Markets are smarter than you think
This tweet caught my eye:
If Biden had been nominated, I guarantee that this example would have been cited by anti-EMH types. “Markets were giving a 20% chance that someone else would be nominated, when it was obvious that Biden had things wrapped up.”
The market is smarter than you think.
PS. A few comments on Harris:
I often see right wingers making two points:
1. DEI programs that promote the unqualified are bad.
2. Problem X occurred in a system that had hired women and blacks, and hence DEI is to blame for problem X.
The first claim is true, while the second is usually sexist/racist.
The Harris case is particularly interesting. She was certainly “hired” because she is a black woman. And yet she’s far more qualified to be president than either Biden or Trump. Smarter, more articulate, more energetic, etc. (Of course I don’t agree with her politics, but that’s neither here nor there.)
On the other hand, she’s not the most electable Democrat, mostly because she is a black woman. That’s presumably why Obama has held back in endorsing her; he understands that someone like Beshear is more electable. Life is unfair.
No one looks good here. Not the DEI obsessed Democrats. Not the low news engagement swing voters that don’t like forceful black female personalities. Not the Republicans who whisper that Harris is a DEI hire. Very sad all around.
PPS. Can we please stop electing senile 80-year old presidents, especially ones who have committed dozens of felonies? Is that too much to ask? The same Republicans who (correctly) insisted Biden was senile see no problem with a very old man who rambles on interminably and incoherently in a major convention speech, in the way that you associate with leaders of countries like Cuba and Venezuela. Really?
PPPS. If we had to have a “thinker” as VP, couldn’t we choose one who is less shallow than Vance. (He’s not even able to hide his disgusting bigotry.) I recently met Rob Henderson at a book signing. His life story has some similarities to Vance’s but Henderson is a vastly more thoughtful intellectual.
PPPPS. When I say “markets are smarter than you think” I’m excluding Matt Yglesias, who doesn’t like headlines telling him that he doesn’t understand something.
Tags:
23. July 2024 at 10:29
Sumner, other than the point in favor of prediction markets, this post is word salad. It’s best to stick to one topic per blog post.
23. July 2024 at 10:55
I can’t speak to why others don’t want to vote for Harris, but I couldn’t care if she were a purple hermaphrodite. I’m pissed what Ross Douthat observed and you quoted in a recent blog post:
“the Democratic Party has treated Trumpism not as a “civic emergency” but as a political opportunity, a golden chance to win over moderate and right-leaning voters with the language of anti-authoritarianism while avoiding substantive concessions to these voters and actually moving farther to the left.”
And here’s GovTrack’s assessment of Harris when she was in the Senate: “Ranked most politically left compared to Senate Democrats” https://www.govtrack.us/congress/members/kamala_harris/412678/report-card/2020
So, yippee, we get to elect a socialist to prevent the election of a nationalist.
23. July 2024 at 11:02
Carl, I’m not asking you to vote for Harris, I’m asking you to vote against Trump/Vance, for reasons that are so obvious I won’t insult your intelligence by repeating them.
23. July 2024 at 11:20
I think that the evidence show being black and/or a woman in today’s politics helps.
https://x.com/cremieuxrecueil/status/1815134244022141256?t=9v7f2ejuS_3udUqyPqCzIQ&s=19
23. July 2024 at 11:27
The Trump campaign’s reaction to the news of Biden stepping down and Harris being the new candidate is telling. Just as was the case with the USSR, the silliar the lies and propaganda, the more it says about their weakness. Trump’s team is clearly concerned that Harris might overperform.
Talk of suing the Democratic Party for the way they chose their candidates would be rich even if the Republicans had standing. The fact that they routinely file lawsuits in cases in which they know they have no standing just underlines that their party is all about symbolism and has nothing to do with substance. The whole party is organized around wishful thinking.
I wouldn’t have chosen her as a candidate, and she is an underdog as of now, but if she’s improved her political skills, she can win this race. She even has a good chance if she hasn’t.
23. July 2024 at 11:36
Scott:
I know you’re not. I was just having a small wail on behalf of us politically homeless people who have no desire to pick people by their tribal characteristics before I have to go hold my nose and vote for someone whose politics I abhor.
23. July 2024 at 11:43
Just dropping in to say I straightforwardly enjoy the blog, and don’t feel the need to push my crazy opinions in the comments. 🙂 Thanks, keep it up!
23. July 2024 at 12:03
My understanding is that Obama doesn’t want to be seen as favouring anyone and that his lack of an endorsement has nothing to do with his feelings re: Harris or her electability.
I also don’t think the 80/20 odds tell us anything about the EMH.
In other news, my Hypermind bet from 2020 that Harris would be the first female president of the US is starting to look a lot better than it was a week ago!
Personally I’d love a Romney, Huntsman, or Kasich to run again. Romney probably too old now, Kasich on the border, but Huntsman is ‘only’ 64.
Carl, you might want to read about the methodology behind that ‘most politically left’ label. Hint: it has nothing to do with her economic policies.
23. July 2024 at 12:26
Isn’t the actual issue that you’d have to pay over $1 to buy all the contracts, which has at most $1 to pay out? Or, alternatively, that you could pay $3.97 and ensure that you received at least $4 in return?
23. July 2024 at 12:45
@Tacitus, you can also check her DW-NOMINATE scores to find that she was the second most liberal member of the Senate (behind Elizabeth Warren). This is based on the economic/redistributive axis.
https://voteview.com/congress/senate/115
23. July 2024 at 12:51
Tacticus:
I will do so. Thanks.
But you’re going to have a hard time convincing me that someone who co-sponsored the Green New Deal bill, https://www.congress.gov/bill/116th-congress/senate-resolution/59/cosponsors, is not a socialist. I hope the realities of the office will constrain her freedom of action sufficiently, but she has, in my mind, made clear her inclination.
23. July 2024 at 13:04
Harris is already overperforming as a communicator, and it’s helped lead her to cut Trump’s original lead over her in half, according to the PredictIt market:
https://www.predictit.org/markets/detail/7456/Who-will-win-the-2024-US-presidential-election
This is very preliminary evidence, but it is consistent with what I’ve been saying about Trump’s vulnerability. A competent candidate can beat him.
