Democrats’ fetish for unions is increasingly counterproductive.
Unions do not help the neediest workers. Public sector workers are six times as likely to be unionized as their private sector peers (35% vs. 6%). This means a major purpose of unions is squeezing rents out of taxpayers.
Indeed, union workers are relatively privileged. Their average wage is $1263 per week versus $1090 per week for workers generally. The rents unions extract are upward redistribution.
Fighting for union workers very different fighting for the underdog. It means fighting for a relatively privileged group of workers who has organized to claw out more privilege still. There is no reason for a fast food or warehouse worker to feel solidarity for the UAW, they inhabit completely different worlds.
In fact, unions only work when there are rents to extract, so they are great for fleecing county boards of education and sticking it to big three car manufacturers but useless for most small business employees. Focusing on a privileged sliver of workers and calling it class solidarity is bad politics.
Redistribution should occur through the tax code. A reasonable, explicit scheme of redistribution that takes more from the top 5% and gives social guarantees to all could cement a durable center left coalition. Coddling 10% of workers because they belong to unions is divisive.
<<There is no reason for a fast food or warehouse worker to feel solidarity for the UAW, they inhabit completely different worlds.>>
I previously had done some political comms work for the Alabama Democratic Party. And they did this whole campaign about solidarity between striking Starbucks workers and striking miners in Muscle Shoals. Needless to say, it didn't quite work.
I guess I’ll stand up for myself a bit here from the perspective of a public safety worker and union member in good standing. I’m reading some true and fair points, but what one might call “rent seeking” by public sector unionization could also be described as investment in the robust safety net which is the second part of Matt’s equation. In a full employment economy with a tight labor market, collective bargaining is a way to keep wages competitive with other options. I have seen this firsthand, with applicant pools lesser than even a decade ago. Thin ranks leave organizations stressed and hollowed out, while elevating chances of injury and burnout among those still on duty.
Stipulating that unions must adapt to new realities, political and otherwise, I doubt that hollowing them out utterly is in line with the Slow Boring ethos, to say the least.
I see three broad things private sector unions do:
1) Physical job protection (don't make me work in unsafe conditions, don't make me work so much overtime that it hurts my health / makes me work in unsafe conditions due to being tired).
2) Negotiate on wages/benefits (better health care, vacation, sick leave, salary)
3) "Having a job" protection (difficult to fire underperforming, tenure-type work, etc)
===
If there is some large category I left out please let me know.
I'm 100% sympathetic to unions on issue 1. I'm not saying they'll _always_ be right that something is actually unsafe, but it broadly strikes me as a good thing to negotiate on. One problem with union power here may be that they've won so many victories (OSHA, 40-hour work week, overtime pay) etc, in the U.S. that the most important parts of this are already covered, especially for service sector jobs.
For #2 it depends for me way too much on specifics. If the _sector_ is doing well but wages are low at all companies (bad labor market?) then I can see unionization to bargain for wages helping to lift them without really hurting competitiveness, but it would have to be something more like UAW rather than a particular company. At a particular company, if the company is profitable enough, this rebalance the profits to the owners vs the wages to the employees, but it could also start strangling the company, especially if it can't change benefits later in response to changing conditions. The main thing here is I'm less sure how much forced unionization laws are necessary.
#3 is probably the issue where unions suffer the most culturally/politically and seems (to an outsider like me) like the area to give up on the most.
I think the largest category you left out would be what I'd call "work rules". Overtime, division of labor, promotion ladder, rules on contractors, etc...
Thanks. I covered _some_ of overtime under #1 but I agree this should be its own category.
This one I'm overall more neutral on. Overtime seems good to negotiate on, promotion ladder seems neutral. Division of Labor unsure (is that where 'featherbedding' comes in? But also helps you not asked to do BS tasks outside your normal remit).
It’s good to recall the bankruptcy of Hostess, which could get no concessions from its unions. One example is that Hostess had to operate multiple delivery systems because the trucks were permitted to deliver only certain brands, not the full range of Hostess products. I believe that this kind of arrangement negotiated to maximize the number of union workers is common, and destructive.
1. Negotiating the split. How much of the product of my labor goes to me vs. goes to my employer.
2. Collectively agreeing to terms. How much of the compensation package is paid out in cash vs. workplace safety, health insurance, job security, etc.
Negotiating the split is, I think, mostly boring and pointless. Monopsony in labor is a weak force in practice so I think total compensation is usually pretty close to as high as it could be sustainably.
Collective bargaining on the components of the compensation package is potentially much more useful. People like a safe workplace, job security, paid time off, etc. but they’ll trade most of those things away for more cash. When they get the extra cash, a lot of it goes to zero-sum positional spending that doesn’t improve aggregate utility. The union is nice because it encourages more compensation that’s fundamentally not zero-sum, like paid time off or better working conditions, which does improve aggregate utility.
I consider job security in that same category, so I’m more sympathetic to it than you are I think. No idea how the politics of this will work though.
I will admit: that last argument sounds to me like "the union knows what's good for you better than you do". And I will also admit that if that's what it means to say, that sort of attitude really rubs me (and many others) the wrong way. Someone else who does not know the exact details of my situation (e.g. whether I value money more because I need to make child support payments or time more because I have to care for their aging parents) does not in fact know what's good for me better than I do.
Sorry if I was unclear, I was assuming that union leadership would reflect the views and interests of membership, and would function primarily as a coordinating mechanism to resolve a collective action problem.
It’s not “The union knows better than you”, it’s more “We’re all in this together”
I’ll admit it’s tough though, politically. People have some good intuitions about this kind of stuff, but if you try to explain it like an economist you probably sound pretty crazy to most.
“No no, if we let you trade away more time for more money, can’t you see that you’ll all lose much of the windfall bidding against each other for zero-sum positional goods?” -> Patronizing, totalitarian
“Eight hours for work, eight hours for rest, eight hours for what you will.” -> Inspiring! My heart thumps harder just typing it out!
Isn't it weird that the AMA is a reasonably powerful union yet doctors routinely work unsafe hours? I guess the revealed preference is for doctors to take money over job quality, but this also jeopardizes patient safety.
Overtime hours are also sometimes psychologically weird. Some people view them as a "badge of honor" of how hard they worked, despite the research about how bad it is for productivity. "I worked 80 hours saving lives, what did you do"
"1) Physical job protection (don't make me work in unsafe conditions, don't make me work so much overtime that it hurts my health / makes me work in unsafe conditions due to being tired)."
My impression is that most blue-collar unions do the opposite. They restrict hiring and demand generous overtime pay, so that their workers rack up good take home pay but at the cost of working crazy high overtime hours which takes a terrible toll on their health.
One way to think about it is that the bargain for "better working conditions" and that can be allocated in different buckets; better pay, safer jobsite, better hours, better benefits, etc.
But the total amount of surplus to be captured remains constant.
Maybe, but does that require a more consistent exchange rate between them (Consistent across jobs/companies)
Some safety rules are relatively cheap to implement for their benefit, some are prohibitively expensive. E.g. My office had 2? emergency defib machines and a written list of people who had undergone recent training (I was on that list after attending CPR training prior to the birth of my children)). I'm not sure of the cost of the machines but the cost of "put a list up there of people who did this on their own" is a super-cheap intervention. Alternatively "provide this training for all employees" is a much more expensive intervention with probably almost no better outcome.
I'm not sure there's a "total amount of surplus" to be captured that can be moved back and forth. There's definitely a "total amount of cost" that can be spent by the company though.
The cost eats away at the surplus. I think we're getting at the same thing but you're phrasing it better. There is an upper limit to the amount of demands a union can make. At a certain point, they can ask for higher wages OR better workplace safety if the safety measures are costly.
If union workers stuck only do wages and benefits I might be ok with that (at least if they were requiring full funding of benefits with current tax payer dollars at reasonable discount rates and not pushing it on future tax payers).
But instead they spend far too much time making it impossible to hold bad or poor performing employees to account and/or just introducing anti-efficiency rules.
Easy example of this would be police union rules that make it hard to fire bad cops. But the same principles apply to the rest/
It's interesting. There is an old leftist idea that all employees share the same real interest, to increase the power and the income share of workers against employers, or to unite the working class everywhere against the capitalist class everywhere. And yet workers consistently reject it in every country with democratic elections and a truly capitalist economy, and communist revolutions succeed only through civil wars in authoritarian, not fully industrialized states (Russia in the 1910s, China in the 1940s) or through conquest (eastern Europe). And to my understanding, the western postwar social democracies weren't powered by uniting the workers of the world to fight together -- the motives were more like national solidarity within the country, combined with blunting the allure of communism by providing some of the benefits of socialism through milder means.
It would be interesting to understand (1) what's wrong with the theory of class solidarity, and (2) why it nonetheless remans popular on the left.
That question is easy to answer. The working class is not unitary, it contains multitudes with different material interests. Harbor pilots and day laborers are both working class, but they are in different markets and different social strata.
If capitalists successfully coordinate to exploit labor, then workers get systematically underpaid relative to the marginal product of their labor, then you’ve got deadweight loss, so then a coordinated worker movement has space to raise real wages while actually increasing aggregate economic output.
In most places most of the time, capitalists have not in practice been good at doing this kind of coordinated exploitation, especially not in democracies, so workers are mostly paid more or less fairly already. On some level, this filters out into the popular consciousness and blunts the appeal of class politics.
In other words, businesses that “defect” and pay their employees unusually well haven’t already outcompeted and taken over everywhere, this can be seen by just looking around, so maybe reorganizing the entire economy along these lines won’t generate large gains.
Which is another argument for enabling efficient and robust markets. A lot of that probably looks like promoting “free “ markets, but it also looks like antitrust, promotion of entrepreneurship with low barriers and financial incentives, promotion of science to enable technical change, good bankruptcy regimes and good financial engineering environments to enable exploration of differ business models. It might even include things like universal healthcare or similar that make it easier for employees to change employers or start their own. Good workplace safety rules also help prevent race to the bottom competition.
Lots of things can be done to ensure healthy competition and creative destruction. The zero-sum mindset of unionism is what I think holds it back. Would Starbucks employees be better off with a union or better with clearer overtime regulation and state capacity improved at the county labor board?
I don't think Noah Smith has read my comment, but he nonetheless wrote a long-form answer to the related question of "why isn't working-class solidarity a winning strategy for the left in 2020s America?"
One potential problem I see with trying to unionize Starbucks employees is that most of those people intend to only be there for a short period of time. I wouldn't say "give up" if that's what you really want to do, but service sector work is fundamentally different than mid-century factory jobs.
The percentage of unionized Starbucks employees is still pretty small (about 11K out of ~240K in the US) but it has shown impressive growth in just a couple years.
Let's see how it plays out before confirming your view.
Sure, let's see how it plays out. I didnt say it's impossible. I'm just pointing out one reason unionizing service workers is difficult; time horizons.
Yes, Matt's claim that progressives are for "Good schools and Good infrastructure" is a bit hard to square with their positions on (a) extended school closures during covid and (b) management of US ports.
In both cases, supporting unions took precedence. To a truly astonishing degree.
Yeah the particular intransigence of Teacher's unions circa Fall 2021 was eye opening.
I'm actually a defender of Teacher's unions actions in 2020. Before vaccines were available, being very Covid cautious made sense to me. I'm one of the people who believes we should have been more like continental Europe in 2020. And a union at the day is at its core supposed to look for the safety and well being of its members.
But denying that lack of in person instruction had any negative impact on learning was galling (I know it was just one person, but the idea that kids were somehow "learning" by just being part of their community was insulting to my intelligence). It's also like an amazing self own in the sense of "ok if in person instruction doesn't matter than why do teachers matter?"
I think of Unions as more like prosecutors or defenders. They aren't supposed to get at "truth". They are supposed to present facts only as far as they help their client.
And many times they seem to be operating even more like trial attorneys, in as much they are trying to win the current case, without much long-term planning beyond winning the current round.
I'm not a lawyer or union member, so maybe someone can correct this perspective if it's way off.
I think this is right — but on the other hand, having been in a union and then having worked in the same role in a non-union shop, it was night and day how management treated us. So whatever they were doing seemed to work.
Of course, it’s a good thing we have prosecutors and defenders! We do a better job getting at the truth when there’s an advocate on each side than we do when we just have a bunch of impartial people looking around.
Similarly with work conditions - the company has organized representation, and it makes sense for workers to as well. Though in this case there’s also a third and fourth side that need representation too, in terms of consumers, and other stakeholders (like potential bearers of pollution).
"We do a better job getting at the truth when there’s an advocate on each side than we do when we just have a bunch of impartial people looking around."
Is that true? The only point of comparison I'm aware of are the systems of continental Europe, which I understand are more geared towards finding "truth" and less permissive of sophistry or dismissing prosecutions based on misconduct.
It always seemed like that's better to me. In terms of criminal law, it's left us stuck with situations where a large fraction of likely guilty people are let go because of "technicalities" and in response we jack up sentencing to compensate. ie, "we might not be able to make the charges stick (if we mess something up on our end) but if we do, we'll hit you hard!"
I'm not sure where you get this idea that a large fraction of likely guilty people are let go on technicalities. After being charged the rate of guilty pleas is anywhere from 90-98%!
If you're talking about people who are released without any charges, then that's probably because the prosecutors lack enough evidence to secure a conviction were the case to go to trial. The European system would be no better in cases where there are no witnesses to cooperate or physical evidence.
I’m mainly thinking about science here. We make more progress when there are advocates for different scientific theories arguing and doing the experiments they hope will show themself to be right (and re-doing the experiments over and over to get past the problems that make most experiments fail the first time you try), and perhaps more importantly, coming up with the tortured arguments for why the other person’s experiment doesn’t show what they claim it shows. We sometimes talk as though we could have a community of dispassionate truth seekers, but that has never been able to deal well with big open ended questions.
Correct. The U.S. has more lawyers per capita than Europe and it’s not clear what we get for that, other then a safety valve that keeps demi elites like me from playing leftist politics full time.
I agree that caution early on was very reasonable. I have no beef with people closing schools in Spring 2020. Then there is a gray zone where reasonable people can disagree, but by the time vaccines were widely available, it was indefensible to argue that school should remain closed.
(Fwiw, I was in 2020 outraged at the Swedish approach of basically letting the virus quickly rip through the young and the middle-aged population. But it's been humbling to see that three years down the road, their numbers compare very favorably on almost every metric. They had sky high deaths among the elderly early on, but it seems the main thing that happened was that people who were about to die within a couple of years anyway just died sooner. That is a tragedy, but perhaps less of a tragedy than throwing a whole generation of low ses kids under the bus.)
I look forward to the day when we all unanimously agree that for the first part of the COVID plague, it was so new and so daunting that wide swaths of society took action amidst great uncertainty that later turned out to be ineffective, and that we grant some forgiveness for not having 20/20 hindsight at the time.
This does *not* apply to cases where people obviously should have known better and were too blind to do the right thing: public health people supporting George Floyd protests, teacher unions keeping schools closed far too long, right wing media convincing their gullible followers to forego getting vaccinated, etc.
What should have happened is that schools should have promptly reopened no later than the start of May 2020 once we had a grasp on its lack of danger to kids, and some mitigation we could do, and then keep them open through the summer, overwhelmingly taking place outdoors, as a catchup from what was missed in March and April, and also to get ahead of the curve for a potential need to take a societywide hibernation in the late fall and into winter, which we very much needed the instant news of the vaccines being around the corner dropped.
A lot of states opened schools in Fall 2020 and never closed again. It was fine. If Costco is open, schools should be open. Thank goodness for federalism!
Our schools reopened in September 2020, and students' families could choose whether they were in-person or remote. Fewer than half of the families chose in-person. This doesn't necessarily mean that our schools should have offered the remote option, but it is easy to forget how scared people were before the vaccine came out.
And also, many of our schools had to either suddenly go remote on any particular day, or have an entire grade go to the gym and basically do remote lessons on their computers because so many staff members were out sick. In some cases, there was not enough supervision for student safety to be assured, and I know many parents who kept their kids home if they knew it was going to be an "in-school remote" day. I live in a high-poverty urban district. The same safety issues may not have applied in wealthier suburban districts, but parents were definitely considering these issues where I live.
I don't think opening schools in May 2020 would have been the panacea many here think.
Fall 2020 was the right time to open schools, but May 2020 feels like pushing it a bit. Remember, May is very close to the end of the school year, and I don't think it makes logistical sense to open schools for just 1-2 weeks before breaking for the summer.
That lack of pivot is my big beef. My older son's private daycare/preK re opened in June 2020 with precautions. The Catholic schools re-opened in fall with precautions. The public school system was closed and/or in some weird ever evolving state of remote or hybrid for the better part of 2 years. That latter fact was decisive in where we send our kids now. One system cared about the children. One cared about a union that unlike the factory workers of yore is organized against the wider public.
Was it that obvious by May 2020? That was barely at the start of the pandemic!
Maybe my memory is colored here, but I recall vast amounts of uncertainty that early in the pandemic and for some time after. I think you have a better argument for criticizing schools that stayed close the following autumn.
On Sweden, what numbers do you look at? Can you find deaths by age bracket and test scores by SES? I'm just curious because I would like to dig into it myself.
Was there a big impact on learning? Very little it turns out, and basically none for white students, but some noticeable impact on poor minority students who don't have access to as many resources.
Yes, of course, it was bad for those students so affected, but in many cases I recall their parents *wanted* them to stay home.
Bottom line, the school closure debate does not have a clear, indisputable answer.
Right. When the unions came out against requiring their members to be vaccinated (with appropriate exemptions available!) it really showed how little they cared about their members and their students. Big wake up for me to hear them say “let’s not request a minor inconvenience that could save lives and certainly will reduce suffering of our members due to illness.”
My brother is an airline pilot and his stories about union impacts are eye-opening. A couple things stand out to me, notably how unions enforce seniority over meritocracy and how it seems that a lot of entry requirements for airline pilots seem designed to control supply and keep pilot incomes high.
How would a pilot meritocracy work? It’s not like it’s Top Gun and they can fight it out. Would it just be simulator, check ride and written test based?
The same ways people working in basically any job are evaluated: observation and evaluation by supervisors, written tests, practical tests, success/failure rates at tasks, so on.
Yeah, there was a period where their position was that teachers should not be required to get vaccinated but their students should be required to mask at all times to protect the teachers.
If you’re that concerned about being protected against a virus, a vaccine sounds like a much sounder proposition than requiring 7 year olds to do something than many of them find unpleasant or uncomfortable at all times.
And on grading, gifted and talented education, and what we should do about disruptive students. I think Matt will get to this when he discusses that public services need to be run for their users, not their employees or some ideological goal.
Even in this article note the distortionary effects: longshoreman’s (economy threatening) strike against automation, snubbing Tesla when EVs are a major policy goal, and I’d argue jones act and buy American protectionism fits into union support because it creates rents to extract and prevents foreign labor from competing. The later common sense bullet about government existing to provide services not employment also is very in tension with unions.
Here in CA the big one is prevailing wage requirements to receive affordable housing subsidies, or other entitlements for multi-family housing. Basically "we can't make you hire union labor but you do have to pay union rates".
Similar to the EV mandate it's not objectionable on the face of it but it shows where the administration's priorities are. Is affordable housing important? "Yes!" Important enough that non-union workers get jobs? "Well, no." Is electrification of the US auto market important? "Yes!" Important enough to subsidize non-union cars? "No, not that important."
Someone on this blog commented a year or so ago that government policies should be "one goal, one lever." The more I think about it, the more accurate that is.
Want below-market housing? Then just subsidize deed-restricted housing with no other requirements.
I don't think that works. First, something we learned post facto can't be used as a justification ex ante, because how crazy and bad he was wasn't known at the time. Second, to the extent we knew that he was bad and vindictive, that makes the administration's decision worse, not better: when someone is both mercurial and influential you often have to play ball with them! You don't get to say, "what, were we supposed to be NICE to him?!" right after he's shown you why the answer to that question is yes.
I'm of two minds on unions. The first mind has been strengthened in recent years by this site, that includes many of the reasons you state here--very broadly speaking, the ability to rent seek. But I also can't shake the other mind that sees that abuse of workers can still happen, and that collective bargaining can help reduce asymmetric information that's to the disadvantage of workers.
But I'll be curious to see if Matt expounds more on unions in particular in point 8 so we can discuss further there--I sure hope he does!
I'm really of the mind that unions are a vestige of an era when there were real asymmetries of mobility/knowledge and governmental didn't have much regulatory strength.
Unions make a ton of sense in company towns full of people with 4th grade educations.
Unions make a ton of sense in uninspected mines or unregulated iron foundries.
Unions don't make sense for skilled workers in workplaces that are heavily regulated and regularly inspected. They especially don't make sense for government workers.
Yeah, I feel like even in a perfect information environment, it's often vastly more painful for an individual to lose their job than it is for a company to lose a single employee (especially given how much healthcare is bound to employment in the US).
Which means there's a power imbalance there that I'm not sure is solved in the private sector without collective bargaining. In the public sector, there's at least the ballot box to make our collective desires known.
How do you think those workplaces came to be well inspected? What force do you think will keep them that way when business interests can donate unlimited sums to politicians? We’re already seeing rollbacks on child labor laws in the meat packing industry across several states. Don’t kind yourself that this world we live in is something you can take for granted.
+1 would love a deep dive on unions, especially how (if) they're making progress, if they're still a viable political constituency, and if a union push from Democrats still makes sense.
I'm not usually the type to stand up for unions, but a lot of this seems off base to me.
Whether unions are public or private doesn't have anything to do with whether the workers they're protecting really need union protection or not. I dislike the negotiation dynamics of public sector unions, but how to balance, say the needs of teachers vs. the needs of students, is actually an important question. One that politicians are mostly uninterested in answering.
The fact that unions make more on average is a good thing! If they didn't you'd wonder what the point of them was. A union that failed to negotiate for something as basic as higher wages would be clear example of waste and rent seeking!
Speaking of rent seeking, I find it weird that you refer to it that way when a union wants a higher share of corporate profits, but just call it taxation when the government does it. Either way it's redistribution. Is it more efficient when the government does it? I sort of doubt it. Is it better targeted? That seems more plausible. The government will catch people who aren't in a union after all. But it still seems weird to condemn the unions for doing the government's job for them!
Lastly while I agree that McDonalds's workers have no cause to feel solidarity with the UAW I don't think it would be unreasonable to feel solidarity with their fellow McDonald's workers! If they wanted to unionize then they should be able to do so.
Whether a union is public or private absolutely impacts the utility of a union. Private corporations (especially closely held ones) have strong incentives to keep wages as low as possible. Every dollar they don’t pay employees increases profits. This is not the case with public jobs. Furthermore, public sector employers can influence elected officials through voting and campaign contributions, a lever private employees completely lack.
The wage case doesn't seem as strong to me as you make it out to be. If it was neither teachers nor police would have such backloaded benefits. The federal government may not care about deficits, but cities, counties, and even states have real budget constraints. Constraints that are hard to manage because the public hates tax increases.
That's why lots of public sector unions have amazingly generous pensions. Both unions and politicians are agreed that the best way to reward workers is to push costs onto future voters and politicians who for some reason are unable to object, like not being around.
This has been really bad especially here in California.
As a first approximation, if I pay my assistant $1 less, my profit increases $1. There may be second order effects and the world is a complicated place, but anything I pay my employees comes straight out of my top line.
I’d argue public sector unions make the government’s job easier. Imagine needing to negotiate salary and benefits with every single new postal worker or police officer or teacher who gets hired. It would be an incredible use (waste) of time and resources. Much easier to just inform them of the union scale.
Wages, profits, prices, and third party protections (like pollution controls) all compete with each other. By default, profits are the only one with organized representation. Unions ensure that wages do, and government regulation can sometimes step in for third party protections. It’s important that these four-way negotiations aren’t run by just one or two of the interest groups with no organized representation from the others. So unions matter, but they shouldn’t be *too* powerful.
I didn't say that. I said its not that mechanically different than the effect of a tax increase. Raising taxes on a business will also cause them to raise prices.
If unions are going to remain relevant politically, unionizing the service sector is the sort of thing that would have to happen. Problem right now is that the labor movement's relationship with the Democratic Party seems more focused on achieving more benefits for existing members than expanding membership.
People are only going to take the effort to organize if they plan to keep jobs for a while. The smartest and most ambitious baristas are either doing it for a few years during school or else are lower middle class proprietors who own their businesses. This is why service workers are hard to organize. Also, restaurants create very few economic profits, so there aren’t really rents to fight over.
I was driving an Amazon vans during the #Bamazon effort, and the most common reaction to that among my fellow drivers was "yeah that'd be cool. By the way, Thursday is my last day."
There have been ~400 Starbucks locations unionized in the past couple years. That's still a small percentage of all locations, but it's far more than there were a few years ago. Let's see how it goes the next few years before we close the book on the effort.
Is it important for McDonalds workers to "feel solidarity" with the UAW? I would have thought that such an alliance was to give a struggling, under-financed unionization effort more access to a more powerful ally in their fight. I'm just guessing here, but is that a wrong take?
1. Unions often push for counterproductive economic policy. E.g. dockworkers trying to block automation.
2. As the % of unionized private sector workers shrinks, there's fewer and fewer people going to the polls thinking of themselves as "union voters." It's not the 1950s anymore. Sure, broadly pro-union sentiment is popular among even non-union workers, but nobody in California gets out of bed to vote in solidarity with unionized workers in Michigan or Visa versa. If Democrats want that to be a reliable constituency, they need to somehow get that % up. If they can't, they need to switch their game up.
Isn’t the fact that unionized employees make more a reason to fight for unions? Think about it from the corporate side - every company I’ve ever worked with is anti-union because it costs them more. You call it rents to extract, I call it high corporate profit margins and workers who are scared of being fired for no reason.
If we don’t fight for unions we’ll end up with unions disbanding and everybody making $1,090 a week while working precariously, instead of many people doing better. How is that a win?
In reality, many unions act as cartels that strangle productivity, protect the worst employees, and drive up costs.
I work in construction and have a lot of first hand experience buying union labor. Whenever possible, I buy union electrician labor because they're relatively competitive on price, their work is almost uniformly higher quality, and they require less day-to-day supervision.
On the other hand, I am forced to buy union labor to install elevators. They charge extortionate rates, do half-assed work, and are generally a giant pain in the ass to deal with. They also operate functionally like a medieval guild. Try getting a job in an elevator shop without knowing someone already on the inside.
The fact is that unions are neither inherently good or bad. Like any other actor with agency, they'll generally take as much as they can unless there is pushback or competition. This is why public sector unions are all generally awful drains on society. Governments are too weak to push back on their demands and scared of losing their voting blocs, so we end up with police unions who refuse to implement any change or teachers unions strangling a city for their exclusive benefit like we're currently seeing in Chicago under Brandon Johnson.
I'll preface this with stating that every regional construction market in America has different dynamics, so this may not apply uniformly, and also that many people much smarter than I have tried to tease out the economics of construction costs and productivity and have very little to show for it.
That said, the simple answer is competition. In our market, we have a healthy mix of union and non-union electricians. While there's a decent amount of wage scale or mandatory union work, there's not enough of it to fully support all the union shops all the time, so they have to compete on jobs with non union companies.
On the other hand, 100% of the elevator installers - basically nationwide - are unionized. You want an elevator? You're getting union labor installing it. The electrical union IBEW is generally more supportive of bigger tent growth, whereas the elevator union IUEC like I mentioned basically operate like a medieval guild. They can keep their union small, which drives up wages, because there's no alternative.
