ernie.bornheimer + bruenig   79

Hobby Lobby and Alter Egos | Demos
In the wake of the Hobby Lobby decision, there has been a discussion about how the decision comports with our understanding of corporate personhood and especially corporate limited liability (Brian Beutler, Matt Yglesias, Jacob Levy). The upshot of this discussion is that owners of corporations like Hobby Lobby appear to want it both ways. When it comes to religious beliefs, the owners want to be one in the same as the Hobby Lobby corporate entity. But when it comes to legal liability, they want to be separate from the corporate entity, such that lawsuits seeking relief are limited only to the corporation's assets.

Indeed, there is a contradiction between the Supreme Court's decision and the corporate law regarding limited liability.

One way to summarize the Supreme Court's decision is that: closely-held corporations are not separate from their owners, possessing their own separate legal persona, but are actually the alter egos of their owners. The problem is that in the realm of corporate law, the rule is that: closely-held corporations are afforded limited liability so long as they are treated as separate from their owners and not treated as the alter egos of their owners. In corporate law, when a closely-held corporation is treated as an alter ego by its owners, those owners typically lose limited liability protection and risk their own assets in a lawsuit against the corporation.
law  Obamacare  Bruenig 
october 2015 by ernie.bornheimer
The Rise of $2-a-Day Poverty and What to Do About It | Demos
The answer to extreme poverty is the welfare state and, if that’s not politically feasible, then we just have to admit that we are going to have a society with extreme poverty in it.
poverty  Bruenig  welfare  state 
october 2015 by ernie.bornheimer
It Matters How Rich the Rich Are | Demos
This is a clever bit of rhetoric, but nothing more than that. It is true, in some super-abstract sense, that the poor suffer because they are poor, not because the rich are rich. But it is also true that the poor can be made not-poor by reducing the wealth/income of the rich in order to increase the wealth/income of the poor. In that sense, then, the richness of the rich is a cause of the poorness of the poor.
Bruenig  poverty  cause 
august 2015 by ernie.bornheimer
Some problems with this traditionalist stuff | MattBruenig | Politics
you can’t get to libertarianism through any prevailing normative theories in philosophy. The institution of property is inconsistent with voluntarism, negative liberty, the non-aggression principle. Property is also inconsistent with desert. Capitalist economic institutions add another layer of inconsistency with desert. Utility demands transfers. And so on. Dimmer libertarians might think there is some way to scratch out libertarianism from those philosophical schools, but Gurri sees the writing on the wall and avoids them.
libertarianism  Bruenig 
august 2015 by ernie.bornheimer
Stigmatizing Poor Kids in Our Public Schools | Demos
Normally when someone goes on one of these rampages, an obvious response is to ask them to campaign against other welfare that is not associated with poor people. For instance, how about the $200+ billion spent last year in welfare programs for homeowners, the vast majority of which went to the richest 20% of families? Shouldn't we be working to stigmatize people who receive that and working to help ween them off of it? Shouldn't they be made to feel like human garbage so that they'll move off of the homeowner welfare programs? This is a fun enough game, but I won't pursue it much here.

Schools Are Welfare Programs

What I find more interesting, in the context of free school lunch crying, is the apparent blind spot of those who do it regarding what public schools actually are. When you hear people talk about free school lunches, they talk as if they have no notion of the fact that public schools themselves are just massive welfare programs.

I mean, really bask in the absurdity of the spectacle going on in all of this. We spend $12.5k per pupil each year to provide schooling for the 9 in 10 American children who attend public schools. Most of them get on the big yellow public bus in the morning, attend publicly-owned facilities, go to publicly-owned classrooms, and then receive instruction from public employees. In many cases, they also get from their schools a whole slew of extracurricular activities, from the public arts programs like band and theater to the public sports activities like football and basketball. The major part of almost every child's life in this country consists of welfare mooching off of public services.

Yet, somehow, in the context of this potpourri of public provisioning, providing free food while they are at the school is a bridge too far. You can spend $12.5k each year providing free welfare services to almost every single kid, but if you up that an extra, say, $5/day to provide food to the kids while they are at the school, then human souls become crushed and welfare dependency becomes inevitable. The public football teams and math classes do not wreck kids' hearts and minds, but the public milk does. You shouldn't stigmatize attending free history class as welfare moochery (I assume), but you should stigmatize eating a free burger as such.


The provided reasons for why conservatives get worked up about school lunch don't make much sense. The entirety of public schooling (which, again, 90% of children attend) is public welfare provisioning. If interacting with publicly-funded welfare programs wrecks children, a free lunch is the least of your concerns. Focusing on it with such fervor is incoherent.

But that's only if you take it at face value. The hatred of free school lunches emanates from the generalized hatred of poor people and poor people things. When you scan the cultural register, free school lunch is coded as a poor person thing and therefore people who don't like poor people things get super-heated about it. Public schooling itself, however, is not coded as a poor people thing. Both free lunches and public schooling are straight up welfare programs, but only the one coded as the poor person thing attracts the "anti-welfare" response. This is because it's not about disliking welfare. It's about disliking poor people.