23. July 2024 at 13:41
Harris’ biggest problem is that she is the VP, and so she owns Biden’s record, and owns the economy. Voters are pissed about the economy, because of inflation. So voters are going to choose the challenger, because they don’t like the economy. Democracy in action.
The left wants the narrative to be that Harris will lose because she is a black woman, because it means that they don’t have to admit that Democrats need to govern in a way to deliver what moderate swing voters want. Complaining about racist, sexist voters is a whole lot easier than governing or running a winning political party.
23. July 2024 at 13:50
Vance may be smarter than you think: https://x.com/snmrrw/status/1815814925610357098.
23. July 2024 at 14:04
Lizard Man,
You can’t always take voters at their word. Harris entered this race underwater in terms of approval rating and as part of a formerly part of a ticket that was even more underwater. However, most voters are unfamiliar with Harris and this election will be about the future and Trump, if Harris is competent, which so far she is. She seems to understand that a handful of issues do matter, and using them to present a positive contrast for her versus Trump is how she can win. The key is to discuss issues in the context of attacks on Trump.
Her opponent is also underwater, has always been so for years, and is completely unacceotable to a majority of voters. He can’t move that many voters. He’s obviously a known commodity.
John Hamilton,
Trump’s choice of Vance was a huge mistake. VPs typically don’t add to compaigns but they can subtract. Vance is a typical MAGA weirdo extremist and fraud and will be exposed if Harris and her team keep up the attacks.
Too rearly to predict an outcome, and even a victory for Harris will be close in swing states, but things are already looking very bad for Trump. They will sling mud at Harris, but most Amerricans know Trump is a total liar.
23. July 2024 at 15:50
In my uninformed opinion, the Democrats should nominate George Clooney. We’re at the point of things where any new candidate needs profile and Clooney is better-looking than Trump is or was, which might help especially with the middle-aged white female vote. Who wouldn’t want to look at him for 4 years? He just needs to steer clear of anything woke and pick a semi-competent team.
23. July 2024 at 18:26
@Rajat
They should only go after Clooney if Oprah declines the nomination first.
23. July 2024 at 18:39
Floccina, I doubt that applies to the presidency. Hillary certainly performed poorly.
John, I already said Vance is smart. But as I learn more about him, I’m inclined to think that he’s dumber than I had thought. That cat lady comment was extremely dumb. Unbelievably stupid.
Rajat, Yup, I favor Clooney too.
23. July 2024 at 19:39
“That cat lady comment was extremely dumb. Unbelievably stupid.”
At the time he said it he wasn’t anticipating that he’d be facing a national general election as VP candidate. Most conservative politicians run in safe or relatively safe seats, like Vance’s Ohio seat in 2022. (Ohio’s basically a red state now, though that wasn’t true historically.)
“PPPS. If we had to have a “thinker” as VP, couldn’t we choose one who is less shallow than Vance. (He’s not even able to hide his disgusting bigotry.)”
He’s clearly able to hide it, or else he wouldn’t have gotten through Yale. He doesn’t WANT to hide it.
Here’s what’s probably going through his head: these careerist cat ladies are having a dysgenic impact with their refusal to have children. In addition, they tend to preach their childless, career-first lifestyle as something all women should aspire to. Whereas the childless guy who’s sitting in his garage smoking weed and playing the guitar usually isn’t promoting that as the ideal life path for all men. Voting for Kamala sends a very bad message to young women in America, even worse than voting for Hilary, who at least had Chelsea.
23. July 2024 at 20:36
I think Vance’s shallowness is a good thing. Better an authoritarian who is a shallow thinker than one who is a deep thinker.
23. July 2024 at 20:40
Harris continued to rise in betting markets tonight. She’s now down by only single digits, as opposed to more than 20, where she was just yesterday.
Polls are showing J.D. Vance is underwater in terms of approval rating. He has made many strange, extreme statements over the past couple of years that will likely conitnue to haunt him.
23. July 2024 at 20:56
I would vote for a dead person before I voted for DT, but I wouldn’t call him dumb. He’s a huckster and opportunist who has a very astute understanding of people. He doesn’t know much about a ton of topics, but that describes everyone. What he does understand about the world he has leveraged to achieve his goals beyond anyone’s prior predictions.
Maybe Kamela has attorney smarts, but we’ll see if she can leverage that prosecutor’s type of understanding of the world to other things. I have serious doubts given her lackluster record as a politician and previous statements when she ran for the Demo nomination. Does she have any core political beliefs? She seems someone who will be swayed by her party’s orthodoxy of the moment. In some sense, that is what a politician is, but one would like a bit less sensitive weathervane so that some of a political party’s insanities are recognized as such in the moment.
23. July 2024 at 21:43
Dip, You said:
“Here’s what’s probably going through his head:”
Explaining what’s “going through his head” doesn’t make his comments any less stupid and offensive. Nor does it help to say he made these dumb comments before he ran for VP. Dumb is dumb.
Travis, His advisors during his first term say he’s really dumb, that explaining things to him is like talking to a kindergartener. Who am I to disagree? He may have a high IQ and have more street smarts than me, but he’s really dumb because he never bothered to learn anything.
23. July 2024 at 22:12
Scott: I agree Kamala is smarter than Biden but being smarter than Biden isn’t much of a complement. Yesterday I re-read Biden’s history in Wikipedia. Not that I needed to do that to recognize his low intelligence. He’s just a simple dork. He was at the bottom of his class in law school – the last refuge of morons with aspirations for high social standing.
But I’m baffled by your constant efforts to discredit anyone who’s a Republican because they lie. As if Biden never lies? Don’t you remember GM is the world’s greatest EV maker? And what was that boner he claimed about being in Afghanistan? You don’t hear about Biden’s lies because the media is busy not reporting them, and anyway they’ve been mostly incomprehensible mumbles for the last couple of years. And now here’s Harris going on about child care and family leave, as if that will just come out of the blue, but you’re crediting her with some kind of integrity? She’s a liar just like Biden and Trump and every politician.