There's also a lot more vertical integration in the elevator industry. There are four major elevator manufacturers - Otis, Kone, TK, and Schindler. If my job calls for an Otis elevator, I have to go to the local Otis branch and get their pricing and have their crews come out and install it. If my project calls for an Eaton brand switchgear, any electrical company can order it and install it and they can order it from multiple suppliers to get the best price.
This is my knee-jerk reaction as well - the rebuttal to "there is no reason for a fast food or warehouse worker to feel solidarity for the UAW, they inhabit completely different worlds" is "well, fast food and warehouse workers should unionize, because at the end of the day they're all line workers who management regards as interchangeable, reducing their individual leverage."
But! I think the steelman argument for why companies oppose unionization is that, in addition to the obvious selfish reasons like wanting a larger share of the surplus/profit, unionization makes it much harder to fire genuinely underperforming employees, and unions push for benefits to flow to incumbent workers, which over time contributes to organizational stagnation and can erode a firm's competitiveness, putting *both* labor and management in a worse position over time.
My industry is mostly non unionized and I can negotiate salary anyway. The biggest issues are overtime issues and some of that is exacerbated by the press getting things wrong.
Unions make more unless they drive their companies out of business (, which can't happen with public sector unions)
I mostly agree but also don't want to end up at a "my job sucks, but my taxes are low" equilibrium. I don't think the tax code can substitute for a fair labor market. I wonder if sectoral bargaining similar to the German model could be a better alternative to unions.
Supporting unions is an easy way of saying “I want good jobs for normal workers.” However, if every worker were unionized, it would be massively inflationary and most of the wage gains would be swallowed up by inflation.
The only way to increase the purchasing power of middling workers is 1) increase productivity and 2) redistribute from capital to labor without too much leakage
But how do you get low unemployment? We tried loose monetary policy and deficit spending in the face of logistical constraints to supply -- as expected, it kept unemployment modest at the cost of significant inflation, and as we now know, voters hated this outcome.
A good start would be getting rid of growth killing regulation. For example, removing all the NIMBY regulation would spur a huge boom in construction. Followed by booms in consumer goods.
Same could happen if we allowed the electric grid to modernize.
Focus on boosting supply too instead of just boosting demand.
I went down a rabbit hole recently about the UK coal miners strike of 1984-85. On the one hand, I understood that they didn't want their livelihoods destroyed and they didn't want to be left in poverty. (Spoiler: this is what has happened in lots of old coal towns in the UK now.) But the government was losing something like £3.70 on every single ton of coal mined. And coal is really dirty and polluting. The government wanted to switch to oil and nuclear. The miners' wives held up signs about "Coal not dole", but I'm thinking "This is both. This is the worst of both systems." I was sort of boggled that there was so much public support for this system, and if Arthur Scargill hadn't squandered all the good will and made some really dumb judgment calls, it might still be the system.
(I'm American so it wasn't really on my radar in the 80s).
This comment is framed very anti-union and very anti-worker, from its word choice (Democratic support for unions is a “fetish”; seeking higher wages is extracting “rents”, etc.) to its analysis:
As several of the replies below note, union workers make more than nonunion workers just shows that unions are fulfilling their primary mission of raising wages;
At any rate, the proper comparison is something like 1) a unionized workforce’s wages as a percent of profits compared to a non-unionized workforce’s wages as a percent of profits or 2) the ratio of CEO pay to median worker’s pay in unionized to nonunionized workforces. As noted above, the comparison you made of union workers’ wages to nonunion workers wages just shows that unions are doing their jobs;
The decline in private-sector union membership since the 1950’s has a lot to do with the law, the hostility of companies to unions, and the willingness of companies to play borderline illegal (or actually illegal) anti-union hardball;
The word “relatively” carries a lot of weight when you call union workers “relatively privileged” in modern American society;
I wouldn’t be so sure that warehouse workers have no feelings of solidarity with UAW members;
There's a tension between "unions are doing their jobs _for the unions" and "laws around unions/unions are making the country better-off overall"
Some union victories, like OSHA (I'm assuming this is largely the result of union victories in the past) seem clearly to make the country better off overall. Some unionization (like port workers preventing us from having automated & faster-functioning ports) seems to make the country worse-off. The union there is still "doing its job" for the benefit of the union members, but not for the benefit of the country.
If we are going to provide special legal rules that privilege unions above simply having workers agree to organize on their own, then I want evidence that unions are good _for the country_ not just for their members.
The UAW is an illuminating example of a union overdoing its job. It did it so well that GM was forced (named otherwise, but effectively) into bankruptcy. I am far less moved by resentment at a few people making huge sums than by hope for a balance in which provides stable work at a wage that bears some relation to skills, knowledge, and diligence. No doubt, there are abusive employers who need to be checked. But there are abusive unions, such as SEIU in Washington State, that got the legislature and governor to implement a law to make it very difficult to inform union members of rights that can reduce SEIU’s dues revenues.
It's ironic that a lot of union hate ignores very bad decisions made by executives. The auto industry has been gutted not because of greedy workers, but because white collar GM engineers designed cars nobody wanted to buy. Is the union responsible for crappy Boeing planes? No, it's due to cost cutting measures taken by executives.
Amazon warehouse workers and Starbucks baristas are "relatively privileged groups of workers"?
There are many unions I think are net negatives for society -- longshoremen, police, teachers, all public union workers, autoworkers. But unionization is still the most effective tool to fight exploitative managers and company owners in cases where workers have little power.
I doubt it. It can still be incredibly portent politics, just look at the Nebraska Independent senate race. Maybe the PRO act will die on the vein, but I think union politics, especially private sector union politics is here to stay
Exit polls show the union vote split 53-45 for Harris. Winning 10% of the electorate (more in PA and MI, less in GA and NC) by 8% equates to 0.8% of the popular vote. Democrats are tolerating alot of privilege and resentment and inefficiency for a smallish portion of the vote. They would do better to ditch unions and embrace social guarantees.
I think unions are kind of like hanging judges. In the wild west, a hanging judge saved lives. It’s a crude, muscular intervention that works well in the absence of state capacity.
The union movement existed for 50 years before we had a federal income tax and for 100 years before we had Medicaid.
The impulse for self help is wholesome and unions did a lot of good before we had the state capacity to have a real safety net.
I feel the need for unions in America has withered.
I'm not a big fan of private unions but I'm fine with them. And acknowledge that historically they did a lot of good.
Public unions should be banned or neutered. In they are allowed they should only be able to bargain for wages and benefits. Nothing about workplace rules.
Massively outperforming expectations and $5 will get you a gingerbread soymilk latte at Starbucks.
I'm sorry, but the Horror Clown and his minions have the trifecta and being told "but this guy lost less badly than a Democrat would have!" is of no practical help.
It's not immediately practical today no. But if it helps create a pathway to winning the next election then it was still useful. If winning battles was all that mattered then Pyhrrus would be hailed one of histories greatest generals. The Democrats just need to prove they're the Romans and not Hannibal. (Although it's an insult to Hannibal to compare him to Trump)
This seems very overstated. Public sector unions are a special case but it’s unreasonable to deride all benefits unions are able to deliver for their members as rent seeking.
At root, they are a mechanism for employees to collectively bargain, thereby increasing their negotiating leverage. Is a high performer “rent seeking” by demanding a higher individual wage?
The regulatory apparatus that has grown up around unions to bolster them has much to be criticized, but at root they represent workers using their God and Constitutionally given freedom to associate in order to drive a better deal with management.
"…union workers are relatively privileged. Their average wage is $1263 per week versus $1090 per week for workers generally." This is the whole point of unions! To get their members more money, safety and benefits. And if they're succeeding at doing so, that's a good argument for supporting them.
Yes, unions are more effective with large employers than small ones, but higher union wages can—if they represent enough of the workforce—increase wages, safety, and benefits for all employees because employers compete for employees.
Argh, the Slow Boring audience has become so dreadfully center right since the election. Might was well build a Clinton automaton and just run that in every race.
I liked this article because it gets at what seems to me to be one of the main problems facing Democrats today. What are the Democrats for these days, beyond some vague sense that economic outcomes in America are unfair?
When I was younger it was pretty clear. Democrats were the party whose main goal was to make the U.S.'s economic system more like Europe's.
Given Europe's recent economic struggles, it seems like taking Europe's approach might not be the best idea (especially on regulation). Anyway, the difficulty of passing anything through Congress has made the party de-emphasize this type of approach.
Today, part of the left-of-center commentariat seems to think that "economic populism" (i.e., pursuing the economic policies of Argentina instead of Europe) is a good goal in and of itself. I'm a bit skeptical that a patchwork of random interventions is desirable or even electorally effective (cracking down on landlords, egg producers, and big tech companies is just too incoherent). Another part of the left-of-center coalition seems to concede that while economic populism isn't necessarily great on the merits, dumb voters will lap it up, so it'll be effective politically. I'm not so sure about this either.
But the Democrats *do* need some sort of economic ideology rather than "we'll just technocratically optimize cost-benefit tradeoffs everywhere," since no one actually believes they're capable of accomplishing that. In fact, this is precisely what happened in the Biden administration: technocratic optimization was really just throwing goodies around to please coalition members.
What should Dems' ideology be? I'll just point out that Matt's two signature ideas are actually pretty libertarian: housing market liberalization and promoting high levels of legal immigration. These aren't necessarily the specific ideas that'll help Dems win, but I think it does indicate that what America needs economically is maybe a little less top-down control rather than trying to be Europe or Argentina. How can Dems sell this? I'm not sure. But the Democrats should at least start with a worthwhile goal before asking how they can win over voters.
Agree—i’ve been struggling with this myself. I think the Dems struggle to function in the absence of a new popular sweeping entitlement to pursue. Once health-care reform was achieved, there were not many big ticket items left on the shelf, and their most popular idea became price controls on pharmaceuticals, an idea hardly in keeping with the spirit of this piece. They also went for student loan forgiveness and a refundable child tax credit, neither of which is great politics as Matt states. Perhaps someone needs to figure out a way to make supply-side reform exciting (i personally love supply side reforms but likely am an outlier). Or perhaps the Republicans will gut several popular entitlement programs and Dems will be reanimated with purpose.
Healthcare reform is not complete, though. "Let people buy into Medicare" was considered, but the Dems didn't quite have the votes to put it into the ACA, even with the majorities they had in 2009. A future Dem trifecta could revive that, alongside "let Medicare limit the price it will pay for all drugs, not just a selected few, following the lead of healthcare systems everywhere else."
There are many examples of countries successfully implementing similar policies, and they would go a long way toward closing the remaining gaps in affordable access to healthcare for all Americans. I'd pair it with a medical education reform too -- expand med schools and residencies, limit tuition, with an eye towards eventually having cheap / free med school and a larger number of lower-paid medical practitioners, like e.g. Germany.
I'd make the other plank of my dream platform be the usual Slow Boring YIMBY-ism, in the hopes that not only will middle-class purchasing power rise, but maybe doctors will still be able to afford the fashionable parts of NYC on their smaller post-reform salaries.
There is still a robust supply side + deregulation agenda for better, less expensive health care that Dems could embrace if they are willing to give up certain shibboleths about the health care professions.
Is there a government program that has been able to significantly cut costs? Even keeping costs the same so they eventually inflate away would be an achievement.
The container ports were all built in the 1970s or later! I don’t know what that means for how to do other things as efficiently as those, or whether those could have been even better if done in some earlier way.
That's deregulation getting out of the way of private industry - It's unclear why government needed to heavily regulate air travel to begin with, but where's a program where government needs to be involved as a prime mover that has become more economically competitive through reform?
There are lots of regulations on medicine —professional licensure, immigration restrictions, restrictions on tele medicine. if Indian radiologists could read American scans, there would be massive savings. If Indians with MDs could come to the US and do primary care, there would be even more savings.
The insurance model is also inefficient because companies spend a lot of effort trying to shift costs to one another. Medical billing is way too big a slice of GDP
It makes sense to a degree when you consider the timing of when or original airline boards were put in place. One thing CAB did was ensure there was mail service to parts of the country that might not otherwise get said service in the private sphere.
I think we have to look at it like we do now with farm subsidies; a government policy that was designed for a very different time in American history. When half of America were still farmers, subsidies to help Americans ruined by the dust bowl makes at least some sense. Today? Not so much. Same with CAB. When flying was still a pretty nascent industry, having strict rules about which routes planes could fly was kind of understandable. But by the 70s with modern jets? Maybe not so much.
I see farm subsidies differently: theyreta national security measure. It's one thing for a country to import all their consumer goods, but another thing entirely if they don't grow enough calories to be self-sufficient.*
Most people don't think of it this way, and subsidies are targeted and administered (very) poorly as a result, but the principle behind them is sound.
*In practice, the US and Canada should align their agriculture / trade policies and operate as a bloc in this regard.
My understanding is that the federal TANF budget has been set at the same level since 1996, so that's a significant fall in real funding over the past ~30 years.
But then I think we both agree that the big hurdle is on the cost side rather than the distribution side, right? Like if costs were way down and we didn’t go for a single-payer system, I think people would be a lot happier than they are with the status quo. Focusing on costs rather than distribution seems to be outside of Democrats’ usual comfort zone.
Healthcare distribution is underrated when talking about the US healthcare system. A lot of complaints are about dealing about health insurance and hospital bureaucracy rather than costs per se. Many (most?) people are relatively insulated from the absurd costs and complain about stuff that is only adjacent to high costs (like receiving crazy high bills that are fake in the sense that your insurer will cover it after you jump through enough hoops and that your insurer will never actually pay the whole amount).
Those complaints still point to real inefficiency in the US system. Many private insurers, lots of latitude for case-by-case negotiations, lots of high-paid labor (doctors etc.) spent on constantly negotiating who pays and how much. This is one of the reasons that US healthcare expenditures are so high, without Americans necessarily getting better healthcare than Europeans or Canadians at the end of the day.
A more standardized system, like the UK or Canada's standard recommendations for reimbursement and cost-effective pricing, or Germany's industry-wide negotiation of prices, would lead to both lower prices (bad for doctors, hospitals, and pharma companies but good for patients and taxpayers) and less duplicative negotiation (bad for people whose job is to represent insurers' reluctance to pay, good for everyone else and for social efficiency).
As an economist, I've been taught to look for deadweight loss and prefer things that avoid or reduce it. Competition is usually better than monopoly in this regard, but there are exceptions -- and the healthcare industry is notoriously unusual compared to "classical" markets.
Norway is a petrostate that gets its money from taxing oil exports (i.e. taxing foreigners). That is an amazing way to finance a welfare state if you have oil reserves way in excess of your country's domestic oil demand. America does not have that.
Norway has a population of 5.5 million and oil exports of $59 billion per year, for $10,700 of oil exports per Norwegian per year. America has a population of 330 million and oil exports of $118 billion per year, for $358 of oil exports per American per year. America is not in the same ballpark as Norway.
Lots of good ideas to gather from Norway but its structure is pretty different from the US. 25% VAT makes *everything* eye-wateringly expensive. That can work if low-end wages are really high (which they are) but *that* only works if your economy has a broadly high-tech, high-education workforce (which Norway does). In turn, this model compresses wage differentials between low-wage and high-wage workers, which may be a good thing for societal stability but hard to achieve in the US, where restaurant servers and warehouse workers starting to earn $20/hr+ seems to trigger grumbles they make too much.
Yes, but not as base wages that drive the price of entrees from $15 to $25, which is where the broader community annoyance comes in. And yes, this is in metro areas with high local minimum wages. My point is simply that waving a wand and saying, “Let the US be like Norway!” carries lots and lots of asterisks!
Correct. In America, top two fifths get to consume more goods and services than in Norway. Over half the electorate comes from the top 40% of the income distribution.
Yeah, this is a dumb policy, driven by petty cultural politics intended to shame tax-minimizing individuals. Note that this tax isn’t essential to the Norwegian model. Rather, the heavy taxes on income and consumption (value-added tax) are the big drivers of the revenue necessary to support universal health care and education.
Short answer: Yes, Norway is a petrostate. However, most of the gov’ts revenues from that flow into the country’s gigantic sovereign wealth fund, of which only 4% goes into current spending (it’s a very smart construct). Most of the year-to-year economic benefits from Norway’s oil & gas industry come from all the investment and (high-education) labor needed to operate that industry. All of that is to say that I think the US has the economic base to run Norway-style economics if it wants to, but all recent political evidence seems to me to point toward the country NOT wanting to do that.
Single-payer healthcare would require large cuts in payments that go to physicians, which will decrease physician income, on top of higher income taxes on physicians. That will do wonders for physician supply.
Currently yes, but if you cut physician salaries by tens to hundreds of thousands of dollars and raise their marginal income tax to 60-70%, that creates a major disincentive to put in all the effort to become a physician
We should make it easier to become a doctor! There's no reason why an MD needs a BS before going to medical school, it just delays everything by 2 years! That's an enormous amount of money over a lifetime.
Call me sentimental, but doctors should be ladies and gentlemen, not technicians. Anyone with that much power over life and death should have the blessings of a liberal education.
I am against BA requirements for most jobs, but strongly pro BA requirements for doctors. Educated professionals should be educated.
You can also eliminate medical school tuition and expand the supply of medical school and residency positions.
Recent grads will be hurt by the change, unless you forgive their debts or refund their tuition -- and if you do a refund, how far back does it go? (E.g. to people who finished their MD five years ago? Ten? Twenty?)
The change will be bad for incumbent doctors for sure, but new doctors can be compensated for it. Germany has much lower doctor salaries than the US, but also tuition-free university and medical school, and more doctors per capita than the US. It can be done, even in a country almost as rich as America.
Very easy to pro rate. If congress imposed changes that reduce physician compensation, recent med grads should get significant compensation. Anyone who has billed for 10 plus post residency years under the ancien regime has already gotten their cut. Give a $200k reparation to every doctor, reduced by $20k for every year post residency.
No one thinks the marginal rate on $250k should be 60%. I certainly don’t.
Now some doctors who own practices are more capitalists than tradesmen— they are profiting off junior practitioners nurse practitioners, physicians assistants etc. the way a big law partner profits off of associates. Those folks can totally pay 55%
We can't afford single-payer healthcare without 60% marginal tax rates. Best estimates I have seen for single-payer cost is $30 trillion over a decade. How are we getting $30 trillion in new tax revenue without 60% marginal rates?
Physician payments are around than 10% of health care costs. Nursing is another 5%. Even were you to effectively halve the salaries, you are not going to make a big dent in the excess cost structure.
Where does the rest of it go...? Surely they're not wasting 85% on "administration" are they? Or is it all for the big fancy machines?
Can I have the option for an old-fashioned, mom-and-pop doctor who practices out of their garage using old used equipment with no administration? I'd take that deal.
The model of worker treatment / worker rights that seems to fit best with an abundance agenda is something like the Danish "Flexicurity" model: give employers more freedom to hire and fire to adapt to market needs; and give workers a real unemployment benefit and access to a high level of background social services (health care, education, job training, child care) that allows them to survive and thrive between jobs and to add skills as global labor markets change. I took this to be the thrust of MY's call for promoting economic growth while providing a robust safety net, both of which become easier with more skilled immigration and some amount of unskilled immigration. But this comes into conflict with many of the typical union bargaining positions we see today, which are designed to make it harder to fire both bad cops and bad warehouse workers, or to impede economic progress by slowing or preventing technological transitions: the Jones act, restrictions on automation, the coming wave of demands of protections from AI job loss. Protecting incumbency for its own sake is one of our most basic instincts but one of our most counter-productive economic habits, regardless of whether we are protecting incumbent businesses in the FF industry, incumbent unions optimizing for members over larger social interests, or incumbent regulators powered by NIMBYism.
Why do they need an economic ideology? Why would one even want one? Indeed, it seems like an economic ideology is just a way of clouding your judgement about what's good to do.
The failures here are the result of Biden being an old guy still wedded to an economic ideology the democrats had in the 60s and 70s.
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Personally I want to see the democrats move away from direct regulation (obv not entirely we need clean air but shit like vehicle fleet requirements or IRA requirements for day care) which tends to be very inefficient and wasteful and move towards the kind of simple efficient mechanisms free market types would always point to in the past but rarely ever implement (eg substantial negative income tax rather than minimum wages etc).
But that's still just a bunch of cost benefit tradeoffs I don't see an ideology. I mean when it comes to things like monopolies I think it's idiotic to have a private power company (meaning the last mile transmission... generation is fine).
Good advice for a grandmaster-level player is "just consider the tradeoffs involved in every move and then pick the best move."
This is terrible advice for new players. They'll end up doing lots of stupid stuff. They need rules like "don't move your knight to the edge of the board," "don't push pawns in front of your king," etc. These rules form a beginner's "ideology." Of course these rules "cloud judgment" in a sense, since it's sometimes optimal to break them. But they're a net positive for beginners.
Democrats are more like beginners than grandmasters when it comes to making policy. The problem is exacerbated by the temptation to make policies that look like optimally managing tradeoffs but are actually just doing favors for coalition members.
They are like beginners who can hire their favorite grandmaster to come and give them advice.
Yes, the danger is the voters just decide not to take good advice. But that's the same danger they choose a really awful ideology. More countries have been economically wrecked by really awful economic ideologies (eg communism and arguably extreme privatization) than by pragmatic muddling.
If you can't trust the voters to listen to the actually correct arguments about the best policy choices why would you expect them not to end up with an ideology that was even worse? Even if the right ideology would be better than none why assume they'll pick that one if they can't decide what economic experts to trust?
I know it’s not exactly equivalent, but didn’t Argentina demonstrate that policies to benefit the poor, when carried to extremes, can destroy an economy?
the Dems should run on personal freedom culturally and abundance economically. It’s should advocate for people having the ability to freely live theirs lives how they see fit in their personal lives, while advocating for economic prosperity - more is more. I think these two pillars allow Dems to tie together various cultural and economic factions into a coherent message
Matt is being far too charitable to Nathan Proctor. The guy seems a few cards short of a full deck.
“Housing is too expensive. Make it more affordable”
“Right, build more housing”
“No, because you’ll just build luxury housing. Build affordable housing instead”
“Affordable housing is just market rate housing that is subsidized. Subsidies raise the cost of housing for everyone else.”
“Then just pass a law that says they can’t. Gosh, do I have to spell everything out for you?”
Also, anyone arguing for more tenant protections as a cure for high rents is clearly just making stuff up. The tenant protections in high cost cities are already ridiculous. It’s a lot of why the rents are so high! Landlords can’t evict anyone so that gets priced in!
YIMBY discourse has taught me that there's a popular but weird view that "affordability" is a design characteristic of housing like square footage or the number of bedrooms. The number of times I've seen people sincerely ask why nobody just builds affordable housing in San Francisco or Manhattan is mind-boggling.
And talking to people on the NIMBY side about it is like taking to Trump people about tariffs. They just like have a block in their brain that means they can’t understand what they are being told.
Edit: also see the “why does no one build beautiful brownstones anymore” discourse
The generous interpretation of that is "does every new apartment building need central air, granite countertops and a 10k sq ft gym/amenity floor."
But if you start with the "affordable" characteristic and work backwards I think people wouldn't like what they get for, say, $1,000/mo in a new build.
Yeah, my guess is that getting down to what most of these people would consider affordable would require all apartments be completely bare-bones studios. I suspect that rent prices are about 90% location and square footage.
But there's an easy answer to that: they put those things in to *justify* the prices they have to charge to make the construction pan out. A rental building without central air wouldn't actually be much cheaper to construct, but rent would be the same!
Lowering construction costs will only have a meaningful impact on rent if lower construction costs lead to more construction, increasing housing supply. (Edit: or if lower construction costs make the housing less desirable, lowering demand)
Different people will make different choices. Some people value having amenities in the building and high end finishings. Other people value having an extra several hundred dollars a month in their pocket that they can spend on other things. The point is that they should be able to make that choice
In Oregon, Construction Defect Liability Laws are apparently causing a sharp decrease in condo construction: instead we’re getting plenty of apartments. (Which signals to me that developers really cannot control possible construction defects to the extent that they’re willing to take risks. )
True, though then they have to deal with the tenant protections that may make this not worth the hassle for an individual condo owner. And MY has made the point that it's often better for renters to be dealing with a professional property management company that runs apartment buildings than individual owners who are just renting out their property as a side gig. It's also the case that pushing construction towards condos instead of apartments is an unintended consequence of tenant protections.
I’ve never rented from a professional property management company, rather I’ve always had individual unit owners as a landlord. Is there a physical/ structural difference in construction intended for condos and construction intended for apartments?
Try to explain this to someone using toothpaste instead of housing. Why don't we set a price ceiling on toothpaste? Why doesn't the Crest/Colgate Cartel fix the price at $10/tube?
People don’t view toothpaste as an investment as well as a good.
Transaction costs for toothpaste are pretty low…basically the cost of going to the store. Real estate often has tens or hundreds of thousands of dollars in transaction costs.
Not to say that I think there should be a price ceiling on real estate. But we shouldn’t pretend like real estate market is the same as the toothpaste market
If you value your time, the transaction costs of going to the store to buy a single tube of toothpaste are probably larger on a percentage basis than the costs of buying a house.
But most people don’t do that or need to do that because toothpaste gets sold at drug stores, grocery stores, and super markets, not at toothpaste stores.
The toothpaste market and the real estate market are very different. This should be self evident. I don’t feel like I need to justify this position.
One thing that bugs me about the “go maximally left on ~all aspects of econ policy” crowd is that a lot of them didn’t actually study economics! It’s a bunch of people who studied history in undergrad and/or went to law school. Nothing against those types and maybe this is me being parochial or credentialist but I’d trust the policy argument a lot more if it came from econ PhDs.
In the past I would have agreed with you but Jerome Powell is perhaps the best fed chair we've ever had and even he's not an econ PhD.
If you can succeed at literally the most important job in economics without that credential, then you shouldn't need it to formulate other policy ideas.
To be fair, though, Powell obviously listens to his economist colleagues and doesn’t do crazy unorthodox monetary policy. He’s a good manager and communicator, and he’s good at finessing the relationship between the Fed and the political branches, but he probably isn’t the main source of economic insight in his organization. (And that’s okay!)
I think the big difference is that Powell shows an enormous amount of deference to economists' thinking. If you listen to him talk, it's basically exactly what you'd get from Bernanke/Greenspan/whoever. Very different from letting Marxist historians and "Modern Monetary Theorists" run Dems' economic policy.
Yes but most people are not Jerome Powell. People on the left have had an obsession with credentialism to their detriment, and it has been very much proven people without credentials can build expertise in any given space. The problem is that there's still no real alternative to credentials. Without them, we are all faced with random twitter account saying things and nobody without expertise has any idea who/what to believe. Bad epistemic situation in general.
I worked at the Fed when he became chair and people who worked closely with him talked about how he was a voracious reader of economic research. Yeah he isn't an econ phd but he did listen to econ phds, and put in the work to understand the field. I don't think it's a requirement that someone has a PhD to understand econ, but people have to try to understand the field. I am not saying you are arguing people on the left do this, but if they did do this, they wouldn't have the opinions they have.
I think this is specifically the case in the antitrust/anticoncentration space where most of the movement is basically Lina Khan's interesting legal paper come to life.
But why should the problems of the 21st century be resolved with legal re-interpretations and understandings of 100 year old laws? A lot of the anti-tech talk on the left smacks of disliking corporate success, then trying to dress up in fancy language how it's bad.
If you read Ben thompson's blog it's clear that antitrust regulators have a point in a some cases but are seeking the result they want (a reason to punish or break up Apple/Amazon/Microsoft/Meta/Alphabet) then backing into reasoning for it, rather than laying out a proactive vision for the country.