The fact that conservatives look directly past a massive public welfare program in the form of public schools in order to cry about a minuscule fraction of that program in the form of school lunches makes the case for universal school lunches. Once they are universal and have been for a while, they (like public schooling itself) will stop registering in the mind of anti-poor conservatives as poor people welfare and will cease to attract their concentrated ire and the stigma that goes along with it.
school  lunch  lunches  Bruenig  welfare  education 
august 2015 by ernie.bornheimer
Salvaging Non-Aggression for Egalitarianism | MattBruenig | Politics
To rehash: the only world that follows the non-aggression principle is the grab-what-you-can world. In this word “nobody initiates force directly against another person’s body, but subject to that constraint, people regularly grab any external resource they can get their hands on, regardless of who has made or been using the resource.” This world follows the non-aggression principle because it forbids people from acting upon the bodies of others without their consent. Introducing the institution of property into such a world violates the non-aggression principle because it permits people to act upon the bodies of others without their consent (walk across an imaginary line on the ground and someone acts upon your body, usually the state).

That property violates the non-aggression principle is so obviously true that it is amusing anyone ever contends otherwise. The institution of property is the most statist, violent, aggressive, anti-libertarian, big government program in history. Through laws of one sort or another, people are violently restricted from nearly every single piece of the world around them. They do not consent to these restrictions, which are imposed from without, unilaterally and at the barrel of a gun. In the process, every shred of negative liberty and self-ownership is destroyed.
Bruenig  NAP  libertarianism  Locke  property  aggression 
august 2015 by ernie.bornheimer
Initial Appropriation: A Dialogue | MattBruenig | Politics
initial acquisition is merely a claim. Others can make claims for the same thing, for example in patent claims. The property RELATIONSHIP is a social relationship, where the claimant relies not just on his claim, but on social enforcement of his claim against the rest of society. Without that social enforcement, all the claimant has is a possession without rights: there are no rights stopping others form using it or from taking it away for themselves


The argument is not about whether there should be private property rights at all. It is about whether to accept the libertarian conceptualization of private property as some kind of inviolable natural right (such that, for example, taxation is verbotten) or whether to accept the liberal conceptualization of private property as a social construction (such that we can limit it; for example, by banning racial segregation even in privately owned restaurants).

The latter view has basically taken over the world, in the last century. The Lochner Era is gone and never to return. Private property can, should, and does carry social obligations on the proprietor, because it constitutes social obligations on everyone else. Taxes are an example; restrictions on use are another example.
property  Bruenig  Locke 
august 2015 by ernie.bornheimer
Uber and Social Insurance Regulations | Demos
In a lot of cities, the taxis are required to be able to take wheelchair-bound passengers. For instance, in London, 100% of the black taxis apparently must be accessible. Although this is a regulatory regime, it is actually a form of implicit social insurance. If taxis were not required to make their cars handicap accessible, very few probably would. The cost of doing so probably outweighs any additional revenue a cab drive might hope to get out of it. But, reasonably, people don't like the way this turns out. So, the regulation is there to make sure every cab does so, with the costs of that regulation being passed on to the entire population of cab users.

That is a common approach for certain kinds of social insurance. The alternative of taxing the public and then I guess setting up an agency that helps pay to outfit cabs to be accessible is not as efficient as just levying an implicit tax on all cab users to fund the accessibility measures.
Bruenig  Uber 
july 2015 by ernie.bornheimer
The State Does Not Enforce Most Agreements | MattBruenig | Politics
they are desperate to say contract law and contract enforcement aren’t regulation. This is because the word “regulation” is so ideologically inflected that certain groups of people want to make sure most of the things they support (especially things they fundamentally support) do not get classified as regulation.

Once you point out the obvious — that all government-imposed economic institutions are regulations — it becomes much harder for them to describe their position as merely being against “regulations” or “distortions” or “government interference.” This becomes a problem because they desperately want to pretend that their preferred economic institutions are what happens by default when you “get the government out of the economy.”

But it isn’t, of course. After property law, contract law is the biggest regulatory system in the country. What’s more, you could plausibly repeal contract law altogether. I often call for its repeal as a joke, but it’s totally doable. People might make less agreements if the state is not willing to impose itself into those agreements, and that might even be a net bad for overall well-being in the world, but I don’t think it would lead to the demise of all humanity.

It would just mean that sometimes you’d make agreements with people that they did not follow through with and have no way of getting the state to force them to compensate you for their breach. Presumably this deregulated environment would require you to be more careful about who you make agreements with, utilize reputations more, and come up with ways to price the new default risks that exist in a world where the state has gotten out of the business of contract enforcement. But, again, all of this is doable.

