Monday, February 28, 2005

Change is in the air

The Lebanese government has just resigned. And get this:
An estimated 50,000 people gathered Monday in Beirut's Martyr Square despite an order a day earlier by Lebanon's Interior Ministry for military forces to "use all necessary means" to make sure the demonstrations did not take place.
I can't be the only one thinking "Kiev again." If there's going to be a crackdown, then the Syrians will have to do it themselves.

Throw in the potentially very good news from Egypt yesterday, and I have to say that things are improving faster than I thought possible.

Sunday, February 27, 2005

NYT links

For those readers not already in the know, using this link generator, one can (legally) access the full contents pointed to by old NYT links without registration or fees. Until now, I've been too lazy to use this feature because I generally only read and blog about recent articles. However, as a courtesy to readers, I will use non-rotting NYT links starting today. I've no plans of updating the links in my old posts though, so if you're reading an old post and want to follow an NYT link, then use the link generator.

North Korea update

More evidence that the grip of totalitarian control in North Korea is loosening. (I noted a previous data point here.) The author's conclusion:
From Kim's perspective, this increasingly depressing reality underscores the need to maintain the military's support. The centerpiece of his "military-first" policy is the nuclear weapons program. He is unlikely to bow to pressure from the international community to give it up, as this would deal a fatal blow to his power base. But nuclear weapons are not usable against those who may be the regime's real enemies: ordinary people whose obedience and loyalty are disappearing. It may be only a matter of time before the army follows suit.
Note that the author acknowledges that the army could stay loyal to Kim, thus keeping the slave ship from sinking. The question is whether we should just wait out Kim, hoping army loyalty will eventually break. Bryan Preston at TCS thinks, "Diplomatically isolated and economically bankrupt, North Korea may now be ripe for revolution or at least collapse." (He also speculates that the Proliferation Security Initiative helped put NK in its current condition.) My take: China, for whatever reasons, doesn't want NK to collapse, for otherwise they could have made it happen already by stopping, say, their fuel subsidies. The North Korean generals know this, and so they'll stick with Kim. As a corollary to my take on China, I'm skeptical of Duncan Currie's suggestion that we pressure to China to let us and other countries resettle North Korean refugees, instead of sending them back to their gulag. (Even he admits it's a long shot.) If such a refugee policy really would lead to NK's collapse as Currie hopes, then China won't go for it. All we can do for now is squeeze NK economically and hope China changes her mind.

Tuesday, February 22, 2005

Immigration reform

Tamar Jacoby is defending Bush's immigration reform plan in the Weekly Standard. I'm still skeptical, but I'm warming up to the possibility that combined with increased enforcement, it could work. Jacoby correctly argues that it would be easier to enforce our immigration laws if there was more legal immigration. My fear has always been that we'll skimp on the enforcement like we have for so many years now, ending up with higher legal immigration, along with some form of amnesty (Jacoby prefers the word "probation") that will encourage further illegal immigration. However, given the strong Republican opposition to Bush's plan, I'm starting to think if a compromise is found, it will probably involve a significant increase in enforcement.

That said, I take issue with Jacoby's economics:
Many of his critics believe that the answer is to turn off the immigrant influx. We should, they say, make the necessary economic adjustments and do without the imported labor. It's an option; with enough resources, we probably could stop the flow. But are the American people prepared for the changes that would come with that decision? The likely economic sacrifice is incalculable: not just a few extra pennies on the cost of lettuce, but forfeited growth all across the economy, on a vast scale. In many industries today, growth depends on foreign laborers, who filled one in every two new jobs created in recent years.
The economic sacrifice is only incalculable if you don't bother to calculate. Behold, a numerical simulation of the economic effects of reducing immigration by 4000 per day for next three years:
First and foremost the population reduction induces a distinct decline in real GDP of approximately $120 billion per year averaged over the entire prediction period.... Averaged over the lower noninstitutional working age population however, the decline turns into a net gain amounting to roughly $220 per year in real terms averaged over the entire prediction period.

The unemployment rate is reduced by roughly half a percentage point...
That doesn't sound so bad.