Regarding race / gender: Kamala looks about as much like a black woman as a Polar bear. To be black she’s going to have to call up Warren and find out how she pulled off being Native American. What a laugher. Her race will play no roll in whether people will vote for her or not – except insofar as she uses it as a campaign issue. But Harris is sure to play the race card because she has everythingn to gain from it. Unless Trump finds some novel attack to tear it appart, any counter argument he makes will be reported as racist by the left-wing propagandists that call themselves the “reporters” or “press”.
The fact that she’s a woman may play a roll and justifiably so. She will be commander in chief of the most powerful military the world has ever seen. Trump has already shown he’s decisive and tough. The default position on Harris – justifiably in my opinion – will be that she’s too much of a weenie for the job. She’ll have to show otherwise, and if she can’t, she shouldn’t have the job.
All the top Democrat women – Harris, Warren, Murray, Klobuchar, Clinton – fit the wimp sterotype of women. Weak, mostly concerned about babies, children and social issues, too spineless and strategically incomptent to lead a war if one came along – and too distracted by chick-social concerns to notice one coming. I would not vote for any of them to be president. None of them are competent for the job.
The only exception is of course Duckworth.
24. July 2024 at 06:12
The reason people don’t like Kamala Harris has nothing to do with her sex or race… it is because she is extremely unlikeable. She is a low-IQ elite, who has spent her entire career failing upwards. She consistently makes up stories (just like Joe Biden) about her upbringing and history to make her appear more like the put upon minority who had to fight for her rights her entire life when she had a more privileged upbringing than 95% of the country.
Her story is not inspiring, and listening to her pretend to try and make it inspiring is off putting.
People who absolutely hate Donald Trump, will still admit that he is charming and likeable – including Obama…
Her team is doing a great job of trying to get ahead of all her cringe gaffs by turning them into less cringe memes, but I don’t think that will really work.
Donald Trump is a poor person’s idea of a rich person.
Kamala Harris is a dumb person’s idea of a smart person.
People’s memories are so short… it was only 4 years ago that we had 6 months of the media drooling over how incredible Kamala Harris was, that she was going to be the next president, a visionary for our time, charming, intelligent! Aaaaaand she was so unlikeable and so incapable of running a campaign, she had to drop out of the primaries before she was embarrassingly going to lose her home state.
One last point about Republicans making point #2 – Please provide an example of this because I am certain this is just a left wing talking point. I don’t think I’ve ever seen a standalone statement from Republicans claiming X is a problem because they hire women and blacks. It’s a very disingenuous statement.
24. July 2024 at 06:45
Here’s more of a preview of things to come for Trump and Vance from Pete Buttigieg:
https://www.youtube.com/watch?v=ari6mvykp_c
All of the sudden, there are Harris advocates everywhere in media attacking Trump and Vance where they are most vulnerable. It’s as if the Democratic campaign for President just began Monday. I’m happy to say this is a test of my hypothesis that Trump is very vulnerable to such attacks.
24. July 2024 at 07:10
“Not the low news engagement swing voters that don’t like forceful black female personalities.”
“On the other hand, she’s not the most electable Democrat, mostly because she is a black woman.”
I’d say the main reason to think she’s “not the most electable Democrat” is something else entirely: her campaign for president in 2020, and the response to it from Democratic primary voters.
And isn’t her problem almost the opposite of being “too forceful?” Being or being perceived as kind of an airhead?
The stuff about being smart and energetic is neither here nor there, I think, the question is does she have political appeal and talent? Can she convince voters that she can be a capable leader?
I think Yglesias has been particularly brilliant on the Harris angle. While his “official” position was “Biden is great, why don’t they get him out there more?” he’s also been tweeting a lot about Harris, for quite some time. (I assume wanting to be ready in the event Biden stepped down). Of course he wants her to take sensible positions to enlarge her appeal, I think he’s worried she won’t.
This guy – a historian on Twitter who’s not an idiot, who knew? (smile emoji) – has a take similar to Yglesias’s I think:
https://x.com/AstorAaron/status/1816085235756421356
24. July 2024 at 07:18
On JD Vance doesn’t this say it all?
https://www.politico.com/news/magazine/2024/07/18/jd-vance-world-view-sources-00168984
Curtis Yarvin? Claremonsters? Theocons?
In 2005 he liked Matt Yglesias and Sufjan Stevens. Did he suffer a brain injury?
24. July 2024 at 07:24
I think I also saw that he liked Becker/Posner! Can we imagine an alternative world where JD Vance made it all the way to Marginal Revolution and The Money Illusion? Escaped the mental hellscape of the Yarvins and the Claremonsters for the free air and the green grass?
(Also I forget to add (smile emoji) after “Sufjan Stevens,” that was a joke).
24. July 2024 at 08:33
Tom and Kangaroo, Not sure why you waste your time with such drivel. Do you think I’ll be impressed with your arguments? Do you really think I’m that dumb?
anon/portly, On Harris, I have the same take as Yglesias. So I guess we agree.
She’ll turn people off in the same way that Hillary did. Women have a harder time appealing to voters as being strong but not annoying. That’s just the way the world is–unfair.
24. July 2024 at 09:23
I’m not totally convinced that being an African American woman is a weakness. A big challenge for democrats is finding a candidate that makes progressives happy without horrifying moderates like myself. I think African American candidates get a free pass with progressives on moderate and even some conservative positions. And I think it’s possible that the anti-woman vote might be overestimated based on Hillary’s performance. But I could be wrong.
24. July 2024 at 09:49
Radical progressives are the most sexist people on this planet. They’re trying to eliminate me, because they’re mostly beta males. They always talk about their compassion, as if they think that’s sexy. I have knews for you Sumner. Changing body parts doesn’t make you a woman. You’re not one of us.
And Kamala Harris witheld exculpatory evidence to falsely imprison Californians. She was one of the worst Atttorny Generals California ever had. She was unqualified to be attorney general, and only got that position because of her connections to the democrat political machine.