The fact that ending contract law is deregulatory poses serious questions to those anti-government sorts out there. What reason is there to involve the state in contract law? Why expand the size and scope of the government to cover this stuff? Don’t you want the government to be small? The answer, of course, is that their supposed commitments against regulation and the big government are rhetorical feints. Like everyone else, they want the government to be as big as it needs to be in order to implement the institutions and regulatory regimes they like, but not to implement the ones they don’t like. By cleverly defining the things they don’t like as “regulation” or “big government” or “intervention” (and excluding from those definitions all the regulation, big government, and intervention they do like), they get to say they are against these things and that this opposition is what animates their politics. But when those words are defined in that way, such opposition amounts to nothing more than them being against what they are against.
law  libertarianism  Bruenig  contract  contracts  government  politics  scope 
july 2015 by ernie.bornheimer
In Kansas and Missouri, Envying and Excluding the Poor | Demos
The upshot of this analysis is that it's OK to be mad at what people get if they aren't really entitled to it. The poor aren't really entitled to their transfer incomes, while the rich really are entitled to their market income. But, as you can probably see, this means the anti-envy argument just begs the question on entitlement. People who think the rich are getting too much think that they aren't entitled to it, that they are getting income above and beyond what really deep down belongs to them. Thus, the whole anti-envy debate ends up not being about envy at all, but instead about divergent views of entitlement that are circularly packed into the anti-envy arguments. This is not surprising because nearly all distributive arguments that aren't explicitly about just entitlement have actually buried into their unstated premises some question-beg on just entitlement.


One of the understated problems with enormous inequality and poverty in particular is that it leads to social exclusion. The 1969 presidential commission report "Poverty Amid Plenty" skillfully explains:

To go to school costs money — books, notebooks, pencils, gym shoes, and ice cream with the other kids. Without these the child begins to be an outcast.

To go to church costs money — some Sunday clothes, carfare to get there, a little offering. Without these one cannot go.

To belong to the Boy Scouts costs money — uniforms, occasional dues, shared costs of a picnic. Without these, no Scouts.

To have friends into the house costs money — for a bit of food, a drink.

To visit relatives costs money — for travel, a gift for the kids. These people cannot afford to visit their relatives.

For a teenager to join his friends on the corner he must have some money — for a coke, a show.

How does a fellow take a girl out on a date without some money? And how does a girl pretty herself for a fellow without some money?

How do you join a club? Buy a book, a magazine, a newspaper?

Poverty settles like an impenetrable cell over the lives of the very poor, shutting them off from every social contact, killing the spirit, casting them out from the community of human life.

The proscriptions coming out of Missouri and Kansas on what the poor can do with their transfer incomes are clearly calibrated to amp up this kind of social exclusion.

Want to take a date to the movies, a social ritual nearly everyone engages in, but have low market income? No movie for you. Want to make a nice dinner for family, guests, or a date? Sorry, can't do that. Want to hang out at the public swimming pool, have your kids go play in the water with the other kids? To bad for you. Need to buy cookies for your kids' class party or for a birthday party? Nope, not allowed.

These sorts of restrictions (and inequality more generally) end up creating two different societies operating in parallel with one another. In one, people with high market incomes are able to live out a full existence, with no restrictions on their ability to participate in social life, enjoy leisure, and fund the sort of discretionary purchases that are fundamental to relationships. In the other, people with low market incomes are made to live like badly-fed animals, unable to fully participate in social life.
envy  Bruenig  poverty 
july 2015 by ernie.bornheimer
Fighting Boss Favoritism | Demos
Work hour caps are designed to prevent workers from competing with one another for the boss' favor by running up work time. Without such caps, someone who works a normal work week so that they have time for leisure and family is disadvantaged relative to someone who is willing to put in a bunch more hours to score the promotion. The effect of this power dynamic is that everyone who wants a chance at promotion is forced to also increase their work hours, and a race to the exhaustion bottom is set off.
With such caps, it becomes impossible for bosses to penalize those who do not work beyond a normal work week. This effectively stops the race to the bottom by removing the pressure to curry favor with the boss by working more hours. The same dynamic can be found in mandatory vacations—it makes it impossible to curry favor with the boss by not taking your vacation—and other kinds of leave as well.
For people who have never worked a normal job or been around those who worked normal jobs (see most journalists), this might seem to be a very alien concept. But there is a reason why labor movements across the world have pushed for these kinds of things, both in regulation and in collective bargaining agreements. Boss favoritism is a serious problem, and the potential of it divides workers and forces them into a kind of degrading rat race. Workers end up working longer, foregoing vacations, accepting mistreatment, and sucking up to the boss, all so that they can angle for the precious gifts of promotions and raises that the boss has power over.
labor  work  Bruenig  hours  perks  vacation  organized  organize  class  unions 
july 2015 by ernie.bornheimer
Why Ending Relationships Is Good | Demos
mate attractiveness is relative to the society you find yourself in


If our institutions towards women more closely matched those of Saudi Arabia, she'd probably stay in the relationship even now. But that's a bad thing. The emerging ability of women to quit these relationships is a good thing. It will mean a lower equilibrium of coupling, but higher equilibria driven by the inability of people to quit bad relationships are abhorrent.