I don't dispute the big tech companies do a lot of things wrong, but they are also our leading export industry, provide tremendously useful services that people love, and are our best shot at future innovation. So its up to political leaders to come up with a better way forward than accusing them of wrongdoing at every turn.
The lack of subject matter knowledge is also really present with banks on the left. The US has the least concentrated banking system among all wealthy countries as far as I know, yet there are frequent calls to "break up the banks" to reduce their power But nobody could reasonably argue there is an insufficient amount of consumer choice in the banking sector, for any normal consumer banking product we have dozens of separate providers who compete on price/convenience/etc. And given correlated risk it's not at all clear how having many smaller banks would reduce the risk of systemic collapse.
So the way I read this is reliance on "big is bad" which emenates from historical/legal interpretations of the old progressive era has resulted in a version of "populism" that isn't popular and won't achieve what its proponents want.;
You’re right but also wrong. People talk outside their expertise all the time. Should Matt stick to whatever it is he studied and never write about anything else? When you complete your econ degree (presumably), are you disqualified from talking about anything other than economics?
So, yes, some simple economics would make the supply/demand trade offs of housing policy more clear to these types, but people should be free to discuss and make arguments about things outside of their specific areas of expertise.
Right, I’m not saying they shouldn’t be allowed to speak outside of their area of training. I’m just saying that I somewhat discount their takes because it’s outside their area of expertise!
Econ obv requires expertise but it is still a social science. Unlike hard sciences like physics, Econ lacks universal laws, controlled experiments, and deterministic outcomes, relying instead on models and assumptions that simplify reality. Idk I do think there’s a moral aspect of designing Econ policy, even hard right wingers talk in moral terms such as it’s “unfair to tax ppl bc it’s theft or smthg.” i think putting editorial board of jacobin to make Econ policy would be a disaster but normative aspects of Econ and its evolving theories (behavioral Econ etc) highlight Econ role in addressing societal challenges (which obv are going to differ based on ideology) rather than adhering to rigid frameworks of hard science or strict scientific rules. just saying Econ is not that rigorous when compared to hard science even if it’s the most rigorous among social sciences, it’s still a *social* science.
Although this is technically true, there are still plenty of simple mechanistic “laws” (theoretical assumptions that are almost always borne out) in economics which many of these commentators still seem unable to understand – even a grasp of completely elementary supply and demand is shockingly uncommon!
Yup I agree, but there’s still a question of morality, ideology, and taste in how one structures society that is more akin to aspects of engineering (where there’s both art and science), as opposed to hard science (fundamental laws of Newton). Even there at least engineering is operating on hard science laws, whereas Econ policy is operating on social science laws.
I think a lot of left wingers would say it’s ok to give up on *some amount* of growth in favor of re-distribution. One can think of this in terms of engineering a product where you trade some amount of quality in favor of making the product cheap. Whereas a ton of Tyler Cowen style right wingers would say any form of re-distribution takes away from Econ growth and thus is bad, and if u want to help poor ppl, most poor ppl are foreigners so best thing to do is Econ growth and then send money abroad or something. I would offer 2 examples where scope of expertise is limited in determining outcomes:
1. A lot of European countries make a different kind of trade off. Consumer electronics and even an ordinary meal is crazy expensive in some European countries but they have socialized healthcare, child care etc. How does this relate to technical expertise? It very faintly does. It’s a question of taste in terms of what kind of society one wants to live in. Americans have bigger houses, purchase more consumer goods, but forego comfort in having guaranteed pathway to college, healthcare etc.
2. Almost all Econ experts saying immigration is net good. Literally almost all of them. It’s actually very rare to have such unanimous consensus on a policy. Yet Americans don’t want the pace of change that the level of immigration the experts suggest would be good. I’m talking about legal immigration, not just illegal immigration.
Idk I sometimes feel ppl refuse to acknowledge that ppl have different preferences and want different outcomes. Expertise towards an outcomes pre-supposes that u share the same outcome.
If u want to design policy, imo its imp to be both Econ literate and politically literate! The left wingers pushing their policies are trying to move politics in their direction. We don’t live in a technocracy.
Agreed on the last point! Economic literacy and political literacy are both (independently) important. The main view I’d like to defend is that, actually, economists are pretty good at identifying the tradeoffs inherent to a given policy decision – they’re also pretty good when it comes to identifying which policies lead to greater literal wealth.
You can argue that wealth is not the be all and end all of societies (a fair critique!) but often the issue you actually see is some variety of politically-motivated actor claiming that their preferred policies will, in fact, promote [wealth / economic security / etc]… even when an economist could tell you otherwise.
It’s fine as a political actor to claim that your preferred policies are best suited to achieving your particular preferred set of moral outcomes. I just think that most politicians, even those who might nominally be most suspicious of wealth as an ultimate societal goal, sort of launder their preferences to the public in a kind of half-hearted confused economic argument.
(I’m also slightly confused at your assertion that Cowen, a Democrat, is a right-winger. You might be focusing overmuch on the vibes vs. the stated political preferences here.)
Elizabeth Warren's econ PhD and subsequent professorship in the field hasn't prevented her from spewing bullshit half the time. I think it's more that some people are committed to reasoning backwards from their predetermined conclusions. This could be for reasons of political expedience, or cognitive dissonance, or general lack of understanding, or wishful thinking, or whatever else.
Econ obv requires expertise but it is still a social science. Unlike hard sciences like physics, Econ lacks universal laws, controlled experiments, and deterministic outcomes, relying instead on models and assumptions that simplify reality. Idk I do think there’s a moral aspect of designing Econ policy, even hard right wingers talk in moral terms such as it’s “unfair to tax ppl bc it’s theft or smthg.” i think putting editorial board of jacobin to make Econ policy would be a disaster but normative aspects of Econ and its evolving theories (behavioral Econ etc) highlight Econ role in addressing societal challenges (which obv are going to differ based on ideology) rather than adhering to rigid frameworks of hard science or strict scientific rules. just saying Econ is not that rigorous when compared to hard science even if it’s the most rigorous among social sciences, it’s still a *social* science.
I somehow missed that the Biden Administration tightened rules around Jones Act. What’s especially galling about this is it apparently did square root of f**k all politically for them. Which means it apparently had no redeeming value.
One of the more right leaning positions over the past 10-15 years to be more skeptical of unions and specifically public sector unions sort of for the reasons FDR laid out. But the last 4 years I think might make me an actual right winger when it comes to private sector unions.
There’s a part of me that is in a spiteful frame of mind when it comes to the election. I suspect I’m not alone. You voted for this let’s see how much you like Gestapo tactics to remove immigrants (not much confidence a Stephen Miller anti immigrant project is going to discerning about illegal vs legal), let’s see how much you like grocery prices going up again because of tariffs. And then I have to stop myself and say a whole lot of Trump voters are not Trump super fans and would have likely voted for a cactus over a Democrat in a general anti incumbent mood fueled by inflation.
But unions? Boy I’m really starting to “the hell with you” stage. And yes I say this knowing how important unions have been historically securing rights and protections. But now? Pure rent seeking as far as I can see. I think I might be ready to say “you wanted this guy? Fine I hope Trump puts anti labor business guy on NLRB and nominates a whole lot of anti union judges”.
If "f**k all" means something very small, then "square root of f**k all" is in fact much *larger* than "f**k all". Perhaps you meant to write "square of f**k all"?
I'll just keep it simple and say tightening rules around the Jones Act might be one of the under the radar worst decisions Biden made given that it seems that absolutely not benefit to him on the merits or even politically.
The square root of something is always closer to 1. If the thing you start with is bigger than 1, then the square root is smaller, but if the thing you start with is smaller than 1, then the square root is bigger. The square root of 1/4 is 1/2.
The Teamsters are the worst offenders by far here. Biden bailed out their pension fund, then they refused to endorse Harris. Their leadership should be persona non grata with the Dems for a while.
The funny thing is Sean O'Brien is almost a bizarro example of what Matt complains about with lefty non profit groups. He's making decisions for his union based on issues completely unrelated to the actual mission statement of his organization. There's really no other way to explain how he can speak at the RNC given how hostile GOP is to unions generally (one of the few through lines to pre Trump GOP along with Tax cuts).
Yes. It's darkly funny to me that despite Biden and Harris being very pro-union, certainly likely to be more pro-union, in pure economic terms than Republicans, unions largely abandoned the party over cultural issues.
I said in another comment but it goes back to Matt's posts about how it's bad when various organizations built around specific issues start making decisions (or pronouncements) based on issues entirely unrelated to the mission of your group. So Matt is a Democrat so he focuses on lefty groups like environmental orgs putting statements supporting Gaza (or having anything at all to say on the subject generally).
I think the unions not really backing Harris (or at least tepidly or having their members vote for Trump) sort of shows this is just a lefty non-profit phenomenon.
I think you can say the same thing about Churches by the way. In the "duh" statement of the century Christianity is about something way more than abortion or homosexuality. In fact both issues are really tiny parts of what being a good Christian is supposed to be. But these two issues dominated Christian politics over the past 30-40 years to the point that you have absurd spectacle of evangelical Christians and worse evangelical leaders supporting a man who's entire existence is antithetical to Christianity generally.
I would also look at churches and unions in similar contexts here. Both are human organizations, and thus are prone to the same distortions and extremes that any institution has to manage (or not.) Unions go off the rails as do political parties, universities, corporations, religions, even marriages and families (which to some extent are also socio-cultural institutions.)
But unions are still potentially a “third leg” that can balance the power of government and corporations in favor of people who work. Theoretically working people could unite for redistribution via tax policy. But that’s more indirect than just going on strike and directly threatening corporate profit, especially since elections are more and more influenced by corporations and their money. (As for religions, I could go on and on about why they exist and why they have played significant roles in contributing to personal and community survival and even flourishing.)
I don’t know how public unions can be reined in. One problem may be that the people attracted to union leadership often aren’t very reasonable: they’re there for the conflict. I suspect unions are also subject to the same problem politics is: most union members don’t may much attention.
But in the meantime there are the nascent service and grocery employee unions which may just manage to get pay and healthcare up to some kind of decent subsistence level before they grow up and fall prey to the usual institutional shortcomings.
Do you think the unions themselves (by which I suppose I mean leadership) have right-coded views on social issues, or do they know that their members do and at a certain point it becomes awkward to endorse a candidate that you know the majority of your members don’t support, regardless of why.
Not coming out and endorsing Harris is likely at least in part a concession on the part of Union heads to be realistic about the political leanings of its members.
Coming out and speaking to the GOP convention is a whole other kettle of fish. That's a direct endorsement of Trump. There's no way Sean O'Brien is doing that just because that fits with the political leanings of a large segment of his union.
Famously the Sunrise movement didn't endorse Harris. In part this was supposedly because the Biden administration wasn't pro green enough. Given the political inclinations of Sunrise, I wouldn't be surprised at all if it turns out part of why they wouldn't endorse is a large segment of their donor base and staff were upset at Biden (and by extension Harris) for not being sufficiently pro Gaza (or being too pro Israel). What didn't happen is the leader of Sunrise going on stage at the GOP convention to speak.
And here's where I unveil my grand theory of this election: Trump won and Harris lost because Americans are very rich and very satisfied with their economic condition.* On the Maslow hierarchy they are way above physiological needs and safety and security.** They are so comfortable they can afford to indulge in self-esteem and self-actualization. I.e., they have the space and comfort to engage in meaningless cultural concerns (e.g., transwomen in women's sports).
In other words, our society is so economically successful that appealing to voters on the basis of improving their material lives will continually fall on deaf ears. We need a different approach.
* Yes, some Americans are suffering economically. Yadda yadda yadda.
** I apply this to the vast concern over inflation which, last I checked, is around 2.5%. I don't think Americans were, by and large, that hurt materially by the gap between their income and the prices they were paying. I think they gained satisfaction, "self-actualization" one might say, from bitching and moaning about how egg prices went up.
I think the inflation issues is in large measure about control and sort of fits your Maslow's hierarchy of needs thesis. As has been noted many times, one reason rising wages didn't counteract the negative feeling about inflation is that people see pay increases as fruits of their own labor and price increases as something out of their control. Financial security means a lot of things but one thing it means is a level control (or at least illusion of control) over your own life. Make enough money to pay bills and put a modest amount in savings, suddenly you feel like you have a certain degree of "freedom" to decide how you want to use the money left over (at least I did when I reached a certain income threshold). But its core financial security is in large a measure of feeling like you have control over life and inflation disrupts that feeling.
I'll disagree with you (at least partially) and note that I think you're underestimating the actual material impact of higher inflation. For one, it seems likely (we'll have to wait for Pew data) that there was a pretty significant swing right among younger male voters under 30. Even among college educated voters this is a cohort of people who don't generally make a ton of money (vast majority don't get analyst roles at Hedge Funds or Consultant firms even among college graduates). This is a group of people who are likely to really feel the pinch of even a modest increase in prices. Second, I think you underestimate the number of voters who do actually struggle financially. And third, I know term "paycheck to paycheck" is overused to the point of almost rendering the phrase meaningless. But I said almost because it is really true a decent number of people who make middle class wages probably on a practical level live "paycheck to paycheck". What I mean is there is a pretty sizable number of people who really do spend almost everything they make. Now the reality is a lot of those people could probably save more money by going out to eat less, maybe not buying that brand new shirt or maybe cutting back subtack subscriptions. But the point is, for those people, even a small increase in prices likely resulted in some sort of "sacrifice" being made even if it was "sacrificing" something that was more a want than a need. Regardless, that's still not going make someone happy.
If you add up an expanded "misery index" (unemployment rate+inflation rate+mortgage rate) for each President, for Reagan in Oct. 1984 you get 25.7; for Biden-Harris you get 12.6. It's two times greater for Reagan than Biden-Harris.*
So I guess it makes sense that Reagan was rejected by the electorate in Nov. 1984 and Harris stormed to a historic victory, winning 59% of the popular vote and 49 states.**
Oh, and in Nov. 1982 it was 28.5 and in Nov. 2022 it was 17.7, meaning in the two years leading up to the election, it didn't improve at all for Reagan and improved vastly for Biden.
** I wrote this very quickly and didn't have a chance to proofread it. Let me know if I got anything wrong.
When people say inflation, what they really mean is price level. And price levels are still very much elevated in particular housing prices.
For example, the small bedroom community I grew up in you could still buy a 1960's track home in the late 90's for around $100k. Now those same crappy track homes are going for between $500k to $600k.
Income sure didn't go up 5x in that time frame. If you are a new family starting out you are basically SOL. There's basically no way you can afford that.
All that being said, I do agree social issues are important. But so is being able to buy a house and still put food on the table.
"There’s a part of me that is in a spiteful frame of mind when it comes to the election"
I have tried to resist this temptation with retired Boomers complaining about how much young people suck, and then voting for Republicans trying to cut their benefits and lower income taxes, for a long time. Like "great, go ahead, cut spending on entitlements, won't hurt me for like thirty years, your loss."
I'm coming around to Scott Galloway on this. Our COVID response to support the equity markets and drive up housing prices was intergenerational theft. If Elon / D.O.G.E. go hard on cutting entitlements ... I'm for it and let the GOP pay the price. Long overdue.
In some ways entitlements are kind of easy. There's no magical solution. We will need to cut benefits and raise taxes. There aren't any other options. WAY more in benefits was promised than will ever be paid.
Aren't all non-citizens with criminal records more or less supposed to get deported (e.g. being convicted of a crime as a non-citizen makes you an illegal immigrant by definition)?
Looking it up, it seems that there are some visas that are revoked by any criminal conviction, but there are some visas that only get revoked for particular crimes. Green cards are only revoked for some very specific crimes, such as fraud or domestic violence.
They explicitly campaigned on demonizing all kinds of immigrants regardless of their legal status. That was the whole point of the "they're eating the dogs!" lie: The Haitian community in Cleveland was legal refugees who were gainfully employed. Trump promised to revoke their legal status and deport them.
I'll be honest..."temporary protected status" is a nonsensical program. I get it's purpose, but then it's commonly seen as horrible to ever take away, especially if they've been here for 10 or 20 years. And I get that, but why do we even call it temporary then? This widespread dissonance in our immigration programs is frustrating.
Here's a quote from a Guardian article, for example:
> A sheriff in Sidney, a town 40 miles (64km) north-west of Springfield that is home to several dozen Haitian immigrants, allegedly told local police in September to “get a hold of these people and arrest them”.
> “Bring them – I’ll figure out if they’re legal,” he said, referencing Haitian immigrants in the area.
To be clear, I know this is just some random sheriff in a county of fewer than 50k people spouting off at the mouth. But it's just the kind of person likely to be emboldened by Miller's rhetoric over the years. I hope if they pursue this project, they draw clear bright lines about acceptable tactics, but I'm not holding my breath.
So meant to say right wing judges. So given they will likely vote in terrible ways on other stuff probably not great these trumpy people will be judges. But still. Not going to be too upset with their anti union rulings I suspect.
When the FTC goes after Microsoft for buying Activision and prevented now bankrupt Spirit from merging, it really seems like the Democratic anti-trust ethos needs a lot of fine tuning.
China's GDP is ~25% higher than the US' at purchasing power parity. China is openly preparing to invade Taiwan, where ~90% of the high-end chips the US economy runs on are produced. It's also been helping Russia invade a US ally in a region of high interest to the US. It has many other efforts to spread its influence globally.
The US is barely responding. Cumulatively, ~2% of GDP has been allocated to supply chain resilience (with little evidence of success so far). Defense spending as % of GDP is at a post-WW2 low. There are several reasons for this. But a big one of them is that the US' economic capacity is fully utilised, with relatively high interest rates and above-target inflation.
Of course the US' economic resources could be more equitably and efficiently allocated, but every allocation problem becomes easier if you just grow the pie. Asserting that the US has a surplus of economic resources seems to fly in the face of actionable consequences that are happening right now.
You should look at the GDP estimates based on lights visible from space. China’s GDP is likely overstated. What we are witnessing is basically an authoritarian regime allocating resource for a military buildup at the expense of average consumers, pensioners, and people’s needs.
There are a few things to take from this. 1) The CCP are not some sort of extraordinary manager. They are reallocating rents, don’t care about efficiency or social tradeoffs. 2) The social costs and problems with the unbalanced economy will get worse over time. 3) The optimal strategy right now is to delay Chinese aggression.
There is a reason the CCP is trying to dump goods globally right now and it is not a sign of strength.
I'd also add that I don't think we've seen the bottom of China's real estate mess. Given how much property sales are tied to tax revenue, I think there is a strong case to be made their real estate crash is more negatively impacting the Chinese economy than the 08 crash affected the US.
It isn’t even taxed. Local governments auction state owned land for development. They have to constantly sell new land for development to get operating revenue. That and the central government foists pension and public services on local governments. The central government has the main tax authority.
> There is a reason the CCP is trying to dump goods globally right now and it is not a sign of strength.
Isn't it the same as it always is? They want to be able to go to everyone when the Taiwan war starts and say " we make all your cars, phones, solar panels, factory feedstock, telecom equipment- stay out of our business". From the perspective of that long term plan, this is great.
Western economists focus too much on fuzzy holistic stuff. China is going to own the world of atoms, they have made excellent progress on that goal, and continue to.
It’s worth noting that China is also currently facing a painful demographic crunch, incredibly high youth unemployment rates, slowing growth well before they get to rich country levels, a local government debt crisis, and a bursting property bubble. They’re not going to be able to resolve any of those issues without painful structural reforms. And despite their efforts at electrification, their economy (and the functioning of their military) is still highly dependent on imported oil. Their military has also been idle for quite some time and has ~0 operational combat experience. There’s also very little evidence that China has gotten anywhere close to parity with the US in aviation (a must if they don’t want that big navy they’ve been investing in to end up on the bottom of the Taiwan Strait a few hours after starting their invasion.) Taiwan itself is also a fairly tough but to crack, with relatively few favorable landing sites and a strong, technologically advanced military.
I think that the US has dedicated limited resources to countering China’s rise in large part because they’re still quite far from capability parity, especially in an offensive war conducted overseas.
"There’s also very little evidence that China has gotten anywhere close to parity with the US in aviation "
Why do so many people continue to underestimate China? They've massively improved their airpower in recent years! Their new J-35 is 5th gen, roughly comparable (as far as is publicly known) to the US F-35. Their J20 is now quite as advanced, but still highly capable and being built in large numbers. Moreover, they can use land-based fighters since they're close to the battlespace, while the US would be entirely reliant on carriers and (maybe) a few distance bases with mid-air refueling and minimal load. The US is still mostly using 4th-gen F-18s on our carriers because it takes us forever to actually build anything.
The US has build over 1000 F35s, while the J35 hasn’t hit production yet. The US is currently readying to produce its next generation bomber, China has yet to.
The US maintains almost 20k jets, and has bases in Singapore, Japan, S. Korea , Philippines and Guam, and the US has mutual defense treaties with most of these nations. Japan has stated multiple times it would fight to defend Taiwan
It’s not to say a war with China wouldn’t be a disaster, or the US couldn’t lose. It’s to say the balance of power is still in the US’ favor, which is why China is working hard to close the gap
"which is why China is working hard to close the gap"
they're not "working hard to close the gap," they *are* closing it, and very rapidly. I don't care about the balance of power right now, i care what it will be like 5, 10, and 20 years in the future. China has caught up in technology, and has massively surpassed us in production. Having bases in other countries doesn't directly translate to winning a war in a specific area. The US seems to think its military is invincible and is content to rest on its laurels forever.
As a one-off response to 3 comments pointing out China has problems
1) Taiwan's off China's coast and an ocean away from the US. China has home field advantage.
2) There's lots of precedent for autocrats launching ill-advised wars. Even when they lose, it'd still have been a lot better if they'd been deterred out of starting at all. Nazi Germany, Soviets in Afghanistan, Saddam into Kuwait. In Ukraine today Putin looks on track for at least a partial victory.
I'll pre-emptively acknowledge the Europeans are far more guilty of failing to maintain defences. However, Europe's paid a steep price for that. Also, two wrongs don't make a right.
Even with Ukraine, Putin's "victory" is likely to be a pyrrhic victory. He clearly expected this war to be over in like a week. I know the sanctions have not been as damaging as we hoped to Russia's war making efforts, due to the creative ways of selling oil/energy but that's not the same thing as saying the sanctions haven't been damaging.
I'm scared for Ukraine almost as much as anyone with Trump in charge. My friend convinced me that as scary as Matt Gaetz AG is, Tulsi being head of DNI is worse given all sorts of signs point to her being an actual Russian asset. What happens to the source we clearly have high up in the Kremlin? But regardless even if Putin "wins" the chances of an Iraq style counterinsurgency seems extremely high to me.
"China's GDP is ~25% higher than the US' at purchasing power parity."
Just noting that this is such a weird measure. Ok, sure ... this is what happens when under-value your currency for 30 years. But that policy has destroyed their equity markets and their citizens are far poorer because of it. It's like ... controlling for how poor we are, we're not that poor.
Also, don't get this at all ... "The US is barely responding." We have the biggest expansion of our nuclear programs -- ever -- going on right now. How much bigger could we realistically go?
Purchasing power parity is important to control for if you want to know how much skilled labor the economy has - the labor is paid Chinese wages, so in measuring how much of it there is, you shouldn’t assume higher prices.
But obviously, for things like uranium availability, you want to use international prices.
If you care about military power, then the basket of goods should be what the military buys. That info isn't available, so the rule of thumb for military spending comparisons is wages are PPP, procurement is international $. That helps China, but not as much as using pure PPP.
“Of course the US' economic resources could be more equitably and efficiently allocated”
That’s certainly not obviously true, and there are good reasons to think that further interference by the federal government will make the economy less efficient, not more.
Fred says it's been 3.6-3.7% the past few quarters, while the 90s trough was 3.8-3.9%. There might be some broader definition under which it is a bit higher now but either way it's towards the lows. Meanwhile China and Russia for that matter have majorly raised their spending.
"...and the Free Press perspective, which is to complain about Democratic Party positioning on cultural issues because they want to see Republicans win elections and cut rich people’s taxes."
Matt is itching for a (rhetorical) fight with Weiss, et al, and quite honestly, I am 100% here for it.
I should add, it's not for sheer entertainment purposes. There is a massive gap between what they purport their mission to be over there and what they actually do, and I'm in favor of people calling them out over it.
Do you think he gets it right, though? I agree that the FP pitches itself as "news" when it's really an opinion publication with a narrow focus on anti-progressivism. But I think it's wrong to think that what's going on behind the scenes is everyone twirling their mustaches and plotting to help Republicans win.
There are plenty of people at the FP who are explicitly against Trump. The only thing that unites everyone there is a virulent hatred of progressives. Matt is usually against bad-faith interpretations, so I struggle to understand why he thinks that everyone at the FP suddenly decided that they liked low taxes on October 8th.
I think many alternative media endeavors start out with this (correct) idea that most Americans aren’t fully dedicated to the right or the left. The problem is that the people who pay for news subscriptions are.
Yes. I also wanted to make this point. The idea that the FP is all in for lower taxes seems absurd to me.
I actually had a good conversation with someone who writes there a couple of weeks (she is engaged to a 2nd cousin of mine). I told her that there were a lot of things I thought were great about FP and that they have real personality but also felt like they were more anti-anti-Trump than committed to following the truth.
A counterweight against reflexive #resistance liberalism that opposes any Trump policy, regardless of its specific merits? Making the best of a difficult situation, recognizing that the U.S. is effectively stuck with Trump for another term?
Even from the perspective of a partisan Democrat, there is ample reason to attempt to understand the perspective of the millions of Americans who share the view that "Sure Trump is bad, but..." and then vote for him anyways.
The FP did not endorse Trump, and they made a show of not endorsing any candidate. I applaud that. Merely having a few opinion pieces from contributors explaining why they personally voted Trump is not an institutional statement on behalf of the FP. It's frankly odd that the NYT, for one, has basically never published such a piece, and instead has carefully curated its conservative columnists to only include never-Trumpers.
IMHO, it is depressing to imagine that so many seem to think it is impossible for an news/politics outlet to not "come down on" the side of one political party or another.
The problem is that the FP isn’t really news so much as it’s a glorified center right blog that masquerades as news. I think the US media landscape could absolutely use more center right, factual reporting outside of just the WSJ, but that’s not the FP at all
I am super curious to see how they react to the Trump administration actually following through on stuff like "fire all the general who were into that woke stuff" or, you know, violently rounding up immigrants and putting them in internment camps.
The Free Press started with some occasionally introspective criticism of woke excess, focusing a lot on how trans activism was bad for women. Then they started scooting towards MAGA until finally writing those "this is why, despite *all of this*, I have come to support Trump".
The repeating pattern with Trump is that, once you enter MAGA orbit, you are presented with two bad options, then two worse options, then two more even worse until either you go full brain-worms or you slink away, broken and possibly incarcerated. The Free Press crowd is immediately going to be confronted with bad option a) rationalize a defense of an indefensible policy or bad option b) criticize the policy and watch their subscriptions implode.
Yeah, that article is bonkers. Reminds me of SA's endorsement of Harris:
"A long time ago, I wrote about the difference between ingroup, outgroup, and fargroup. Ingroup and outgroup you know. But how come people have stronger emotions about Ibram X. Kendi (or Chris Rufo) than about Kim Jong-un or whoever's committing the latest genocide in Sudan? It's not because you're American and naturally care about American affairs - how about that Brazilian judge who banned Elon Musk's X? It's because all those guys are part of your psychodrama and some Sudanese psychopath isn't. Well, Kamala Harris' price controls are my outgroup; Donald Trump setting tariffs is my fargroup....But when I ask what work I have to do, it’s to prod the part of my brain that says “The Democrats are terrible! You should lodge a protest vote!” and remind it that Trump is also terrible. This isn’t a null hypothesis test, where you consider whether the Democrats are worth voting for, and then, if not, vote for their opponent. It’s a comparison on the merits of two alternatives."
