Rick Perry was… uses a euphemism…. ‘Republicans have questioned the Fed’s moves to stimulate the economy since the financial crisis, arguing that the expansion of its balance sheet will create economic instability.’ Well, actually they have spent the past six years warning about ‘currency debasement and inflation‘. The chart shows how that prediction has turned out. And that in turn makes the fact that the anti-Fed ranks are swelling, not shrinking, a much more remarkable political story than the whitewashed version would indicate.”
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: Redistribution or Inclusion?: “It is crucial to distinguish inequality in productivity among firms from unequal distribution of income within firms. The traditional battle between labor and capital has been about the latter…. But there is surprisingly deep inequality in firms’ productivity, which means that the size of the pie varies radically. This is especially true in developing countries…. These two very different sources of inequality are often conflated, which prevents clear thinking on either one…. Given productivity constraints, redistribution is only palliative, not curative. To address the problem requires investing in inclusion, endowing people with skills, and connecting them to the inputs and networks that can make them productive…”
Should Be Aware of:
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: But Wait… There’s More!: “BIf someone would like to write an intelligent, detailed article about stifling political correctness in a specific online milieu of twitter users and feminist tumblrs, or whatever, WITH LINKS, they should do that, and then we can talk about that. But Chait didn’t write anything like that at all. There’s no reason I should extend him so much argumentative charity that I go bankrupt over here constructing his argument for him. It’s like trying to make an Eiffel Tower out of popsicle sticks in Pre-K, and my partner on the project uses each stick in turn like a nacho to eat paste off of, and then just hands them to me all slimy. I have better things to do.” -
: Scam PACs Open Thread): “Kenneth Vogel reports on the rise of scam PACs and that they mainly exist in GOP circles. Kevin Drum wants to know why they exist more on the right-wing than the left. Any ideas?”