All of which is to say: Behind the veil, you'd prefer an institutional regime that didn't effectively imprison you in bad relationships, lest you find yourself in one as a child or adult.

As a final note, I want to make a somewhat related point that I haven't a had a chance to yet. Douthat's paragraph speaks of marriage and relationships in general terms, but in fact they are very specific things that contain within them very different people. Of late, conservatives have rallied behind the pithy line that people need to "preach what they practice" regarding marriage. But, in fact, people of Douthat's ilk do not practice what they preach. They preach the importance of marrying poor and working class people, but they don't actually marry any of these people.

They certainly could marry someone from those classes. Many a person would take up a spouse who makes six figures banging out a few blog posts each week. But they choose not to.

After rigging the institutions to capture the majority of the national income and basically all of the national wealth, segregating themselves residentially, intermarrying almost solely in their rich enclaves, and even sealing off their schools from being accessed by the unwashed masses, these rich social conservatives turn around and implore others to marry people that they wouldn't touch with a ten foot pole, people they can't even bring themselves to make even the most minimal of community with.

If this all was really that important to them (the most pressing issue in the entire country by their accounts), why don't they marry any of these people? What is it about them that they find too unattractive to couple with? One really has to wonder.
Bruenig  natural  mating  strategies  marriage  politics 
june 2015 by ernie.bornheimer
An Education Dystopia | Demos
Charter school advocates, often because of their conservative temperament, assume child poverty in the background as if it is some natural feature of life. But in reality, the uniquely sky-high child poverty levels seen in the US are a function of the country's uniquely bad economic institutions.
Bruenig  education  poverty  politics  natural 
june 2015 by ernie.bornheimer
Missing the Point on Employer Subsidies | Demos
the corporatist model doesn't actually work. Corporatist countries like Switzerland and Germany look good by American standards, but the social democracies crush them on basically every indicator of the well-being of vulnerable populations.

The only problem with the social democratic way is that there simply are no advocates of it in the US mainstream.
economics  Bruenig  welfare  social  democracy  safety  net 
june 2015 by ernie.bornheimer
Why Do We Have Labor Protection? | Demos
Lee’s analysis falls into that old libertarian trap that corrupts almost all of our economic discussion in this country. Under this trap, laissez-faire economic arrangements operate as the baseline and then economic rules that diverge from those arrangements come in specifically to correct some market problem (here the outsized power of a boss in a specific kind of employment relationship).

In reality, of course, laissez-faire is not the baseline and divergent economic rules don’t exist only to correct identified defects in laissez-faire. Instead, economic rules of all sorts are created to affirmatively carve up the national income and to establish the terms under which production, consumption, and economic life more generally will proceed.

If you believe, as labor generally does, that economic life should proceed such that normal working class people generally have predictable schedules, predictable (and adequate) income, and paid leave for various life events, then it doesn’t matter that new-fangled app-based employment systems have come on to the scene. That changes exactly nothing about your perspective on the proper aim of our economic rules. You still think that the rules should (one way or another) be constructed so as to facilitate the good and comfortable life as you see it.

Now you can call this anti-freedom (as Lee does) because it means workers who deeply prefer some other economic arrangement are effectively prevented from having it. But this is not a charge freshly relevant to the app-based worker economy. It’s a charge that’s been lobbed at all economic arrangements forever. “What if they want to work on-demand without minimum wages and paid leave” is just an updated version of “what if they want to work 60 hours a week at normal pay.” Some people have always been persuaded that non-laissez-faire economic rules were freedom-infringing, while others have always correctly observed that they are no more freedom-infringing than any other economic rules.

Here, if Uber is legally placed under conventional employment rules, those who’d prefer to work for Uber under an independent contractor arrangement are out of luck, but likewise if it’s placed under independent contractor rules, those who’d prefer to work for Uber under a conventional employment arrangement are out of luck. A preferred choice is being taken off the table for some set of people no matter what route you go.
Bruenig  economics  politics  Uber 
june 2015 by ernie.bornheimer
What is limited government? | MattBruenig | Politics
What we are really seeing in references to limited government is our old cultural-ideological friend: the assumption that laissez-faire institutions are somehow natural, default, and don’t involve the government making intentional distributive decisions that require a great deal of resources to enforce.
Bruenig  property  laissez-faire 
june 2015 by ernie.bornheimer
Nobody Wants Welfare Communitarianism | Demos
A certain minority strand of conservatives often like to complain that public social insurance schemes blew up communitarianism because they helped get rid of the horrific insecurity of laissez-faire capitalism (and the social networking some people did to somewhat deal with that insecurity). In this sense, the conservatives object, not to the dread collectivism of the welfare state, but instead to the dread individualism of it. When the economic system secures your well-being as a matter of right and eliminates the risks of severe deprivation, this position maintains, it liberates you from dependency on others and guts the economic coercion at the heart of community-building.

