Raise the Cigarette Tax, in India, NOW!

This is astounding: "In India, 1 in 5 of all adult male deaths and 1 in 20 of all adult female deaths at ages 30-69 are due to smoking." The article makes a strong case for a big increase in the tax on cigarettes.

Estimates of the responsiveness of cigarette purchases to the (after-tax) cigarette price, while not particularly high, are nevertheless higher than that for bidis, which are a South Asian variety of cigarettes that wrap the tobacco in tendu leaf instead of paper. Why is the bidi comparison important? The mortality rate from smoking is higher for cigarettes: "compared to non-smokers, the risk of dying as a result of smoking 1-7 bidis per day was 30% higher compared to an increase in risk of 80% from smoking the same number of cigarettes per day." Moreover, with rising incomes and stagnant cigarette taxes, more and more Indians are switching to the increasingly affordable and deadlier -- but presumably "cooler" -- cigarettes. This, therefore, is the right time to jack up cigarette taxes and -- as with everything in India -- make sure that the higher taxes are enforced.

I wish the authors of the study had established that when someone switches from bidis to cigarettes, the number of cigarettes smoked per day is no smaller than the number of bidis that was smoked prior to the switch. There is also the possibility that a rise in the cigarette tax may drive smokers to alcohol. But, despite these doubts, a hike in the cigarette tax is almost certainly a no-brainer.

This is what a plutocracy looks like

If a nation accepts at the heart of its animating creed the notion that any restraint on the role of money in elections is a restraint on free speech, it cannot claim to be a democracy. There's another word that better describes its political system.

One of the uglier consequences of living in a plutocracy is to have to live through something like the current debate in the United States on the debt ceiling. The American people have been saying, in poll after poll, that (a) the US federal government should live within its means, and (b) that the budget should be balanced not by cutting the government programs that vulnerable people depend on -- such as social security, medicare, and medicaid -- but by raising taxes on the rich, who have been cornering a larger and larger share of the nation's income since at least the 1970s. And yet the Republican Party is prevailing in the debt ceiling debate by steadfastly sticking to the view that tax increases -- of any kind, on any group or entity, no matter how rich -- are unacceptable, and that the federal budget deficit must be reduced entirely through spending cuts. Their legislative strategy is essentially that of a bank robber who shows his suicide vest to the teller. They are threatening to precipitate an economic crisis by refusing to vote for increasing the government's debt limit and thereby causing an unprecedented default by the US Treasury. They have essentially reduced the Obama administration to begging them to accept the closing of a few tax loopholes, such as tax exemptions for corporate jets! They know that they have Obama over a barrel and are dismissively laughing at even Obama's corporate jet pleas.

How can the Republicans get away with this flagrant disregard for the vox populi? Why do they not fear the wrath of the electorate?

The following excerpt from yesterday's PBS Newshour may indicate why. I suspect that the Republicans believe the corporate media will help them pull the wool over the electorate's eyes. This is why they don't fear all those polls.

Judy Woodruff, the anchor of this Newshour segment, is talking to Andrew Kohut of the Pew Research Center, a polling organization, and Naftali Bendavid, congressional correspondent for The Wall Street Journal. The emphases are mine.

JUDY WOODRUFF: Andy Kohut, you have been looking at what the American public thinks about the deficit, the debt. What do you find when you look at public opinion in terms of how they see the debt and what they think has caused the debt?

ANDREW KOHUT: Well, the debt and deficit, concern about it are at an all-time high.

Interestingly, we did a poll a few weeks ago which showed 60 percent saying that great contributions to this were the wars in Afghanistan and Iraq. Only 24 percent said increased domestic spending.

And while there is a lot of focus on domestic spending, if you talk to the ordinary person, it's -- that spending is seen as vulnerable if it involves waste, fraud and abuse, but when benefits or when the entitlements are considered, that's not considered waste, fraud and abuse.

