# The Rush to Avoid Taxes

We now have less than 30 days to finish up our federal tax forms and get them to the IRS and state capitols. As I noted recently in this blog, “taxes are dues for living in a civilized society”. So why do we all seek every advantage to reduce those taxes? We want deductions for …

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# The weirdest academic seminar ever

… but in a good way! :-) Beijing-based economist and rapper Andrew Dougherty (“Big Daddy Dough”) presents The Redprint: Rhyme and Reason in the Riddle Kingdom at the BYU Kennedy Center. This is his classic cover Beijing State of Mind: Dougherty interview on Sinica podcast. Tweet

Several years ago, I found out about Kiva.org, an online “microfinance” site where individuals can make small loans ($25 is the standard increment at Kiva) to entrepreneurs in low income settings. The entrepreneurs actually apply for larger amounts, which they typically receive from third-party “field partners”. The entrepreneurs repay the loans with interest to the … More # Taxes Are the Dues We Pay to Live in a Civilized, Democratic Society [I attempted to get this viewpoint published in three newspapers in Michigan without success. So I am putting it out there via the blogosphere. Share as you see fit]. Taxes are the dues we pay to live in a civilized, democratic society. Recent Michigan legislation introduced to eliminate the state income tax therefore suggests the … More # Independent Streams (week of January 23) Our weekly roundup of policy-relevant reads and IPPSR-connected research Problems Betsy DeVos’ Accountability Problem (link is external) IPPSR Affiliate David Arsen comments on charter school organization in light of President Donald Trump’s pro-charter school education secretary nominee Betsy DeVos. Senate Hearing, DeVos Shows Ignorance Central Debate Over How To Measure Schools (link is external) IPPSR … More # Two Recent Major Reports of Note Two Recent Major Reports of Note Here are two reports issued in the past ten days from two very different sources that should get way more play than they are receiving. There is a confluence between the two that I shouldn’t have to explain once you look at them. One report comes from the international … More # Publication – The Economics of a Food Fraud Incident – Case Studies and Examples, Including Melamine in Wheat Gluten We all know Food Fraud occurs for economic gain, but it is more complex than just “profit margin” or “commodity price swings.” Reviewing the incidents provides insight on exactly how and where bad guys are attacking… which is critical to prevention and selecting countermeasures. New Publication: The Economics of a Food Fraud Incident – Case … More # Brexit in the Multiverse: Dominic Cummings on the Vote Leave campaign It’s not entirely an exaggeration to say that my friend Dominic Cummings both kept the UK out of the Euro, and allowed it to (perhaps) escape the clutches of the EU. Whether or not you consider these outcomes to be positive, one can’t deny the man his influence on history. Wikipedia: Dominic Mckenzie Cummings (born … More # China’s Crony Capitalism: The Dynamics of Regime Decay (Minxin Pei) China’s Crony Capitalism: The Dynamics of Regime Decay (Minxin Pei) Minxin Pei is an exceptional observer of modern Chinese politics, although he tends toward the pessimistic. In his new book he has assembled a dataset of 260 major corruption cases involving officials at the highest levels, covering roughly the last 25 years. There is no … More # People Don’t Always Like Economists, But Economists Love Early Childhood Education Say what you will about the involvement of economists in education reform, but what economics has done to bring early childhood education and development into the spotlight is monumental. Given the high cost of childcare, it takes talking money on a national scale to get government talking about why they should care. Thanks to the … More # “Forest City”:$100 billion bet next to Singapore

Ghost city or $100 billion paradise adjacent to Singapore? Chinese developers build gigantic “Forest City” in Malaysian Special Economic Zone. 10 km of coastline! 2 bedroom apartments for <$200k. The mental model is Shenzhen: a city that barely existed 25 years ago, across the border from Hong Kong. Population today: 10 million. Bloomberg: The …

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# Shift Commission on Work, Workers, and Technology (New America Foundation and Bloomberg)

I spent yesterday at this event. If you look carefully you can see Tim O’Reilly in one of the photos below. New America and Bloomberg are convening the Shift Commission on Work, Workers, and Technology to bring together a community of leaders from different disciplines — technology, business, policy, civil society, academia, and others — who want to understand …

