@dpp @jgordon I think you’d want not to let the amount of these gap notes depend on individual transaction prices and home values. It’s too gamable. The government could develop zillow-like notional values and rely upon those and just the purchase and sales dates. There’d be some legit “basis risk”, as your home’s value evolution might differ from the Fedestimate, but it’d be very hard to police overpriced purchases underpriced sales + side agreements. 2/
@dpp @jgordon Same for portfolios: The state could tie these notes to the performance of a reference portfolio (perhaps age sensitive, to accommodate older savers’ greater bond preference). There’s a bit less risk of self-dealing with prices of buys/sells of public securities via regulated brokers. But people can do idiosyncratic things in their IRAs, for example, and that could create Springtime-for-Hitler-style temptations to milk. 3/
@dpp @jgordon A minor nitpick: I think for most purposes it’s best to consolidate the debt position of the Treasury with the Fed. (For example, when the Fed buys bonds, “debt held by the public” doesn’t typically change. The “public” includes the Fed, which makes sense when you realize the public no longer holds Treasuries, but it now holds Fed reserves and notes.) 5/
@marick @eyesquash they certainly seem capable of taking cues from Elon Musk’s X/Twitter.
@llimllib @akkartik I have this hypothesis that basically we’ve made ourselves institutionally, structurally more greedy. Burgeoning inequality at the top means you have to make a lot more to have the social position you consider normal, not a loser. At a policy level, that goes through Wall Street and the tax system, we’ve made payouts from firms to the already wealthy very cheap, and called it “efficient” if Wall Street demands ever more of them.
“If you’re not not paying for the product, you’re the product, and if you are paying for the product, you’re still the product.” @pluralistic https://pluralistic.net/2024/08/17/hack-the-planet/#how-about-a-nice-game-of-chess
“the soft bigotry of low expectations”
Screenshot of tweet from @XLProfessor: The bias in the press is the bias of massively lower expectations for Republicans, who aren't expected to tell the truth, make sense, have policy based on reality or pretends to help people, or even not be criminal authoritarians But purposeful bias would be easier to counter.
from “Why Inequality Matters”, #BrankoMilanovic https://blogs.lse.ac.uk/inequalities/2024/08/14/why-inequality-matters/
Text: High inequality has also political effects. The rich have more political power and they use that political power to promote their own interests and to entrench their relative position in society. This means that all the negative effects due to exclusion and lack of equality of opportunity are reinforced and made permanent (at least, until a big social earthquake destroys them). In order to fight off the advent of such an earthquake, the rich must make themselves safe and unassailable from "conquest". • This leads to adversarial politics and destroys social cohesion. Ironically, the social instability which then results discourages investments of the rich, that is it undermines the very action that was at the beginning adduced as the key reason why high wealth and inequality may be socially desirable.
@djc I don’t think matching on tips was a great move, but all things considered her moves have been pretty good, so I’m not going to get too bent out of shape. Dems’ policy process is better than their political process about policy. If you followed Warren’s “windfall profits tax” on oil a while back, all your Econ 101 pundits (what a tiresome genre) got up in arms, but if you read the details, it was intelligently done, with careful attention to preserving supply incentives.
@djc there’s a lot in this first round of proposals that reflects good impulses but not-so-great details. from my perspective, it’s been a mistake to get as specific as she has (though the tip thing was just matching Trump). but i think it’s the impulses that have staying power, much more than details. Obama campaigned against Hillary’s individual mandate, the program he passed included it, that “flip flop” wasn’t a big deal.
“Look, I’m a prosecutor, and I’m going to prosecute the people who are ripping you off,” is not so bad a pitch!
@kentwillard What I think yesterday suggests is that Kamala’s campaign thinks swing voters are people frustrated about the cost of living including especially housing, groceries, and child-rearing, who think abuse of corporate power is part of the problem, and who want an active interventionist state to address these issues. 1/
@kentwillard If she thought these ideas would only please “lefties” already firmly in her pocket, I doubt she’d have risked alienating “centrists” (who do not in fact constitute the center of mass of the broad public, they steal that intuition for the conventional views of a small professional establishment), who hate them. She had to make judgments about what swing voters want, and her judgment is they are not remotely with the misnamed center. /fin
@kentwillard I think the economic policy is something of a first draft, but there’s a commitment to a direction. What’s interesting about the beauty content is to whom she is trying to be beautiful.
@skinnylatte what a beautiful Picasso.
@eyesquash @pluralistic @marick @maxmmiller@mastodon.online he put a dent in the universe. it’s where the rust took hold.
The crypto industry opposes the creation of a central bank digital currency for the same reason Intuit dislikes free tax-prep software from the IRS.
@John We are usually on a knife’s edge, that’s the attractor of a two-party system. But the knife’s edge isn’t on a one dimensional continuum, left or right. The preferences and inclinations (on policy and other things) that drive voters are multidimensional. 1/
@John That we are 50/50 balanced does not tell you we are “where voters are”. The deep insight of “What’s the matter with Kansas” is that the knife’s edge is defined by the dimensions along which the parties choose to compete. What Frank pointed out is that, during the Clinton/Bush/Obama era, parties (there are only two!) chose not to compete on “economic populism”, so the balance was set by positions on social issues. 2/
@John We were not “right there” on economics during that era. That’s not to prejudge where were would have ended up, if parties had competed on that dimension (although yes, like the libertarians I suppose, I have a view). Both parties governed within a narrow consensus. Barack Obama appropriated the Mitt Romney / Federalist society health care plan. 3/
@John What Frank pointed out was that the “paradox” that downscale Kansans who pay almost no income tax voted for tax-cutting Republicans becomes easy to understand when neither party was offering much in economic terms that would affect them. (I’m not claiming that about Obamacare, he wrote earlier.) 4/
@John Sure, directionally and by (post-FDR) historical vibe, the Democrats better served their economic interests. But the difference was so minor, it was perfectly reasonable to vote values. Democrats could have shaken this equilibrium and potentially won votes, but both a 70s/Carter/Reagan hangover and how financial support gets allocated in an increasingly unequal society dissuaded them. 5/
@John The process of even trying to limn that 50/50 edge on economic issues was suppressed, until in 2016 both Bernie Sanders and Donald Trump broke the tacit agreement between the parties not to compete aggressively along this dimension. Now, finally, we are groping our way towards something like the 50/50 point (although that has to be hedged, our system doesn’t find that point on any one dimension, but holistically across all issues). /fin
@John * (all issues the parties contest!)
A bad economist is one that presumes supply is price elastic, when in fact the price elasticity of goods and services varies tremendously over time, across different goods, across different regulatory regimes. Supply is expected to be less inelastic when industries are consolidated and firms have market power.
A lot of bad economists are wagging their fingers today.
Core to the art of economic policy is to engender price-elastic supply. It’s a difficult, remarkable achievement.
@eARCwelder Yes. Obama’s tilt to austerity during an employment crisis was quite a thing. Harris-Walz, like Biden-Harris, seem to have learned something. So many people are trying to get them to unlearn it. I am so gratified they seem to be resisting.
@John I’m not telling you anything strange. Midterms are based on turnout. Parties win when their coalition is fired up, lose when portions of their coalition are demoralized. I’m not saying there was some hidden preference for full social democracy. I’m saying a lot of people who had voted for Obama felt let down and didn’t rouse themselves for the midterms. 1/
@John Structurally it’s very normal for first-term midterms to be bad, because fresh candidates fire up voters with promise when running for election then voters are disappointed because reality is hard. It’s not some preference of left vs right. It’s both parties. Obama endured this phenomenon turbo-charged, both because he ran so inspirationally, and governed so disappointingly. /fin