JUDY WOODRUFF: So, when you -- when you ask them about the tradeoffs they're prepared to accept in terms of, you know, how much of -- how much cutting are you, as a citizen, prepared to see to deal with the debt, what do you find?

ANDREW KOHUT: Well, surprisingly, when you ask about what is more important, preserving benefits for Social Security and Medicare, by 2-1 -- or reducing deficit or the debt -- 2-1, people say, preserve -- preserve our benefits.

There is very little give there. Now, Republicans are of the view -- more of the view that reducing the -- reducing the deficit should be given high priority. But even among Republicans, it's really interesting. There is a big income divide. Affluent Republicans say it is more important to reduce the deficit, but poorer Republicans, middle-class and lower-middle-class Republicans say, no, no, protect our benefits.

JUDY WOODRUFF: And have -- are these attitudes, Andy, that have changed over time, with all the attention that's now being given to the size of the debt and the urgency of the problem?

ANDREW KOHUT: Well, a lot -- people are willing to do a lot of things to reduce this deficit. Concern is at an all-time high.

But when it comes to entitlements, there's no movement. It really is rock-solid when we see 2-1 margins.

JUDY WOODRUFF: And, again, entitlements meaning Social Security, Medicaid, and Medicare.

ANDREW KOHUT: And even Medicaid. Having states raise the -- make it more -- reduce eligibility for Medicaid, not 2-1, but a solid majority say, no, let's not do that.

...

JUDY WOODRUFF: One of the -- I guess one of the overriding sense, senses that one gets out of all this is that more of the debt reduction would come from cuts, from cuts in entitlement, than it would on the revenue side. Is that pretty much a given?

NAFTALI BENDAVID: That is pretty much a given. I think there is something about the way the political landscape has evolved, that people are willing to accept far more cuts, even Democrats, spending cuts, rather than tax increases.

I mean, tax increases have become such anathema, such political poison in the political dialogue, that I think people are talking about a 3-to-1 ratio or something approaching that.

ANDREW KOHUT: And that is completely opposite to public opinion.

When we say, if push comes to shove, if you have to do something, what would you rather see with respect to these entitlements, revenues increased, or taxes increased, or benefits cut? People say, raise taxes, raise costs, but don't cut those benefits.

JUDY WOODRUFF: And you see that across the board?

ANDREW KOHUT: See that across the board.

JUDY WOODRUFF: Republican -- what about Republican vs. Democrat?

ANDREW KOHUT: Well, there is a gap on this, but when you get such large 2-1 margins and you have this class division within the Republican Party, that is potentially big stuff come election time. There will be a huge cry and howl if benefits are seen to have been -- to have been cut here.

JUDY WOODRUFF: And so I hear you saying some of the public reaction is going to depend on how this is packaged, how it is described to the American people, whatever -- if they come up with an agreement.

ANDREW KOHUT: Right.

I mean, there is support for raising the contribution cap [on social security taxes -- U.R.], of doing some things like that. But the notion that the retirement ages will be delayed or in some way people are going to have to pay a larger share of their Medicare costs out of their pocket, all of those things are very, very unpopular.

"Oh My God"

I am a fan of the Kaiser Chiefs, a British indie rock band, and their 2004 debut single Oh My God. The song was also recorded in 2007 by Mark Ronson, a DJ much sought after by recording artists, and Lily Allen, a super-talented British singer. I like the original very much, but I prefer the Lily Allen version. The YouTube videos are given below; you decide which version you like better.

Combatting Female Feticide in India

This Economic and Political Weekly editorial on female feticide in India argues for (a) better enforcement of the anti-feticide law (duh!), (b) more consciousness-raising against the practice (ditto), and (c) stronger protection of women's economic rights to work and to inherit property. ("Impassioned Slogans, Half-hearted Actions," EPW, June 11, 2011, Vol. XLVI, No. 24.)

Why (c) would reduce female feticide is not explained in the editorial.