This argument is quite a clever and refreshing change up from the usual "taxes are theft" and "the welfare state is anti-individualist enslavement." But it doesn't really work either.

In our modern society, people who have the means generally secure themselves against economic risks, not through the community, but through hyper-individualistic private insurance schemes. They buy life insurance (survivor's insurance). They buy health insurance. They buy retirement insurance products of various sorts. They get long-term disability insurance. Around half have newborn insurance through their work (paid leave). Needless to say, these are not communitarian insurance options. They are just as liberating from "dependency" on others as social insurance (if you can afford them).

All social insurance does is take the kind of individual insurance people who have money buy against economic risks and extends it to everyone. The thing that rubs out communitarianism, is not social insurance, but insurance period. If you want community dependency back, you need to make it illegal for all people to insure against the horrific risks of capitalism, not just rip that insurance away from the lower classes.

Of course, I don't think outlawing insurance (whether social or private) is a good idea. The fact that rich folks heavily buy private insurance should tell you that nobody in their right mind actually wants to use communitarian welfare for major economic risks. Rich people often seem to want others to rely on communitarian welfare (where such a change would pad the already ample pockets of the rich by cutting social insurance), but they certainly don't want it for themselves. There is much wisdom in that revealed preference.
insurance  risk  community  Bruenig  welfare 
june 2015 by ernie.bornheimer
Appeals to "Equality of Opportunity" Are Non-Responsive | Demos
not only can you talk about outcome inequality and opportunity separately, but conceptually you must do so. That is, you must both have a position on equal opportunity and a position on how unequally we should structure our economy. Talking about opportunity in response to discussions about inequality is just entirely non-responsive.
equality  opportunity  Bruenig  politics  economics 
june 2015 by ernie.bornheimer
Pope Francis, Conservatives Battle for U.S. Catholic Church's Future | The New Republic
Conservatives describe themselves in terms of attachment to the past. In a 2014 National Affairs article titled “The Conservative Governing Disposition,” Philip Wallach and Justus Myers addressed a question they felt had been neglected during the Republican Party’s previous two presidential defeats: “What is conservatism?” Conservatism, they argued, is more a disposition than a set of political goals, one for which “social practices, habits, and institutions embody the accumulated wisdom of trial-and-error experience.” This thinking detaches conservatism from the realm of policy, and returns it to the core of conservative commitments, where they believe it should be. At the center of the conservative disposition, Wallach and Myers locate a belief that explains why conservatives “doubt the ability of fallible people to overhaul [the] evolved social order according to their vision of how it should be.” The conservative disposition springs from the conviction that there is something transcendently meaningful about the past. “Conservatism has the most to offer societies,” Wallach and Myers wrote, “that have much worth conserving yet run the risk of dissipating their inheritance through wrong-headed, sweeping changes.” What obtains today, in the conservative mind, does so because it was found worthy in the past, and humility should prevent us from meddling too much with received wisdom.


Conservatives describe themselves in terms of attachment to the past. In a 2014 National Affairs article titled “The Conservative Governing Disposition,” Philip Wallach and Justus Myers addressed a question they felt had been neglected during the Republican Party’s previous two presidential defeats: “What is conservatism?” Conservatism, they argued, is more a disposition than a set of political goals, one for which “social practices, habits, and institutions embody the accumulated wisdom of trial-and-error experience.” This thinking detaches conservatism from the realm of policy, and returns it to the core of conservative commitments, where they believe it should be. At the center of the conservative disposition, Wallach and Myers locate a belief that explains why conservatives “doubt the ability of fallible people to overhaul [the] evolved social order according to their vision of how it should be.” The conservative disposition springs from the conviction that there is something transcendently meaningful about the past. “Conservatism has the most to offer societies,” Wallach and Myers wrote, “that have much worth conserving yet run the risk of dissipating their inheritance through wrong-headed, sweeping changes.” What obtains today, in the conservative mind, does so because it was found worthy in the past, and humility should prevent us from meddling too much with received wisdom.


Corey Robin, in his 2011 book, The Reactionary Mind, writes, “while the conservative theorist claims for his tradition the mantle of prudence and moderation there is a not-so-subterranean strain of imprudence and immoderation running through that tradition—a strain that, however counterintuitive it seems, connects Sarah Palin to Edmund Burke.” Thus conservatives can claim a deep attachment to the America of their grandparents while trying to dismantle labor unions and Social Security, mainstays of the era they profess to love.