Here's what I mean: this is the only thing she says about the views on the right, the rest of the article is detailing every bonkers opinion some weirdo in Portland holds on Twitter.
"Now, I am not saying the right is perfect by any means. Just because I'm voting against the left does not mean I'm on board with everything that's going on on the right. But I do think there are establishment problems on the left, and they need to be stopped."
FP had a piece the day before the election: “we are equally divided among those who support Trump, those who support Harris, and those who support neither, and we are all best buddies!”
Yes, I would. I care about my friends having some semblance of moral standards. Trump is so flagrantly, ostentatiously amoral that I cannot respect anyone who votes for him, and I don't want to be friends with people I don't respect.
What I would think (not necessarily say out loud) about a friend who voted for Trump: "That man explicitly ran on 'I am your retribution,' 'fuck the Americans who don't support me.' I don't support Trump; therefore, he hates me and wants to fuck me over. And you supported him. What does that say about you? And don't give me any false equivalence; Harris criticized and mocked Trump harshly but she never, ever ran on 'I want to fuck over Trump voters,'"
I'll admit that I probably wouldn't be friends with a hard-core MAGA acolyte in the first place, but ending friendships over ideological disagreements is what cults do, so no way.
I have "Common Sense with Bari Weiss" in my RSS reader and leading up to the election I saw articles of the form "I am a sane, rational individual like you, but I have come around and now accept that the best outcome is a Trump victory." go by, e.g., "I Refused to Vote in the Last Two Elections. Now, I’m Voting for Trump." by Martin Gurri (October 16, 2024)
No doubt, it will start with takes about how "if you progressives think what is happening is bad, you only have yourselves to blame", which will work for things like installing RFK Jr. at HHS. Then Trump will do something blatantly corrupt and/or criminal and they'll have to take the "if the president does it, that means it's not illegal" line or risk a subscriber revolt.
"We have a constitutional democracy, and in it, the supreme court decides what is legal or not, so if the supreme court says that the President can sterilize the entire state of Illinois, then that is within the law. I thought you libs were all about democracy?"
I think Matt's tongue-in-cheek criticism that FP wants Republicans to win so they lower taxes is aimed at the self-styled libertarians who have entered the FP orbit. It bugs me that they would cozy up to the MAGA agenda, which is advocating for an unprecedented intrusion of government into our daily lives. And I hope the *actual* libertarians get off that train go back to writing self-conscious Reason articles promoting borderline anarchy.
TheFP like The Dispatch seems to employee a lot of different authors with different viewpoints. Some Pro Trump, some anti-Trump and some a pox on both their houses.
This seems pretty reasonable to me.
And I would submit that both have done some great reporting. TheFP's stuff on antisemitism in public schools was great.
I also follow Blocked and Reported and occasionally check in with the comments there, and the folks there *also* believe TFP doesn't do what it says on the tin.
Claim: heterodox views! stuff the wokes won't let you publish! real discussion!
Truth: slightly more couched and intelligent anti-anti-Trump stuff than The Federalist
I'm still a big Jessie fan - he's literally bought my affection as he got me a beer when he was in London this past August, so take my fandom for what it's worth - but I agree with you on Katie. To be fair, she has been treated very badly by "the left" and I don't blame her for being pissed, but overall I find her insights to be pretty dime-a-dozen "wokeness is bad" cliches.
I don't care what they claim their (or her) perspective is, I'm going with their output.
I followed that site for quite a while and it got progressively more and more about bad-faith "look at these crazzzzzzyyyy libs" while articles about the right were always along the lines of, "the mainstream media says this about Trump, let's see if those liars dotted all their i's and crossed all their t's" without even diving in to explore whether Trump-proposed policy [x] would, in fact, be bad.
The Free Press is trying to have a place with viewpoint diversity to fill in gaps left by the mainstream media, which is primarily run by urban left wing Democrats.
It attracts people with heterodox views (including leftists, Trumpists, conservatives and libertarians). But what’s missing from yet publication is an actual defense of liberal orthodox votes.
But I see very little evidence that the motivation of most of the Free Press writers is small government, low taxes for the rich. Perhaps some. But I think they are more motivated by distrust of mainstream media and orthodox liberal thinking.
Making money by talking about the things that progressives do that annoy people. That it helps Trump is IMO not nearly as important as that people like bashing progressives. Often for good reason, but still...
edit- not a FP subscriber/reader, but its my take from 1000 yards.
I think the big difference is that there are plenty of places to read criticism of progressives while still maintaining a clear anti-Trump perspective: this site, Chait, The Atlantic, Singal, etc. The FP is the only one that appears dedicated to creating a permission structure for Trump support.
The degrowthers haven't thought through the ramifications of their policies on housing. At all. Like, even if you have the most aggressively redistributive policies imaginable (envision an extremely robust and progressively structured UBI on top of all our other safety net spending), we'd still need more homes. Human exist in the physical world and need actual housing to live in. Confiscating vacation homes isn't going to be nearly enough, either.
Now, the degrowthers will say we can just have noble government agencies build housing supply (like back in the good old days). But even that's a problem in 2024—NIMBY barriers, lawsuits, environmental hurdles, etc are used to prevent the construction of public housing, just like private housing. Which means you'd have to change laws and engage in root and branch permitting reform. But if you're going to do that, why not just allow private builders to build? Are they really going to clear the way for large scale production of public housing while FORBIDDING *private* housing from being supplied?
The zero sum mentality always drives me nuts here. There is no natural barrier to having plenty of long term residential housing *and* plenty of short term rentals *and* plenty of hotels *and* plenty of vacation homes and condos that stay vacant most of the time (but still generate full property tax revenue!).
Actually, there is: the law of physics that says two objects can't occupy the same space at the same time.
Sorry to sound snarky, and I love looking for positive-sum games whenever possible, but land is just about the most zero-sum thing there is: there's only so much of it, and you can't make more.
Well, we're going to join Japan in the shrinkage department before too long, if the Census Bureau is correct. And yes, this is taking into account immigration. We're not letting in nearly enough people to make up for the birth crash:
I mean, the logical conclusion of degrowth housing policy is to confiscate every detached single-family house and force everyone to live in Chinese-style apartment towers.
"Americans are much richer than Europeans, and that matters."
Does it, though?
This is going to be another "drosophilist posts something most commenters, and Matt Y himself, strongly disagree with," but if we all agreed with each other all the time, this would be a boring-boring (as opposed to slow boring) comment section, now wouldn't it?
I have lived in the People's Republic of Poland, in Canada, and in the United States. I went from very poor (by American standards) to wealthy. And I have to say: wealth is great, but Americans as a whole aren't getting a good bang for their buck in terms of *well-being* and *happiness*.
For a country that was ostensibly founded on the pursuit of happiness, we do a piss-poor job of it. People are ungrateful as heck. We had one of the best post-pandemic recoveries in the world, and people bitch about the price of gasoline and eggs. We have a shit-ton of social dysfunction, loneliness, people hate each other across party lines, most of the country thinks we're on the wrong track.
And a lot of the ways in which we spend our money make us unhappier in the long run. We eat crappy food and get heart disease and type 2 diabetes. We sit on our asses all day and drive everywhere and we get the health problems that come with a sedentary lifestyle. We post on social media, which stokes our fear and resentment and envy. We watch YouTube or movies or play video games for hours on end in our spare time and then wonder why we have no social life and no friends.
I don't have any policy prescriptions, I think government sucks at enforcing anything like morality, anyway enforced morality is a contradiction in terms, because morality must be freely chosen (paging Ayn Rand). Mostly I just wanted to put up a little flag that says, "Yes, yes, material growth is all well and good but what are we getting out of it?" Bigger houses, bigger lawns, bigger and heavier cars, more Made in China plastic stuff, more screens to stare at, how much happiness and goodness has this all brought us?
But a poorer America doesn’t revert to being Europe. You’re still stuck in a huge house only now you can’t afford to heat it. You’re still in WalkScore 0 land and now you can’t afford gas. Physically transforming America to something more satisfying is going to require vast wealth.
But it doesn't require vast wealth for people to change to some healthier habits. Even if you live in WalkScore 0 land, you can put down the McD's and cook some lentil soup. And call a friend instead of binge-watching YouTube.
If your wages don't keep up with cost of living because we are getting poorer, you have less time to cook and are *more* likely to get McDonald's because the alternative is eating chips at home or going to bed hungry.
I don't think the problem in this last election was Harris or the Democratic party. I don't even think it was the loudmouth, obnoxious progressive voices.
I think it was the voters.
Sure, we can't replace the electorate. But I'm guessing that four years of Trump/Vance will change an awful lot of minds. I'll be happy to welcome back the sinners, but I think they're going to have to learn some painful lessons first.
8 years after "the Democratic Party did nothing wrong, it was the voters and they'll realize they were wrong after 4 years of Trump" and now there are more Trump voters than ever.
No, of course not. And look, I think blaming the voters is futile, since as Marc acknowledged we can't change them so we should focus on what we can change. I don't think the Dems have been flawless; far from it. But I also don't think that a flawless Democratic Party would win every election, because voters really do have short memories and poor understanding of political cause and effect. If we don't keep that in mind, we're going to be disappointed a lot.
A flawless Democratic Party is impossible, but I do agree that a better Democratic Party would still lose elections. That being said, I still don't buy that a better Democratic Party could not have won this election and there's plenty of good reasons to believe that. Kamala jumped into the race an almost immediately had a 3-point polling lead and nearly even favorability against an unpopular opponent with inflation improving, all before even having to spend a cent of what would become a billion-dollar warchest and still somehow lost.
I also don't buy that voters have as poor an understanding of the state of things as some think they do. Democrats embrace inflationary policies and inflation happens. Democrats adopt rhetoric and policies that come across as being on soft on crime and illegal immigration and we see higher crime, homelessness, and general disorder in Democratic-run cities.
I don't think he was saying its the *only*, or even primary, thing that matters. Matt's written at length about how "sitting around doing basically nothing" has become way more addictive and appealing in the last 20 years, with all sorts of the bad downstream effects that you allude to. But wealth does matter a lot, and "make GDP line go up faster" is probably more tractable (and certainly more quantifiable) than "fix deep-seated cultural problems that encourage loneliness, gluttony, and disfunction".
It'd be nice if we could get the cultural package of Scandinavia or Israel, which (apparently) makes those places the happiest in the world. But there's still a pretty strong correlation between wealth and all sorts of things we associated with a good life, so let's work on that in the meantime.
To wit: you COULD carefully shape the culture (how?) to encourage more exercise, smaller portions, and healthier eating... or you can just pour money onto econ-maxing, invent Ozempic, and use the magical pill your hyper-innovative economy just discovered to turn a cultural problem into a financial one. I'm not saying this will work in every case (hard to see how we fix the build environment this way, for example), but I bet there are actually a good number of lifestyle problems that are pretty amenable to this approach.
While we can't enforce morality, we CAN and should teach the difference between Abundance and Excess, with an appreciation of the former and abhorrence of the latter. I was lucky enough to learn it as the son of two Depression Kids and from twelve years of Catholic schools when they were at their apogee. My siblings and I passed it on to our kids, most of whom completed college debt-free -- by working and selecting schools for quality, not prestige -- have good careers, and are homeowners in their late 20s or early 30s.
I just wish that I had some brilliant insights on how to duplicate that at scale.
Excess is an unfortunate symptom of abundance. I disagree that we should preach abhorrence of it. That leads to our current world, where people actually think the cure of degrowth is better than the disease of excess.
If you want to approach this along the lines of "Ask everyone to ignore their basic human natures and make better choices", I think that is doomed. Therefore you are left with policy that discourages or eliminates excess. And I've yet to see many that don't end up removing a ton of healthy tissue in an effort to remove the cancer.
The devil is in the details, obviously, but a general "Excess is evil" philosophy is, shall we say...unlikely... to use nuance and actually get into the details of each policy proposal.
i was going to post something similar. It's amazing how US gdp per capita has grown something like 5x since 1980, and yet people are more miserable than ever. "growing the economy" doesn't seem to be a very effective answer to real human problems. Perhaps that's part of why people have gotten tired of the Democrats relentlessly boring message on the economy.
The part you’re missing is Jared Polis’s focus on making things cheaper. The goal shouldn’t be “the government will provide x.” It should be the government will ensure you can afford X. Part of that is strong economic growth and part of it is making things cheaper.
100%. Democrats have to become the party that lowers cost of living. I'm totally Annie Lowrey pilled on this. Ezra's interview with Polis was such an aha moment for me and why I can't stand Pritzker. Pritzker is still pushing legacy high tax + redistribution. It's a race to the bottom and it's ruining Illinois.
I need to see data on this. Illinois as a whole ranks #1 with the highest local tax burden and NIMBY zoning caps have constrained all the high growth areas in Chicago. If you're looking at the Chicago MSA ... maybe, but that's just because the south and west side are completely desolate.
I have a distinct memory of visiting Chicago about two years ago and taking the river boat tour. The lady guiding the tour did the "guess how much monthly rent in that brand new, multi-story penthouse over there is" game, and when the answer came back as "$10,000/mth!" half the boat laughed at how ridiculously affordable that is per sq/ft where we come from. The prices my CHI friends paid for their houses don't even exist for starter homes where I live. I don't know what's going on in Chicago, but from my limited research it feels like the best bang for your housing buck in the country right now.
Chicago is still bleeding population, and like any city that has been losing people for a long time, it doesn’t have a particularly constrained housing market. See: Cleveland, Buffalo, St. Louis, Cincinnati, Rochester, etc.
It’s a world apart from NYC, or San Jose, or Vancouver CA, for instance – rich cities that struggle to build anywhere near enough housing for the people who want to live there.
Yeah, but the difference between Chicago and all those other cities is that they're nowhere near as cool as Chicago? Like, Chicago is legitimately a world class city, probably second only to NY in the US in terms of urban amenities, whereas Buffalo is... Buffalo. Like, it's not surprising to me that housing prices are steady or trending downward in Cincinnati or St. Louis. But if you take a list of the 15 best cities in the US in terms of urban lifestyle amenities, only CHI has seen little housing cost growth. I get that weather is a confounding factor, but Boston/Toronto/Montreal have shitty winters too, and they have all seen exploding costs.
Condo prices in the city are laughable low and when I was visiting we joked about playing the punch buggy game every time we saw a new condo building going up. They are everywhere!
Not sure which buildings you were price checking but the majority of towers coming out of the ground r/n are apartments and the one's that are condos (e.g., Cirrus) are locked in so far above market pricing they're secretly flipping to apartments.
As someone who is kind of the opposite politics as the people in your intro, where my first priority is left cultural politics it’s nice to recall that I basically agree with center-left economics.
Like basically all of this feels really right to me. Tradeoffs matter, support for people who need help and growth is good, regulations are complex and needed to be imposed as a late resort with a spirit of humility.
It’s doing a better job than any other part of the country! (Real shame that Union Pacific won’t let them build the important segment from Bakersfield, through the Tehachapi Pass, to Palmdale.)
I’m glad they’ve got what they have! But it still maxes out at 130 mph, and it remains to be seen if they can actually connect something urban in Orlando or Tampa.
Lack of vision is the problem. It seems to me like the way of the future should be the idea of universal portable safety nets (health insurance, retirement, etc.) free market goods and services. Embrace tech as a delivery method, aim for high efficiency. What needs to be rejected is the hold over ideas about a big brick and mortar state and official unionized stakeholders, i.e. Europe. That's hard for me to say since I used to like a lot about the European model but it's clearly being left in the dust. It's also an area where I think we simply embrace that America is different than the old world nation-state democracies and so of course our system is going to look different. There's absolutely nothing wrong with that, especially if it sustains a high standard of living and isn't riddled with holes people fall through for arbitrary reasons. The current problem is that ours is still a bit of an incoherent patchwork.
Yeah, Matt's vision seems to be "make all of the right economic decisions." Regulate when it's good to regulate and not when it's bad, set up good income transfer schemes instead of bad ones, support industrial policy in just the right industries...
The problem with this vision is that you can only sell it if you have a proven track record of being really good at managing tradeoffs and intervening only when necessary.
This is not the track record that Democrats actually have.
"I think that leads us to see that the social safety net is incredibly important, but so are other things. Population movements to the red states are telling us something important about the cost of overregulation, especially but not exclusively, in the housing sector. Regulatory protections can be very important, but rigorous cost-benefit analysis is also important. Economic growth and consumer goods matter a lot. Stopping cartels from jacking up prices helps poor kids a lot. Trying to create a comprehensive price control regime so lawyers can get over on businessmen does not. Investing in effective educational institutions is great. Providing open-ended subsidies to college and universities and telling yourself it’s “neoliberalism” to demand any kind of measurable result is not."
Or if you want it pithy, there's, "Economic self-interest for the working class includes both robust economic growth and a robust social safety net."
I agree that a lot of this article is spent contrasting the existing ethos as opposed to setting up a new one from scratch, so to speak. Is that what you're looking for?
* Markets and capitalism are to be minimized and eventually eliminated. Price setting and government provision of goods are good.
* Markets provide prosperity! We should deregulate and unencumber markets to the greatest extent possible, and then do a layer of redistribution on top of that.
* We want a strong industrial base. Provide government protection to manufacturing businesses in order to have as much industrial supply-chain in the country as possible.
* Prosperity through exports! We want to make goods at world-best price/quality tradeoffs to maximize external markets for our goods.
Or there are many others. These provide a lens through which to evaluate ideas. They tell you what policies to pursue. They are helpful in coming up with new policies. They have a strong goal.
Matt's deal is like, "Try to do good things." I mean, that's great. I maybe agree with Matt's ideas more than I do any of the above agendas. But it's not an agenda. If you're thinking about, "Okay, what should I do to improve the economy?" Matt's "agenda" doesn't really tell you anything. Try to do good things. It does tell you some bad things to avoid (and, again, that's fine), but it's not an AGENDA.
He wants better supply-side policy. Okay! Me too! What does better supply-side policy look like? We know it involves antitrust, but not too much antitrust, and regulation, but not too much regulation, and, uh....
That's because what's needed is both. You want to pursue and abundance and growth agenda. BUT you also need to acknowledge that sometimes regulation is going to be the right answer.
When to do each can be a hard question. And you can literally write 100+page policy paper or whole books on it.
YIMBY has an agenda, it's true. I think that's the one thing that's pretty clear that would be a big item on Matt's agenda.
Is it in fact true that he thinks that power infrastructure is one of the top items on the economic agenda? I'm genuinely unclear (yes, it's clear that he's in favor of it, that's different).
What does "let them automate the ports etc" actually mean? Like, what's the etc? Is it "weaken organized labor"? Are there other cases where something (unions? other stuff?) are preventing automation that are high-impact? Is automating the ports actually high impact (I though the construction physics article here was pretty convincing)? Like, again, it's not that I think it's directionally wrong, but is this actually deserving of a major item on the agenda?
This is what I mean by there isn't an agenda here.
Closest he gets is "fully refundable Child Tax Credit" which he admits is not great politics, but worth (someone else) risking their career over. Would have loved to see more details.
Just a nitpick on student loan forgiveness that I've picked at before--even if it was meritorious as an easy way to achieve stimulus while bypassing Congress, the politics of it were always going to be toxic, as plenty were going to see it, rightly or wrongly, as a handout to people they deemed didn't need one, and that it would be insulting to those who did pay their way through college and wouldn't get anything from it. It's a pitfall that should have been avoided from the start.
I beat this drum with people IRL. Any kind of large-scale loan forgiveness will be political suicide and will encourage a lot of poor choices by students and universities.
I really think that academia is one of the worst parts of the Dem coalition. So much waste of time and money because "education is always good" is considered axiomatic on the American left.
The YIMBY on housing issue is still too niche for national elections. A lot of battleground states have plenty of homes. Multi-family rents are high, but they are usually pretty responsive to supply and demand forces. YIMBY on public infrastructure is of bigger importance. If the pattern is a yo-yoing between parties, then it is extremely important that if an infrastructure bill is passed, that projects get done before the next election. And push back on the environmentalists that are anti road building. People like good roads.
I continue to think that YIMBYism for electrical transmission is underrated from an economic standpoint. Electricity enables a lot of jobs at the destinations and at generation.
Democrats’ fetish for unions is increasingly counterproductive.
Unions do not help the neediest workers. Public sector workers are six times as likely to be unionized as their private sector peers (35% vs. 6%). This means a major purpose of unions is squeezing rents out of taxpayers.
Indeed, union workers are relatively privileged. Their average wage is $1263 per week versus $1090 per week for workers generally. The rents unions extract are upward redistribution.
Fighting for union workers very different fighting for the underdog. It means fighting for a relatively privileged group of workers who has organized to claw out more privilege still. There is no reason for a fast food or warehouse worker to feel solidarity for the UAW, they inhabit completely different worlds.
In fact, unions only work when there are rents to extract, so they are great for fleecing county boards of education and sticking it to big three car manufacturers but useless for most small business employees. Focusing on a privileged sliver of workers and calling it class solidarity is bad politics.
Redistribution should occur through the tax code. A reasonable, explicit scheme of redistribution that takes more from the top 5% and gives social guarantees to all could cement a durable center left coalition. Coddling 10% of workers because they belong to unions is divisive.
<<There is no reason for a fast food or warehouse worker to feel solidarity for the UAW, they inhabit completely different worlds.>>
I previously had done some political comms work for the Alabama Democratic Party. And they did this whole campaign about solidarity between striking Starbucks workers and striking miners in Muscle Shoals. Needless to say, it didn't quite work.
I guess I’ll stand up for myself a bit here from the perspective of a public safety worker and union member in good standing. I’m reading some true and fair points, but what one might call “rent seeking” by public sector unionization could also be described as investment in the robust safety net which is the second part of Matt’s equation. In a full employment economy with a tight labor market, collective bargaining is a way to keep wages competitive with other options. I have seen this firsthand, with applicant pools lesser than even a decade ago. Thin ranks leave organizations stressed and hollowed out, while elevating chances of injury and burnout among those still on duty.
Stipulating that unions must adapt to new realities, political and otherwise, I doubt that hollowing them out utterly is in line with the Slow Boring ethos, to say the least.
I see three broad things private sector unions do:
1) Physical job protection (don't make me work in unsafe conditions, don't make me work so much overtime that it hurts my health / makes me work in unsafe conditions due to being tired).
2) Negotiate on wages/benefits (better health care, vacation, sick leave, salary)
3) "Having a job" protection (difficult to fire underperforming, tenure-type work, etc)
===
If there is some large category I left out please let me know.
I'm 100% sympathetic to unions on issue 1. I'm not saying they'll _always_ be right that something is actually unsafe, but it broadly strikes me as a good thing to negotiate on. One problem with union power here may be that they've won so many victories (OSHA, 40-hour work week, overtime pay) etc, in the U.S. that the most important parts of this are already covered, especially for service sector jobs.
For #2 it depends for me way too much on specifics. If the _sector_ is doing well but wages are low at all companies (bad labor market?) then I can see unionization to bargain for wages helping to lift them without really hurting competitiveness, but it would have to be something more like UAW rather than a particular company. At a particular company, if the company is profitable enough, this rebalance the profits to the owners vs the wages to the employees, but it could also start strangling the company, especially if it can't change benefits later in response to changing conditions. The main thing here is I'm less sure how much forced unionization laws are necessary.
#3 is probably the issue where unions suffer the most culturally/politically and seems (to an outsider like me) like the area to give up on the most.
I think the largest category you left out would be what I'd call "work rules". Overtime, division of labor, promotion ladder, rules on contractors, etc...
Thanks. I covered _some_ of overtime under #1 but I agree this should be its own category.
This one I'm overall more neutral on. Overtime seems good to negotiate on, promotion ladder seems neutral. Division of Labor unsure (is that where 'featherbedding' comes in? But also helps you not asked to do BS tasks outside your normal remit).
It’s good to recall the bankruptcy of Hostess, which could get no concessions from its unions. One example is that Hostess had to operate multiple delivery systems because the trucks were permitted to deliver only certain brands, not the full range of Hostess products. I believe that this kind of arrangement negotiated to maximize the number of union workers is common, and destructive.
I’d divide it differently.
1. Negotiating the split. How much of the product of my labor goes to me vs. goes to my employer.
2. Collectively agreeing to terms. How much of the compensation package is paid out in cash vs. workplace safety, health insurance, job security, etc.
Negotiating the split is, I think, mostly boring and pointless. Monopsony in labor is a weak force in practice so I think total compensation is usually pretty close to as high as it could be sustainably.
Collective bargaining on the components of the compensation package is potentially much more useful. People like a safe workplace, job security, paid time off, etc. but they’ll trade most of those things away for more cash. When they get the extra cash, a lot of it goes to zero-sum positional spending that doesn’t improve aggregate utility. The union is nice because it encourages more compensation that’s fundamentally not zero-sum, like paid time off or better working conditions, which does improve aggregate utility.
I consider job security in that same category, so I’m more sympathetic to it than you are I think. No idea how the politics of this will work though.
I will admit: that last argument sounds to me like "the union knows what's good for you better than you do". And I will also admit that if that's what it means to say, that sort of attitude really rubs me (and many others) the wrong way. Someone else who does not know the exact details of my situation (e.g. whether I value money more because I need to make child support payments or time more because I have to care for their aging parents) does not in fact know what's good for me better than I do.
Sorry if I was unclear, I was assuming that union leadership would reflect the views and interests of membership, and would function primarily as a coordinating mechanism to resolve a collective action problem.
It’s not “The union knows better than you”, it’s more “We’re all in this together”
I’ll admit it’s tough though, politically. People have some good intuitions about this kind of stuff, but if you try to explain it like an economist you probably sound pretty crazy to most.
“No no, if we let you trade away more time for more money, can’t you see that you’ll all lose much of the windfall bidding against each other for zero-sum positional goods?” -> Patronizing, totalitarian
“Eight hours for work, eight hours for rest, eight hours for what you will.” -> Inspiring! My heart thumps harder just typing it out!
I meant "care for my aging parents". Edited the comment from third to first person and missed that one.
Isn't it weird that the AMA is a reasonably powerful union yet doctors routinely work unsafe hours? I guess the revealed preference is for doctors to take money over job quality, but this also jeopardizes patient safety.
I don't think they're a labor union, it's more of a professional guild.
Isn't the AMA a trade org not a union?
I think it's stronger than a trade org. I mean they basically set wages by restricting MD supply. Even "real" unions have to negotiate
Overtime hours are also sometimes psychologically weird. Some people view them as a "badge of honor" of how hard they worked, despite the research about how bad it is for productivity. "I worked 80 hours saving lives, what did you do"
"1) Physical job protection (don't make me work in unsafe conditions, don't make me work so much overtime that it hurts my health / makes me work in unsafe conditions due to being tired)."
My impression is that most blue-collar unions do the opposite. They restrict hiring and demand generous overtime pay, so that their workers rack up good take home pay but at the cost of working crazy high overtime hours which takes a terrible toll on their health.
One way to think about it is that the bargain for "better working conditions" and that can be allocated in different buckets; better pay, safer jobsite, better hours, better benefits, etc.
But the total amount of surplus to be captured remains constant.
Maybe, but does that require a more consistent exchange rate between them (Consistent across jobs/companies)
Some safety rules are relatively cheap to implement for their benefit, some are prohibitively expensive. E.g. My office had 2? emergency defib machines and a written list of people who had undergone recent training (I was on that list after attending CPR training prior to the birth of my children)). I'm not sure of the cost of the machines but the cost of "put a list up there of people who did this on their own" is a super-cheap intervention. Alternatively "provide this training for all employees" is a much more expensive intervention with probably almost no better outcome.