Nobody gives a damn about her race or sex; they care only about competence, and she’s incompetent.
The fact that you would think her qualifications (not much) are equivalent to building skyscrapers and golf courses, and reshaping the NYC skyline shows how bad your judgement really is.
And the only comments I’ve seen denigrating women on Twitter, coming from the right, is towards the DEI secret service agents. Nobody gives a damn if the secret service hires women. But they better hire a woman who is actually athletic, and knows how to use a weapon. Like Anne Oakley or Calamity Jane.
24. July 2024 at 10:54
That Politico artible anon/portly links to is quite revealing. It is rather shocking to see people react to issues as stagnation due to overregulation and capture by an elite oligarchy by wanting even more top-down control, in the form of a dictatorship. My conclusion is exactly the opposite. At 48, the older I get, the more I value decentralization in many respects.
This is even true with respect to typical top-down corporate governance. Rather than seeing this as a model to be emulated in govvernment, I’ve been increasingly favoring so-called market-based management, which is bottom-up and structures firms more like cartels than internal dictatorships. Employees are owners who can be entrepreneurial and there is internal competition and pricing, etc. There can be competing HR operations within the same organization, for example, or even some departments or even managers who choose to outsource some or all of their HR functions. Product/service producers can hire their sales and customer service teams internally, and/or externally, etc. Individuals can set up their own operations within the cartel-like company if there’s sufficient demand for their products or services to support them. CEOs effectively become the equivalant of sports league commissioners.
Koch Industries, one of the largest private companies, is run on this model to some degree.
24. July 2024 at 11:32
“On Harris, I have the same take as Yglesias. So I guess we agree.”
Well, here’s an Yglesias take:
“Harris has a number of fundamental problems: (a) Her approval rating is bad; (b) Her instincts as a candidate in 2019-2020 were often off-base; (c) Her whole career as a politician in San Francisco and California didn’t involve trying to appeal to swing voters; (d) Her electoral record, while fine, is not impressive relative to the partisan fundamentals; (e) She is tied to Joe Biden’s unpopular administration.”
https://www.slowboring.com/p/17-thoughts-on-the-transformation
Compare to:
“On the other hand, she’s not the most electable Democrat, mostly because she is a black woman. That’s presumably why Obama has held back in endorsing her; he understands that someone like Beshear is more electable. Life is unfair.”
In his public writing he’s emphasizing that someone like Beshear (or Baldwin or Whitmer – see also https://www.slowboring.com/p/kamala-harris-should-try-to-be-really) is good at winning general-election races in a red (or purple) state, while Harris is good at winning primaries in a blue state. At times to my mind he seems to be directly arguing against the idea that “life is unfair” is a very useful way of looking at these things.
I don’t think he’d say it’s of no use at all, and perhaps Yglesias would agree privately that Beshear’s main advantage over Harris is that he’s a white man, or put more emphasis on this, I don’t know.
I really don’t see these takes as similar, but my track record when disagreeing with Scott Sumner is very poor, so maybe they are!
24. July 2024 at 11:54
bb, Trump says he has a personality cult, that he could shoot someone in Times Square and his supporters would stick with him. I agree with Trump.
I cannot even imagine a female presidential candidate having that sort of personality cult. I myself am probably biased against women candidates (I didn’t like Hillary), but at least I try to fight back against my bias. I see lots of people (both men and women) who aren’t even willing to consider whether they have a deep seated view that a strong leader should be a man. What would a female Trump even look like? I cannot even imagine. Thatcher was so disliked for being “strong” her own party threw her out in 1991. What does a female personality cult look like?
anon, You said:
“(a) Her approval rating is bad;”
Yeah, why is that? I’d guess that 90% of Americans only know two things about her—she’s black and she’s female.
Otherwise I agree with Yglesias, but I don’t see those other points as being all that important. Any Democrat would be tied to Biden’s record, it’s not like voters are going to think that it was Harris who secretly masterminded his inflationary policies.
To be clear, I would have preferred a stronger candidate than Harris, and I agree with Yglesias about some of her other weaknesses. And I agree that Biden’s record might play a bigger role in Trump’s winning that Harris’s race and gender, so we aren’t far apart.
24. July 2024 at 12:59
@Scott
You think people were turned off by Hillary because she was a woman… and not because she was arguably one of the most corrupt, unlikeable politicians in recent memory? People who are close to the Clinton’s don’t even like her personally… which has been documented and extensively detailed even in her own autobiography.
I don’t think you’re dumb, I just think your thinking is lazy in this domain. Race/Sex play a VERY minor role in her unlikability. That is why someone like Michelle Obama polls significantly better than Harris. Michelle is an intelligent, strong, charismatic individual. She is a capable public speaker, she is thoughtful, tough and generally very well liked. Politics aside, most people can recognize that…
There are dozens of strong female politicians who aren’t viewed as annoying.. it sounds like your projecting your own sexist beliefs on everyone else.
Her approval rating is bad, because she’s not a good politician lol. You can’t even watch clips of her without cringing. Did people not like Sarah Palin because they are sexist or because she’s a terrible politician? Like come on…
In terms of female personality cult – again you’re absolutely so off base. If Taylor Swift decided to run for president, she would be able to commit genocide on a weekly basis and her supporters would stand by her. Just because many of the prominent female politicians at the moment tend to be terrible, doesn’t mean that you couldn’t have a female candidate with a strong personality cult.
24. July 2024 at 13:17
Hi Scott,
I’m wondering if you’ve written somewhere about Project 2025 and its monetary policy proposals. I saw Menzie Chinn post an excerpt over at Econbrowser a few weeks ago and wonder if maybe you’d written somewhere I hadn’t seen. Among other things, what caught my eye most were the paragraphs on free banking. “Further benefits of free banking include dramatic reduction of economic cycles, an end to indirect financing of federal spending, removal of the ‘lender of last resort’ permanent bailout function of central banks, and promotion of currency competition…”
Any thoughts?
https://econbrowser.com/archives/2024/07/mandate-for-leadership-aka-project-2025-on-monetary-policy
Thanks.