In certain sections of Indian Hindu society, a woman, upon marriage, comes to be regarded as a member of her husband's family. As a result, female children are regarded as a burden, an expensive investment that will one day go on to enrich her husband's family. This vicious logic, in some cases, fuels the selective abortion of female fetuses.

Now, given this chain of reasoning, why would the strengthening of the economic rights of women lead to lower levels of female feticide? If the parents of a female fetus are planning to kill her -- because, were she to live, she would soak up her parents' resources only to enrich the family she marries into -- why would they be dissuaded if the law strengthens her right to inherit her parents' property? (In fact the reverse may well be true: if women are shorn of their right to inherit their parents' property, parents of a female fetus may regard her as less of a bad investment and may well be persuaded to be a little merciful and let her live.)

Moreover, if the economic right of women to work is strengthened, her increased income would end up enriching not her initial family but her husband's, thereby providing no economic incentive against female feticide. You might think that a married woman with her own income would be likely to help her parents financially and that, consequently, stronger economic rights for women may reduce female feticide. But let's go back into the minds of the sort of people who kill female fetuses. They are conditioned to think of their married daughters as people of some other family. Therefore, it is unlikely that such people would expect any financial help from their married daughters, irrespective of whether they earned a paycheck or not.

Needless to say, the strengthening of the economic rights of Indian women is valuable in itself. But why the EPW thinks this would reduce the slaughter of female fetuses is unclear to me.

I have been thinking, for a while now, that India needs to try providing a sizable subsidy for every newborn girl. However, I was somewhat discouraged about the likely effectiveness of my subsidy idea when the Lancet study (mentioned in the EPW editorial) revealed that "selective abortion of the female foetus is the highest in the most educated and in the richest 20% of the households." After all, such families are unlikely to be persuaded to be merciful by a mere subsidy, I thought.

But another finding of the Lancet study gives me some hope that a workable subsidy may yet be implementable. "[W]hen the first child was a male, there was no fall in the sex ratio of the second child. But when the first born was a female, the sex ratio of the second births declined." In other words, the danger of the murder of a female fetus is really serious only when the mother has already had a daughter and is now hoping for a son. So, instead of giving a subsidy for every newborn girl, it may be a good idea to start with a less ambitious subsidy for parents only if their second child is also their second daughter. (The previous sentence has been slightly revised.) And as this would be a limited subsidy, its size could be made very large -- large enough perhaps to tempt even the rich to show some mercy.

A Distant Election

The front page of the May 14, 2011 issue of anandabazar patrika that you see above announces the outcome of the recent elections in the Indian state of West Bengal. (Although I wasn't born there, I spent the first two decades of my life in Kolkata, the capital city of West Bengal, and continue to consider it my hometown.) In this election, the 34-year rule of the Communist Party of India (Marxist) -- and its considerably smaller coalition partners, including the Communist Party of India, from which the CPI(M) split in 1964 -- came to an ignominious end. Consequently, this election could, in the fullness of time, come to be regarded as a milestone in the history of West Bengal. (The election didn't go unnoticed in the U.S. press: see reports in The New York Times and in The Washington Post.)

Of the 294 seats in the West Bengal legislature, the CPI(M) won a mere 40 seats. By contrast, the Trinamul Congress -- the big winner -- won 184 seats.

In other words, dear reader, this was a blowout. This was like the hydrogen gas explosion that blew the roof off the Fukushima nuclear power plant. No, this was like the explosion that sank BP's Deepwater Horizon oil rig in the Gulf of Mexico. No no, what am I saying! This was like the Mount St. Helens eruption of 1980. No, silly me, that wasn't it either. This was like the Krakatoa eruption of 1883!