I'm not sure there's a "total amount of surplus" to be captured that can be moved back and forth. There's definitely a "total amount of cost" that can be spent by the company though.
The cost eats away at the surplus. I think we're getting at the same thing but you're phrasing it better. There is an upper limit to the amount of demands a union can make. At a certain point, they can ask for higher wages OR better workplace safety if the safety measures are costly.
If union workers stuck only do wages and benefits I might be ok with that (at least if they were requiring full funding of benefits with current tax payer dollars at reasonable discount rates and not pushing it on future tax payers).
But instead they spend far too much time making it impossible to hold bad or poor performing employees to account and/or just introducing anti-efficiency rules.
Easy example of this would be police union rules that make it hard to fire bad cops. But the same principles apply to the rest/
It's interesting. There is an old leftist idea that all employees share the same real interest, to increase the power and the income share of workers against employers, or to unite the working class everywhere against the capitalist class everywhere. And yet workers consistently reject it in every country with democratic elections and a truly capitalist economy, and communist revolutions succeed only through civil wars in authoritarian, not fully industrialized states (Russia in the 1910s, China in the 1940s) or through conquest (eastern Europe). And to my understanding, the western postwar social democracies weren't powered by uniting the workers of the world to fight together -- the motives were more like national solidarity within the country, combined with blunting the allure of communism by providing some of the benefits of socialism through milder means.
It would be interesting to understand (1) what's wrong with the theory of class solidarity, and (2) why it nonetheless remans popular on the left.
That question is easy to answer. The working class is not unitary, it contains multitudes with different material interests. Harbor pilots and day laborers are both working class, but they are in different markets and different social strata.
If capitalists successfully coordinate to exploit labor, then workers get systematically underpaid relative to the marginal product of their labor, then you’ve got deadweight loss, so then a coordinated worker movement has space to raise real wages while actually increasing aggregate economic output.
In most places most of the time, capitalists have not in practice been good at doing this kind of coordinated exploitation, especially not in democracies, so workers are mostly paid more or less fairly already. On some level, this filters out into the popular consciousness and blunts the appeal of class politics.
In other words, businesses that “defect” and pay their employees unusually well haven’t already outcompeted and taken over everywhere, this can be seen by just looking around, so maybe reorganizing the entire economy along these lines won’t generate large gains.
Which is another argument for enabling efficient and robust markets. A lot of that probably looks like promoting “free “ markets, but it also looks like antitrust, promotion of entrepreneurship with low barriers and financial incentives, promotion of science to enable technical change, good bankruptcy regimes and good financial engineering environments to enable exploration of differ business models. It might even include things like universal healthcare or similar that make it easier for employees to change employers or start their own. Good workplace safety rules also help prevent race to the bottom competition.
Lots of things can be done to ensure healthy competition and creative destruction. The zero-sum mindset of unionism is what I think holds it back. Would Starbucks employees be better off with a union or better with clearer overtime regulation and state capacity improved at the county labor board?
I don't think Noah Smith has read my comment, but he nonetheless wrote a long-form answer to the related question of "why isn't working-class solidarity a winning strategy for the left in 2020s America?"
https://www.noahpinion.blog/p/america-doesnt-really-have-a-working
One potential problem I see with trying to unionize Starbucks employees is that most of those people intend to only be there for a short period of time. I wouldn't say "give up" if that's what you really want to do, but service sector work is fundamentally different than mid-century factory jobs.
The percentage of unionized Starbucks employees is still pretty small (about 11K out of ~240K in the US) but it has shown impressive growth in just a couple years.
Let's see how it plays out before confirming your view.
Sure, let's see how it plays out. I didnt say it's impossible. I'm just pointing out one reason unionizing service workers is difficult; time horizons.
The original Omnicause was one singular OmniLabor movement.
Yes, Matt's claim that progressives are for "Good schools and Good infrastructure" is a bit hard to square with their positions on (a) extended school closures during covid and (b) management of US ports.
In both cases, supporting unions took precedence. To a truly astonishing degree.
Yeah the particular intransigence of Teacher's unions circa Fall 2021 was eye opening.
I'm actually a defender of Teacher's unions actions in 2020. Before vaccines were available, being very Covid cautious made sense to me. I'm one of the people who believes we should have been more like continental Europe in 2020. And a union at the day is at its core supposed to look for the safety and well being of its members.
But denying that lack of in person instruction had any negative impact on learning was galling (I know it was just one person, but the idea that kids were somehow "learning" by just being part of their community was insulting to my intelligence). It's also like an amazing self own in the sense of "ok if in person instruction doesn't matter than why do teachers matter?"
I think of Unions as more like prosecutors or defenders. They aren't supposed to get at "truth". They are supposed to present facts only as far as they help their client.
And many times they seem to be operating even more like trial attorneys, in as much they are trying to win the current case, without much long-term planning beyond winning the current round.
I'm not a lawyer or union member, so maybe someone can correct this perspective if it's way off.
I think this is right — but on the other hand, having been in a union and then having worked in the same role in a non-union shop, it was night and day how management treated us. So whatever they were doing seemed to work.
Of course, it’s a good thing we have prosecutors and defenders! We do a better job getting at the truth when there’s an advocate on each side than we do when we just have a bunch of impartial people looking around.
Similarly with work conditions - the company has organized representation, and it makes sense for workers to as well. Though in this case there’s also a third and fourth side that need representation too, in terms of consumers, and other stakeholders (like potential bearers of pollution).
"We do a better job getting at the truth when there’s an advocate on each side than we do when we just have a bunch of impartial people looking around."
Is that true? The only point of comparison I'm aware of are the systems of continental Europe, which I understand are more geared towards finding "truth" and less permissive of sophistry or dismissing prosecutions based on misconduct.
It always seemed like that's better to me. In terms of criminal law, it's left us stuck with situations where a large fraction of likely guilty people are let go because of "technicalities" and in response we jack up sentencing to compensate. ie, "we might not be able to make the charges stick (if we mess something up on our end) but if we do, we'll hit you hard!"
I'm not sure where you get this idea that a large fraction of likely guilty people are let go on technicalities. After being charged the rate of guilty pleas is anywhere from 90-98%!
If you're talking about people who are released without any charges, then that's probably because the prosecutors lack enough evidence to secure a conviction were the case to go to trial. The European system would be no better in cases where there are no witnesses to cooperate or physical evidence.
I’m mainly thinking about science here. We make more progress when there are advocates for different scientific theories arguing and doing the experiments they hope will show themself to be right (and re-doing the experiments over and over to get past the problems that make most experiments fail the first time you try), and perhaps more importantly, coming up with the tortured arguments for why the other person’s experiment doesn’t show what they claim it shows. We sometimes talk as though we could have a community of dispassionate truth seekers, but that has never been able to deal well with big open ended questions.
Correct. The U.S. has more lawyers per capita than Europe and it’s not clear what we get for that, other then a safety valve that keeps demi elites like me from playing leftist politics full time.
The analogy is apt
I agree that caution early on was very reasonable. I have no beef with people closing schools in Spring 2020. Then there is a gray zone where reasonable people can disagree, but by the time vaccines were widely available, it was indefensible to argue that school should remain closed.
(Fwiw, I was in 2020 outraged at the Swedish approach of basically letting the virus quickly rip through the young and the middle-aged population. But it's been humbling to see that three years down the road, their numbers compare very favorably on almost every metric. They had sky high deaths among the elderly early on, but it seems the main thing that happened was that people who were about to die within a couple of years anyway just died sooner. That is a tragedy, but perhaps less of a tragedy than throwing a whole generation of low ses kids under the bus.)
I look forward to the day when we all unanimously agree that for the first part of the COVID plague, it was so new and so daunting that wide swaths of society took action amidst great uncertainty that later turned out to be ineffective, and that we grant some forgiveness for not having 20/20 hindsight at the time.
This does *not* apply to cases where people obviously should have known better and were too blind to do the right thing: public health people supporting George Floyd protests, teacher unions keeping schools closed far too long, right wing media convincing their gullible followers to forego getting vaccinated, etc.
"20/20 hindsight"
Or 2020 hindsight
What should have happened is that schools should have promptly reopened no later than the start of May 2020 once we had a grasp on its lack of danger to kids, and some mitigation we could do, and then keep them open through the summer, overwhelmingly taking place outdoors, as a catchup from what was missed in March and April, and also to get ahead of the curve for a potential need to take a societywide hibernation in the late fall and into winter, which we very much needed the instant news of the vaccines being around the corner dropped.
A lot of states opened schools in Fall 2020 and never closed again. It was fine. If Costco is open, schools should be open. Thank goodness for federalism!
Our schools reopened in September 2020, and students' families could choose whether they were in-person or remote. Fewer than half of the families chose in-person. This doesn't necessarily mean that our schools should have offered the remote option, but it is easy to forget how scared people were before the vaccine came out.
And also, many of our schools had to either suddenly go remote on any particular day, or have an entire grade go to the gym and basically do remote lessons on their computers because so many staff members were out sick. In some cases, there was not enough supervision for student safety to be assured, and I know many parents who kept their kids home if they knew it was going to be an "in-school remote" day. I live in a high-poverty urban district. The same safety issues may not have applied in wealthier suburban districts, but parents were definitely considering these issues where I live.
I don't think opening schools in May 2020 would have been the panacea many here think.
If we had just stayed on lockdown for a few more years, we could have had True Socialism™ In Our Lifetime. =[
Fall 2020 was the right time to open schools, but May 2020 feels like pushing it a bit. Remember, May is very close to the end of the school year, and I don't think it makes logistical sense to open schools for just 1-2 weeks before breaking for the summer.
As I said, there should have been no summer break.
That lack of pivot is my big beef. My older son's private daycare/preK re opened in June 2020 with precautions. The Catholic schools re-opened in fall with precautions. The public school system was closed and/or in some weird ever evolving state of remote or hybrid for the better part of 2 years. That latter fact was decisive in where we send our kids now. One system cared about the children. One cared about a union that unlike the factory workers of yore is organized against the wider public.
Was it that obvious by May 2020? That was barely at the start of the pandemic!
Maybe my memory is colored here, but I recall vast amounts of uncertainty that early in the pandemic and for some time after. I think you have a better argument for criticizing schools that stayed close the following autumn.
On Sweden, what numbers do you look at? Can you find deaths by age bracket and test scores by SES? I'm just curious because I would like to dig into it myself.
“ But denying that lack of in person instruction had any negative impact on learning was galling”
But everyone works better at home, right? /s
Was there a big impact on learning? Very little it turns out, and basically none for white students, but some noticeable impact on poor minority students who don't have access to as many resources.
Yes, of course, it was bad for those students so affected, but in many cases I recall their parents *wanted* them to stay home.
Bottom line, the school closure debate does not have a clear, indisputable answer.
https://jabberwocking.com/remote-learning-during-covid-was-harmful-but-limited/
I find Drum to be a very shoddy thinker these days, and I think the data suggest longer-lasting problems than he acknowledges. https://www.washingtonpost.com/education/2024/07/23/covid-test-scores-learning-loss-absenteeism/
https://www.vox.com/education/372475/math-reading-school-covid-education-learning-loss-kids
Right. When the unions came out against requiring their members to be vaccinated (with appropriate exemptions available!) it really showed how little they cared about their members and their students. Big wake up for me to hear them say “let’s not request a minor inconvenience that could save lives and certainly will reduce suffering of our members due to illness.”
My brother is an airline pilot and his stories about union impacts are eye-opening. A couple things stand out to me, notably how unions enforce seniority over meritocracy and how it seems that a lot of entry requirements for airline pilots seem designed to control supply and keep pilot incomes high.
How would a pilot meritocracy work? It’s not like it’s Top Gun and they can fight it out. Would it just be simulator, check ride and written test based?
The same ways people working in basically any job are evaluated: observation and evaluation by supervisors, written tests, practical tests, success/failure rates at tasks, so on.
Yeah, there was a period where their position was that teachers should not be required to get vaccinated but their students should be required to mask at all times to protect the teachers.
If you’re that concerned about being protected against a virus, a vaccine sounds like a much sounder proposition than requiring 7 year olds to do something than many of them find unpleasant or uncomfortable at all times.
And on grading, gifted and talented education, and what we should do about disruptive students. I think Matt will get to this when he discusses that public services need to be run for their users, not their employees or some ideological goal.
Even in this article note the distortionary effects: longshoreman’s (economy threatening) strike against automation, snubbing Tesla when EVs are a major policy goal, and I’d argue jones act and buy American protectionism fits into union support because it creates rents to extract and prevents foreign labor from competing. The later common sense bullet about government existing to provide services not employment also is very in tension with unions.
Here in CA the big one is prevailing wage requirements to receive affordable housing subsidies, or other entitlements for multi-family housing. Basically "we can't make you hire union labor but you do have to pay union rates".
Similar to the EV mandate it's not objectionable on the face of it but it shows where the administration's priorities are. Is affordable housing important? "Yes!" Important enough that non-union workers get jobs? "Well, no." Is electrification of the US auto market important? "Yes!" Important enough to subsidize non-union cars? "No, not that important."
Someone on this blog commented a year or so ago that government policies should be "one goal, one lever." The more I think about it, the more accurate that is.
Want below-market housing? Then just subsidize deed-restricted housing with no other requirements.
I'd say that snubbing Elon Musk was a forgivable act given what we've learned about him.
Was the result of that snub that Tesla refused to sell any more EVs?
Poor Elon. What a beautiful, fragile hothouse flower who can only be sustained with loving care and devoted attention.
I don't think that works. First, something we learned post facto can't be used as a justification ex ante, because how crazy and bad he was wasn't known at the time. Second, to the extent we knew that he was bad and vindictive, that makes the administration's decision worse, not better: when someone is both mercurial and influential you often have to play ball with them! You don't get to say, "what, were we supposed to be NICE to him?!" right after he's shown you why the answer to that question is yes.
I'm of two minds on unions. The first mind has been strengthened in recent years by this site, that includes many of the reasons you state here--very broadly speaking, the ability to rent seek. But I also can't shake the other mind that sees that abuse of workers can still happen, and that collective bargaining can help reduce asymmetric information that's to the disadvantage of workers.
But I'll be curious to see if Matt expounds more on unions in particular in point 8 so we can discuss further there--I sure hope he does!
I'm really of the mind that unions are a vestige of an era when there were real asymmetries of mobility/knowledge and governmental didn't have much regulatory strength.
Unions make a ton of sense in company towns full of people with 4th grade educations.
Unions make a ton of sense in uninspected mines or unregulated iron foundries.
Unions don't make sense for skilled workers in workplaces that are heavily regulated and regularly inspected. They especially don't make sense for government workers.
Yeah, I feel like even in a perfect information environment, it's often vastly more painful for an individual to lose their job than it is for a company to lose a single employee (especially given how much healthcare is bound to employment in the US).
Which means there's a power imbalance there that I'm not sure is solved in the private sector without collective bargaining. In the public sector, there's at least the ballot box to make our collective desires known.
How do you think those workplaces came to be well inspected? What force do you think will keep them that way when business interests can donate unlimited sums to politicians? We’re already seeing rollbacks on child labor laws in the meat packing industry across several states. Don’t kind yourself that this world we live in is something you can take for granted.
Economic growth happened, along with massive advancements in quality of life.
I don't see how economic growth is a brake on any of the things that Matthew listed; if anything, search for more growth feels like the opposite.
Economic growth provides vastly improved opportunities and quality of life to people, meaning that people can avoid dangerous or unpleasant work.
Economic growth also expands resources available to the government, allowing it to provide more regulation and enforcement.
Union advocates so often act as if 2024 Americans would be working in Triangle Shirtwaist conditions without them, but that's just not true.
+1 would love a deep dive on unions, especially how (if) they're making progress, if they're still a viable political constituency, and if a union push from Democrats still makes sense.
I'm not usually the type to stand up for unions, but a lot of this seems off base to me.
Whether unions are public or private doesn't have anything to do with whether the workers they're protecting really need union protection or not. I dislike the negotiation dynamics of public sector unions, but how to balance, say the needs of teachers vs. the needs of students, is actually an important question. One that politicians are mostly uninterested in answering.
The fact that unions make more on average is a good thing! If they didn't you'd wonder what the point of them was. A union that failed to negotiate for something as basic as higher wages would be clear example of waste and rent seeking!
Speaking of rent seeking, I find it weird that you refer to it that way when a union wants a higher share of corporate profits, but just call it taxation when the government does it. Either way it's redistribution. Is it more efficient when the government does it? I sort of doubt it. Is it better targeted? That seems more plausible. The government will catch people who aren't in a union after all. But it still seems weird to condemn the unions for doing the government's job for them!
Lastly while I agree that McDonalds's workers have no cause to feel solidarity with the UAW I don't think it would be unreasonable to feel solidarity with their fellow McDonald's workers! If they wanted to unionize then they should be able to do so.
Whether a union is public or private absolutely impacts the utility of a union. Private corporations (especially closely held ones) have strong incentives to keep wages as low as possible. Every dollar they don’t pay employees increases profits. This is not the case with public jobs. Furthermore, public sector employers can influence elected officials through voting and campaign contributions, a lever private employees completely lack.
The wage case doesn't seem as strong to me as you make it out to be. If it was neither teachers nor police would have such backloaded benefits. The federal government may not care about deficits, but cities, counties, and even states have real budget constraints. Constraints that are hard to manage because the public hates tax increases.
That's why lots of public sector unions have amazingly generous pensions. Both unions and politicians are agreed that the best way to reward workers is to push costs onto future voters and politicians who for some reason are unable to object, like not being around.
This has been really bad especially here in California.
Benefits are the accounting fudge that keeps the party going.
“Every dollar they don’t pay employees increases profits”
Or enables the firm to better compete on price, and thereby grow market share. (You run a business, no? You should know better.)
As a first approximation, if I pay my assistant $1 less, my profit increases $1. There may be second order effects and the world is a complicated place, but anything I pay my employees comes straight out of my top line.
Not to be pedantic but it comes out of your bottom line. Top line would be sales.
Paying your employees more wouldn't decrease sales, it would increase expenses which would decrease your net income.
it comes out of my top line. i take in my top
line and then disburse. i am the residual claimant
I’d argue public sector unions make the government’s job easier. Imagine needing to negotiate salary and benefits with every single new postal worker or police officer or teacher who gets hired. It would be an incredible use (waste) of time and resources. Much easier to just inform them of the union scale.
“…rent seeking…when a union wants a higher share of corporate profits”
It’s telling that you believe union wage increases come from lower profits rather than increased prices and/or inferior products.
Wages, profits, prices, and third party protections (like pollution controls) all compete with each other. By default, profits are the only one with organized representation. Unions ensure that wages do, and government regulation can sometimes step in for third party protections. It’s important that these four-way negotiations aren’t run by just one or two of the interest groups with no organized representation from the others. So unions matter, but they shouldn’t be *too* powerful.
There are non wage costs, too.
I didn't say that. I said its not that mechanically different than the effect of a tax increase. Raising taxes on a business will also cause them to raise prices.
“Raising taxes on a business will also cause them to raise prices”
Or not. It depends.
If unions are going to remain relevant politically, unionizing the service sector is the sort of thing that would have to happen. Problem right now is that the labor movement's relationship with the Democratic Party seems more focused on achieving more benefits for existing members than expanding membership.
https://www.statista.com/statistics/195349/union-membership-rate-of-employees-in-the-us-since-2000/
Really? Hasn’t there been a lot of campaigning to unionize Starbucks and Amazon and the like?
People are only going to take the effort to organize if they plan to keep jobs for a while. The smartest and most ambitious baristas are either doing it for a few years during school or else are lower middle class proprietors who own their businesses. This is why service workers are hard to organize. Also, restaurants create very few economic profits, so there aren’t really rents to fight over.
I was driving an Amazon vans during the #Bamazon effort, and the most common reaction to that among my fellow drivers was "yeah that'd be cool. By the way, Thursday is my last day."
Yeah and they haven't been that successful. Which leaves us with the alternative of "try something else" for the Democrats.
There have been ~400 Starbucks locations unionized in the past couple years. That's still a small percentage of all locations, but it's far more than there were a few years ago. Let's see how it goes the next few years before we close the book on the effort.
Two separate threads here, but sure, let's see how it goes. My point is, that 10% number needs to increase for the political model to have a future.
Is it important for McDonalds workers to "feel solidarity" with the UAW? I would have thought that such an alliance was to give a struggling, under-financed unionization effort more access to a more powerful ally in their fight. I'm just guessing here, but is that a wrong take?
Problem for Democrats with unions is twofold:
1. Unions often push for counterproductive economic policy. E.g. dockworkers trying to block automation.
2. As the % of unionized private sector workers shrinks, there's fewer and fewer people going to the polls thinking of themselves as "union voters." It's not the 1950s anymore. Sure, broadly pro-union sentiment is popular among even non-union workers, but nobody in California gets out of bed to vote in solidarity with unionized workers in Michigan or Visa versa. If Democrats want that to be a reliable constituency, they need to somehow get that % up. If they can't, they need to switch their game up.
Isn’t the fact that unionized employees make more a reason to fight for unions? Think about it from the corporate side - every company I’ve ever worked with is anti-union because it costs them more. You call it rents to extract, I call it high corporate profit margins and workers who are scared of being fired for no reason.
If we don’t fight for unions we’ll end up with unions disbanding and everybody making $1,090 a week while working precariously, instead of many people doing better. How is that a win?
In theory, yes this is why unions are important.
In reality, many unions act as cartels that strangle productivity, protect the worst employees, and drive up costs.
I work in construction and have a lot of first hand experience buying union labor. Whenever possible, I buy union electrician labor because they're relatively competitive on price, their work is almost uniformly higher quality, and they require less day-to-day supervision.
On the other hand, I am forced to buy union labor to install elevators. They charge extortionate rates, do half-assed work, and are generally a giant pain in the ass to deal with. They also operate functionally like a medieval guild. Try getting a job in an elevator shop without knowing someone already on the inside.
The fact is that unions are neither inherently good or bad. Like any other actor with agency, they'll generally take as much as they can unless there is pushback or competition. This is why public sector unions are all generally awful drains on society. Governments are too weak to push back on their demands and scared of losing their voting blocs, so we end up with police unions who refuse to implement any change or teachers unions strangling a city for their exclusive benefit like we're currently seeing in Chicago under Brandon Johnson.
I'd be interested to hear why you think the electricians' union is more reasonable than the elevator one. Is there some kind of structural reason?
I'll preface this with stating that every regional construction market in America has different dynamics, so this may not apply uniformly, and also that many people much smarter than I have tried to tease out the economics of construction costs and productivity and have very little to show for it.
That said, the simple answer is competition. In our market, we have a healthy mix of union and non-union electricians. While there's a decent amount of wage scale or mandatory union work, there's not enough of it to fully support all the union shops all the time, so they have to compete on jobs with non union companies.
On the other hand, 100% of the elevator installers - basically nationwide - are unionized. You want an elevator? You're getting union labor installing it. The electrical union IBEW is generally more supportive of bigger tent growth, whereas the elevator union IUEC like I mentioned basically operate like a medieval guild. They can keep their union small, which drives up wages, because there's no alternative.
There's also a lot more vertical integration in the elevator industry. There are four major elevator manufacturers - Otis, Kone, TK, and Schindler. If my job calls for an Otis elevator, I have to go to the local Otis branch and get their pricing and have their crews come out and install it. If my project calls for an Eaton brand switchgear, any electrical company can order it and install it and they can order it from multiple suppliers to get the best price.
Probably that elevator service is niche enough that there aren't outside competitors the way that there are for electricians.
Sounds like we should be getting into the elevator installation business. 'Slow Elevator Company. Our elevators are slow, our service is even slower'
This is my knee-jerk reaction as well - the rebuttal to "there is no reason for a fast food or warehouse worker to feel solidarity for the UAW, they inhabit completely different worlds" is "well, fast food and warehouse workers should unionize, because at the end of the day they're all line workers who management regards as interchangeable, reducing their individual leverage."
But! I think the steelman argument for why companies oppose unionization is that, in addition to the obvious selfish reasons like wanting a larger share of the surplus/profit, unionization makes it much harder to fire genuinely underperforming employees, and unions push for benefits to flow to incumbent workers, which over time contributes to organizational stagnation and can erode a firm's competitiveness, putting *both* labor and management in a worse position over time.
My industry is mostly non unionized and I can negotiate salary anyway. The biggest issues are overtime issues and some of that is exacerbated by the press getting things wrong.
Unions make more unless they drive their companies out of business (, which can't happen with public sector unions)
I mostly agree but also don't want to end up at a "my job sucks, but my taxes are low" equilibrium. I don't think the tax code can substitute for a fair labor market. I wonder if sectoral bargaining similar to the German model could be a better alternative to unions.
Supporting unions is an easy way of saying “I want good jobs for normal workers.” However, if every worker were unionized, it would be massively inflationary and most of the wage gains would be swallowed up by inflation.
The only way to increase the purchasing power of middling workers is 1) increase productivity and 2) redistribute from capital to labor without too much leakage
“ if every worker were unionized, it would be massively inflationary and most of the wage gains would be swallowed up by inflation.”
Why is that? What assumptions are you making about the power of unions as compared to consumers?
merely that wages are a cost are that higher production costs shift aggregate supply left
Over the past forty years, profits as a percentage of GDP have increased 130%.
It seems maybe there is some room for more distribution without sparking inflation.
https://fred.stlouisfed.org/graph/?g=1Pik
The best way to get good wages is to have low unemployment. Then companies fight over good employees.
unions by and large don't ensure a fair labor market they just push for bad work place rules that protect poor employees and harm efficiency
But how do you get low unemployment? We tried loose monetary policy and deficit spending in the face of logistical constraints to supply -- as expected, it kept unemployment modest at the cost of significant inflation, and as we now know, voters hated this outcome.
A good start would be getting rid of growth killing regulation. For example, removing all the NIMBY regulation would spur a huge boom in construction. Followed by booms in consumer goods.
Same could happen if we allowed the electric grid to modernize.
Focus on boosting supply too instead of just boosting demand.
Sounds reasonable
I went down a rabbit hole recently about the UK coal miners strike of 1984-85. On the one hand, I understood that they didn't want their livelihoods destroyed and they didn't want to be left in poverty. (Spoiler: this is what has happened in lots of old coal towns in the UK now.) But the government was losing something like £3.70 on every single ton of coal mined. And coal is really dirty and polluting. The government wanted to switch to oil and nuclear. The miners' wives held up signs about "Coal not dole", but I'm thinking "This is both. This is the worst of both systems." I was sort of boggled that there was so much public support for this system, and if Arthur Scargill hadn't squandered all the good will and made some really dumb judgment calls, it might still be the system.
(I'm American so it wasn't really on my radar in the 80s).
This comment is framed very anti-union and very anti-worker, from its word choice (Democratic support for unions is a “fetish”; seeking higher wages is extracting “rents”, etc.) to its analysis:
As several of the replies below note, union workers make more than nonunion workers just shows that unions are fulfilling their primary mission of raising wages;
At any rate, the proper comparison is something like 1) a unionized workforce’s wages as a percent of profits compared to a non-unionized workforce’s wages as a percent of profits or 2) the ratio of CEO pay to median worker’s pay in unionized to nonunionized workforces. As noted above, the comparison you made of union workers’ wages to nonunion workers wages just shows that unions are doing their jobs;
The decline in private-sector union membership since the 1950’s has a lot to do with the law, the hostility of companies to unions, and the willingness of companies to play borderline illegal (or actually illegal) anti-union hardball;
The word “relatively” carries a lot of weight when you call union workers “relatively privileged” in modern American society;
I wouldn’t be so sure that warehouse workers have no feelings of solidarity with UAW members;
Etc.