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# The truth about the Chinese economy, from debt to ghost cities

Highly recommended. See also references linked below. Andy Rothman has interpreted the Chinese economy for people who have serious and practical decisions to make since his early career heading up macroeconomic research at the U.S. Embassy in Beijing. He is now an investment strategist for Matthews Asia, where he continues to focus on the Chinese …

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# How Brexit was won, and the unreasonable effectiveness of physicists

The scale of … triumph cannot be exaggerated. He … had brought about a complete transformation of the European international order. He had told those who would listen what he intended to do, how he intended to do it, and he did it. He achieved this incredible feat without commanding an army, and without the …

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# Gunder Frank debates David Landes on world economic history

Gunder Frank debates David Landes on world economic history This C-SPAN video captures two hours of debate between Gunder Frank (ReORIENT: Global Economy in the Asian Age) and David Landes (The Wealth and Poverty of Nations), which took place at Northeastern University in 1998. Frank and Landes were on opposite sides of a debate over …

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# The Sell-Off of Democracy

In the past few months we have seen an acceleration of mergers among giants in many industries. Dow Chemical and Dupont, followed by Monsanto and Bayer, Marriott and Starwood, Microsoft and Linked-In, Verizon and Yahoo, and recently Miller and Budweiser. Each of these firms were giants before a merger. By combining they not only grab …

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# Will Spartacism Take Hold Again?

The economist John Maynard Keynes was one of the members of the British team charged with negotiating a peace treaty end World War I. After several months of frustration, he quit and in 1919 published a short book about it. In the book he warned about what he called Spartacism – a militaristic response by …

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# Cheng Li on elite Chinese politics (Sinica podcast)

Excellent podcast interview with Cheng Li of Brookings. Li has both a long historical perspective on Chinese politics (having lived through the Cultural Revolution) and a detailed understanding of current developments. He addresses topics such as technocracy, rule of law, Xi Jinping, corruption, princelings vs grassroots party members, etc. Sinica podcast: One of the most …

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# Perestroika and the discovery of price signals

I read The Oligarchs: Wealth And Power In The New Russia many years ago. A passage which I found fascinating, and still remember today, describes the explorations of reformist Soviet economists toward market economics and price signals. Imagine groping dimly most of your adult life for subtle but monumental concepts that lie far down a …

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# The Vanishing Trash Collector

July | 2016 | American Myths A few days ago the trash collector came along on his usual route. Typically, one person would drive while the other collected the trash bins and moved them to an automatic lift that dumped them into the truck. Afterwards, the same trash collector would deposit the empty bins on …

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# Chaos Monkeys: physics to Goldman to Y Combinator to Twitter to Facebook

Highly recommended! I blogged about this guy 5 years ago here: From physics to Goldman to Y Combinator. The book is hilarious and pretty accurate, AFAICT. I don’t know much about Facebook corporate culture or that particular era of ad monetization, but the finance and startup stuff all rings true. The reality is, Silicon Valley …

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# Arthur Kroeber (Gavekal) on Chinese economy

Highly recommended. Kroeber gives a realistic assessment of the Chinese economy, covering topics such as historical development models, infrastructure investment, debt levels, SOEs vs private enterprise, corruption pre- and post-Xi, demographics, hukou reform, etc. In this episode of Sinica, we present an in-depth interview with Arthur Kroeber, founding partner and head of research for Gavekal …

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# Enlightened Minds in a Darkening Time

It’s been more than a month since I finished reading two very insightful books, Sheldon Wolin’s Democracy Incorporated (2008) and John Ralston Saul’s The Collapse of Globalism. I have been wanting to write about them but have felt mentally paralyzed by fear that I could not possibly provide an adequate synopsis of their depth of …

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# If You Don’t Believe Change Is Possible – Read This

If you don’t believe change is possible the story of  Playing for Change that started as simply a videographer finding street musicians in various places around the world and then connecting them is a moving antidote to that hardening of the mental arteries. This initial travel experience has now evolved into a global band with …