24. July 2024 at 14:56
> No one looks good here. Not the DEI obsessed Democrats. Not the low news engagement swing voters that don’t like forceful black female personalities. Not the Republicans who whisper that Harris is a DEI hire. Very sad all around.
I don’t believe this is fair, Republicans are right in point out that without DEI the Democrats could’ve had chosen a far more electable politician such as Whitmer, Gavin Newsom or Pete Buttigieg. The problem is not with race or gender, it’s about the process.
24. July 2024 at 14:57
Tom, You said:
“If Taylor Swift decided to run for president, she would be able to commit genocide on a weekly basis and her supporters would stand by her”
Whatever you say . . .
Justin, I’m all for reducing the role of the Fed and deregulating banking, but those comments are mostly silly, not worth commenting on. Neither a gold standard nor a fixed monetary base would stabilize the business cycle.
24. July 2024 at 15:04
If Oprah were the Democratic nominee, would she be tied to Biden’s record? I don’t think that she would be, and I think that illustrates the larger point that the only thing that most voters know about Harris is that she was Biden’s VP, so the extent to which she is tied to Biden’s record is unique among Democrats. Another way of saying the same thing is that Harris doesn’t have a brand for low information voters outside of “Biden’s VP”.
24. July 2024 at 15:05
Cochrane, Calling Harris a DEI person when she’s 10 times more ethical and talented than Trump is borderline offensive. I get that DEI is a bad idea, and Republicans should say so. But stop calling out individual people, especially when they are more qualified than the white male alternatives (Biden and Trump).
More and more I see Republicans blaming almost everything that goes wrong on DEI, even things that were much worse in the past when white males dominated.
I should probably stop giving advice to the GOP, as I want to see the party lose in November. But doing things like insulting gay men and women with no children is just really bad politics.
24. July 2024 at 15:16
I find it interesting that Biden was never referred to as an affirmative action hire, given that he may have been chosen because he was an older, experienced white man. It didn’t happen, because the people who make such charges are bigots.
24. July 2024 at 15:16
I’m referring to Biden being chosen as VP by Obama.
24. July 2024 at 15:29
Justin,
I’ll comment on the problems with having a money supply that does not sufficiently expand with the economy. I wish more economists would address such issues in fundamental terms, so perhaps many of these myths would finally die.
The central problem with cyclical instability is sticky wages. This is what couples inflation with real effects. Because shifts in economic growth occur more quickly than that in wages, the money supply needs to expand at a rate that doesn’t lag enough behind potential growth such that deflation leads to the wage/NGDP ratio rising enoough to cause unnecessary unemployment.
Demand for money tends to rise in response to net real negative shocks, in which case the money supply either needs to expand, or markets have to have confidence that it will expand, as needed.
Similarly, it’s undesirable to have the money supply outstrip potential growth too much, particularly during periods in which it represents shocks. This lowers the wage/NGDP ratio such that unemployment rises to unsustainable levels, only to be reversed when wages catch up, sans more positive nominal shocks.
Ideal policy would probably involve something like level targeting NGDP in the US, with deflation that’s mild enough not to lead to unnecessary unemployment.
24. July 2024 at 15:38
Justin, I’d add that it’s not worth paying much attention to Project 2025, as it will have no bearing on what the Fed does going forward.
Lizard, That’s not how voters think. Any Dem will face some blowback on inflation, but Harris is not likely to face more than any other candidate. The real problem is that she’s simply not a very attractive candidate. Another Hillary.
24. July 2024 at 16:23
I understand the animus directed at Trump. (Living offshore, my passions are damped on all US topics. I hardly even follow baseball anymore. But I understand).
Vance? OK, he has policy positions that many do not like.
But a legitimate question is, “Is any amount of ripping of social fabric tolerable to live under “free trade” and de facto open-border models?”
Vance is asking that question, and I think it is a valid question. Believe me, they are asking that question in spades in Sweden and large parts of Europe.
Vance appears to be relatively smart, married to a Bharat, does not appear racist sexist etc. His daily commentary is not egregious, unlike that of Trump.
OK, Vance flipped-flopped on Never Trump, but Kamala Harris once called Biden a racist, and then started working for him a few weeks later. That is politics.
I will say Vance appears devoid of charisma. Trump probably should have picked a charismatic pro-business sensible guy with a Hispanic surname. JFK loathed LBJ and brought him onto the ticket.
I think Harris will win. D-Party ballot-harvesting techniques have proven successful, and absentee ballots are mailed out by the millions.
Harris may stumble, who knows?
Interesting election to watch.
Remember: each side predicts galactic doom if the other side wins. Do not be too alarmed.
24. July 2024 at 16:39
Sumner,
You are correct that Harris is 10 times more ethical and talented than Trump, however that is not what makes a politician more electable, else Jimmy Carter would have served 2 terms and Trump wouldn’t be running now.
As for Harris being a DEI pick or not, she was chosen by Biden specifically for being black woman, he told us so!
Also, the criticism was not against Harris versus Biden or Trump, it was Harris versus more electable Biden substitutes such as Whitmer, Gavin Newsom or Pete Buttigieg, and for that reason my point still stands: they chose a less electable candidate because of a DEI decision 4 years ago.
24. July 2024 at 17:58
Non – American here so I am just following from the balcony on how YOU guys decide over the fate of the planet.
Am I the only one who actually likes Harris’ persona? I heard little of her except right wingers’ jokes on Twitter before Biden dropped out. Now I discover all sorts of clips supposedly discrediting her and she looks smart and above all, really human, charming, and likeable. And like many, uh, non white women, she seems to have a sharp with that could cut down the likes of a Trump in a face to face discussion. [Harris of course isn’t “black”, she’s mixed race and therefore embodies the future much better than any single race]
Vance: seems more like Hitler to me than Trump ever did. Why? Better opportunist, much younger and ideologically driven, rather than narcistically like Trump. Most importantly, YUUUUGE chips on his shoulder. Trump plays on the poor white victim complex. Vance IS the poor white victim complex embodied. I mean, he literally wrote a book on it. Nothing more dangerous than the righteous.