The Catholic Church has always been “liberal” on economic matters. Since the early centuries of the Church, prominent theologians such as Ambrose, Augustine, and Saint John Chrysostom have emphasized that private property rights obtain only after allhuman needs have been met, and that the excess of the wealthy truly belongs to the poor.


Every blowhard with a stake in unmitigated capitalism, from Rush Limbaugh to The Economist, has had their turn at accusing Francis of sundry McCarthyist infractions, Marxist, Leninist, and otherwise. But the reality is that Francis’s views on economic justice hew more closely to traditional Christian teaching than those of a free marketeer.
Stoker  Bruenig  conservatism  authenticity  Catholic  social  teaching  private  property 
may 2015 by ernie.bornheimer
Education reform will not fix poverty or inequality | MattBruenig | Politics
It is true that if you take any given poor person and push them through college, that specific poor person will probably escape poverty as a result. However, taking all poor people and putting them all through college will not result in all of them escaping poverty. Anyone can escape poverty, but not everyone can.

The reason you cannot scale up college as a poverty-reducer is that high-paying jobs are scarce, positional goods. In the present economy, only so many people can capture good jobs, not because only so many people have the credentials to do so, but because only so many good jobs exist. The number and quality of jobs are decided by market forces, not the number of college graduates. You could educate every single person in the United States to the point where they held a joint PhD-JD-MD-MBA, but that does not mean we would suddenly become a society of doctors, lawyers, managers, and professors. The market defines how many people can hold those positions: we cannot keep adding management jobs and law jobs if there is not market demand for more.

Ultimately, someone has to clean toilets, prepare food, and build infrastructure. In fact, as Doug Henwood pointed out in the latest LBO newsletter, only 5 of the top 20 growing professions even require a college degree. Putting more people through college wont change that, and will thus have little impact on the total amount of inequality or poverty in the United States. Although better educating the population wont create high-paying jobs out of thin air, it may marginally increase the productivity of workers in general. But as we have seen over the past 4 decades, increased productivity does not necessarily translate into more income for working people.
education  Bruenig  policy  politics 
may 2015 by ernie.bornheimer
The Problem With Income Inequality | Demos
where disposable income inequality is high, that suggests there is money out there going to the rich that could be hoovered up and shot out to the non-rich.
This suggestive evidence is actually bolstered by the fact that other countries have similar levels of market inequality. If other countries got to be more equal primarily because of their market distribution of income, it could prove very difficult to replicate. Making the market distribute out the national income in a different pattern is a tough task for a lot of reasons. The fact that other countries achieve their lower disposable income inequality through non-market programs is thus extremely promising. After all, if they can transform the same level of market inequality into a lower level of disposable income inequality by adopting a certain set of social income institutions, why can't we do the same thing?
Nordic countries, which have the highest living standards for the bottom of any other set of countries in the world, do not have especially low market poverty rates. On average, their market poverty rates are just 1.2 percent points lower than ours. Yet, from that similar market poverty "starting point," they manage to secure dramatically lower levels of disposable income poverty, especially for children (which they focus the most effort on). 

In fact, even children of single mothers (the great bogeyman of the Right) don't fare that much better in the Nordics in the market, but have a much higher standard of living after social incomes are counted:

To reiterate: when two sets of countries have the same market income inequality, but one set has much lower disposable income inequality, that's a good indication that simple changes in distributive institutions could do wonders for the more unequal country. When it comes to the US and the Nordics (which Winship notes are doing the best in this regard), adopting tax and transfer institutions that are similar in form to what the Nordics have should significantly improve the standard of living of those at the middle and especially those at the bottom. The further fact that economies in the Nordic countries grow at about the same rate as the US economy throws even more fuel on that fire because it indicates that, at least when they do it, there is no obvious efficiency/equality trade off involved.
The concern about inequality has very little to do with the market distribution itself (the market is, after all, just a creature of policy, a government program like any other). Rather, the concern is that high and rising inequality signals that we are throwing away opportunities to relieve the want and humiliation of the bottom (and to a lesser extent, the middle), and are opting instead to shovel more and more of the national income to the rich for no good reason.
Bruenig  inequality  economics  markets  redistribution  efficiency  secondary  distribution  Nordics 
december 2014 by ernie.bornheimer
Wealth Inequality and Savings | Demos
evening out wealth inequality in this country does not necessarily requiring any change in savings rates. My preferred policy on handling wealth inequality is to levy a moderate progressive wealth tax and put all of the revenues from that tax into a sovereign wealth fund. This would reduce wealth levels at the top and, insofar as everyone could be deemed to have an equal share in the sovereign wealth fund, increase wealth levels at the bottom and middle. According to Zucman, a 2% net worth tax that fell only on the wealthiest 1% could deliver as much as $500 billion in revenue annually. I would also prefer assessing a lower wealth tax on smaller fortunes, but even just this 2% tax would allow for the construction of a $5 trillion sovereign wealth fund within a decade, delivering (with a 5% real return) $250 billion of revenue in investment returns alone in the 11th year (returns which would only get bigger as the fund grows from the wealth tax revenues). Those returns could go to all sorts of things, including a social dividend payment to all citizens, as in Alaska.
Bruenig  economics  Alaska  sovereign  wealth  fund  inequality 
december 2014 by ernie.bornheimer
Uber's Surge Pricing | Demos
In an equal society, jacking prices when demand outstrips supply causes those who need/want the rides the most to get them. In an unequal society, jacking prices when demand outstrips supply causes those who have the most money to get the ride. Despite the taunts of irrationality you read from journalists, it is actually totally "rational" for someone on the bottom end of an unequal economic distribution to prefer keeping the prices low, thereby allocating the rides by lottery, rather than allowing them to be jacked up, thereby allocating the rides by wealth.