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# Putting a Lid On It

It is time for me to get off my duff. I have been sitting safely a bit too long, ensconced in my middle class security. A security a majority can’t share. Time to push forward some radical possibilities. Here’s one to start, some of which I’ve hinted around in the past. It’s time to enact …

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# Another World Is Possible – An Unlikely Vehicle for Change

I was reminded earlier this morning before the light of day opened the curtains to a windy, snowy day that the paths we take are not all preordained. I was reading a Christmas gift, Lin Jensen’s Bad Dog!: A Memoir of Love, Beauty, and Redemption in Dark Places. One of the short pieces is entitled …

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# John Stuart Mill

My second “food ethics icon” for 2016 is John Stuart Mill. Mill is a pretty interesting figure in his own right and certainly one of the most important individuals of the 19th century. Mill inhabited a rarified intellectual and political environment from his London birth in 1806 to his death from a severe skin infection …

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# A New Year, A New Economy?

I did not begin the day with any intention to write about anything in particular. Several ideas popped in and out of my consciousness during the day, but no one thing grabbed me. But then I skimmed the new January 2016 issue of Too Much, diligently compiled by Sam Pizzigati, and saw a familiar name …

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# Saudis toast?

See also The one sided clash of civilizations. Telegraph: …If the aim was to choke the US shale industry, the Saudis have misjudged badly, just as they misjudged the growing shale threat at every stage for eight years. … The problem for the Saudis is that US shale frackers are not high-cost. They are mostly …

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# Who’s on the other side of the trade?

A great conversation between Tyler Cowen and fund manager Cliff Asness, who has appeared many times on this blog. See, e.g., this 2004 post on his analysis of the well known Fed Model for equity valuation, also discussed in the interview. Hedge-fund manager Cliff Asness, one of the most influential—and outspoken—financial thinkers, will join Tyler Cowen …

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# Bank of Japan More Innovative than US Fed

The Bank of Japan has begun a modest purchase of the stock of Japanese firms that expand the economy by investing in their factories or by raising workers’ pay.  “The BOJ is doing what it can to support capital spending and investment in human resources” says the Bank’s governor.  In contrast, the American central bank …

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# Milnor, Nash, and Game Theory at RAND

Nash and Milnor were involved in experimental tests of n-person game theory at RAND in 1952. Even then it was clear that game theory had little direct applicability in the real world. See also What Use Is Game Theory? , Iterated Prisoner’s Dilemma is an Ultimatum Game, and, e.g., The Econ Con or Venn Diagram …

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# Dollar Empire

This speech emphasizes an under-recognized motivation for US adventurism abroad: local military and geopolitical conflicts enhance the strength of the US dollar as a reserve currency in the face of global volatility. The essay is long but worth reading as it gives a fresh look at superpower competition across multiple arenas, and some insight into …

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# Where men are men, and giants walk the earth

In this earlier post I advocated for cognitive filtering via study of hard subjects Thought experiment for physicists: imagine a professor throwing copies of Jackson’s Classical Electrodynamics at a group of students with the order, “Work out the last problem in each chapter and hand in your solutions to me on Monday!” I suspect that …

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# W-2s don’t lie

These numbers are derived from aggregate W-2 incomes for 158 million working Americans (see link for full table). The “raw” average wage, computed as net compensation divided by the number of wage earners, is $7,050,259,213,644.55 divided by 158,186,786, or$44,569.20. Based on data in the table below, about 67.2 percent of wage earners had net …

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# Bourdieu and the Economy of Symbolic Exchange

From Bobos in Paradise by David Brooks. This part of Bourdieu’s oeuvre is, of course, required reading for all academics. By academics, I don’t just mean humanists and social scientists. Even those in the hardest of sciences and technology would benefit from considering the political / symbolic economy of their field. Why, exactly, did most …

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# Trump carried on interest and hedge funds: “They didn’t build this country.”