24. July 2024 at 18:36
Justin,
Sorry about my sloppy statement there. I try to write too quickly when I take breaks.
To sum up, the money supply needs to be expected grow at close to the rate of real GDP growth to avoid unnecessary unemployment due to sticky wages. Also, the rate of growth needs to be expected to change as necessary to offset positive and negative real shocks. Hence, monetary policy regimes that seek to do something other than this, or maybe nominal wage targeting for smaller, less diversified economies or economies subject to large trade shocks, are ill-advised. Bitcoin will never replace the dollar.
24. July 2024 at 19:49
mbka, Interesting Vance comparison—but glad I didn’t make it. 🙂
24. July 2024 at 22:58
Scott, is truly a petulant narcissist, with a low I.Q. to boot.
Just read this gem and laugh hysterically. “Don’t give me that drivel”. LOL.
Wow. What a coherent argument. Don’t give me that drivel. Sounds like the comeback of a plumber.
Other amazing, high I.Q. comebacks include, “Do you think I’d be impressed…” lol. Where did you get that comeback, from a farmer picking his ass in deep Missouri?
It’s really comical. It’s a good thing nobody listens to him, outside of a few deranged academics, otherwise we really would be a banana republic.
Here is my favorite nonsensical comeback: “They can’t handle the stong black woman” lol.
This is the type of libtard who always cries racism when someone doesn’t like his political choice. And this is precisely what bigots do. For example, Obama is the “strong black man”, but Thomas Sowell is a “uncle tom” according libtards.
Sumner told us, for example, and these are his own words: that Liz Cheney, a corrupt politician, was a “strong woman” and that’s why people didn’t like her. But if a woman speaks their mind, and he disagrees with them, like Marsha Blackburn, they are not “strong”, their “idiots” and “bimbos”.
The left are bigots. They always have been. From slavery to jim crow, to DEI, these are nasty people.
25. July 2024 at 02:53
It should go without saying the comment by MBKA is sexist and racist.
He claims white women don’t have “wit” and that the future is “mixed.” Why are you so desperate for a mixed future? Do you hate blacks, whites and asians? Would you be happier if all three were erased?
You clearly hate white women. Was Roseanne Barr not witty enough for you? One of the greatest comics of all-time, who just happened to be born a white female.
It’s interesting how psuedointellecuals form these bizarre opinions; they generalize to such an extent that reduces people to mere cogs in a machine. A lot of people, myself included, don’t find Kamala very articulate or witty. But we wouldn’t conclude that all mixed people are unwitty and inarticulate simply because Kamala isn’t. How does one draw such a ridicilous conclusion?
It’s simple. They allow their bigotry to form opinions.
It’s like saying A + B = Z. The logic is awful.
25. July 2024 at 03:56
@mkba
I dislike Harris because she is a PMC from California without any deep family roots, and so she appears to have a very shallow understanding of the US outside of the Californian PMC’s, who are very unrepresentative of the country. Also, the policy ideas she touted in the 2019-2020 primary really are terrible, and I say that as someone who mostly votes for Democrats.
I dislike Vance even more, mostly because of his authoritarian ambitions, but also because he really dislikes the poor and middle class white people he claims to represent and come from.
25. July 2024 at 04:58
Hilarious that Trump chose someone as VP who was originally famous for writing a book about a large segment of Trump’s base, from a looking-down-his-nose elite establishment perspective. And now Vance is more famous for his sexist paternalistic, anti-democratic, race-baiting, anti-abortion/reprodutive freedom weirdo who said on video that wives should stay with physically abusive husbands for the good of the children.
How many voters hasn’t he insulted in his career as someone who’ll say or do anything for fame, power, and money?
25. July 2024 at 06:24
Michael, as long as Vance hasn’t insulted the broligarchs, he should be okay.
25. July 2024 at 06:38
“the money supply needs to be expected grow at close to the rate of real GDP growth”
What a bizarre statement. The money supply has of course grown dramatically faster than real GDP for decades. The entire point of this blog is to offer an intellectual defense for maintaining that state of affairs in perpetuity. The entire appeal of the heterodox ideas you were trying to refute is the sense that this sort of “forced growth” appears essentially fake and self-serving for a privileged minority.
I don’t know which way this election will go, but in general, the idea that politicians or people younger than 50 are going to “graduate” en masse to the thinking of blogs like Marginal Revolution or this one seems delusional to me. I like Scott a lot, but his brand of “libertarianism” has fundamental tensions and inconsistencies at a deep level. An economic system where the people are free to choose anything but a lower rate of economic growth is about as free as a political system where people are “free” to criticize anyone but the government. I.e., not free at all.
25. July 2024 at 07:47
Jeff,
You need to pay attention to the sticky wages part of what I said. That’s the only reason we care about changes in the price level. The economy can only grow as fast as the expansion of the money supply allows, because if it grows too slowly to prevent wage/NGDP ratio from rising too much, unnecessary unemployment results, which obviously reduces real growth.
The fact that the money supply has often been mismanaged has no bearing on my point. It’s possible a 100% free banking system would lead to better money supply management.
25. July 2024 at 09:05
I understood your comment but disagree with it. It’s not at all obvious that “unnecessary unemployment” reduces long run real growth, at least not any more than it might be similarly reduced by “unnecessary employment”.
25. July 2024 at 09:07
Jeff:
Can you elaborate on what you mean by:
How do you see Scott advocating for a system that prevents people from choosing a lower rate of economic growth?
25. July 2024 at 09:23
Jeff,
You disagree that wages are sticky?
25. July 2024 at 09:28
“I dislike Harris because she is a PMC from California without any deep family roots”
That’s funny, I dislike bigots.
25. July 2024 at 11:18
Michael, I don’t disagree that wages are sticky, I disagree with the conclusions you draw from this.
Carl, If the value of a currency is fixed, then the people can collectively select a lower rate of economic growth simply by refraining from spending money. If the growth rate is fixed by policy, then that freedom is eliminated.