The communists came to power in West Bengal way back in 1977, when I was a teenager, and they have been in power ever since. I never understood how the CPI(M) kept winning election after election for more than three decades. Granted, they began well. They implemented important land reforms that distributed valuable land to destitute and landless agricultural workers. But that was an easy one-off achievement. If you have the electoral numbers to push your program through it doesn't take much creativity to grab land from Peter and give it to Paul. Land reform was the low-hanging fruit. After that fruit got plucked, things got tougher. Once you've done your Peter-to-Paul redistribution, for your next act you'll have to get a lot more creative. And if your creative idea for economic reform requires short-term pain for long-term gain, some clever corraling of political support will be needed. The communists turned out to be quite incapable of any of this. They slowly but surely ran the economy of West Bangal into the ground, while the rest of India raced ahead.

Towards the end they seemed to have seen the light. They began a desperate effort to lure private enterprise into West Bengal. But, barring some successes in the information technology sector, it was too little, too late.

Another factor behind the communists' long tenure in power in West Bengal was the general cluelessness of the opposition parties. These parties could not convince the electorate that they had good ideas or that the ideas that the communists had were bad ones. They did not have the muscle power to fight the communist cadres in the streets. They did not even have the guile to steal the communists clothes and convince the Bengali voter that they (the opposition parties) had the things that the Bengali people liked about the communists.

All that changed with the arrival of Ms. Mamata Banerjee -- that's her in the picture above -- and Trinamul Congress, the party that she almost single-handedly founded. Mamata is a highly imperfect political leader and it is completely unclear what she will do for West Bengal. But the people of West Bengal had grown sick and tired of the CPI(M) after 34 years of sub-par economic performance and constant political turmoil. And, I suspect that there is something about Mamata's gumption, her never-say-die spirit (that was so clearly in evidence in all her epic fights with the communists), and her emotional and excessively volatile demeanor that may have appealed to something deep in the psyche of the Bengali electorate. My late father, for example, was a big fan.

By the way, West Bengal -- along with two other Indian states, Kerala and Tripura -- can claim the very rare (and dubious?) distinction of having democratically elected communist governments. San Marino, an independent republic that is a really, really tiny landlocked enclave within Italy, is, as far as I know, the only example outside India. According to the Wikipedia entry on San Marino, "San Marino had the world's first democratically elected communist government, which held office between 1945 and 1957 and again between 2006 and 2008". However, another Wikipedia entry -- this one on E.M.S. Namboodiripad, a legendary Indian communist leader -- says this: "In 1957, EMS led the Communists to victory in the first election for the [Kerala] state government, making him the first communist leader anywhere to head a popularly elected government". Go figure!

What the Sai Baba Phenomenon Says About India Today

The recent death, at the age of 85, of Sathyanarayana Raju, an Indian man whose numerous devotees considered him an incarnation of God, provides an opportunity to highlight the frightening degree of tolerance of corruption and dishonesty in Indian society. Please see below two TV documentaries on the deceased godman. (The documentaries are available on YouTube in ten-minute segments. I have never been able to figure out the logic behind or the purpose of YouTube's ten-minute limit.)

Seduced by Sai Baba (DR, Denmark, 2002)

• Part 1 http://youtu.be/nsPwhkqboSI (introduction)
  
• Part 2 http://youtu.be/44uX8JcpXQ4 (holy ash and jewelry scam)
  
• Part 3 http://youtu.be/XF_LDKgODZE (amrit, alchemy, sexual abuse)
  
• Part 4 http://youtu.be/FFX47jL8Osk (sexual abuse of underage boys)
  
• Part 5 http://youtu.be/YoPZc0WgtK4 (sexual abuse of underage boys)
  
• Part 6 http://youtu.be/mvEJi2YNsvU (sexual abuse of underage boys and a possible link to the mysterious police killiings of four men in Sai Baba's apartment in 1993)
  

The Secret Swami (BBC, 2004)

• Part 1 http://youtu.be/_BVEJDPrGpM (introduction)
  
• Part 2 http://youtu.be/i-Ajawd59RM (Western devotees)
  
• Part 3 http://youtu.be/Ag93TX6DI0w (The Rahm Family of Arkansas and Alaya Rahm, immaculate materialization scams, Mark Roche)
  
• Part 4 http://youtu.be/CROnyK2fzcs (sex abuse of Alaya Rahm, regurgitation scam)
  
• Part 5 http://youtu.be/1PHsxBEYI9g (Murli Manohar Joshi)
  
• Part 6 http://youtu.be/6Q4M2raOwPI (The police killing of four "boys" armed with knives in Sai Baba's apartment)
  
• Part 7 http://youtu.be/mGZ3Bdjvg3I (legacy of corruption)
  

See also Miracle Man by K. Venkateshwarlu, Frontline, May 7, 2011.