Say what you want about Trump, he’s one of the only candidates who isn’t beholden to oligarch campaign contributors. Below he goes after the crazy tax break that hedge fund managers enjoy. Bloomberg: … “I know a lot of bad people in this country that are making a hell of a lot of money and …

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# Thinking the Twenty-First Century

I stumbled on this one, Thinking the Twenty-first Century: Ideas for the New Political Economy, during one of my usual visits to the new book shelf at the MSU Libraries. I had not heard of the author, Malcolm McIntosh, before, but the title was intriguing and the praise on the book jacket was urging me …

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# Productive Bubbles

These slides are from one of the best sessions I attended at scifoo. Bill Janeway’s perspective was both theoretical and historical, but in addition we had Sam Altman of Y Combinator to discuss Airbnb and other examples of 2 way market platforms (Uber, etc.) that may or may not be enjoying speculative bubbles at the …

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# I call this progress

The tail of the (green) 2000 curve seems slightly off to me: ~10 million individuals with >$100k annual income? (~$400k per annum for a family of four; but there are many more than 10 million “one percenters” in the US/Europe/Japan/China/etc.) Via Roger Chen. Tweet

# Elegant Economies

The 19th century author Elizabeth Gaskel advises that “almost everyone has his own individual small economies—careful habits of saving fractions of pennies in some one particular direction—any disturbance of which him more than spending schillings or pounds on some more real extravagance.” She goes on to illustrate the point with examples, one of which falls …

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# Strange Alignments – Trade and Democracy

As the battle for fast track status for the Trans-Pacific Partnership (TPP) continues watching the alignments for either side form has been curious at least. President Obama and generally progressive Senator Ron Wyden (D-OR) have been bullish on the pact, as of of course has been conservative stalwarts like Sen. Orin Hatch (R-UT) and Sen. …

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# John Nash, dead at 86

The original title of this post was For this you won a Nobel (Memorial) Prize? But see sad news at bottom. A Beautiful Mind: Nash went to see von Neumann a few days after he passed his generals? He wanted, he had told the secretary cockily, to discuss an idea that might be of interest …

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# Why I won’t sign the petition to cancel all student debt

As I have written in the past, a lot of attention is currently being paid to the topic of student loan debt in the United States (a couple of representative posts can be found here and here).  Earlier this year, President Obama proposed to make community college free for all students, motivated at least in …

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# Proposal 1 Fails: Implications for Michigan’s Schools

The message sent by 1.7 million voters that entered ballot boxes across the state last week was loud and clear: voters rejected Proposal 1 by a 4-to-1 margin. The Proposal did not garner a majority of the votes in a single county in the state. While the central component of Proposal 1 was road funding, …

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# New kids on the blockchain

WSJ reports on institutional interest in blockchain technologies. WSJ: Nasdaq OMX Group Inc. is testing a new use of the technology that underpins the digital currency bitcoin, in a bid to transform the trading of shares in private companies. The experiment joins a slew of financial-industry forays into bitcoin-related technology. If the effort is deemed …

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# Our Kids and Coming Apart

Nick Lemann reviews Our Kids: The American Dream in Crisis by Robert D. Putnam. At the descriptive level, Putnam’s conclusions seem very similar to those of Charles Murray in Coming Apart. Of course, description is much easier to obtain than causality. NYBooks: … By the logic of the book, access to social capital ought to …

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New report from Brookings estimates value added (in terms of economic success) by university, controlling for input factors such as student quality and family income. This is just the first step toward outcomes-driven rankings of universities that will be far more useful than the existing rankings, which are largely based on prestige. Brief summary. See …

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# Earnings by educational attainment 1990-2013

This graphic is from today’s NYTimes: Why American Workers Without Much Education Are Being Hammered. Aside from the human capital (education) point the figure makes, I’m a bit puzzled by the following: real per-capita GDP is probably up at least ~50% (e.g., ~2% x 23 years) over the 1990-2013 period. Where did those gains go? …

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# The Fires of Mordor

We’re right in the middle of a multi-week theme here at the Thornapple Blog, so if you are just dropping in you might find it helpful to go all the way back to February if you want to get the full treatment. But the synopsis is that we’re taking a dive into moral dietetics: the …

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