25. July 2024 at 11:28
Jeff,
If the money suppply doesn’t grow at a minimum rate relative to real economic growth, how do you avoid too much deflation and recession?
25. July 2024 at 14:15
It is a bad idea for people who don’t understand a country to try to govern it. Harris has amply demonstrated that she does not understand the United States, and that all she knows is California, and only a very small specific demographic of California at that. This is in say, a clear contrast to Obama, who lived in multiple different states, has extended family throughout the US, and ancestry in the US going back to the colonial period (in Plymouth, Ma. less).
25. July 2024 at 15:05
So far as I can find information available on the web, Harris has no cousins in the US. And the information that is available indicates she isn’t related to anyone in the US who has served in the military, and she never served herself. She also is not related to anyone who is or was a union member, unless through marriage, and she has only been married since 2014. Ditto for anyone working blue or pink collar jobs for extended periods of time. She has no relatives from the South, or Appalachia, or the Midwest, or New England, or the Rio Grande Valley, or the Great Plains or the Mountain West, and no relatives from the Pacific Northwest.
25. July 2024 at 16:16
Lizard Man,
Are you actually paying attention to what is happening so far with Harris? It’s still very early, but she’s really energized the anti-Trump voters. She seems to have obviously improved as a candidate and she’s riding a wave of anti-Trump sentiment.
Her job in a sense is not so difficult. A small majority of Americans are opposed to Trump, many of them deeply. She just has to get enough of them to vote, particularly in the swing states. Biden was able to do it in 2020 in a very flukish election. There’s no reason to think Harris is incapable of doing it, particularly with her fast, rolling start. Biden was never supported with his much enthusiasm.
Add to Trump’s already difficult situation the fact that he chose Vance as his VP, and he’s even more vulnerable than he would be otherwise. Vance has been very prominent in the news since the convention, and not in a good way for Trump. The combination of his recent past as an anti-Trump elitist RINO, his obvious corruption by authoritarian-loving billionaires, and his weirdo adopted stances on marriage, family, and reproductive rights, along with his open bigotry spell doom for Trump.
Harris is finally doing what Democrats should have done for years, which is relentlessly attack Trump from many angles. There are many talented generation X and millennial politicians in the Democratic party, and they’ve joined the fight this week. Democrats have many execellent communicators, like Pete Buttigieg, Witmer, Moore, Shapiro, Bashear, etc. Add to that celebrities like Beyonce, Clooney, and Annistan joining the fight. I suspect many more will come on board, including Taylor Swift.
When it comes to people who don’t understand America, look in the mirror. You’re out of touch with the majority of Americans.
25. July 2024 at 16:37
Michael, What is “too much” deflation? If a recession results simply from the sum total of free decisions of individuals, on what grounds can it be called bad? What is “unnecessary” unemployment? I think it’s impossible to make those value judgments in the context of a framework that is ostensibly neutral and “libertarian.”
25. July 2024 at 16:52
Scott,
you’re welcome 😉
Tacticus,
broligarchs… I learned something. Fits like a glove.
PMC,
while I understand the sentiment, the “un-rooted” are a tribe in and of themselves, just like the atheists are a religion. They might be the srongest US tribe, after all few are from Appalachia. I am un-rooted myself (elsewhere) and when I see others like me, they understand me, and I understand them. In an instant. I have family in the old country and as much as I love them, understanding isn’t really the word.
Sara,
ah the pleasure of commenting on this. First, you quoted logic. Let’s see. “Many non-white women have sharp with” does not imply that no white women have sharp wit, nor that all non-white women have sharp wit. But yes I do take pleasure in the peculiar wit I was talking about, even if it’s a probablistic-statistical thing to find it. And totally, I admit to this particular sexism: women’s wit is different from men’s wit, in my experience.
Is the future mixed? I practice it, Scott practices it, Kamala embodies it, and worldwide the mix is on the rise generally. I don’t feel the need to put a value on it – is it good, is it bad? I don’t know. But personally, I like it. And I do get a chuckle from the old zinger from “Bulworth” on racial deconstruction
https://www.youtube.com/watch?v=GfxL_wuYtSg
25. July 2024 at 16:52
Jeff,
You’re just ignoring the facts. There is no more solid conclusion to be reached from macroeconomic research than that the money supply needs to grow at a minimum rate to ensure economic stability. Again, that doesn’t mean government has to manage the money supply. It means that a functional free banking system would naturally choose to grow the money supply at a minimum rate, to avoid disequilibria.
I would prefer to grow the money supply such that there is mild deflation, rather than mild inflation, but it doesn’t make a huge difference, execept perhaps from a political economy perspective.
25. July 2024 at 17:29
Lizard Man for the comment on “PMC” above …fast fingers
25. July 2024 at 19:02
@mkba
The PMC are on the whole good people when used in the right way, just like anybody else. If the problems you are trying to solve don’t require an understanding of non PMC people, they are usually pretty great at solving the problem. But leadership at the highest levels does require both knowledge and strong curiosity about non PMC people(s), or else you get people making really poor decisions, like banking leadership with mortgage backed securities supported by liar loans, or someone like David Cameron thinking it was a good idea to offer a Brexit referendum because it would settle the issue affirmatively how he wanted it to be resolved.
One of the really good qualities about Obama was that while he was a PMC (like almost all US politicians are nowadays), he was very seriously invested in a group of Americans who mostly aren’t PMCs (African Americans), or at the very least a group of people who often have as their strongest identity something that connects them intimately to non-PMC people. And he was not only invested, but identified with the folkways of that group of largely non PMC Americans. Crazily enough, Trump also identifies with some non-PMC folkways of masculinity, which is I think a large part of his appeal to black and Hispanic men.
25. July 2024 at 19:25
@ Michael Sandifer
I wish that a majority of Americans were anti-Trump. But polling doesn’t look that way to me. Remember that it took one of the worst global pandemics in a century to keep Trump from reelection, and even then Trump would have won if he hadn’t been an idiot and told his supporters and sympathetic potential voters not to vote by mail.