A truly awful aspect of the entire episode is its clear demonstration of the utter shamelessness of the Indian establishment. Raju's funeral was attended by Dr. Manmohan Singh, the Prime Minster, and Ms. Sonia Gandhi, the President of the ruling Congress Party.

Good god!!

Why only two dollars?

The New Yorker, May 2, 2011

Let the Sun Shine In!

We need to listen to serious arguments, even when those making them are paid hacks. We also need to know that they are paid hacks.

Trevor Swan, Unveiled

Trevor Swan (1918–1989) is an economist hero of mine. Even today's macroeconomists rely on the Solow-Swan model of 1956 to organize their thoughts on long-run economic growth. (I have never understood why Robert Solow alone was awarded the economics Nobel in 1987.) The Swan Diagram has been used by macroeconomists -- and still is, when exchange rates are not entirely flexible -- to deduce the combination of fiscal policy and exchange rate policy that is appropriate for given levels of the two big macroeconomic ailments, unemployment and inflation. Swan was also responsible for major innovations in the conduct of monetary policy as a member of the Australian Reserve Bank's monetary policy board.

For quite a while, I have been searching on the Internet for images of Trevor Swan to post on my web site on the history of economic thought, but in vain. It was easy to find photographs of virtually every economist worth listing, but there was nothing on Trevor Swan.

Recently, however, my luck has turned, thanks to Prof. Barbara Spencer of the University of British Columbia, who is Swan's daughter (as well as a great economist and one of the pioneers of strategic trade theory). I had read her paper "Trevor Swan and the Neoclassical Growth Model," co-authored with Robert Dimand, History of Political Economy, 2009, and I knew that she was Swan's daughter. I had hoped to find a photograph of Swan without having to bother her. But, when Google fell through, I finally wrote to Prof. Spencer. I am now delighted to report that she has provided me with what I had been looking for.

The black-and-white photograph of Trevor Swan above was "taken in 1950 at his office after Trevor was appointed the first Chair in Economics at the Research School of Social Sciences [at the Australian National University]. He was only 32 years old." The two color portraits of Swan below were "taken around 1983 - 1985 by the Australian Reserve Bank. Trevor was a member of the bank board responsible for setting monetary policy from 1975-85."

My great thanks to Professor Spencer.

Mr. Mummy!

This is a video profile from today's New York Times of Prof. Bob Brier of the philosophy department of the C.W. Post Campus of Long Island University. The related blog post is here.

Regulatory Relevance of the Value of a Human Life

This post is about As U.S. Agencies Put More Value on a Life, Businesses Fret by BINYAMIN APPELBAUM, a highly informative article in today's New York Times that will come in handy when I teach about public goods later this semester in my introductory microeconomics class.

There invariably are some commodities that businesses may not find profitable enough to produce and sell even though the public may really-really-really need them. This peculiarity arises when a commodity is -- jargon alert! -- non-excludable: that is, the commodity is such that those who don't want to pay for it cannot be excluded from consuming it anyway.

For example, clean air cannot be limited only to those who agree to pay for it, which is why businesses have no incentive to clean up the air we breathe. Protection from foreign enemies cannot be restricted to only those who pay for it, which is why -- Blackwater notwithstanding! -- national defense cannot be provided by private businesses. Broadcast radio and TV are also non-excludable. (Commercial broadcasters do exist, however, thanks to advertising.) The fruits of fundamental research -- think E = mc², or Boyle's Law, or the Pythagorean Theorem, or existentialism -- while essential for human progress, are non-excludable too, which is why profit-seeking businesses are unlikely to invest in such research.

