What Is the Worst Mistake the Biden Administration Could Make?

Austerity. It was a huge mistake on Obama's part and it could definitely happen again. Brad DeLong explains:

"Ten years and ten months ago, US President Barack Obama announced in his 2010 State of the Union address that it was time for austerity. “Families across the country are tightening their belts and making tough decisions,” he explained. “The federal government should do the same.” Signaling his willingness to freeze government spending for three years, Obama argued that, “Like any cash-strapped family, we will work within a budget to invest in what we need and sacrifice what we don’t.” So great was the perceived need for austerity that he even vowed to “enforce this discipline by veto,” just in case congressional Democrats had something else in mind.....

In 2012, Lawrence H. Summers, the director of Obama’s National Economic Council until January 2011, and I warned that without a renewal of aggressive fiscal stimulus, prime-age employment, productivity, and real incomes would never recover to their pre-2007 trends. We were right about the latter two, while the prime-age employment rate eventually recovered only after 12 years (three times longer than in previous post-World War II business cycles)....

I am reminded of this now-ancient history because it increasingly looks like we are about to repeat it.

Owing to the COVID-19 pandemic, US prime-age employment is back down to 76%, just a little higher than it was in 2010. Remember, in normal times (before 2007-08), one-fifth of prime-age Americans were neither employed nor looking for a job; but now, an extra 5% of the population has been added to this cohort. That is millions of people who could be performing any number of useful paid tasks that are currently being left undone.

Under a sane national policy, the federal government would spend as much money as it takes to generate the demand necessary to make it worthwhile for employers to re-hire this one-twentieth of the working-age population. Worries about what we can afford would be set aside until the day the world’s savers no longer regard US government debt as a special, singularly valuable asset. That day may never come.

As John Maynard Keynes famously observed during World War II, “What we can do, we can afford.” Today, the point is even more obvious. We do not even have to figure out how to finance the response to the current crisis; that part of the equation has already worked itself out."

But we'd never do something so dumb again right? Think again and consider what might happen when the clear necessity to spend money--lots of money--meets the reality of Congressional politics. Matt Yglesias:

"[Congressional politics] could add up to a scenario where Republicans insist on spending cuts in government funding deals while Democrats argue that deficit reduction should feature tax increases too in order to be balanced and fair. This would exacerbate party tensions on the Democratic side, make it essentially impossible for a Biden administration to solve any big problems, and very likely founder on the basic reality that Republicans are fanatically opposed to taxing the rich.

There is an alternative to “eat your peas” politics — a push for a different kind of bipartisan deal in which, rather than giving up on progressive spending priorities, Biden tries to secure support for them by giving in to big, GOP-friendly tax cuts.

The Democratic economic policy wonks I’ve floated this by are skeptical, but mostly because they insist Republicans would never go for it. The Republicans are more optimistic — though they concede it’s dicey. Call it an ice cream party, the opposite of eating your peas. Certainly it might fail. But given the economic fundamentals, it’s worth a shot."

Definitely. Ice cream all around barkeep!

https://www.project-syndicate.org/.../return-of-austerity...

https://www.vox.com/.../joe-biden-budget-deficit-senate...

PROJECT-SYNDICATE.ORG

The Siren Song of Austerity | by J. Bradford DeLong - Project Syndicate

More Violence, Less Policing

This is not good. Peter Moskos, a criminologist who actually spent time in Baltimore as a cop, has some comments on his excellent blog Cop in the Hood prompted by the situation in Chicago. In his area of expertise, as you can tell, he's getting pretty tired of the bullshit about abolishing the police. Moskos:

"If residents want more policing, and I guarantee you most do, don’t listen to out-of-touch people who don’t live there clamoring for less policing in minority neighborhoods against the wishes of the residents.

Of course it can’t be just policing. But policing plays an essential role. A service, even. But policing will never be perfect. It can be better, though. We need to minimize bad policing and promote good policing. But more policing is needed. And it will save lives.

Imagine if this neighborhood had 18 covid deaths this year? If the area (because of demographics) has a COVID fatality rate 50% more than Cook County in general, which it might. And if there are 5,000 people (a big if), there would have been 13 COVID deaths this year. Now if we were talking about COVID, we would be talking about racial disparity, but we’d also be talking about doctors. Of course doctors don’t prevent COVID, but they’re an important part of saving lives.

Permit me to compare COVID to shootings; masks and social distancing to social programs; doctors to police. Right now it’s popular to talk about how to reduce violence without police. That’s a great discussion. Sort of. And there are ways. But not in lieu of police. Public safety without police is like health care without doctors. Yes, preventive care is important. But doctors play a role in that, too. Can I _imagine_ a health care system of diet and exercise and no doctors? Sure. But why would I want to? And what if I have a tumor?

There’s an element of police abolitionists that is a bit like anti-vaxxers. They’re so convinced they’re on to something. And yet so wrong. And so harmful to others. Though anti-vaxxers also put themselves at risk, whereas anti-policers usually theorize from very safe homes.

For most people, a safe neighborhood without much policing is the life they live and see every day. It doesn’t mean everybody has that privilege. It would be like being healthy and telling a sick person, “You don’t need a doctor. Maybe you should try yoga and eating organic?”