Jacoby would do better to focus on the long-term costs of ending immigration. First the gloomy demographics: even if current immigration levels are sustained, our population is going to age a lot this century. Cutting off immigration would make supporting Social Security and Medicare that much more burdensome of future young workers. Also, from the geostrategic perspective, in a world in which overpopulation is not a concern (quite the opposite), more Americans, and more Americans as a fraction of world population, are preferable. Therefore, immigration should be kept at as high a level as is consistent with assimilation.

Alas, it's not clear at what level assimilation fails. (And how precisely are success and failure defined?) I suspect that at some point Hispanic immigration levels will have to be reduced if we want to avoid a permanently bilingual society (see here).

Update: fixed link to economic simulation to make scrolling down unnecessary.

Wednesday, February 16, 2005

Dave's filter

Gloomy demographics dept.: aging China

This story is more credible than Sy Hersh's.

Trogdor strikes again! (Hat tip: Dean Esmay)

Iraqi elections analysis: Daniel Drezner - also check out the analysis by James Joyner that Drezner links to; Patrick Ruffini has made a map.

The last two topics at the Becker-Posner blog have been Social Security reform and Medicare reform. Some excerpts are below, but this stuff is worth reading in full (1 2 3 4 5 6).
(Posner) The explanation usually offered for the fact that a substantial fraction of the population has no health insurance is that these are unfortunate people who cannot afford health insurance. A better explanation is free riding. ...temptations to free ride provide an argument for compulsory health insurance rather than, as often argued, for socialized medicine.
(Becker) If we simply raised social security taxes now-say by two percentage points- consolidated federal deficits would appear much smaller, and the federal government would be under less constraint to reduce spending.
(Posner) Some of these excellent comments put me in mind of the following crude but suggestive way of stating the difference between liberals and conservatives: liberals think that the average person is good but dumb, conservatives that he or she is "bad" (in the sense of self-interested) but smart. Liberals trust the intellectual elite (because they are good) to guide the masses (because they cannot guide themselves); conservatives distrust the elite (because the elite are bad and therefore dangerous) and think the masses can guide themselves.

Monday, February 14, 2005

Iraqi turnout

The good news:
Overall turnout across the country was 58% of eligible voters.
The bad news:
But in Anbar province, at the heart of the restive "Sunni triangle" area of central Iraq where the insurgency is strongest, fewer than 2% of those eligible to vote actually did so.

Friday, February 11, 2005

Dave's filter

Thursday, February 10, 2005

More gloomy demographics

As a follow-up to "The Global Baby Bust," I recommend Stanley Kurtz's "Demographics and the Culture War," a review of four books on future demographics, appearing in the latest issue of Policy Review. Kurtz picks up where "Baby Bust" left off, speculating on the cultural effects of the global decline in fertility. (The human fertility rate is 2.7 children per woman and falling - yes, even in the developing world.) He foresees three options for societies.

1) A Exponential decrease in population. This is also known as extinction - enough said.

2) A resurgence of traditional mores that produces a stable or increasing population level. One theory is this will happen simply as a result of religious traditionalists outbreeding everyone else. However such a resurgence came about, it would have to overcome the powerful anti-natal forces including birth control, abortion, and increased female education and labor force participation.

3) The Brave New World option. People still have too few children, but technology will let societies have children without families.

First of all, how feasible is option #3? Once children are born, rearing them seems without families seems possible though detestable: just scale up what we now call orphanages. An artificial womb is needed, because it's extremely unlikely that there could be an adequate supply of surrogate mothers but not an adequate supply of real mothers. Given the biochemical complexity of designing a human womb "from scratch," I think the only kind of artificial human womb that could appear in this century is a genetic engineered kind, most likely transgenic, such as a human womb inside a cow. The whole idea creeps me out, but as a future technological capability, it might be only a few decades away.

I'd bet on option #2. The interesting question is how option #2 will come into effect in various societies. A strong increase in individual preference for a family with children due to resurgent traditionalism is possible (and, I think, preferable), but is it the only possibility? Perhaps a society could come to value children greatly on a collective level (if only out of self-preservation), but still not enough on the individual level to prevent population decline. In this case, the societal value of children could be manifested in massive pro-natal subsidies. Even in places like Scandinavia with generous family-leave benefits and the like, the opportunity cost of having a child is nowhere near compensated. Could bigger subsidies work, or would they be too inefficient to be both affordable and effective?