So, it is up to the government to pay for the things we need that businesses won't provide.

However, just because we would benefit from a commodity does not mean that the government should provide it -- costs must also be considered. Only if the benefits exceed the costs would it make sense for the government to step into the breach.

Unfortunately, this cost-benefit analysis can be a very tricky business.

For one thing, to figure the benefits of a public good -- technically, a public good is both non-excludable and non-rival, but I will not dwell on this issue here -- it may be necessary to have a dollar measure of the value of a human life!

Take tornado sirens, a popular example of a public good in econ textbooks. They save lives by emitting a loud sound that warns people about approaching tornadoes, giving them time to reach a safe bunker somewhere. But business can't make money by building such sirens because their services are not excludable: even those who refuse to pay will end up benefiting from the existence of the siren, and, knowing this, most people will refuse to pay.

Therefore, it is up to the government to provide a tornado siren. But such sirens cost money. What if the cost was a gazzillion trillion dollars and the benefit was 2 lives saved per year? Would a siren be worth the cost? Yes, if each human life was worth at least half a gazzillion trillion dolars; no, otherwise.

In other words, for rational public policy, a government would need to have a reliable dollar measure of the value of a human life.

Moreover, as Appelbaum's article makes clear, the rational regulation of industry is also heavily reliant on the government's estimate of the dollar value of a human life. Appelbaum also provides interesting examples of the application of the value-of-life concept to the regulation of auto safety, cigarette packaging, emissions from industrial boilers, etc.

U.S. businesses have expressed alarm that federal regulators have lately raised their value-of-life estimates -- in one case to $7.9 million per human -- because the higher the estimated dollar value of a human life, the stronger the justification for a regulation that restricts what businesses may do to cut costs at the expense of the safety of the general public.

The funny thing is that although federal regulators have recently raised their value-of-life estimates, they did so after a long period of torpor during which they refused to even adjust their estimates for inflation! Moreover, even the top-end estimates of the feds are less than the $8.7 million per human figure estimated by W. Kip Viscusi, the economist who initiated this whole approach to cost-benefit analysis. Nevertheless, the business lobby sees the government regulators as unrestrained and out of control! (By the way, why has Viscusi not won the economics Nobel yet? Are you listening, Bank of Sweden?)

It was during the Jimmy Carter presidency that the use of cost-benefit analysis was enshrined into U.S. law: every regulatory proposal would thenceforth have to come armed with a cost-benefit analysis. At that time the business community had welcomed this rationalization and de-politicization of the regulatory process. Now, however, the tide has turned and the politicians are more eager than ever to suck up to big business. This is why the U.S. Chamber of Commerce is now lobbying for the return of the use of political discretion and control of the regulatory process. As Appelbaum, brilliantly and mordantly writes, "The United States Chamber of Commerce is now campaigning for Congress to assert greater control over the rule-making process, reflecting a judgment that formulas may offer less reliable protection than politicians."

So true! In a plutocracy, the golden rule is that whoever has the gold makes the rules.

January Jones on Jon Stewart: She is Funny Too!

"Collapse Into Now" by R.E.M.

R.E.M.'s new album, "Collapse Into Now," will go on sale in March. If you can't wait that long, check out below the album's first video, "Mine Smell Like Honey." I liked the video -- it's monochromatic, until the very end, when it takes you by surprise and turns into sublimely restful and clarifying color -- and I just love the song.

An alternative version that scrolls the lyrics as the song unfolds is available here. Please also check out a few other sneak peeks into the album: Oh My Heart, It Happened Today, ÜBerlin, and Discoverer.

Sonic Youth and The Black Keys on Austin City Limits

Did you see last Saturday's episode of Austin City Limits? It was an absolutely extraordinarily super excellent blast of rock music at its best, featuring, first, Sonic Youth and, then, The Black Keys. The video is embedded below from the ACL web site.