Most normative economic theory that justifies using prices like this assumes that they operate so as to allocate the scarce good to those who need/want it the most. This is meant to follow obviously from the fact that those who want/need it the most will be willing to pay the most for it. This kind of price-driven matching is therefore said to maximize utility.

But this theory collapses when there is background inequality due to the diminishing marginal utility of money. Under equality, my being willing to pay $100 (compared to your being willing to pay $90) for the scarce ride indicates that I am willing to sacrifice more utility for it, which further indicates I get the most utility out of it (in theory). Under inequality, it's more likely that my $100 reservation price *does not require more utility sacrifice* than your $90 reservation price. Or put simply: the millionaire paying $100 for the ride to outbid your $90 price is not giving up *more* (in utility) than you were offering. In fact, they are giving up less. Therefore in utility terms, the allocation is inefficient.

You have switched away from the common utility stuff that undergirds the default way economists talk about stuff (which is silly in any case) and reached instead for some kind of procedural right to charge whatever price blah blah blah. But that's a fringe normative approach even among economists.
Bruenig  economics  Uber 
december 2014 by ernie.bornheimer
On Measuring Government Benefits | Demos
If you want to know how much a given person benefits from the government, then the proper thing to do is imagine what they would have if all of the government-imposed economic institutions didn't exist.

It makes little sense to say, as category two does, that Bill Gates was net harmed by the government by billions of dollars when he would likely not be worth even one-tenth of what he is now if the government had never invented and imposed intellectual property institutions.

More generally, it makes little sense to use the distributions that result from the government-imposed institutions we call "market institutions" as the baseline against which the extent of government benefits is tallied.

This is especially so because our economic institutions, market and non-market, operate as a coherent set and have been put in place through historical negotiations that treats them as such. For instance, deeply insecure and unstable market institutions have been tolerated, across all Western countries at least, only as they are coupled with social insurance schemes that make people living within them more secure.
Bruenig  government  markets  wealth 
december 2014 by ernie.bornheimer
Reducing Abortion at the Margins | Elizabeth Stoker Bruenig
with policy we can’t inculcate goodness into people. All we can hope to do is encourage or discourage behaviors
Bruenig  policy  ethics  morality  abortion  poverty  quote 
july 2014 by ernie.bornheimer
Immigration, charity, and conservatives' unholy assault on Glenn Beck - The Week
There are always moral hazards in our interactions with others, including in charitable acts.


If a crisis involving unaccompanied children isn't enough to elicit a charitable impulse, nothing will ever be.
quote  Elizabeth  Bruenig  moral  hazard  charity  border  children  crisis  immigration 
july 2014 by ernie.bornheimer
Property and Conflict | MattBruenig | Politics
Contrary to popular conceptions, a “property right” is not a right over a piece of the world, but a right over other human beings: to initiate aggressive violence against them if they do not abide by your rules regarding some piece of the world whether they consent to those rules or not.
property  aggression  Matt  Bruenig 
may 2014 by ernie.bornheimer
Imagine people did things they already do | MattBruenig | Politics
This is nothing more than an argument against small businesses, which is precisely what a homeowner is. What do small business owners do? They “bet their economic fortunes on the [consumer] market where they live, rather than making the less volatile bet on the overall condition of the economy that comes from a balanced portfolio of stocks and bonds.” Of course, there is economic literature that actually puzzles over why anyone ever puts up capital to start their own businesses and why entrepreneurs exist at all that uses precisely Barro’s reasoning here. But if he is going to make it, he should make it in its totality about all small business owners, not the small business owners who happen to be in the business of renting out housing services to themselves.