There's a tension between "unions are doing their jobs _for the unions" and "laws around unions/unions are making the country better-off overall"
Some union victories, like OSHA (I'm assuming this is largely the result of union victories in the past) seem clearly to make the country better off overall. Some unionization (like port workers preventing us from having automated & faster-functioning ports) seems to make the country worse-off. The union there is still "doing its job" for the benefit of the union members, but not for the benefit of the country.
If we are going to provide special legal rules that privilege unions above simply having workers agree to organize on their own, then I want evidence that unions are good _for the country_ not just for their members.
The UAW is an illuminating example of a union overdoing its job. It did it so well that GM was forced (named otherwise, but effectively) into bankruptcy. I am far less moved by resentment at a few people making huge sums than by hope for a balance in which provides stable work at a wage that bears some relation to skills, knowledge, and diligence. No doubt, there are abusive employers who need to be checked. But there are abusive unions, such as SEIU in Washington State, that got the legislature and governor to implement a law to make it very difficult to inform union members of rights that can reduce SEIU’s dues revenues.
It's ironic that a lot of union hate ignores very bad decisions made by executives. The auto industry has been gutted not because of greedy workers, but because white collar GM engineers designed cars nobody wanted to buy. Is the union responsible for crappy Boeing planes? No, it's due to cost cutting measures taken by executives.
Amazon warehouse workers and Starbucks baristas are "relatively privileged groups of workers"?
There are many unions I think are net negatives for society -- longshoremen, police, teachers, all public union workers, autoworkers. But unionization is still the most effective tool to fight exploitative managers and company owners in cases where workers have little power.
Some unions good, some unions bad.
Maybe this is overstating it but I wouldn't be surprised if Biden's defeat signaled the end of Dems going to the mat for unions.
I doubt it. It can still be incredibly portent politics, just look at the Nebraska Independent senate race. Maybe the PRO act will die on the vein, but I think union politics, especially private sector union politics is here to stay
Exit polls show the union vote split 53-45 for Harris. Winning 10% of the electorate (more in PA and MI, less in GA and NC) by 8% equates to 0.8% of the popular vote. Democrats are tolerating alot of privilege and resentment and inefficiency for a smallish portion of the vote. They would do better to ditch unions and embrace social guarantees.
Are you against unions in general? Or just public sector.
I think unions are kind of like hanging judges. In the wild west, a hanging judge saved lives. It’s a crude, muscular intervention that works well in the absence of state capacity.
The union movement existed for 50 years before we had a federal income tax and for 100 years before we had Medicaid.
The impulse for self help is wholesome and unions did a lot of good before we had the state capacity to have a real safety net.
I feel the need for unions in America has withered.
I'm not a big fan of private unions but I'm fine with them. And acknowledge that historically they did a lot of good.
Public unions should be banned or neutered. In they are allowed they should only be able to bargain for wages and benefits. Nothing about workplace rules.
The Independent Senate candidate in Nebraska lost, though. That kind of contradicts your "incredibly potent" statement.
He massively outperformed expectations.
Massively outperforming expectations and $5 will get you a gingerbread soymilk latte at Starbucks.
I'm sorry, but the Horror Clown and his minions have the trifecta and being told "but this guy lost less badly than a Democrat would have!" is of no practical help.
It's not immediately practical today no. But if it helps create a pathway to winning the next election then it was still useful. If winning battles was all that mattered then Pyhrrus would be hailed one of histories greatest generals. The Democrats just need to prove they're the Romans and not Hannibal. (Although it's an insult to Hannibal to compare him to Trump)
It could be pretty helpful to future candidates to figure out how to break that trifecta.
inshallah
Unions are labor monopolies or cartels. They have a role when there are monopsonies in hiring. That’s not extracting rents; it’s canceling them out.
This seems very overstated. Public sector unions are a special case but it’s unreasonable to deride all benefits unions are able to deliver for their members as rent seeking.
At root, they are a mechanism for employees to collectively bargain, thereby increasing their negotiating leverage. Is a high performer “rent seeking” by demanding a higher individual wage?
The regulatory apparatus that has grown up around unions to bolster them has much to be criticized, but at root they represent workers using their God and Constitutionally given freedom to associate in order to drive a better deal with management.
Public sector unions are not a “special case” they comprise roughly half of all unionized workers.
That’s not really responsive to my point. It’s unreasonable to levy public sector union specific complaints at private unions.
fair, but it is equally fair to say private sector unions only work in oligopolistic industries where there are rents to extract.
like, yes, we can create a privileged stratum of workers. but if, as I believe, the core problem is precarity, why?
"…union workers are relatively privileged. Their average wage is $1263 per week versus $1090 per week for workers generally." This is the whole point of unions! To get their members more money, safety and benefits. And if they're succeeding at doing so, that's a good argument for supporting them.
Yes, unions are more effective with large employers than small ones, but higher union wages can—if they represent enough of the workforce—increase wages, safety, and benefits for all employees because employers compete for employees.
Argh, the Slow Boring audience has become so dreadfully center right since the election. Might was well build a Clinton automaton and just run that in every race.
I liked this article because it gets at what seems to me to be one of the main problems facing Democrats today. What are the Democrats for these days, beyond some vague sense that economic outcomes in America are unfair?
When I was younger it was pretty clear. Democrats were the party whose main goal was to make the U.S.'s economic system more like Europe's.
Given Europe's recent economic struggles, it seems like taking Europe's approach might not be the best idea (especially on regulation). Anyway, the difficulty of passing anything through Congress has made the party de-emphasize this type of approach.
Today, part of the left-of-center commentariat seems to think that "economic populism" (i.e., pursuing the economic policies of Argentina instead of Europe) is a good goal in and of itself. I'm a bit skeptical that a patchwork of random interventions is desirable or even electorally effective (cracking down on landlords, egg producers, and big tech companies is just too incoherent). Another part of the left-of-center coalition seems to concede that while economic populism isn't necessarily great on the merits, dumb voters will lap it up, so it'll be effective politically. I'm not so sure about this either.
But the Democrats *do* need some sort of economic ideology rather than "we'll just technocratically optimize cost-benefit tradeoffs everywhere," since no one actually believes they're capable of accomplishing that. In fact, this is precisely what happened in the Biden administration: technocratic optimization was really just throwing goodies around to please coalition members.
What should Dems' ideology be? I'll just point out that Matt's two signature ideas are actually pretty libertarian: housing market liberalization and promoting high levels of legal immigration. These aren't necessarily the specific ideas that'll help Dems win, but I think it does indicate that what America needs economically is maybe a little less top-down control rather than trying to be Europe or Argentina. How can Dems sell this? I'm not sure. But the Democrats should at least start with a worthwhile goal before asking how they can win over voters.
Agree—i’ve been struggling with this myself. I think the Dems struggle to function in the absence of a new popular sweeping entitlement to pursue. Once health-care reform was achieved, there were not many big ticket items left on the shelf, and their most popular idea became price controls on pharmaceuticals, an idea hardly in keeping with the spirit of this piece. They also went for student loan forgiveness and a refundable child tax credit, neither of which is great politics as Matt states. Perhaps someone needs to figure out a way to make supply-side reform exciting (i personally love supply side reforms but likely am an outlier). Or perhaps the Republicans will gut several popular entitlement programs and Dems will be reanimated with purpose.
Healthcare reform is not complete, though. "Let people buy into Medicare" was considered, but the Dems didn't quite have the votes to put it into the ACA, even with the majorities they had in 2009. A future Dem trifecta could revive that, alongside "let Medicare limit the price it will pay for all drugs, not just a selected few, following the lead of healthcare systems everywhere else."
There are many examples of countries successfully implementing similar policies, and they would go a long way toward closing the remaining gaps in affordable access to healthcare for all Americans. I'd pair it with a medical education reform too -- expand med schools and residencies, limit tuition, with an eye towards eventually having cheap / free med school and a larger number of lower-paid medical practitioners, like e.g. Germany.
I'd make the other plank of my dream platform be the usual Slow Boring YIMBY-ism, in the hopes that not only will middle-class purchasing power rise, but maybe doctors will still be able to afford the fashionable parts of NYC on their smaller post-reform salaries.
There is still a robust supply side + deregulation agenda for better, less expensive health care that Dems could embrace if they are willing to give up certain shibboleths about the health care professions.
"Or perhaps the Republicans will gut several popular entitlement programs and Dems will be reanimated with purpose."
That has been the problem with the Democratic party in my lifetime - they've been consistently defined by what they're against, not what they're for.
The sweet spot is in synthesizing what is best about Europe and America— American prosperity and European security.
America is rich enough to afford security. Eg, if we could just get health care costs to Canadian levels, single payer would be very easy to finance.
Is there a government program that has been able to significantly cut costs? Even keeping costs the same so they eventually inflate away would be an achievement.
> Is there a government program that has been able to significantly cut costs?
The internet.
Thanks Al!
And decrease productivity :)
Various government infrastructure has cut costs for everything. Shipping is cheap because of government subsidies of highways, rails, and ports.
I doubt we can build that sort of infrastructure more efficiently nowadays than in the 1950s, even controlling for the already built environment.
The container ports were all built in the 1970s or later! I don’t know what that means for how to do other things as efficiently as those, or whether those could have been even better if done in some earlier way.
airline travel has gotten cheaper
That's deregulation getting out of the way of private industry - It's unclear why government needed to heavily regulate air travel to begin with, but where's a program where government needs to be involved as a prime mover that has become more economically competitive through reform?
There are lots of regulations on medicine —professional licensure, immigration restrictions, restrictions on tele medicine. if Indian radiologists could read American scans, there would be massive savings. If Indians with MDs could come to the US and do primary care, there would be even more savings.
The insurance model is also inefficient because companies spend a lot of effort trying to shift costs to one another. Medical billing is way too big a slice of GDP
It makes sense to a degree when you consider the timing of when or original airline boards were put in place. One thing CAB did was ensure there was mail service to parts of the country that might not otherwise get said service in the private sphere.
I think we have to look at it like we do now with farm subsidies; a government policy that was designed for a very different time in American history. When half of America were still farmers, subsidies to help Americans ruined by the dust bowl makes at least some sense. Today? Not so much. Same with CAB. When flying was still a pretty nascent industry, having strict rules about which routes planes could fly was kind of understandable. But by the 70s with modern jets? Maybe not so much.
I see farm subsidies differently: theyreta national security measure. It's one thing for a country to import all their consumer goods, but another thing entirely if they don't grow enough calories to be self-sufficient.*
Most people don't think of it this way, and subsidies are targeted and administered (very) poorly as a result, but the principle behind them is sound.
*In practice, the US and Canada should align their agriculture / trade policies and operate as a bloc in this regard.
My understanding is that the federal TANF budget has been set at the same level since 1996, so that's a significant fall in real funding over the past ~30 years.
But then I think we both agree that the big hurdle is on the cost side rather than the distribution side, right? Like if costs were way down and we didn’t go for a single-payer system, I think people would be a lot happier than they are with the status quo. Focusing on costs rather than distribution seems to be outside of Democrats’ usual comfort zone.
Healthcare distribution is underrated when talking about the US healthcare system. A lot of complaints are about dealing about health insurance and hospital bureaucracy rather than costs per se. Many (most?) people are relatively insulated from the absurd costs and complain about stuff that is only adjacent to high costs (like receiving crazy high bills that are fake in the sense that your insurer will cover it after you jump through enough hoops and that your insurer will never actually pay the whole amount).
Those complaints still point to real inefficiency in the US system. Many private insurers, lots of latitude for case-by-case negotiations, lots of high-paid labor (doctors etc.) spent on constantly negotiating who pays and how much. This is one of the reasons that US healthcare expenditures are so high, without Americans necessarily getting better healthcare than Europeans or Canadians at the end of the day.
A more standardized system, like the UK or Canada's standard recommendations for reimbursement and cost-effective pricing, or Germany's industry-wide negotiation of prices, would lead to both lower prices (bad for doctors, hospitals, and pharma companies but good for patients and taxpayers) and less duplicative negotiation (bad for people whose job is to represent insurers' reluctance to pay, good for everyone else and for social efficiency).
As an economist, I've been taught to look for deadweight loss and prefer things that avoid or reduce it. Competition is usually better than monopoly in this regard, but there are exceptions -- and the healthcare industry is notoriously unusual compared to "classical" markets.
So Norway. Canada and the US should look to Norway. The particular source of wealth might vary.
Norway is a petrostate that gets its money from taxing oil exports (i.e. taxing foreigners). That is an amazing way to finance a welfare state if you have oil reserves way in excess of your country's domestic oil demand. America does not have that.
As a net oil exporter, don't we kind of have this?
Norway has a population of 5.5 million and oil exports of $59 billion per year, for $10,700 of oil exports per Norwegian per year. America has a population of 330 million and oil exports of $118 billion per year, for $358 of oil exports per American per year. America is not in the same ballpark as Norway.
Lots of good ideas to gather from Norway but its structure is pretty different from the US. 25% VAT makes *everything* eye-wateringly expensive. That can work if low-end wages are really high (which they are) but *that* only works if your economy has a broadly high-tech, high-education workforce (which Norway does). In turn, this model compresses wage differentials between low-wage and high-wage workers, which may be a good thing for societal stability but hard to achieve in the US, where restaurant servers and warehouse workers starting to earn $20/hr+ seems to trigger grumbles they make too much.
Lots of European countries have 20%+ VATs but prices are still much lower than in Scandinavia so I’m not sure that explains it.
Cute waitresses have made well over $20/hr for a while.
Yes, but not as base wages that drive the price of entrees from $15 to $25, which is where the broader community annoyance comes in. And yes, this is in metro areas with high local minimum wages. My point is simply that waving a wand and saying, “Let the US be like Norway!” carries lots and lots of asterisks!
Correct. In America, top two fifths get to consume more goods and services than in Norway. Over half the electorate comes from the top 40% of the income distribution.
Norway, which is driving away wealthy people at increasing rates due to its wealth tax that includes unrealized gains, crippling new businesses?
https://www.theguardian.com/world/2023/apr/10/super-rich-abandoning-norway-at-record-rate-as-wealth-tax-rises-slightly
https://www.barrons.com/news/norway-struggles-to-keep-ultra-rich-tempted-by-exile-9901c193
Yeah, this is a dumb policy, driven by petty cultural politics intended to shame tax-minimizing individuals. Note that this tax isn’t essential to the Norwegian model. Rather, the heavy taxes on income and consumption (value-added tax) are the big drivers of the revenue necessary to support universal health care and education.
Plus, don't they have huge oil revenues? They really don't seem like a country we could easily model ourselves after.
Short answer: Yes, Norway is a petrostate. However, most of the gov’ts revenues from that flow into the country’s gigantic sovereign wealth fund, of which only 4% goes into current spending (it’s a very smart construct). Most of the year-to-year economic benefits from Norway’s oil & gas industry come from all the investment and (high-education) labor needed to operate that industry. All of that is to say that I think the US has the economic base to run Norway-style economics if it wants to, but all recent political evidence seems to me to point toward the country NOT wanting to do that.
hard to compare the US to Norway when Norway has fewer people than metro Atlanta
I think is pretty much what Matt is arguing for today, but yeah.
Single-payer healthcare would require large cuts in payments that go to physicians, which will decrease physician income, on top of higher income taxes on physicians. That will do wonders for physician supply.
physician supply is artificially constrained by the ama and by the refusal to fund more residencies and to admit foreign doctors
A lot of European countries have more doctors per capita than we do!
We also make the process of becoming a doctor far more expensive and unpleasant than a lot of other countries do.
Currently yes, but if you cut physician salaries by tens to hundreds of thousands of dollars and raise their marginal income tax to 60-70%, that creates a major disincentive to put in all the effort to become a physician
We should make it easier to become a doctor! There's no reason why an MD needs a BS before going to medical school, it just delays everything by 2 years! That's an enormous amount of money over a lifetime.
Call me sentimental, but doctors should be ladies and gentlemen, not technicians. Anyone with that much power over life and death should have the blessings of a liberal education.
I am against BA requirements for most jobs, but strongly pro BA requirements for doctors. Educated professionals should be educated.
You can also eliminate medical school tuition and expand the supply of medical school and residency positions.
Recent grads will be hurt by the change, unless you forgive their debts or refund their tuition -- and if you do a refund, how far back does it go? (E.g. to people who finished their MD five years ago? Ten? Twenty?)
The change will be bad for incumbent doctors for sure, but new doctors can be compensated for it. Germany has much lower doctor salaries than the US, but also tuition-free university and medical school, and more doctors per capita than the US. It can be done, even in a country almost as rich as America.
Very easy to pro rate. If congress imposed changes that reduce physician compensation, recent med grads should get significant compensation. Anyone who has billed for 10 plus post residency years under the ancien regime has already gotten their cut. Give a $200k reparation to every doctor, reduced by $20k for every year post residency.
No one thinks the marginal rate on $250k should be 60%. I certainly don’t.
Now some doctors who own practices are more capitalists than tradesmen— they are profiting off junior practitioners nurse practitioners, physicians assistants etc. the way a big law partner profits off of associates. Those folks can totally pay 55%
We can't afford single-payer healthcare without 60% marginal tax rates. Best estimates I have seen for single-payer cost is $30 trillion over a decade. How are we getting $30 trillion in new tax revenue without 60% marginal rates?
Physician payments are around than 10% of health care costs. Nursing is another 5%. Even were you to effectively halve the salaries, you are not going to make a big dent in the excess cost structure.
Where does the rest of it go...? Surely they're not wasting 85% on "administration" are they? Or is it all for the big fancy machines?
Can I have the option for an old-fashioned, mom-and-pop doctor who practices out of their garage using old used equipment with no administration? I'd take that deal.
"What are the Democrats for these days[?]"
Using government to make Americans' lives better.
(No judgment here on how well they're doing that; I'm just saying that's what Democrats are for.)
****************************************************************************
"What is MAGA for these days?"
"Using government to stick it to their enemies."
The model of worker treatment / worker rights that seems to fit best with an abundance agenda is something like the Danish "Flexicurity" model: give employers more freedom to hire and fire to adapt to market needs; and give workers a real unemployment benefit and access to a high level of background social services (health care, education, job training, child care) that allows them to survive and thrive between jobs and to add skills as global labor markets change. I took this to be the thrust of MY's call for promoting economic growth while providing a robust safety net, both of which become easier with more skilled immigration and some amount of unskilled immigration. But this comes into conflict with many of the typical union bargaining positions we see today, which are designed to make it harder to fire both bad cops and bad warehouse workers, or to impede economic progress by slowing or preventing technological transitions: the Jones act, restrictions on automation, the coming wave of demands of protections from AI job loss. Protecting incumbency for its own sake is one of our most basic instincts but one of our most counter-productive economic habits, regardless of whether we are protecting incumbent businesses in the FF industry, incumbent unions optimizing for members over larger social interests, or incumbent regulators powered by NIMBYism.
Why do they need an economic ideology? Why would one even want one? Indeed, it seems like an economic ideology is just a way of clouding your judgement about what's good to do.
The failures here are the result of Biden being an old guy still wedded to an economic ideology the democrats had in the 60s and 70s.
--
Personally I want to see the democrats move away from direct regulation (obv not entirely we need clean air but shit like vehicle fleet requirements or IRA requirements for day care) which tends to be very inefficient and wasteful and move towards the kind of simple efficient mechanisms free market types would always point to in the past but rarely ever implement (eg substantial negative income tax rather than minimum wages etc).
But that's still just a bunch of cost benefit tradeoffs I don't see an ideology. I mean when it comes to things like monopolies I think it's idiotic to have a private power company (meaning the last mile transmission... generation is fine).
Let me try to give an analogy to chess.
Good advice for a grandmaster-level player is "just consider the tradeoffs involved in every move and then pick the best move."
This is terrible advice for new players. They'll end up doing lots of stupid stuff. They need rules like "don't move your knight to the edge of the board," "don't push pawns in front of your king," etc. These rules form a beginner's "ideology." Of course these rules "cloud judgment" in a sense, since it's sometimes optimal to break them. But they're a net positive for beginners.
Democrats are more like beginners than grandmasters when it comes to making policy. The problem is exacerbated by the temptation to make policies that look like optimally managing tradeoffs but are actually just doing favors for coalition members.
They are like beginners who can hire their favorite grandmaster to come and give them advice.
Yes, the danger is the voters just decide not to take good advice. But that's the same danger they choose a really awful ideology. More countries have been economically wrecked by really awful economic ideologies (eg communism and arguably extreme privatization) than by pragmatic muddling.
If you can't trust the voters to listen to the actually correct arguments about the best policy choices why would you expect them not to end up with an ideology that was even worse? Even if the right ideology would be better than none why assume they'll pick that one if they can't decide what economic experts to trust?
I know it’s not exactly equivalent, but didn’t Argentina demonstrate that policies to benefit the poor, when carried to extremes, can destroy an economy?
the Dems should run on personal freedom culturally and abundance economically. It’s should advocate for people having the ability to freely live theirs lives how they see fit in their personal lives, while advocating for economic prosperity - more is more. I think these two pillars allow Dems to tie together various cultural and economic factions into a coherent message
Matt is being far too charitable to Nathan Proctor. The guy seems a few cards short of a full deck.
“Housing is too expensive. Make it more affordable”
“Right, build more housing”
“No, because you’ll just build luxury housing. Build affordable housing instead”
“Affordable housing is just market rate housing that is subsidized. Subsidies raise the cost of housing for everyone else.”
“Then just pass a law that says they can’t. Gosh, do I have to spell everything out for you?”
Also, anyone arguing for more tenant protections as a cure for high rents is clearly just making stuff up. The tenant protections in high cost cities are already ridiculous. It’s a lot of why the rents are so high! Landlords can’t evict anyone so that gets priced in!
YIMBY discourse has taught me that there's a popular but weird view that "affordability" is a design characteristic of housing like square footage or the number of bedrooms. The number of times I've seen people sincerely ask why nobody just builds affordable housing in San Francisco or Manhattan is mind-boggling.
And talking to people on the NIMBY side about it is like taking to Trump people about tariffs. They just like have a block in their brain that means they can’t understand what they are being told.
Edit: also see the “why does no one build beautiful brownstones anymore” discourse
The generous interpretation of that is "does every new apartment building need central air, granite countertops and a 10k sq ft gym/amenity floor."
But if you start with the "affordable" characteristic and work backwards I think people wouldn't like what they get for, say, $1,000/mo in a new build.
Yeah, my guess is that getting down to what most of these people would consider affordable would require all apartments be completely bare-bones studios. I suspect that rent prices are about 90% location and square footage.
But there's an easy answer to that: they put those things in to *justify* the prices they have to charge to make the construction pan out. A rental building without central air wouldn't actually be much cheaper to construct, but rent would be the same!
"Justify" is probably right, I figured developers are looking at a demand curve, seeing a sweet spot of cost/price, and building to that.
But why would the rent be the same if it's cheaper to construct? Every dollar not spent is one fewer dollar you have to see the ROI on.
Rent is a function of supply and demand.
Lowering construction costs will only have a meaningful impact on rent if lower construction costs lead to more construction, increasing housing supply. (Edit: or if lower construction costs make the housing less desirable, lowering demand)
Different people will make different choices. Some people value having amenities in the building and high end finishings. Other people value having an extra several hundred dollars a month in their pocket that they can spend on other things. The point is that they should be able to make that choice
"The tenant protections in high cost cities are already ridiculous. It’s a lot of why the rents are so high!"
And creates incentives to build condos instead of apartments.
In Oregon, Construction Defect Liability Laws are apparently causing a sharp decrease in condo construction: instead we’re getting plenty of apartments. (Which signals to me that developers really cannot control possible construction defects to the extent that they’re willing to take risks. )
Condo owners can rent their places out, no?
True, though then they have to deal with the tenant protections that may make this not worth the hassle for an individual condo owner. And MY has made the point that it's often better for renters to be dealing with a professional property management company that runs apartment buildings than individual owners who are just renting out their property as a side gig. It's also the case that pushing construction towards condos instead of apartments is an unintended consequence of tenant protections.
I’ve never rented from a professional property management company, rather I’ve always had individual unit owners as a landlord. Is there a physical/ structural difference in construction intended for condos and construction intended for apartments?
Physical difference no. But the decision over whether a building will be a rental or condo building has to be made before anyone moves in.
edit: actually I thought of a way there may be a physical difference. Shared amenities are far more common in rental buildings than condo buildings.
Try to explain this to someone using toothpaste instead of housing. Why don't we set a price ceiling on toothpaste? Why doesn't the Crest/Colgate Cartel fix the price at $10/tube?
Housing is different than toothpaste.
People don’t view toothpaste as an investment as well as a good.
Transaction costs for toothpaste are pretty low…basically the cost of going to the store. Real estate often has tens or hundreds of thousands of dollars in transaction costs.
Not to say that I think there should be a price ceiling on real estate. But we shouldn’t pretend like real estate market is the same as the toothpaste market
If you value your time, the transaction costs of going to the store to buy a single tube of toothpaste are probably larger on a percentage basis than the costs of buying a house.
But most people don’t do that or need to do that because toothpaste gets sold at drug stores, grocery stores, and super markets, not at toothpaste stores.
The toothpaste market and the real estate market are very different. This should be self evident. I don’t feel like I need to justify this position.
One thing that bugs me about the “go maximally left on ~all aspects of econ policy” crowd is that a lot of them didn’t actually study economics! It’s a bunch of people who studied history in undergrad and/or went to law school. Nothing against those types and maybe this is me being parochial or credentialist but I’d trust the policy argument a lot more if it came from econ PhDs.
In the past I would have agreed with you but Jerome Powell is perhaps the best fed chair we've ever had and even he's not an econ PhD.
If you can succeed at literally the most important job in economics without that credential, then you shouldn't need it to formulate other policy ideas.
To be fair, though, Powell obviously listens to his economist colleagues and doesn’t do crazy unorthodox monetary policy. He’s a good manager and communicator, and he’s good at finessing the relationship between the Fed and the political branches, but he probably isn’t the main source of economic insight in his organization. (And that’s okay!)
I think the big difference is that Powell shows an enormous amount of deference to economists' thinking. If you listen to him talk, it's basically exactly what you'd get from Bernanke/Greenspan/whoever. Very different from letting Marxist historians and "Modern Monetary Theorists" run Dems' economic policy.
Yes but most people are not Jerome Powell. People on the left have had an obsession with credentialism to their detriment, and it has been very much proven people without credentials can build expertise in any given space. The problem is that there's still no real alternative to credentials. Without them, we are all faced with random twitter account saying things and nobody without expertise has any idea who/what to believe. Bad epistemic situation in general.
I worked at the Fed when he became chair and people who worked closely with him talked about how he was a voracious reader of economic research. Yeah he isn't an econ phd but he did listen to econ phds, and put in the work to understand the field. I don't think it's a requirement that someone has a PhD to understand econ, but people have to try to understand the field. I am not saying you are arguing people on the left do this, but if they did do this, they wouldn't have the opinions they have.
He’s probs 3rd. Volker > Bernanke > Powell
I think this is specifically the case in the antitrust/anticoncentration space where most of the movement is basically Lina Khan's interesting legal paper come to life.
But why should the problems of the 21st century be resolved with legal re-interpretations and understandings of 100 year old laws? A lot of the anti-tech talk on the left smacks of disliking corporate success, then trying to dress up in fancy language how it's bad.