Sonic Youth has long been a favorite of mine. Even after all these years, they remain experimental rock's avant garde. I like their stripped down and unadorned style in performances for live audiences. They play rock the way it should be played on a stage and this particular performance was one of the best of their's that I have seen (on video). The Black Keys are an insanely talented new band. Their music sounds to me like straight-up guitar-driven blues. Both bands have incredibly gifted guitarists and frighteningly good drummers, in Steve Shelley of Sonic Youth and Patrick Carney of the Black Keys.

Curiously, the Black Keys chose not to play their big hit, "Your Touch." But, again, the video is available on YouTube and is embedded below.

India's Devadasi Custom: Sex Slavery Under the Fig Leaf of Religion

The English film director Beeban Kidron (Bridget Jones: The Edge of Reason) has directed Sex, Death and the Gods, a BBC documentary on the devadasi custom in India. This vicious custom, although illegal in India since 1988, continues in a few areas. Destitute mothers -- often devadasis themselves -- sell their young daughters into sex slavery. The sale itself is framed as the mother dedicating her daughter to a life of service to a God. But nobody is under any illusion that it is anything but prostitution. This is an especially vivid example of how religion can be used as a fig leaf for any kind of atrocious behavior, whether it is murderous violence and terrorism or the sale of children into sexual slavery.

Here is a video with scenes from the documentary and excerpts from an interview with the filmmaker. See also:

Why India's 'devadasi' girls face a wretched life in the name of religion by Tracy McVeigh guardian.co.uk, Saturday 22 January 2011. [It was once considered a holy calling but a BBC film shows that becoming a devadasi is a direct path into sexual exploitation.]

Beeban Kidron on the devadasi system As told to Joanna Moorhead The Guardian, Friday 21 January 2011. [The film-maker is outraged by the practice, but says that 'evil mothers' are not to blame.]

'Devadasis are a cursed community' by Nash Colundalur The Guardian, Friday 21 January 2011. [Southern India's devadasi system, which 'dedicates' girls to a life of sex work in the name of religion, continues despite being made illegal in 1988. A veneer of religion covers the supply of concubines to wealthy men.]

Slippery Glenn!

Glenn Beck, the talk-radio superstar and ultra-vicious right-wing propagandist on Fox TV, is in the news. In a series of broadcasts he has accused Frances Fox Piven, a 78-year-old liberal academic, of proposing -- in an article co-authored with her late husband 45 years ago -- a plan to “intentionally collapse our economic system.” Moreover, as Brian Stelter writes in today's The New York Times, he has accused her on television this week of being "an enemy of the Constitution." Not surprisingly, "Anonymous visitors to his Web site have called for her death, and some, she said, have contacted her directly via e-mail."

These threats against Prof. Fox Piven can't be taken lightly. As the recent horrors in Tucson have reminded the world, the United States remains a country where idiotic and suggestible people can easily get hold of automatic weapons and copious quantities of deadly ammunition.

Although I do not watch Beck's program, I think I have an idea of his basic approach to propaganda: He starts by describing a government initiative that most people would find innocuous. He then uses the slippery slope argument -- the last refuge of every debater who realizes that he has no case -- to argue that the initiative, no matter how reasonable -- or even appealing -- it may seem, is only a start and that in the end all your rights will be taken away and you will become a slave of the government.

As proof, I give you -- ta da! -- Beck's Sept. 14, 2010 program. Beck begins with a gratuitous and vulgar attack on Michelle Obama, the first lady, and her anti-childhood-obesity campaign. He then launches a prolonged attack on Nudge: Improving Decisions About Health, Wealth, and Happiness, the recent bestselling bestselling book on behavioral economics and its policy implications, by Cass Sunstein and Richard Thaler, two world-renowned academics.