Harris may well be a competent campaigner now. We still don’t know how she is going to do when Republicans blanket the airwaves in Pennsylvania with clips of her saying she wants to ban fracking. My guess is that anything less a total flip flop to her saying “I love fracking, and I will give you more of it” means she looses Pennsylvania, and with it the presidency. And of course you have the example of Biden as president, who was a competent campaigner in 2020, but then governed in a manner to open the door to a Republican victory in 2024, all for goals that will be undone by Republicans if they win in 2024 (as opposed to things like an expanded child tax credit that Republicans would have a much harder time repealing than the IRA or some executive orders on immigration). My suspicion is that Harris, if she become president, will govern like Biden. Which is to try to give the left what it wants because that is what the President hears from staffers and donors all the time, instead of trying to figure out what policies fit the Venn diagram of things that address the things that ordinary party voters and swing voters both care about, things that can pass congress and/or be done via executive order, that can be pushed out as earned media on mass media, and that they can sell enough of the public on to make Republicans pay a political price for opposing it and to benefit Democrats for supporting it.
25. July 2024 at 21:43
Lizard Man,
Harris still faces tough tests for sure, including those you mention. She will also face the standard Republican attempts at total character assasination.
However, I think you’re underestimating Trump’s challenges. As all know, he’s got a high floor, but low ceiling. He’s always net unpopular. Also, he’s underperformed non-Trump Republicans in some key states in recent years, including Georgia. At the same time, Democrats have been overperforming in elections since 2016, and Trump-chosen candidates tend to be defeated in competitive general elections.
Then there’s the fact that Biden was running behind Senators in key swing states, sometimes by high single digits, indicating that Harris could have a relatively high ceiling in those states.
Then there’s the aforementioned Vance pick, which seems to make no sense politically, and is potentially already costing Trump support among swing voters. The first rule in picking VPs is to choose someone who will not detract from the ticket. Not only is Vance detracting so far, but he’s even overshadowing Trump to a large d
Of course, Harris has just begun, and though she’s started well, she’s still the underdog and has to dig herself out of a hole. I can’t predict the outcome, but I think there’s more uncertainty now than before Biden stepped down.
That said, for fun, I’ll go out on somewhat of a limb and say I think Harris will win.
26. July 2024 at 03:39
@ Michael Sandifer
That’s a good point about polling for Democratic senate candidates. I haven’t been paying attention to those numbers. I am curious as to what those numbers look like in swing states, or states similar in some ways to swing states, so I will look it up.
Hopefully I am wrong about Harris’ odds of winning, and if she wins, her performance as president. I honestly don’t think that there are any US politicians that have the skills to successfully deter Xi Jinping from attempting to conquer Taiwan. Or that have the skills to successfully lead the country in response to a PRC attempt to conquer the ROC. And at times I think Trump might do better than any Democrat precisely because he can be bribed and is a narcissist, so he may be uniquely able to figure out what makes himself look good to US public and in doing so do the best job figuring out whether Americans are better off with the dangers and sacrifices entailed with war with China, or those entailed with letting China have unquestioned naval supremacy in Northeast Asia and the South China Sea. The best option is the “lake of fire” strategy for the waters around Taiwan that would deter China from even attempting conquest, but it doesn’t seem likely that the US or Taiwan will devote the resources necessary to make that happen quickly enough to deter Xi, who knows he has a limited window of opportunity.
Also, I totally agree that Vance is a terrible VP pick. If Trump had to pick a guy from Southwest Ohio, he should have at least asked Boehner, who is far more popular than Vance.
26. July 2024 at 07:41
Jeff:
My understanding is that Scott isn’t choosing a particular economic system (or perhaps more accurately, monetary system). He’s advocating for the best monetary policy given the system we have. See https://www.themoneyillusion.com/money-and-libertarianism/. Even given our current system we’re still all free to vote for a President who will appoint a Fed chair who will set a deflationary target.
26. July 2024 at 08:04
Jeff, You said, “Michael, What is “too much” deflation? If a recession results simply from the sum total of free decisions of individuals, on what grounds can it be called bad? What is “unnecessary” unemployment? I think it’s impossible to make those value judgments in the context of a framework that is ostensibly neutral and “libertarian.””
If only Herbert Hoover had used that rigorously logical argument in 1932, he would have been re-elected in a landslide. 🙂
27. July 2024 at 03:39
Carl, Thanks for pointing me to that post of Scott’s. As he says in talking about monetary policy being a compromise with pure libertarianism, “once that compromise has occurred, it makes little sense to talk of one monetary regime as being more interventionist than another.” I would just ask what the “monetary” qualifier is doing in that sentence. Is a government that has an activist monetary policy truly “more libertarian” than one that has a similarly activist fiscal policy?
I would argue that setting and carrying out monetary policy inevitably entails value judgments that a truly neutral or libertarian regime could not make. (And, to your point, Scott, I would also say that Hoover and FDR were equally non-libertarian.)
So the Fed holding down interest rates and purchasing mortgage securities during the pandemic was not substantially different from the government simply cutting a check for roughly $100,000 to any homeowner who asked for it. In that respect, the policy is also not substantially different from one in which the government simply cuts a check for $100,000 to every parent of young children, or to every person who has green eyes. Those policy proposals have to be evaluated against each other on the merits, based on how well they accord with the demands of justice and on their foreseeable effects. The idea that some of these policy proposals are “more libertarian” or “less interventionist” than the others is incorrect and a distraction.
27. July 2024 at 07:41
Jeff, You said:
“And, to your point, Scott, I would also say that Hoover and FDR were equally non-libertarian.”
No, that’s not even remotely close to my “point”.
So the Fed holding down interest rates and purchasing mortgage securities during the pandemic was not substantially different from the government simply cutting a check for roughly $100,000 to any homeowner who asked for it.”
That’s like say that a person spending $100,000 on buying bonds is not substantially different from taking the $100,000 and giving the money to their neighbor. Those are radically different actions.
With all due respect, you are in way over your head.