Another possibility which Kurtz touches on is fewer, not more, subsidies. Specifically, if the government no longer supported the elderly, then might children become a good financial investment? I'm not sure. After all, there's always the risk that a child will be unable or unwilling to support his parents' retirement. So is the financially prudent move to have more kids to reduce this risk, or to have no kids and work more, allowing one to save more? Or maybe a mix: have just one or two children, but also save plenty for retirement? In the worst case, only the poor might find children economically advantageous. Ending government dependency of the elderly is a noble goal, but it's not clear to me that it would solve our demographic problems.

When some future generation achieves sustainable fertility levels, however they accomplish this, they will face the economic burden of a ratio of dependents - young and elderly - greater than the ratio the previous generation of workers supported. Nevertheless, I've found a small way to make lemonade from the lemons of our demoographic trends. To quote Stein's Law, "Things that can't go on forever, don't." I believe a society that can't reproduce itself has something seriously out of whack, and not just in the Darwinian sense. That such a state of affairs can't continue is a good thing in my book. Admittedly, what comes next could be worse, but my expectation is that a least a few countries will find a better way.

Monday, February 07, 2005

How not to fight Saudi Arabia

Arnold Kling provides a helpful economic reminder about Saudi oil and the pernicious ideas it finances. He argues that if the goal is to peacefullyreduce Saudi oil revenues, then in order of increasing cost-effectiveness, we have subsidization of alternative energies, forced reduction of our energy consumption, and some form of tax on oil. Note that our current policy is a mild dose of the first option - it may not be effective, but it's relatively cheap, and subsidies are always more popular than taxes. Also note that energy subsidies have purely domestic policy goals.

Kling's conclusion is absolutely right:
Even if we were to succeed in lowering the price of oil, it is not clear that this would have much effect on the Saudi policies that concern us. ... In contrast, if we were to invade Saudi Arabia, it would cost less and we could be more certain of achieving the desired policy changes there. Does that make an invasion a good idea? No. The point is that launching an economic war to try to reduce the price of oil is an even worse idea.

Dave's filter

Saturday, February 05, 2005

Means and motives

As I've written before, the privatizing Social Security and making it fiscally sustainable are issues that can be separated. In President Bush's SOTU address this week, he implied as much: "As we fix Social Security, we also have the responsibility to make the system a better deal for younger workers."

In the post I linked to above, I wrote that private accounts would increase our rate of saving, and thus us make us richer in the long-term. I now regret not going beyond that and also making the moral case for private accounts. The moral rationale lies far closer to my heart than any utilitarian economic argument, but it's one of those things that I've said so many times (if not so many times in my blog) that composing the argument once again often feels burdensome.

What prompted this regret was reading Jacob Sullum make the moral case pithily but beautifully:
Although sold to the public as a pension system, Social Security is based on the forced transfer of resources between generations. It steals from the poor to give to the rich, and it substitutes dependence on a beneficent state for self-reliance and voluntary mutual aid. It may not be financially bankrupt, but it is morally so.

By contrast, private investment accounts represent genuine savings, as opposed to claims on other people's money. There is no getting around the fact that requiring people to save also involves the use of force, but this sort of paternalism seems preferable to the predation at the heart of the current system.
That's what the Social Security fight is really about. Arrayed against the above argument stand Democrats with a different moral vision instantiated as policy in the New Deal. Looking at economic and budgetary analyses of various reform proposals, one sees some very interesting technocratic arguments, but they are all means to an end.

Thursday, February 03, 2005

Dave's filter

The Insurgency Revisited
Are men funnier?
"Iraqis do not want us to disengage but they do want us to honor their sovereignty."
Chairman Kim’s dissolving kingdom - something I'd really like to believe is accurate.
"The EU's embassies in Havana will now craft their guest lists in accordance with the Cuban government's wishes." - Vaclav Havel is not happy.
The Global Baby Bust
In my SOTU commentary I wrote that Pelosi was all complaints. I forgot to mention how ridiculous they were.

Great expectations

Reason has an interesting survey of commentary on hopes and fears for Bush's second term. I'll touch on three excerpts. Jacob Levy is optimistic:
...there is a silver lining in the real chance that the Commerce Clause/10th Amendment revolution will continue and finally come to its overdue fruition. One to four Bush Supreme Court nominees could lead to some genuine supervision over whether Congress is usurping responsibilities of the states and exceeding the bounds of its Commerce Clause power.
Tyler Cowen is dreaming:
To keep American taxes at reasonable levels I would eliminate all farm subsidies, tariffs, quotas, and price supports, along with other forms of corporate welfare. More important, I would repeal the Medicare prescription drug bill, slowly raise the retirement age for Social Security and Medicare, and introduce means testing for benefits.
I'm sure he would if he could.