Yes, some neighborhoods need more policing that others. Some people need to be policed. And some more than others. Many more people need good policing around them. That is the world we have. And people who live with daily gunshots rightfully expect public agencies to respond.

But that’s where we are with violence and police. There’s more violence and there’s less policing. You could say our health care has failed, as demonstrated by COVID. It doesn’t mean we should #defund hospitals. That’s where the academic discussion is right now with violence and policing. Anything but police. Sure I can “reimagine” public safety without police. But it will be less safe world. This doesn’t mean we can’t _also_ fund programs that don’t involve police. We absolutely should. But most won’t work well without safe streets."

COPINTHEHOOD.COM

Murders in concentrated locations – Cop in the Hood

Murders in concentrated locations November 29, 2020 There’s an article b

What Happened in Pennsylvania?

We're still figuring it out but I do recommend this detailed piece based on the certified vote results by county in the Philadelphia Inquirer. With all the caveats about interpreting county-level results it is striking the extent to which Biden received positive margin shifts across the state, including in many heavily white working class areas. The only exceptions were in a handful of rural counties and, interestingly, in Philadelphia. The biggest chart in the article (part of which is reproduced below) shows the change in two-party vote share for Trump for every PA county. Since it's two-party data you can derive the two-party margin shift by simply doubling the Trump share shift. The wide distribution of gains is quite apparent--and it all added up to a Biden victory.

https://www.inquirer.com/.../pennsylvania-2020-election...

A Primer on No Bullshit Progressivism

You really must listen to this interview with David Shor on Yascha Mounk's podcast, The Good Fight. In my opinion, Shor gets to the heart of what I have termed no bullshit progressivism. If Democrats really want to win and make serious change this decade they must learn to think in the manner outlined by Shor--seeing beyond their class biases and pet causes to the ineluctable reality of the complex, contradictory American electorate and how difficult it is get enough of these voters on your side to actually get progressive things done. Shor outlines this challenge succinctly and catalogues the class and cultural blindness that currently hobbles progressive thinking. I urge you to listen to this podcast in full; it's well worth your time (the interview starts about 4:30 in the podcast episode).

PERSUASION.COMMUNITY

The Best Way to Lose an Election

Listen now | Yascha Mounk and David Shor

Inequality Datapalooza!

Who among does not love a huge stash of excellent inequality data? Check this one out, courtesy of the Peterson Institute for International Economics. Really nice charts. Also, an accompanying essay by Olivier Blanchard and Dani Rodrik on how to actually reverse the rise in inequality!

https://www.piie.com/.../we-have-tools-reverse-rise...

https://www.piie.com/microsites/how-fix-economic-inequality

PIIE.COM

How to Fix Economic Inequality?

An engaging look at the rise of inequality over 50 years, how policy failur

Quit Whining and Figure Out How to Win!

With the sub-optimal down-ballot election results has come the predictable loud complaints from the left about the structure of the American electoral system especially, of course, the Senate. There is no doubt that given the current distribution of partisan preferences the structure of the Senate disadvantages the Democrats. And there is no doubt that if you were designing a fair electoral system from scratch, you probably wouldn't have the Senate in its current incarnation.

But, in the immortal words of James Earl Carter, Jr., there are many things in life that are not fair--and this is one of them! However, that structure is not likely to change anytime soon so Democrats need to suck it up and figure out how to win with the structure they've got. Jeff Greenfield makes the argument well in a recent Washington Post piece.

"[T]he Senate isn’t quite the unsolvable problem that Democratic critics think it is. The chamber’s current Republican tilt is political, not structural — and it could be overcome without any changes to the Constitution. The Democrats just have to start winning elections....

[I]f the Senate’s small-state bias is locked in, that doesn’t mean the upper chamber is destined to remain a GOP bastion. This year, Republicans minimized their potential losses in the Senate by winning every seat in states that went for President Trump, probably retaining control. But you don’t have to look very far back in the past to find Democrats regularly winning Senate seats in states that vote deeply crimson at the presidential level. North Dakota had two Democrats in the Senate from 1987 through 2011, and one until 2019. Both of Montana’s senators were Democrats from 2007 to 2015, and one was reelected just two years ago. Until the 2014 midterms, Democrats held seats from Alaska, Louisiana, Arkansas, North Carolina, Iowa and South Dakota....

None of [Democrats'] hopes for altering its imbalance — granting statehood to Puerto Rico and the District of Columbia, killing the filibuster, ending conservative domination of the federal bench — can happen unless Democrats first take the upper chamber, which essentially means winning the battle on a Republican-tilted playing field.

But that’s a political problem, not a structural one. And it’s solvable: Sherrod Brown (Ohio), Jon Tester (Mont.) and Joe Manchin (W.Va.) have been elected and reelected; are they the only Democrats who can win in increasingly red states? Is it impossible to imagine, for example, that a candidate who acknowledged the failure of both parties to stem the economic decline of the working class might strike a responsive chord? Might a candidate find a way to insulate herself against the more provocative arguments of more progressive Democrats, like “defund the police,” while emphasizing the economic-fairness arguments that bridge the gap between the party’s wings? If Democrats could hold 60 Senate seats 11 years ago, is a return to the majority really beyond reach?"