Last fall semester, I had introduced a new course on behavioral economics, and one of the textbooks I used was Nudge. To illustrate my lectures, I had been scouring the Internet for related video, and it was this search that had led me to Glenn Beck's program. I couldn't believe that one of the most popular programs on TV was devoting 15 precious minutes to a textbook that I was teaching from. This had never happened before and will almost surely not happen again. I was appalled by Beck's insane attempt to turn what was essentially a deep and policy-oriented treatise -- see the reviews in The Chronicle of Higher Education, Time, and The New York Times -- into some sort of blueprint for a program to enslave all Americans. But I was thrilled that I had something to impress my (largely apathetic) students with. After this, they would not be able to say that what I was teaching did not matter. The textbook was on TV, for heaven's sake!

Nudge argues that the choices that we make are in may cases distorted by deep-seated psychological weaknesses and that, as a result, government policy may be able to intervene to make us all better off without in any way taking away our freedom to choose as we please. (Take, for example, the fact that many Americans save far too little for retirement. Many workers do not bother to even join the pension plan available at work, not through conscious decision but simply because they are hobbled by procrastination. Thaler and Sunstein suggest that the current opt-in system be replaced by an opt-out system. Under an opt-in system a worker must write to his or her employer to be included in the company's pension plan. Naturally, many don't bother to do even that. Under an opt-out plan, on the other hand, every employee would automatically be enrolled into a pension plan, but would be able to opt-out by simply checking a box on a card. Such opt-out systems do not take away a worker's freedom to not join a pension plan, but have been found to dramatically increase enrollment rates and saving rates. See Thaler's article in Newsweek.) In his program, Glenn Beck -- what a coward! -- actually does not take on the argument of the book. He simply distorts the book's argument! He says that eventually "a nudge will become a shove" and that the freedoms that Americans take for granted will be taken away.

Thaler and Sunstein repeatedly clarify that they are against any reduction in a citizen's freedom to choose. They call their approach libertarian paternalism, to emphasize this very point. And yet, Beck completely ignores this! In short, Beck makes no argument against the Thaler-Sunstein proposals, distorts what the book says, and uses the slippery slope argument to frighten his largely semi-literate audience. As a coup de grace, Beck calls Cass Sunstein -- who, before joining the Obama administration, was a professor of constitutional law first at the University of Chicago and then at Harvard, and is one of America's most distinguished legal scholars -- the "most dangerous man in America." Twice!

Please read Brian Stelter's article on the Fox Piven affair. It seems that Beck is simply recycling the strategy he used against Nudge.

"The Spirit Level"

This post is about "Equality, a True Soul Food," By NICHOLAS D. KRISTOF in today's New York Times. This is the sort of article that makes The New York Times a great newspaper.

I had read Richard Wilkinson and Kate Pickett's "The Spirit Level" last year. It was an eye-opening experience. I remember finding it difficult to understand why a book with such deep policy implications had been by and large neglected by the mainstream media.

I discussed Wilkinson and Pickett's findings in my Behavioral Economics course in the recently concluded fall semester -- the PowerPoint presentation that I used is available here.

Traditional economics -- which is usually concerned with the nature of a society made up of rational people -- finds it hard to understand why the mere fact of inequality would affect a rational individual: after all, why should your happiness depend on someone else's income or wealth?

Heterodox economists -- most prominently Thorstein Veblen in "The Theory of the Leisure Class" -- knew that there was something missing in the economist's disregard for the effect of inequality on our psyches. So did the American humorist H.L. Mencken. In "A Mencken Chrestomathy" (1949), he defined "wealth" as "any income that is at least $100 more a year than the income of one's wife's sister's husband!" (By the way, the inflation calculator at the Bureau of Labor Statistics says that $100 in 1949 is equivalent to $919.34 in 2010.)

Wilkinson and Pickett show that -- like it or not -- inequality affects us in a profound way. It corrodes our souls, and, eventually, our bodies too.

Please see their web site for more about the data underlying their book.