Things to Read at Lunchtime on November 30, 2013

Must-Reads:

1. Evan Soltas: “U1 through U6 don’t collapse to one single measure of unemployment… [but] to… two dimensions… the narrow side and… the farther-out reaches of unemployment…. Narrower definitions of unemployment are improving more quickly than wider definitions of unemployment… labor markets are probably looser than the normal measures suggest… underemployment [is] a real, serious concern…”

2. Jonathan Bernstein: The minimum wage and the post-policy GOP: “When both parties are healthy… popular, high-priority policy preferences of one party are bundled with the popular, high-priority policy preferences of the other. However, what exactly do Republicans have[?]… The Republican policy cupboard is pretty much empty…. It’s not clear that Republicans would accept any deal, given their paranoia about primary challenges based on accepting any kind of accommodation with the Kenyan socialist in the White House… conservatives are rejecting getting some of their priorities passed if it means accepting anything that Democrats want…. This just isn’t how the American political system is supposed to work. There really is an opportunity here for a deal that could enact popular policy ideas from both sides. But thanks to a dysfunctional Republican Party, it’s very hard to see it happening.”

Should-Reads:

1. Francesco Saraceno: What is Mainstream Economics?: “Paul Krugman and Simon Wren-Lewis have been widely criticized… as defending ‘mainstream’ economics that spectacularly failed…. Krugman has a point, a very good one, when claiming that standard textbook analysis is (almost) all you need to understand the current crisis…. The point is what we define as ‘textbook analysis’. Krugman refers to IS-LM models. But these… disappeared from graduate curricula because supposedly too simplistic, not grounded on optimization, not intertemporal, and so on and so forth…. They were nowhere to be found during my graduate studies at Columbia (certainly not a freshwater school). None of the macro I studied in graduate school (Real Business Cycle models, or their fixed-price variant proposed by New Keynesians)… could give me insight…. The IS-LM model with minor amendments (most notably properly accounting for expectations to deal among other things with liquidity traps) remains a powerful tool to understand current phenomena. The problem is that it is not mainstream at all. What bothers me in Krugman’s post is the word ‘standard’, not ‘textbook analysis’.”

2. Charlie Stross: Trotskyite singularitarians for Monarchism! A political speculation: “The 20th century spanned the collapse of the Monarchical System, the rise and fall of Actually Existing Socialism, a bunch of unpleasant failed experiments in pyramid building using human skulls, and the ascent to supremacy of Neoliberalism and the Washington Consensus. In 2007/08, the system malfunctioned spectacularly: it’s clearly unstable and has huge problems, but what’s going to replace it?… Neo-reactionaries… are effectively libertarians who have thrown up their hands in disgust.. and the appropriate political solution to the problem is to go back to aristocracy… Geeks for Monarchy…. We have Accelerationism… the notion that rather than halting the onslaught of capital, it is best to exacerbate its processes to bring forth its inner contradictions and thereby hasten its destruction…. Despair is a common reaction to defeat, as is Stockholm syndrome…. Libertarians… assumed [neoliberalism] would bring about the small government/small world goals…. As it becomes clear that the fruits of neoliberalism are instability and corporate parasitism rather than liberty and justice for all–is it unreasonable of them to look to an earlier, superficially simpler settlement?”

Should Be Aware of:

1. Mark Kleiman: Against Symmetry: Republicans-love-being-lied-to Edition: “>Liberals felt sorry for Dan Rather for having used… fabricated documents in reporting on George W. Bush’s derelictions of duty…. But… no liberal blogger–let alone any liberal politician–called Rather a ‘hero’…. Contrast Mike Huckabee, who… might actually be President some day. He’s ‘shocked’ that the ‘hero journalist’ Lara Logan has been suspended from her job at CBS. It’s simply not the case that the Red Team and the Blue Team are symmetric. Yes, they both act factionally, and both camps include some lunatics. But we don’t let ours run the asylum…”

Barry Ritholtz: “No, David Rosenberg’s Bullishness Was Not ‘Purchased for $3M’: I was going to write a long point-by-point rebuttal to a Zero Hedge post about David Rosenberg that is factually erroneous, biased, defamatory and just plain wrong; instead, I will offer my correction” | Franklin Fisher: The Stability of General Equilibrium | Franklin Fisher: Disequilibrium Foundations of Equilibrium Economics | Firat Kayakiran & Thomas Biesheuvel: Zeppelins Seen Hauling Caterpillars to Mine Siberia: Commodities | Henry Blodget: Rich People Actually Don’t Create The Jobs |