If you read Ben thompson's blog it's clear that antitrust regulators have a point in a some cases but are seeking the result they want (a reason to punish or break up Apple/Amazon/Microsoft/Meta/Alphabet) then backing into reasoning for it, rather than laying out a proactive vision for the country.
I don't dispute the big tech companies do a lot of things wrong, but they are also our leading export industry, provide tremendously useful services that people love, and are our best shot at future innovation. So its up to political leaders to come up with a better way forward than accusing them of wrongdoing at every turn.
The lack of subject matter knowledge is also really present with banks on the left. The US has the least concentrated banking system among all wealthy countries as far as I know, yet there are frequent calls to "break up the banks" to reduce their power But nobody could reasonably argue there is an insufficient amount of consumer choice in the banking sector, for any normal consumer banking product we have dozens of separate providers who compete on price/convenience/etc. And given correlated risk it's not at all clear how having many smaller banks would reduce the risk of systemic collapse.
So the way I read this is reliance on "big is bad" which emenates from historical/legal interpretations of the old progressive era has resulted in a version of "populism" that isn't popular and won't achieve what its proponents want.;
You’re right but also wrong. People talk outside their expertise all the time. Should Matt stick to whatever it is he studied and never write about anything else? When you complete your econ degree (presumably), are you disqualified from talking about anything other than economics?
So, yes, some simple economics would make the supply/demand trade offs of housing policy more clear to these types, but people should be free to discuss and make arguments about things outside of their specific areas of expertise.
Right, I’m not saying they shouldn’t be allowed to speak outside of their area of training. I’m just saying that I somewhat discount their takes because it’s outside their area of expertise!
Econ obv requires expertise but it is still a social science. Unlike hard sciences like physics, Econ lacks universal laws, controlled experiments, and deterministic outcomes, relying instead on models and assumptions that simplify reality. Idk I do think there’s a moral aspect of designing Econ policy, even hard right wingers talk in moral terms such as it’s “unfair to tax ppl bc it’s theft or smthg.” i think putting editorial board of jacobin to make Econ policy would be a disaster but normative aspects of Econ and its evolving theories (behavioral Econ etc) highlight Econ role in addressing societal challenges (which obv are going to differ based on ideology) rather than adhering to rigid frameworks of hard science or strict scientific rules. just saying Econ is not that rigorous when compared to hard science even if it’s the most rigorous among social sciences, it’s still a *social* science.
Although this is technically true, there are still plenty of simple mechanistic “laws” (theoretical assumptions that are almost always borne out) in economics which many of these commentators still seem unable to understand – even a grasp of completely elementary supply and demand is shockingly uncommon!
Yup I agree, but there’s still a question of morality, ideology, and taste in how one structures society that is more akin to aspects of engineering (where there’s both art and science), as opposed to hard science (fundamental laws of Newton). Even there at least engineering is operating on hard science laws, whereas Econ policy is operating on social science laws.
I think a lot of left wingers would say it’s ok to give up on *some amount* of growth in favor of re-distribution. One can think of this in terms of engineering a product where you trade some amount of quality in favor of making the product cheap. Whereas a ton of Tyler Cowen style right wingers would say any form of re-distribution takes away from Econ growth and thus is bad, and if u want to help poor ppl, most poor ppl are foreigners so best thing to do is Econ growth and then send money abroad or something. I would offer 2 examples where scope of expertise is limited in determining outcomes:
1. A lot of European countries make a different kind of trade off. Consumer electronics and even an ordinary meal is crazy expensive in some European countries but they have socialized healthcare, child care etc. How does this relate to technical expertise? It very faintly does. It’s a question of taste in terms of what kind of society one wants to live in. Americans have bigger houses, purchase more consumer goods, but forego comfort in having guaranteed pathway to college, healthcare etc.
2. Almost all Econ experts saying immigration is net good. Literally almost all of them. It’s actually very rare to have such unanimous consensus on a policy. Yet Americans don’t want the pace of change that the level of immigration the experts suggest would be good. I’m talking about legal immigration, not just illegal immigration.
Idk I sometimes feel ppl refuse to acknowledge that ppl have different preferences and want different outcomes. Expertise towards an outcomes pre-supposes that u share the same outcome.
If u want to design policy, imo its imp to be both Econ literate and politically literate! The left wingers pushing their policies are trying to move politics in their direction. We don’t live in a technocracy.
Agreed on the last point! Economic literacy and political literacy are both (independently) important. The main view I’d like to defend is that, actually, economists are pretty good at identifying the tradeoffs inherent to a given policy decision – they’re also pretty good when it comes to identifying which policies lead to greater literal wealth.
You can argue that wealth is not the be all and end all of societies (a fair critique!) but often the issue you actually see is some variety of politically-motivated actor claiming that their preferred policies will, in fact, promote [wealth / economic security / etc]… even when an economist could tell you otherwise.
It’s fine as a political actor to claim that your preferred policies are best suited to achieving your particular preferred set of moral outcomes. I just think that most politicians, even those who might nominally be most suspicious of wealth as an ultimate societal goal, sort of launder their preferences to the public in a kind of half-hearted confused economic argument.
(I’m also slightly confused at your assertion that Cowen, a Democrat, is a right-winger. You might be focusing overmuch on the vibes vs. the stated political preferences here.)
Get your econ degree and then stunt on them hard, Milan.
Elizabeth Warren's econ PhD and subsequent professorship in the field hasn't prevented her from spewing bullshit half the time. I think it's more that some people are committed to reasoning backwards from their predetermined conclusions. This could be for reasons of political expedience, or cognitive dissonance, or general lack of understanding, or wishful thinking, or whatever else.
Warren doesn’t have a PhD, she’s a lawyer by training
This explains quite a bit
Huh, TIL. I stand corrected!
Econ obv requires expertise but it is still a social science. Unlike hard sciences like physics, Econ lacks universal laws, controlled experiments, and deterministic outcomes, relying instead on models and assumptions that simplify reality. Idk I do think there’s a moral aspect of designing Econ policy, even hard right wingers talk in moral terms such as it’s “unfair to tax ppl bc it’s theft or smthg.” i think putting editorial board of jacobin to make Econ policy would be a disaster but normative aspects of Econ and its evolving theories (behavioral Econ etc) highlight Econ role in addressing societal challenges (which obv are going to differ based on ideology) rather than adhering to rigid frameworks of hard science or strict scientific rules. just saying Econ is not that rigorous when compared to hard science even if it’s the most rigorous among social sciences, it’s still a *social* science.
No aspect of human decision-making or group behavior, especially in the context of politics or philosophy, is a hard science.
I somehow missed that the Biden Administration tightened rules around Jones Act. What’s especially galling about this is it apparently did square root of f**k all politically for them. Which means it apparently had no redeeming value.
One of the more right leaning positions over the past 10-15 years to be more skeptical of unions and specifically public sector unions sort of for the reasons FDR laid out. But the last 4 years I think might make me an actual right winger when it comes to private sector unions.
There’s a part of me that is in a spiteful frame of mind when it comes to the election. I suspect I’m not alone. You voted for this let’s see how much you like Gestapo tactics to remove immigrants (not much confidence a Stephen Miller anti immigrant project is going to discerning about illegal vs legal), let’s see how much you like grocery prices going up again because of tariffs. And then I have to stop myself and say a whole lot of Trump voters are not Trump super fans and would have likely voted for a cactus over a Democrat in a general anti incumbent mood fueled by inflation.
But unions? Boy I’m really starting to “the hell with you” stage. And yes I say this knowing how important unions have been historically securing rights and protections. But now? Pure rent seeking as far as I can see. I think I might be ready to say “you wanted this guy? Fine I hope Trump puts anti labor business guy on NLRB and nominates a whole lot of anti union judges”.
I’m semi serious that what the unions did to Biden amounted to elder abuse.
If "f**k all" means something very small, then "square root of f**k all" is in fact much *larger* than "f**k all". Perhaps you meant to write "square of f**k all"?
That is first-rate comic pedantry! But I'm with Colin on style: "square root of f**k all" sounds better.
I think you're taking my statement too literally.
I'll just keep it simple and say tightening rules around the Jones Act might be one of the under the radar worst decisions Biden made given that it seems that absolutely not benefit to him on the merits or even politically.
What? The square root of something is always smaller than the thing itself.
SQRT(0.01) = 0.1 or 10x larger. I think that's where Gunnar was going ...
Yes, sqrt(x) << x for large x (as x->infty), but sqrt(x) >> x for small x (as x -> 0).
But it was a joke, of course.
Specifcally sqrt(X) > X for 0 < X < 1. Sqrt (X) can be >>> X in order-of-magnitude terms as
X goes to zero but on a scale going from, say, 0-100, the absolute value of difference is trivial because it has an upper bound of sqrt(X) < 1.
The square root of something is always closer to 1. If the thing you start with is bigger than 1, then the square root is smaller, but if the thing you start with is smaller than 1, then the square root is bigger. The square root of 1/4 is 1/2.
The Teamsters are the worst offenders by far here. Biden bailed out their pension fund, then they refused to endorse Harris. Their leadership should be persona non grata with the Dems for a while.
The funny thing is Sean O'Brien is almost a bizarro example of what Matt complains about with lefty non profit groups. He's making decisions for his union based on issues completely unrelated to the actual mission statement of his organization. There's really no other way to explain how he can speak at the RNC given how hostile GOP is to unions generally (one of the few through lines to pre Trump GOP along with Tax cuts).
Yes. It's darkly funny to me that despite Biden and Harris being very pro-union, certainly likely to be more pro-union, in pure economic terms than Republicans, unions largely abandoned the party over cultural issues.
I said in another comment but it goes back to Matt's posts about how it's bad when various organizations built around specific issues start making decisions (or pronouncements) based on issues entirely unrelated to the mission of your group. So Matt is a Democrat so he focuses on lefty groups like environmental orgs putting statements supporting Gaza (or having anything at all to say on the subject generally).
I think the unions not really backing Harris (or at least tepidly or having their members vote for Trump) sort of shows this is just a lefty non-profit phenomenon.
I think you can say the same thing about Churches by the way. In the "duh" statement of the century Christianity is about something way more than abortion or homosexuality. In fact both issues are really tiny parts of what being a good Christian is supposed to be. But these two issues dominated Christian politics over the past 30-40 years to the point that you have absurd spectacle of evangelical Christians and worse evangelical leaders supporting a man who's entire existence is antithetical to Christianity generally.
I would also look at churches and unions in similar contexts here. Both are human organizations, and thus are prone to the same distortions and extremes that any institution has to manage (or not.) Unions go off the rails as do political parties, universities, corporations, religions, even marriages and families (which to some extent are also socio-cultural institutions.)
But unions are still potentially a “third leg” that can balance the power of government and corporations in favor of people who work. Theoretically working people could unite for redistribution via tax policy. But that’s more indirect than just going on strike and directly threatening corporate profit, especially since elections are more and more influenced by corporations and their money. (As for religions, I could go on and on about why they exist and why they have played significant roles in contributing to personal and community survival and even flourishing.)
I don’t know how public unions can be reined in. One problem may be that the people attracted to union leadership often aren’t very reasonable: they’re there for the conflict. I suspect unions are also subject to the same problem politics is: most union members don’t may much attention.
But in the meantime there are the nascent service and grocery employee unions which may just manage to get pay and healthcare up to some kind of decent subsistence level before they grow up and fall prey to the usual institutional shortcomings.
"especially since elections are more and more influenced by corporations and their money"
Are you sure? Harris raised and spent WAY more than Trump, and it didn't seem to matter.
"I don’t know how public unions can be reined in."
ban them
Do you think the unions themselves (by which I suppose I mean leadership) have right-coded views on social issues, or do they know that their members do and at a certain point it becomes awkward to endorse a candidate that you know the majority of your members don’t support, regardless of why.
Not coming out and endorsing Harris is likely at least in part a concession on the part of Union heads to be realistic about the political leanings of its members.
Coming out and speaking to the GOP convention is a whole other kettle of fish. That's a direct endorsement of Trump. There's no way Sean O'Brien is doing that just because that fits with the political leanings of a large segment of his union.
Famously the Sunrise movement didn't endorse Harris. In part this was supposedly because the Biden administration wasn't pro green enough. Given the political inclinations of Sunrise, I wouldn't be surprised at all if it turns out part of why they wouldn't endorse is a large segment of their donor base and staff were upset at Biden (and by extension Harris) for not being sufficiently pro Gaza (or being too pro Israel). What didn't happen is the leader of Sunrise going on stage at the GOP convention to speak.
And here's where I unveil my grand theory of this election: Trump won and Harris lost because Americans are very rich and very satisfied with their economic condition.* On the Maslow hierarchy they are way above physiological needs and safety and security.** They are so comfortable they can afford to indulge in self-esteem and self-actualization. I.e., they have the space and comfort to engage in meaningless cultural concerns (e.g., transwomen in women's sports).
In other words, our society is so economically successful that appealing to voters on the basis of improving their material lives will continually fall on deaf ears. We need a different approach.
* Yes, some Americans are suffering economically. Yadda yadda yadda.
** I apply this to the vast concern over inflation which, last I checked, is around 2.5%. I don't think Americans were, by and large, that hurt materially by the gap between their income and the prices they were paying. I think they gained satisfaction, "self-actualization" one might say, from bitching and moaning about how egg prices went up.
I think the inflation issues is in large measure about control and sort of fits your Maslow's hierarchy of needs thesis. As has been noted many times, one reason rising wages didn't counteract the negative feeling about inflation is that people see pay increases as fruits of their own labor and price increases as something out of their control. Financial security means a lot of things but one thing it means is a level control (or at least illusion of control) over your own life. Make enough money to pay bills and put a modest amount in savings, suddenly you feel like you have a certain degree of "freedom" to decide how you want to use the money left over (at least I did when I reached a certain income threshold). But its core financial security is in large a measure of feeling like you have control over life and inflation disrupts that feeling.
I'll disagree with you (at least partially) and note that I think you're underestimating the actual material impact of higher inflation. For one, it seems likely (we'll have to wait for Pew data) that there was a pretty significant swing right among younger male voters under 30. Even among college educated voters this is a cohort of people who don't generally make a ton of money (vast majority don't get analyst roles at Hedge Funds or Consultant firms even among college graduates). This is a group of people who are likely to really feel the pinch of even a modest increase in prices. Second, I think you underestimate the number of voters who do actually struggle financially. And third, I know term "paycheck to paycheck" is overused to the point of almost rendering the phrase meaningless. But I said almost because it is really true a decent number of people who make middle class wages probably on a practical level live "paycheck to paycheck". What I mean is there is a pretty sizable number of people who really do spend almost everything they make. Now the reality is a lot of those people could probably save more money by going out to eat less, maybe not buying that brand new shirt or maybe cutting back subtack subscriptions. But the point is, for those people, even a small increase in prices likely resulted in some sort of "sacrifice" being made even if it was "sacrificing" something that was more a want than a need. Regardless, that's still not going make someone happy.
If you add up an expanded "misery index" (unemployment rate+inflation rate+mortgage rate) for each President, for Reagan in Oct. 1984 you get 25.7; for Biden-Harris you get 12.6. It's two times greater for Reagan than Biden-Harris.*
So I guess it makes sense that Reagan was rejected by the electorate in Nov. 1984 and Harris stormed to a historic victory, winning 59% of the popular vote and 49 states.**
* Reagan: 7.4% unemployment rate, 4.2% CPI, 14.2% mortgage rate
Biden: 4.1% unemployment rate, 2.4% CPI, 6.1% mortgage rate
Oh, and in Nov. 1982 it was 28.5 and in Nov. 2022 it was 17.7, meaning in the two years leading up to the election, it didn't improve at all for Reagan and improved vastly for Biden.
** I wrote this very quickly and didn't have a chance to proofread it. Let me know if I got anything wrong.
When people say inflation, what they really mean is price level. And price levels are still very much elevated in particular housing prices.
For example, the small bedroom community I grew up in you could still buy a 1960's track home in the late 90's for around $100k. Now those same crappy track homes are going for between $500k to $600k.
Income sure didn't go up 5x in that time frame. If you are a new family starting out you are basically SOL. There's basically no way you can afford that.
All that being said, I do agree social issues are important. But so is being able to buy a house and still put food on the table.
There is no significant difference in home ownership across generations at the same age. There is no difference in accumulated wealth either.
Each generation is richer than the one before.
https://www.google.com/amp/s/amp.knowyourmeme.com/memes/most-people-rejected-his-message
“Trump is going to ruin a lot of lives, but at least they’ll include the lives I dislike.”
"There’s a part of me that is in a spiteful frame of mind when it comes to the election"
I have tried to resist this temptation with retired Boomers complaining about how much young people suck, and then voting for Republicans trying to cut their benefits and lower income taxes, for a long time. Like "great, go ahead, cut spending on entitlements, won't hurt me for like thirty years, your loss."
I'm coming around to Scott Galloway on this. Our COVID response to support the equity markets and drive up housing prices was intergenerational theft. If Elon / D.O.G.E. go hard on cutting entitlements ... I'm for it and let the GOP pay the price. Long overdue.
In some ways entitlements are kind of easy. There's no magical solution. We will need to cut benefits and raise taxes. There aren't any other options. WAY more in benefits was promised than will ever be paid.
"not much confidence a Stephen Miller anti immigrant project is going to discerning about illegal vs legal"
Pretty uncharitable given that they've explicitly stated the target is non-citizens with criminal records.
That’s not very discriminating about legal vs non-legal, if your target is all non-citizens with criminal records.
Aren't all non-citizens with criminal records more or less supposed to get deported (e.g. being convicted of a crime as a non-citizen makes you an illegal immigrant by definition)?
Looking it up, it seems that there are some visas that are revoked by any criminal conviction, but there are some visas that only get revoked for particular crimes. Green cards are only revoked for some very specific crimes, such as fraud or domestic violence.
Got it. That's surprising to me that the law is that loose
They explicitly campaigned on demonizing all kinds of immigrants regardless of their legal status. That was the whole point of the "they're eating the dogs!" lie: The Haitian community in Cleveland was legal refugees who were gainfully employed. Trump promised to revoke their legal status and deport them.
I'll be honest..."temporary protected status" is a nonsensical program. I get it's purpose, but then it's commonly seen as horrible to ever take away, especially if they've been here for 10 or 20 years. And I get that, but why do we even call it temporary then? This widespread dissonance in our immigration programs is frustrating.
Here's a quote from a Guardian article, for example:
> A sheriff in Sidney, a town 40 miles (64km) north-west of Springfield that is home to several dozen Haitian immigrants, allegedly told local police in September to “get a hold of these people and arrest them”.
> “Bring them – I’ll figure out if they’re legal,” he said, referencing Haitian immigrants in the area.
To be clear, I know this is just some random sheriff in a county of fewer than 50k people spouting off at the mouth. But it's just the kind of person likely to be emboldened by Miller's rhetoric over the years. I hope if they pursue this project, they draw clear bright lines about acceptable tactics, but I'm not holding my breath.
https://www.theguardian.com/us-news/2024/nov/17/haitian-immigrants-springfield-ohio-trump-election
So meant to say right wing judges. So given they will likely vote in terrible ways on other stuff probably not great these trumpy people will be judges. But still. Not going to be too upset with their anti union rulings I suspect.
When the FTC goes after Microsoft for buying Activision and prevented now bankrupt Spirit from merging, it really seems like the Democratic anti-trust ethos needs a lot of fine tuning.
But thank goodness we protected our right to low cost handbags ...
https://www.nytimes.com/2024/10/24/business/tapestry-capri-merger-coach-versace.html
China's GDP is ~25% higher than the US' at purchasing power parity. China is openly preparing to invade Taiwan, where ~90% of the high-end chips the US economy runs on are produced. It's also been helping Russia invade a US ally in a region of high interest to the US. It has many other efforts to spread its influence globally.
The US is barely responding. Cumulatively, ~2% of GDP has been allocated to supply chain resilience (with little evidence of success so far). Defense spending as % of GDP is at a post-WW2 low. There are several reasons for this. But a big one of them is that the US' economic capacity is fully utilised, with relatively high interest rates and above-target inflation.
Of course the US' economic resources could be more equitably and efficiently allocated, but every allocation problem becomes easier if you just grow the pie. Asserting that the US has a surplus of economic resources seems to fly in the face of actionable consequences that are happening right now.
You should look at the GDP estimates based on lights visible from space. China’s GDP is likely overstated. What we are witnessing is basically an authoritarian regime allocating resource for a military buildup at the expense of average consumers, pensioners, and people’s needs.
There are a few things to take from this. 1) The CCP are not some sort of extraordinary manager. They are reallocating rents, don’t care about efficiency or social tradeoffs. 2) The social costs and problems with the unbalanced economy will get worse over time. 3) The optimal strategy right now is to delay Chinese aggression.
There is a reason the CCP is trying to dump goods globally right now and it is not a sign of strength.
I'd also add that I don't think we've seen the bottom of China's real estate mess. Given how much property sales are tied to tax revenue, I think there is a strong case to be made their real estate crash is more negatively impacting the Chinese economy than the 08 crash affected the US.
It isn’t even taxed. Local governments auction state owned land for development. They have to constantly sell new land for development to get operating revenue. That and the central government foists pension and public services on local governments. The central government has the main tax authority.
> There is a reason the CCP is trying to dump goods globally right now and it is not a sign of strength.
Isn't it the same as it always is? They want to be able to go to everyone when the Taiwan war starts and say " we make all your cars, phones, solar panels, factory feedstock, telecom equipment- stay out of our business". From the perspective of that long term plan, this is great.
Western economists focus too much on fuzzy holistic stuff. China is going to own the world of atoms, they have made excellent progress on that goal, and continue to.
It’s worth noting that China is also currently facing a painful demographic crunch, incredibly high youth unemployment rates, slowing growth well before they get to rich country levels, a local government debt crisis, and a bursting property bubble. They’re not going to be able to resolve any of those issues without painful structural reforms. And despite their efforts at electrification, their economy (and the functioning of their military) is still highly dependent on imported oil. Their military has also been idle for quite some time and has ~0 operational combat experience. There’s also very little evidence that China has gotten anywhere close to parity with the US in aviation (a must if they don’t want that big navy they’ve been investing in to end up on the bottom of the Taiwan Strait a few hours after starting their invasion.) Taiwan itself is also a fairly tough but to crack, with relatively few favorable landing sites and a strong, technologically advanced military.
I think that the US has dedicated limited resources to countering China’s rise in large part because they’re still quite far from capability parity, especially in an offensive war conducted overseas.
You can add nuclear submarines to the list too. They're probably still 1.5 generations behind us and they just sunk their most advanced sub at dock:
https://archive.is/XPU6C
That’s surprising that they’re building submarines so far inland! I wouldn’t have guessed the Yangtze was deep enough for that far.
"There’s also very little evidence that China has gotten anywhere close to parity with the US in aviation "
Why do so many people continue to underestimate China? They've massively improved their airpower in recent years! Their new J-35 is 5th gen, roughly comparable (as far as is publicly known) to the US F-35. Their J20 is now quite as advanced, but still highly capable and being built in large numbers. Moreover, they can use land-based fighters since they're close to the battlespace, while the US would be entirely reliant on carriers and (maybe) a few distance bases with mid-air refueling and minimal load. The US is still mostly using 4th-gen F-18s on our carriers because it takes us forever to actually build anything.
The US has build over 1000 F35s, while the J35 hasn’t hit production yet. The US is currently readying to produce its next generation bomber, China has yet to.
The US maintains almost 20k jets, and has bases in Singapore, Japan, S. Korea , Philippines and Guam, and the US has mutual defense treaties with most of these nations. Japan has stated multiple times it would fight to defend Taiwan
It’s not to say a war with China wouldn’t be a disaster, or the US couldn’t lose. It’s to say the balance of power is still in the US’ favor, which is why China is working hard to close the gap
"which is why China is working hard to close the gap"
they're not "working hard to close the gap," they *are* closing it, and very rapidly. I don't care about the balance of power right now, i care what it will be like 5, 10, and 20 years in the future. China has caught up in technology, and has massively surpassed us in production. Having bases in other countries doesn't directly translate to winning a war in a specific area. The US seems to think its military is invincible and is content to rest on its laurels forever.
As a one-off response to 3 comments pointing out China has problems
1) Taiwan's off China's coast and an ocean away from the US. China has home field advantage.
2) There's lots of precedent for autocrats launching ill-advised wars. Even when they lose, it'd still have been a lot better if they'd been deterred out of starting at all. Nazi Germany, Soviets in Afghanistan, Saddam into Kuwait. In Ukraine today Putin looks on track for at least a partial victory.
I'll pre-emptively acknowledge the Europeans are far more guilty of failing to maintain defences. However, Europe's paid a steep price for that. Also, two wrongs don't make a right.
Even with Ukraine, Putin's "victory" is likely to be a pyrrhic victory. He clearly expected this war to be over in like a week. I know the sanctions have not been as damaging as we hoped to Russia's war making efforts, due to the creative ways of selling oil/energy but that's not the same thing as saying the sanctions haven't been damaging.
I'm scared for Ukraine almost as much as anyone with Trump in charge. My friend convinced me that as scary as Matt Gaetz AG is, Tulsi being head of DNI is worse given all sorts of signs point to her being an actual Russian asset. What happens to the source we clearly have high up in the Kremlin? But regardless even if Putin "wins" the chances of an Iraq style counterinsurgency seems extremely high to me.
"China's GDP is ~25% higher than the US' at purchasing power parity."
Just noting that this is such a weird measure. Ok, sure ... this is what happens when under-value your currency for 30 years. But that policy has destroyed their equity markets and their citizens are far poorer because of it. It's like ... controlling for how poor we are, we're not that poor.
Also, don't get this at all ... "The US is barely responding." We have the biggest expansion of our nuclear programs -- ever -- going on right now. How much bigger could we realistically go?
https://www.nytimes.com/interactive/2024/10/10/opinion/nuclear-weapons-us-price.html
https://archive.is/ftcIG
https://fas.org/publication/nuclear-weapons-2024/
Purchasing power parity is important to control for if you want to know how much skilled labor the economy has - the labor is paid Chinese wages, so in measuring how much of it there is, you shouldn’t assume higher prices.
But obviously, for things like uranium availability, you want to use international prices.
If you care about military power, then the basket of goods should be what the military buys. That info isn't available, so the rule of thumb for military spending comparisons is wages are PPP, procurement is international $. That helps China, but not as much as using pure PPP.
I mean, we could get to the 1970s level…
“Of course the US' economic resources could be more equitably and efficiently allocated”
That’s certainly not obviously true, and there are good reasons to think that further interference by the federal government will make the economy less efficient, not more.
Defense spending as a % of GDP is not at a post-WW2 low. It was lower in the late 90s/early aughts.
Fred says it's been 3.6-3.7% the past few quarters, while the 90s trough was 3.8-3.9%. There might be some broader definition under which it is a bit higher now but either way it's towards the lows. Meanwhile China and Russia for that matter have majorly raised their spending.
https://fred.stlouisfed.org/seriesBeta/A824RE1Q156NBEA
I hate it when Mom and Dad are fighting.
SIPRI provides different numbers:
https://data.worldbank.org/indicator/MS.MIL.XPND.GD.ZS?locations=US
"...and the Free Press perspective, which is to complain about Democratic Party positioning on cultural issues because they want to see Republicans win elections and cut rich people’s taxes."
Matt is itching for a (rhetorical) fight with Weiss, et al, and quite honestly, I am 100% here for it.