I am not even trying to tell people to be homeowners. But Barro is not making very interesting points here. He also does a poor job of explaining that the return on owning a home is not purely a function of how high its value increases, but also the stream of imputed rents. I can tell he understands this (and maybe he is just using some present value discounting to pretend those returns aren’t real, reasoning that makes all investments returnless), but he doesn’t communicate it very well. In any event, you don’t need your property values to increase significantly to make money renting buildings out to people, whether renting those buildings out to others (landlords) or renting them out to yourself (homeowners).
Matt  Bruenig  economics  home  ownership 
may 2014 by ernie.bornheimer
Two kinds of anti-paternalism | MattBruenig | Politics
if we are going to call such transfers anti-paternalist, we need to distinguish between two kinds of anti-paternalism: anti-paternalism aimed at increasing autonomy and anti-paternalism aimed at increasing welfare.

Autonomy-motivated anti-paternalism objects to forcing someone to do something because it limits their freedom to do what they want. On the most extreme end, supporters of this kind of anti-paternalism oppose even efforts to keep people from doing heroin, not because they think prohibition is a failure, but because they think there is no justification for limiting the autonomy of individuals in that way.

Welfare-motivated anti-paternalism objects to forcing someone to do something because it harms their welfare. The cash transfer case is especially relevant. It is assumed that the circumstances, needs, and wants of individuals are extremely diverse. Providing one-size-fits-all services and benefits will therefore fail to capture what would actually be best for a large chunk of people. It is assumed further that, generally speaking, individuals have a good sense of what they need and want, and will direct cash they receive towards satisfying those needs and wants. From these two assumptions — which can be empirically tested — it follows that unrestricted cash benefits will boost welfare outcomes more so than many in-kind benefit programs.
paternalism  Matt  Bruenig  welfare 
april 2014 by ernie.bornheimer
Corporate Income Tax Arguments Almost Always Miss the Point | Demos
It is this kind of complexity that renders most siloed discussions of the value of the corporate income tax somewhat ridiculous. Talking about the value of any particular tax in a vacuum almost always generates this kind of borderline futile discussion. What ultimately matters is not the merit of each specific tax, but the way in which each tax fits into the overall tax system, and most importantly how that tax system fits into an overall system of economic distribution. There are conceivable societies where there is no corporate income tax, but the overall distribution of income and wealth is just. Likewise, there are conceivable societies where there is a substantial corporate income tax, but the overall distribution is unjust.

If we are going to entertain getting rid of the corporate income tax, then it should be done in a way that brings us closer to a fairer, more equal economic distribution. Proposals to cut or eliminate the corporate income tax rarely if ever take the broader social view or make package proposals that could conceivably lead to a more equitable overall economic system. That is why -- corporate tax incidence quibbling notwithstanding -- I tend to find such proposals so boring and unpersuasive.
tax  taxes  taxation  corporate  Matt  Bruenig  tradeoffs 
april 2014 by ernie.bornheimer
Matt Bruenig RSS feed | Matt Bruenig reader - Page 9
The popular accounts of organized debates in film are entirely inaccurate. It is not a soaring speech competition. It is a highly technical activity involving argument for its own sake and in its most pure form. You don’t pick a side. You argue for whatever you are told to argue for, which has the effect of stripping out a lot of the self-imposed blinding and cognitive biases that come along with real life arguments in which you try to defend your own position.

Most importantly, in debate there is a judge who is more or less an unbiased technical scorer. You can’t strip bias out entirely, but if anything, most judges (who were themselves former debaters) actually wanted to vote for arguments that ran against their own beliefs. Scoring a weak, strange, or perverse case as the winner was seen as a real plus for the activity, provided such cases did actually win on the technical merits.

The fact that it was a technical and judged event made the kind of bullshitting that you see in real life debates extremely scarce. The most brutal technical rule was the one pertaining to so-called “dropped” arguments. If one side made an argument and the other side did not respond to it, it was assumed for the debate that the other side conceded the argument, no matter how weak or absurd it was. And response meant a specific thing. It wasn’t enough to say some vaguely or thematically related thing about the argument that you called a response. You’re response had to clash with the argument. You had to actually hit the argument in a way that was relevant to its function in the debate. If you didn’t, no matter what you said about it, the argument would be scored as dropped and conceded.

You can imagine the way this rule quickly reshapes your argumentative mind. In real life (and on the web) you can “takedown” someone without actually attacking their argument in a responsive or clashing way. So long as enough fools stand around and tell you that you’ve really beat that other guy, it’s a win. But you can’t do that in organized debate. The judges will score such bullshitting as a concession to the argument, and in many rounds that will cause you to lose.

These technical pressures eventually force you to tear away what appears to be a natural tendency to misread and misrepresent the arguments of your opponent. The tendency to quibble with some orthogonal point that doesn’t actually affect the disposition of the core point in contention is also bludgeoned out of existence in this activity. Instead, you end up developing a mind for actually interpreting an opponent’s argument in its strongest most relevant form. You end up developing a mind that interprets arguments that way on the very first take as well because you can’t re-read the point later and you are extremely time-crunched. Those who fail to adapt in this way lose over and over again.
Matt  Bruenig  debate  debates  debating  organized 
april 2014 by ernie.bornheimer

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