John Berthoud is realistic:
By the time the books are closed on the current fiscal year, federal spending will have risen by roughly 20 percent in real terms since the last budget signed into law by Bill Clinton. This four-year spending explosion has not been limited to the areas of defense and homeland security. Spending at the Department of Agriculture will have risen in real terms by an estimated 19 percent, at the Department of Labor by 40 percent, and at the Department of Education by 74 percent.

The entire eight years of the Bush administration are thus unlikely ever to be seen as a landmark in the fight for smaller government. At best, a concerted effort at spending restraint in the second term will make a difference between a so-so record and a historically disastrous one.

Wednesday, February 02, 2005


A transcript is here, among many other places. Here's my commentary, as yet uninfluenced by reading that of others.

" week I will send you a budget that holds the growth of discretionary spending below inflation" - Good! - "...and stays on track to cut the deficit in half by 2009." - Sigh; a nominal cut in discretionary spending is required to actually balance the budget anytime soon. "My budget substantially reduces or eliminates more than 150 government programs." - Also good, though he gives one the impression that all the savings will go towards "strengthening America's community colleges," "increasing the size of Pell Grants," "a community health center in every poor county," providing "strong funding for leading-edge technology -- from hydrogen-fueled cars, to clean coal, to renewable sources such as ethanol." First of all, ethanol should be discussed in the context of beer, not government subsidies. Second, even if I loved every one of these initiatives, I'd still say they're mostly state and local matters, although that argument was lost during the New Deal.

As for Social Security, I was hoping Bush would at least pick on the five ways to cut benefits he mentioned, or foreswear cutting benefits - lead already. Other than that, I loved the Social Security reform part of his speech. He carefully started with "strengthen and save Social Security" and promised the status quo for those at least 55, and then compellingly argued for a reform that included private retirement accounts.

The show of support for the FMA, which has no chance of getting the required two-thirds approval in the House and Senate, apparently makes some conservatives feel better, and presumably angers some liberals; that's about all it does.

Okay, did you make it through the domestic half of the speech? At times it was a laundary list, as most SOTUs are. Even the short blurbs I wrote above are rather dry compared to the foreign policy half of this SOTU. Ever since 9/11, defense and foreign policy have obviously been Bush's passion, and it shows in his speeches. I survived the laundary list by telling myself that the uplifting part was on its way. Finally, it arrived. I earlier described Bush's inaugural address as "nothing new" because I interpreted the freedom rhetoric as long term stuff, and in the subsequent press conference Bush made clear that his speech did not indicate policy shift. However, it did indicate a rhetoric shift: for this SOTU, Bush gets props for singling out Saudi Arabia, Egypt Syria, and Iran as in need of freedom.

Bush moved on to talk about Iraq, basking in the afterglow of the Iraqi elections. A few Iraqis in the gallery held up inked index fingers. Then came the moment of the evening. A little while after Bush talked about "[o]ne of Iraq's leading democracy and human rights advocates is Safia Taleb al-Suhail" and we saw her in the gallery, Bush spoke of fallen Marine Corps Sgt. Byron Norwood, and of his parents seated in the gallery right behind Safia Taleb al-Suhail. Safia and Byron's mother embraced, and for a minute the President was a spectator along with all the rest of the chamber and the TV viewers, all of us watching a very emotional scene.

Bush couldn't come close to topping that, but he gave a decent closing with that characteristic optimism he derives from his faith: "The road of Providence is uneven and unpredictable -- yet we know where it leads: It leads to freedom."

The Democratic response: Harry Reid presented himself with a folksy charm, and he wisely emphasized the moral dimension of his arguments. As for substance, I really didn't care for his protectionism, and I was amused by how his complaints about the deficit were followed by advocation of a "Marshall plan" for the US, which were in turn followed by complaints about Bush's Social Security reform increasing the national debt. Nancy Pelosi had the opposite of charm, more often than not staring bug-eyed into the camera and spending almost all her time on complaining in a grating tone.