I should add, it's not for sheer entertainment purposes. There is a massive gap between what they purport their mission to be over there and what they actually do, and I'm in favor of people calling them out over it.
Do you think he gets it right, though? I agree that the FP pitches itself as "news" when it's really an opinion publication with a narrow focus on anti-progressivism. But I think it's wrong to think that what's going on behind the scenes is everyone twirling their mustaches and plotting to help Republicans win.
There are plenty of people at the FP who are explicitly against Trump. The only thing that unites everyone there is a virulent hatred of progressives. Matt is usually against bad-faith interpretations, so I struggle to understand why he thinks that everyone at the FP suddenly decided that they liked low taxes on October 8th.
I see the FP as audience capture.
I think many alternative media endeavors start out with this (correct) idea that most Americans aren’t fully dedicated to the right or the left. The problem is that the people who pay for news subscriptions are.
Yes. I also wanted to make this point. The idea that the FP is all in for lower taxes seems absurd to me.
I actually had a good conversation with someone who writes there a couple of weeks (she is engaged to a 2nd cousin of mine). I told her that there were a lot of things I thought were great about FP and that they have real personality but also felt like they were more anti-anti-Trump than committed to following the truth.
Their staff is definitely very heterodox.
It's a publication full of "Sure Trump is bad, but......". What value could that possibly serve anymore?
A counterweight against reflexive #resistance liberalism that opposes any Trump policy, regardless of its specific merits? Making the best of a difficult situation, recognizing that the U.S. is effectively stuck with Trump for another term?
Even from the perspective of a partisan Democrat, there is ample reason to attempt to understand the perspective of the millions of Americans who share the view that "Sure Trump is bad, but..." and then vote for him anyways.
The FP did not endorse Trump, and they made a show of not endorsing any candidate. I applaud that. Merely having a few opinion pieces from contributors explaining why they personally voted Trump is not an institutional statement on behalf of the FP. It's frankly odd that the NYT, for one, has basically never published such a piece, and instead has carefully curated its conservative columnists to only include never-Trumpers.
IMHO, it is depressing to imagine that so many seem to think it is impossible for an news/politics outlet to not "come down on" the side of one political party or another.
More value than publications full of "Let me tell you how bad Trump is going to be ".
The problem is that the FP isn’t really news so much as it’s a glorified center right blog that masquerades as news. I think the US media landscape could absolutely use more center right, factual reporting outside of just the WSJ, but that’s not the FP at all
I am super curious to see how they react to the Trump administration actually following through on stuff like "fire all the general who were into that woke stuff" or, you know, violently rounding up immigrants and putting them in internment camps.
The Free Press started with some occasionally introspective criticism of woke excess, focusing a lot on how trans activism was bad for women. Then they started scooting towards MAGA until finally writing those "this is why, despite *all of this*, I have come to support Trump".
The repeating pattern with Trump is that, once you enter MAGA orbit, you are presented with two bad options, then two worse options, then two more even worse until either you go full brain-worms or you slink away, broken and possibly incarcerated. The Free Press crowd is immediately going to be confronted with bad option a) rationalize a defense of an indefensible policy or bad option b) criticize the policy and watch their subscriptions implode.
"Then they started scooting towards MAGA until finally writing those "this is why, despite *all of this*, I have come to support Trump"."
Who at the FP wrote that they support Trump?
Bridget Phetasy, just off the top of my head
It's a good summation of the path of many of the folks over there.
https://www.realclearpolitics.com/video/2024/11/03/bridget_phetasy_im_hesitant_about_trump_but_im_voting_against_the_left.html
Yeah, that article is bonkers. Reminds me of SA's endorsement of Harris:
"A long time ago, I wrote about the difference between ingroup, outgroup, and fargroup. Ingroup and outgroup you know. But how come people have stronger emotions about Ibram X. Kendi (or Chris Rufo) than about Kim Jong-un or whoever's committing the latest genocide in Sudan? It's not because you're American and naturally care about American affairs - how about that Brazilian judge who banned Elon Musk's X? It's because all those guys are part of your psychodrama and some Sudanese psychopath isn't. Well, Kamala Harris' price controls are my outgroup; Donald Trump setting tariffs is my fargroup....But when I ask what work I have to do, it’s to prod the part of my brain that says “The Democrats are terrible! You should lodge a protest vote!” and remind it that Trump is also terrible. This isn’t a null hypothesis test, where you consider whether the Democrats are worth voting for, and then, if not, vote for their opponent. It’s a comparison on the merits of two alternatives."
https://www.astralcodexten.com/p/acx-endorses-harris-oliver-or-stein
Interesting, had never heard of her.
Here's what I mean: this is the only thing she says about the views on the right, the rest of the article is detailing every bonkers opinion some weirdo in Portland holds on Twitter.
"Now, I am not saying the right is perfect by any means. Just because I'm voting against the left does not mean I'm on board with everything that's going on on the right. But I do think there are establishment problems on the left, and they need to be stopped."
FP had a piece the day before the election: “we are equally divided among those who support Trump, those who support Harris, and those who support neither, and we are all best buddies!”
Fair and Balanced (TM)
Did they say who was for whom?
On the best buddies part, would you end a friendship with someone who voted for Trump?
They didn't (probably on purpose).
Yes, I would. I care about my friends having some semblance of moral standards. Trump is so flagrantly, ostentatiously amoral that I cannot respect anyone who votes for him, and I don't want to be friends with people I don't respect.
What I would think (not necessarily say out loud) about a friend who voted for Trump: "That man explicitly ran on 'I am your retribution,' 'fuck the Americans who don't support me.' I don't support Trump; therefore, he hates me and wants to fuck me over. And you supported him. What does that say about you? And don't give me any false equivalence; Harris criticized and mocked Trump harshly but she never, ever ran on 'I want to fuck over Trump voters,'"
I'll admit that I probably wouldn't be friends with a hard-core MAGA acolyte in the first place, but ending friendships over ideological disagreements is what cults do, so no way.
nope. Both my wife and most of my family voted for Trump. I didn't (the whole stealing the election thing was a deal breaker).
Ending a friendship over who someone voted for seems pretty stupid to me.
I have "Common Sense with Bari Weiss" in my RSS reader and leading up to the election I saw articles of the form "I am a sane, rational individual like you, but I have come around and now accept that the best outcome is a Trump victory." go by, e.g., "I Refused to Vote in the Last Two Elections. Now, I’m Voting for Trump." by Martin Gurri (October 16, 2024)
They will do A, and then blame it on the left, somehow.
No doubt, it will start with takes about how "if you progressives think what is happening is bad, you only have yourselves to blame", which will work for things like installing RFK Jr. at HHS. Then Trump will do something blatantly corrupt and/or criminal and they'll have to take the "if the president does it, that means it's not illegal" line or risk a subscriber revolt.
"We have a constitutional democracy, and in it, the supreme court decides what is legal or not, so if the supreme court says that the President can sterilize the entire state of Illinois, then that is within the law. I thought you libs were all about democracy?"
I think Matt's tongue-in-cheek criticism that FP wants Republicans to win so they lower taxes is aimed at the self-styled libertarians who have entered the FP orbit. It bugs me that they would cozy up to the MAGA agenda, which is advocating for an unprecedented intrusion of government into our daily lives. And I hope the *actual* libertarians get off that train go back to writing self-conscious Reason articles promoting borderline anarchy.
TheFP like The Dispatch seems to employee a lot of different authors with different viewpoints. Some Pro Trump, some anti-Trump and some a pox on both their houses.
This seems pretty reasonable to me.
And I would submit that both have done some great reporting. TheFP's stuff on antisemitism in public schools was great.
I also follow Blocked and Reported and occasionally check in with the comments there, and the folks there *also* believe TFP doesn't do what it says on the tin.
Claim: heterodox views! stuff the wokes won't let you publish! real discussion!
Truth: slightly more couched and intelligent anti-anti-Trump stuff than The Federalist
I used to really enjoy B&R but man Katie is pretty much just anti-left at this point.
I'm still a big Jessie fan - he's literally bought my affection as he got me a beer when he was in London this past August, so take my fandom for what it's worth - but I agree with you on Katie. To be fair, she has been treated very badly by "the left" and I don't blame her for being pissed, but overall I find her insights to be pretty dime-a-dozen "wokeness is bad" cliches.
Josh Barro is smarter and considerably more principled than the BARpod crowd, IMO.
Ditto.
I’m just not sure that that’s an accurate description of the Free Press’s (or Bari Weiss’ personal) perspective.
I don't care what they claim their (or her) perspective is, I'm going with their output.
I followed that site for quite a while and it got progressively more and more about bad-faith "look at these crazzzzzzyyyy libs" while articles about the right were always along the lines of, "the mainstream media says this about Trump, let's see if those liars dotted all their i's and crossed all their t's" without even diving in to explore whether Trump-proposed policy [x] would, in fact, be bad.
Oh I a referring to MY’s claim that The Free Press wants to criticize the libs so that Republicans win and rich people get tax cuts.
I don’t think that’s accurate.
The Free Press is trying to have a place with viewpoint diversity to fill in gaps left by the mainstream media, which is primarily run by urban left wing Democrats.
It attracts people with heterodox views (including leftists, Trumpists, conservatives and libertarians). But what’s missing from yet publication is an actual defense of liberal orthodox votes.
But I see very little evidence that the motivation of most of the Free Press writers is small government, low taxes for the rich. Perhaps some. But I think they are more motivated by distrust of mainstream media and orthodox liberal thinking.
What do you think TFP is doing?
Making money by talking about the things that progressives do that annoy people. That it helps Trump is IMO not nearly as important as that people like bashing progressives. Often for good reason, but still...
edit- not a FP subscriber/reader, but its my take from 1000 yards.
I think the big difference is that there are plenty of places to read criticism of progressives while still maintaining a clear anti-Trump perspective: this site, Chait, The Atlantic, Singal, etc. The FP is the only one that appears dedicated to creating a permission structure for Trump support.
I agree. Which makes it the same as dozens of other projects in the right wing media ecosystem.
The degrowthers haven't thought through the ramifications of their policies on housing. At all. Like, even if you have the most aggressively redistributive policies imaginable (envision an extremely robust and progressively structured UBI on top of all our other safety net spending), we'd still need more homes. Human exist in the physical world and need actual housing to live in. Confiscating vacation homes isn't going to be nearly enough, either.
Now, the degrowthers will say we can just have noble government agencies build housing supply (like back in the good old days). But even that's a problem in 2024—NIMBY barriers, lawsuits, environmental hurdles, etc are used to prevent the construction of public housing, just like private housing. Which means you'd have to change laws and engage in root and branch permitting reform. But if you're going to do that, why not just allow private builders to build? Are they really going to clear the way for large scale production of public housing while FORBIDDING *private* housing from being supplied?
It's all very nonsensical.
Plus, the flaws of everything bagel liberalism makes public housing absurdly expensive to build.
The zero sum mentality always drives me nuts here. There is no natural barrier to having plenty of long term residential housing *and* plenty of short term rentals *and* plenty of hotels *and* plenty of vacation homes and condos that stay vacant most of the time (but still generate full property tax revenue!).
"There is no natural barrier..."
Actually, there is: the law of physics that says two objects can't occupy the same space at the same time.
Sorry to sound snarky, and I love looking for positive-sum games whenever possible, but land is just about the most zero-sum thing there is: there's only so much of it, and you can't make more.
But you can build taller buildings with multiple units in them for multiple purposes.
Sorry to sound snarky in response, but land is not housing.
> we'd still need more homes
The Japanese model of a shrinking population and a housing stock that depreciates in value is possible, just not a good idea for American.
Well, we're going to join Japan in the shrinkage department before too long, if the Census Bureau is correct. And yes, this is taking into account immigration. We're not letting in nearly enough people to make up for the birth crash:
https://www.census.gov/newsroom/press-releases/2023/population-projections.html
maybe. But in the meantime we should build more housing.
I mean, the logical conclusion of degrowth housing policy is to confiscate every detached single-family house and force everyone to live in Chinese-style apartment towers.
"Americans are much richer than Europeans, and that matters."
Does it, though?
This is going to be another "drosophilist posts something most commenters, and Matt Y himself, strongly disagree with," but if we all agreed with each other all the time, this would be a boring-boring (as opposed to slow boring) comment section, now wouldn't it?
I have lived in the People's Republic of Poland, in Canada, and in the United States. I went from very poor (by American standards) to wealthy. And I have to say: wealth is great, but Americans as a whole aren't getting a good bang for their buck in terms of *well-being* and *happiness*.
For a country that was ostensibly founded on the pursuit of happiness, we do a piss-poor job of it. People are ungrateful as heck. We had one of the best post-pandemic recoveries in the world, and people bitch about the price of gasoline and eggs. We have a shit-ton of social dysfunction, loneliness, people hate each other across party lines, most of the country thinks we're on the wrong track.
And a lot of the ways in which we spend our money make us unhappier in the long run. We eat crappy food and get heart disease and type 2 diabetes. We sit on our asses all day and drive everywhere and we get the health problems that come with a sedentary lifestyle. We post on social media, which stokes our fear and resentment and envy. We watch YouTube or movies or play video games for hours on end in our spare time and then wonder why we have no social life and no friends.
I don't have any policy prescriptions, I think government sucks at enforcing anything like morality, anyway enforced morality is a contradiction in terms, because morality must be freely chosen (paging Ayn Rand). Mostly I just wanted to put up a little flag that says, "Yes, yes, material growth is all well and good but what are we getting out of it?" Bigger houses, bigger lawns, bigger and heavier cars, more Made in China plastic stuff, more screens to stare at, how much happiness and goodness has this all brought us?
But a poorer America doesn’t revert to being Europe. You’re still stuck in a huge house only now you can’t afford to heat it. You’re still in WalkScore 0 land and now you can’t afford gas. Physically transforming America to something more satisfying is going to require vast wealth.
Good point.
But it doesn't require vast wealth for people to change to some healthier habits. Even if you live in WalkScore 0 land, you can put down the McD's and cook some lentil soup. And call a friend instead of binge-watching YouTube.
If your wages don't keep up with cost of living because we are getting poorer, you have less time to cook and are *more* likely to get McDonald's because the alternative is eating chips at home or going to bed hungry.
I don't think the problem in this last election was Harris or the Democratic party. I don't even think it was the loudmouth, obnoxious progressive voices.
I think it was the voters.
Sure, we can't replace the electorate. But I'm guessing that four years of Trump/Vance will change an awful lot of minds. I'll be happy to welcome back the sinners, but I think they're going to have to learn some painful lessons first.
8 years after "the Democratic Party did nothing wrong, it was the voters and they'll realize they were wrong after 4 years of Trump" and now there are more Trump voters than ever.
Maybe we try something different this time.
The voters did realize they were wrong after four years of Trump! Actually they realized it after two years!
4 years after that, they apparently realized they were wrong to elect Biden over Trump in the first place.
Do you think the country will generally be in a better state when Trump leaves on January 2029 than it was in November 2016?
No, of course not. And look, I think blaming the voters is futile, since as Marc acknowledged we can't change them so we should focus on what we can change. I don't think the Dems have been flawless; far from it. But I also don't think that a flawless Democratic Party would win every election, because voters really do have short memories and poor understanding of political cause and effect. If we don't keep that in mind, we're going to be disappointed a lot.
A flawless Democratic Party is impossible, but I do agree that a better Democratic Party would still lose elections. That being said, I still don't buy that a better Democratic Party could not have won this election and there's plenty of good reasons to believe that. Kamala jumped into the race an almost immediately had a 3-point polling lead and nearly even favorability against an unpopular opponent with inflation improving, all before even having to spend a cent of what would become a billion-dollar warchest and still somehow lost.
I also don't buy that voters have as poor an understanding of the state of things as some think they do. Democrats embrace inflationary policies and inflation happens. Democrats adopt rhetoric and policies that come across as being on soft on crime and illegal immigration and we see higher crime, homelessness, and general disorder in Democratic-run cities.
Poe's law strikes again!
I don't think he was saying its the *only*, or even primary, thing that matters. Matt's written at length about how "sitting around doing basically nothing" has become way more addictive and appealing in the last 20 years, with all sorts of the bad downstream effects that you allude to. But wealth does matter a lot, and "make GDP line go up faster" is probably more tractable (and certainly more quantifiable) than "fix deep-seated cultural problems that encourage loneliness, gluttony, and disfunction".
It'd be nice if we could get the cultural package of Scandinavia or Israel, which (apparently) makes those places the happiest in the world. But there's still a pretty strong correlation between wealth and all sorts of things we associated with a good life, so let's work on that in the meantime.
To wit: you COULD carefully shape the culture (how?) to encourage more exercise, smaller portions, and healthier eating... or you can just pour money onto econ-maxing, invent Ozempic, and use the magical pill your hyper-innovative economy just discovered to turn a cultural problem into a financial one. I'm not saying this will work in every case (hard to see how we fix the build environment this way, for example), but I bet there are actually a good number of lifestyle problems that are pretty amenable to this approach.
While we can't enforce morality, we CAN and should teach the difference between Abundance and Excess, with an appreciation of the former and abhorrence of the latter. I was lucky enough to learn it as the son of two Depression Kids and from twelve years of Catholic schools when they were at their apogee. My siblings and I passed it on to our kids, most of whom completed college debt-free -- by working and selecting schools for quality, not prestige -- have good careers, and are homeowners in their late 20s or early 30s.
I just wish that I had some brilliant insights on how to duplicate that at scale.
Excess is an unfortunate symptom of abundance. I disagree that we should preach abhorrence of it. That leads to our current world, where people actually think the cure of degrowth is better than the disease of excess.
Excess doesn't HAVE to be a symptom of abundance. It's a choice.
A choice by whom?
If you want to approach this along the lines of "Ask everyone to ignore their basic human natures and make better choices", I think that is doomed. Therefore you are left with policy that discourages or eliminates excess. And I've yet to see many that don't end up removing a ton of healthy tissue in an effort to remove the cancer.
The devil is in the details, obviously, but a general "Excess is evil" philosophy is, shall we say...unlikely... to use nuance and actually get into the details of each policy proposal.
i was going to post something similar. It's amazing how US gdp per capita has grown something like 5x since 1980, and yet people are more miserable than ever. "growing the economy" doesn't seem to be a very effective answer to real human problems. Perhaps that's part of why people have gotten tired of the Democrats relentlessly boring message on the economy.
The part you’re missing is Jared Polis’s focus on making things cheaper. The goal shouldn’t be “the government will provide x.” It should be the government will ensure you can afford X. Part of that is strong economic growth and part of it is making things cheaper.
100%. Democrats have to become the party that lowers cost of living. I'm totally Annie Lowrey pilled on this. Ezra's interview with Polis was such an aha moment for me and why I can't stand Pritzker. Pritzker is still pushing legacy high tax + redistribution. It's a race to the bottom and it's ruining Illinois.
That said Chicago is shockingly cheap.
I think that's just being a midwest city though.
I need to see data on this. Illinois as a whole ranks #1 with the highest local tax burden and NIMBY zoning caps have constrained all the high growth areas in Chicago. If you're looking at the Chicago MSA ... maybe, but that's just because the south and west side are completely desolate.
I have a distinct memory of visiting Chicago about two years ago and taking the river boat tour. The lady guiding the tour did the "guess how much monthly rent in that brand new, multi-story penthouse over there is" game, and when the answer came back as "$10,000/mth!" half the boat laughed at how ridiculously affordable that is per sq/ft where we come from. The prices my CHI friends paid for their houses don't even exist for starter homes where I live. I don't know what's going on in Chicago, but from my limited research it feels like the best bang for your housing buck in the country right now.
Chicago is still bleeding population, and like any city that has been losing people for a long time, it doesn’t have a particularly constrained housing market. See: Cleveland, Buffalo, St. Louis, Cincinnati, Rochester, etc.
It’s a world apart from NYC, or San Jose, or Vancouver CA, for instance – rich cities that struggle to build anywhere near enough housing for the people who want to live there.
Yeah, but the difference between Chicago and all those other cities is that they're nowhere near as cool as Chicago? Like, Chicago is legitimately a world class city, probably second only to NY in the US in terms of urban amenities, whereas Buffalo is... Buffalo. Like, it's not surprising to me that housing prices are steady or trending downward in Cincinnati or St. Louis. But if you take a list of the 15 best cities in the US in terms of urban lifestyle amenities, only CHI has seen little housing cost growth. I get that weather is a confounding factor, but Boston/Toronto/Montreal have shitty winters too, and they have all seen exploding costs.
Condo prices in the city are laughable low and when I was visiting we joked about playing the punch buggy game every time we saw a new condo building going up. They are everywhere!
Not sure which buildings you were price checking but the majority of towers coming out of the ground r/n are apartments and the one's that are condos (e.g., Cirrus) are locked in so far above market pricing they're secretly flipping to apartments.
The Hancock (the one with the pool on the 50th floor). 3 bed 2 bath 1806 sq feet for $595k. That’s way less than 1/3 the price of NYC per/sq foot.
And it even has a parking space for fucks sake.
As someone who is kind of the opposite politics as the people in your intro, where my first priority is left cultural politics it’s nice to recall that I basically agree with center-left economics.
Like basically all of this feels really right to me. Tradeoffs matter, support for people who need help and growth is good, regulations are complex and needed to be imposed as a late resort with a spirit of humility.
Why don’t you have a seat right there?
there is a gap that cuts across parties in retards to a future-oriented pro-growth agenda
MAGA is fundamentally backward looking. just like the democrats implicit de-growth faction turns away from the party
a reagan/clinton type pro-growth agenda needs to be fashioned for this century to capture our imaginations. build america great again!
"...to capture our imaginations". This is the part that is missing. California can't even build its bullet train!
It’s doing a better job than any other part of the country! (Real shame that Union Pacific won’t let them build the important segment from Bakersfield, through the Tehachapi Pass, to Palmdale.)
Florida built a real train!
I’m glad they’ve got what they have! But it still maxes out at 130 mph, and it remains to be seen if they can actually connect something urban in Orlando or Tampa.
Lack of vision is the problem. It seems to me like the way of the future should be the idea of universal portable safety nets (health insurance, retirement, etc.) free market goods and services. Embrace tech as a delivery method, aim for high efficiency. What needs to be rejected is the hold over ideas about a big brick and mortar state and official unionized stakeholders, i.e. Europe. That's hard for me to say since I used to like a lot about the European model but it's clearly being left in the dust. It's also an area where I think we simply embrace that America is different than the old world nation-state democracies and so of course our system is going to look different. There's absolutely nothing wrong with that, especially if it sustains a high standard of living and isn't riddled with holes people fall through for arbitrary reasons. The current problem is that ours is still a bit of an incoherent patchwork.
I don't think Matt provides a very compelling vision of what an economic agenda IS, here. He has some basic sensible points of what it is NOT.
Yeah, Matt's vision seems to be "make all of the right economic decisions." Regulate when it's good to regulate and not when it's bad, set up good income transfer schemes instead of bad ones, support industrial policy in just the right industries...
The problem with this vision is that you can only sell it if you have a proven track record of being really good at managing tradeoffs and intervening only when necessary.
This is not the track record that Democrats actually have.
I mean:
"I think that leads us to see that the social safety net is incredibly important, but so are other things. Population movements to the red states are telling us something important about the cost of overregulation, especially but not exclusively, in the housing sector. Regulatory protections can be very important, but rigorous cost-benefit analysis is also important. Economic growth and consumer goods matter a lot. Stopping cartels from jacking up prices helps poor kids a lot. Trying to create a comprehensive price control regime so lawyers can get over on businessmen does not. Investing in effective educational institutions is great. Providing open-ended subsidies to college and universities and telling yourself it’s “neoliberalism” to demand any kind of measurable result is not."
Or if you want it pithy, there's, "Economic self-interest for the working class includes both robust economic growth and a robust social safety net."
I agree that a lot of this article is spent contrasting the existing ethos as opposed to setting up a new one from scratch, so to speak. Is that what you're looking for?
No, look. Here are some economic agendas:
* Markets and capitalism are to be minimized and eventually eliminated. Price setting and government provision of goods are good.
* Markets provide prosperity! We should deregulate and unencumber markets to the greatest extent possible, and then do a layer of redistribution on top of that.
* We want a strong industrial base. Provide government protection to manufacturing businesses in order to have as much industrial supply-chain in the country as possible.
* Prosperity through exports! We want to make goods at world-best price/quality tradeoffs to maximize external markets for our goods.
Or there are many others. These provide a lens through which to evaluate ideas. They tell you what policies to pursue. They are helpful in coming up with new policies. They have a strong goal.
Matt's deal is like, "Try to do good things." I mean, that's great. I maybe agree with Matt's ideas more than I do any of the above agendas. But it's not an agenda. If you're thinking about, "Okay, what should I do to improve the economy?" Matt's "agenda" doesn't really tell you anything. Try to do good things. It does tell you some bad things to avoid (and, again, that's fine), but it's not an AGENDA.
He wants better supply-side policy. Okay! Me too! What does better supply-side policy look like? We know it involves antitrust, but not too much antitrust, and regulation, but not too much regulation, and, uh....
That's because what's needed is both. You want to pursue and abundance and growth agenda. BUT you also need to acknowledge that sometimes regulation is going to be the right answer.
When to do each can be a hard question. And you can literally write 100+page policy paper or whole books on it.
You can write hundred page policy papers on anything. But highly detailed policy papers are not *agendas*.
Agendas are like, "Okay, here are the three or five or ten or one things that we need to do." "We should do the right things" is not an agenda.
Fair but I think Matt's been pretty clear about the broad brush strokes he's in favor of.
Things that might piss off some local special interests but have much bigger positive effects for the economy overall.
Let them build more housing
let them build more electric stuff and connect it.
let them automate the ports etc
YIMBY has an agenda, it's true. I think that's the one thing that's pretty clear that would be a big item on Matt's agenda.
Is it in fact true that he thinks that power infrastructure is one of the top items on the economic agenda? I'm genuinely unclear (yes, it's clear that he's in favor of it, that's different).
What does "let them automate the ports etc" actually mean? Like, what's the etc? Is it "weaken organized labor"? Are there other cases where something (unions? other stuff?) are preventing automation that are high-impact? Is automating the ports actually high impact (I though the construction physics article here was pretty convincing)? Like, again, it's not that I think it's directionally wrong, but is this actually deserving of a major item on the agenda?
This is what I mean by there isn't an agenda here.
Closest he gets is "fully refundable Child Tax Credit" which he admits is not great politics, but worth (someone else) risking their career over. Would have loved to see more details.
Just a nitpick on student loan forgiveness that I've picked at before--even if it was meritorious as an easy way to achieve stimulus while bypassing Congress, the politics of it were always going to be toxic, as plenty were going to see it, rightly or wrongly, as a handout to people they deemed didn't need one, and that it would be insulting to those who did pay their way through college and wouldn't get anything from it. It's a pitfall that should have been avoided from the start.
I beat this drum with people IRL. Any kind of large-scale loan forgiveness will be political suicide and will encourage a lot of poor choices by students and universities.
I really think that academia is one of the worst parts of the Dem coalition. So much waste of time and money because "education is always good" is considered axiomatic on the American left.
The YIMBY on housing issue is still too niche for national elections. A lot of battleground states have plenty of homes. Multi-family rents are high, but they are usually pretty responsive to supply and demand forces. YIMBY on public infrastructure is of bigger importance. If the pattern is a yo-yoing between parties, then it is extremely important that if an infrastructure bill is passed, that projects get done before the next election. And push back on the environmentalists that are anti road building. People like good roads.
I continue to think that YIMBYism for electrical transmission is underrated from an economic standpoint. Electricity enables a lot of jobs at the destinations and at generation.