Difficult but not impossible. So time to stop the whining and figure out ways of winning in places Democrats have been losing. As Greenfield notes:

'[Democrats] cannot build a time machine to bring them back to 1789, so that they can stiffen James Madison’s spine against the small states’ demands. They cannot erase Article V from the Constitution. They probably cannot persuade Mike Bloomberg and other billionaires to pay for the resettlement of a few hundred thousand Californians and New Yorkers to the Dakotas. They have no choice, then, but to find the messages and the organizing tools that can break through that new red wall that stands between their national majority and the power to govern."

Greenfield is correct. There is no choice but to do exactly that.

WASHINGTONPOST.COM

Perspective | Yes, the Senate is rigged for small states. But not for Republicans.

Democrats can win in stat

What Do County Voting Results Tell Us About Demographic Trends?

Not as much as you think! We've had a plethora of analyses of county voting results purporting to show us which groups really drove the election results. Partially this reflects some justified skepticism about the exit polls' version of events. As awareness of exit poll flaws has spread, it has perhaps encouraged a turn to scrutiny of voting patterns.

Perhaps even more important, data analytic capabilities are now far higher at most media outlets, so it's not too difficult to download and crunch the county voting results and look for patterns. In its simplest form, looking at county voting results from this election indicates that margin shifts in Biden's favor were overwhelmingly in suburban areas, so, since suburban areas = college-educated whites, therefore college-educated whites were responsible for the Biden margin swing.

But the suburbs are vast and diverse; even in the large suburban counties in our biggest metropolitan areas, white noncollege residents still outnumber white college residents by 44 to 25 percent. And in small metro, white noncollege residents are more numerous by 52 to 23 percent. So tying margin shifts in the suburbs to white college voters alone is quite a stretch.

More sophisticated than this, outlets like 538, the Economist and others have taken the county voting results and regressed these margins against various county-level demographic characteristics like percent white college, percent white noncollege, percent Hispanic, etc. Again, this is now quite easy for many places to do, involving no more than downloading the county voting results and also obtaining county level demographics from, say, the government's American Community Survey and running the statistical procedure.

You've no doubt seen the results in various graphics. A whole bunch of dots on a chart, with the margin shift on the y-axis and the demographic characteristic on the x-axis. The dots kinda sorta form a pattern, which is helpfully indicated by the regression line drawn through the dots, with the direction and steepness of the slope indicating the relationship between margin shift and level of the demographic characteristic. Typically no goodness-of-fit measures are reported; the line is the line.

So what does a chart like this really mean? For example, if there's a chart relating margin shift to percent white noncollege in a county and the line slopes a bit downward as white noncollege percent goes up, what does that mean? It literally means that at the county level, and only at the county level, we would predict higher white noncollege counties to have lower margin shifts. But we don't know from this kind of aggregate data exercise what the individual-level behavior of specific voter groups--white noncollege and others--within these counties actually was (to assume otherwise is the ecological fallacy). That is a different, more specific question for which this exercise may suggest hypotheses, but does not directly provide an answer.

But that does not stop writeups of these results from claiming that they have in fact shown how groups within the population moved. To stay with the white noncollege example, the downward sloping regression line is interpreted as meaning that white noncollege voters generally shifted against Biden. That could be. But that is only one possible story.

Another possible story is that white noncollege voters in rural areas, where concentrations of these voters are highest, have a distinctive and homogeneous culture that led them to keep or increase their Trump margins. But only about a fifth of white noncollege adults live in rural areas White noncollege voters in large suburban and small nonmetro counties, where three-fifths of this population lives (including in states like Michigan, Pennsylvania and Wisconsin) and in core urban areas are different economically and culturally and did shift toward Biden. A downward sloping line therefore but with the net margin shift across the demographic likely positive for Biden.

So is that the real story? We don't know that either, merely that it is possible and not at all contradicted by a aggregate plot of county data. And actually more consistent with the available individual-level survey data, whatever with those data may be.

One final illustration from a specific state. In PA, slightly less than a fifth of residents are in rural areas and slightly than a quarter of the white noncollege population. Theses areas had a pro-Biden margin shift of 1 point. In large suburban (58 percent white noncollege) and small metro (64 percent white noncollege) areas , where three fifths of the white noncollege population of PA resides there were, respectively, pro-Democratic margin shifts of 4 and 3 points. In the urban cores, the least white noncollege by far, there was no margin shift at all.

Is it possible that all these white noncollege voters all over PA shifted against Biden and were simply overwhelmed by shifting in the other direction by the relatively small white college population, including in the many heavily white working class counties? Absolutely that's mathematically possible. But we don't somehow "know" that by looking at a scatter plot and the slope of a regression line.

So the next time you see one of these county data charts, take it with a grain of salt. Eventually, we'll have properly modeled 2020 estimates of voter group partisan preference and turnout trends that integrate survey data with voting results and underlying demographics. But until that glorious day, be careful what you believe.