Krugman gets it wrong… again

Imagine that:

Paul Krugman has weighed in to an ongoing debate sparked by Jonathan Chait’s criticism of a passage in my essay “Keeping America’s Edge.” I believe that I have responded to Mr. Chait’s assertions comprehensively. Unlike Chait, Professor Krugman has argued that I have presented incorrect data.

Krugman says this:

But I went back to Manzi’s source of data, and it turns out that it’s even worse than that. If you use the broad definition of Europe, which includes the USSR, it did indeed have 40 percent of world output in the early 1970s. But that share has not fallen to 25 percent — it’s still above 30 percent.

His assertion is flatly false.

First, Krugman has incorrectly identified my source of data. I have never corresponded with Krugman concerning data sources and analysis for the passage in question (unlike Chait, who was careful to contact me prior to publishing his blog post, and to whom I sent data sources and calculation details), so I cannot know on what basis Krugman asserts that the dataset to which he links is my “source of data.” It is not. As per the blog post in which I reviewed multiple data sources for the analysis in question, I averaged multiple sources of data. Krugman has selected only one of these sources, presented it as if it were my sole source, and therefore (obviously) failed to replicate the published result. The error is his.

Second, Krugman incorrectly interpreted the economic dataset that he did identify.

I know I’m shocked that A NOBEL-WINNING ECONOMIST could get it so wrong. And speaking of errors and Krugman, a recent reviewer of RGD managed to impressively cock things up in “correcting” my explanation of the loan multiplier in a fractional reserve system. Amusingly, he seizes upon this “error”, combined with the fact that I dared to criticize A NOBEL-WINNING ECONOMIST, to claim that the book “Should Never Have Been Published”. While I have to take responsibility for failing to distinguish between “the bank” and “the banking system”, our intrepid reviewer nevertheless managed to completely miss both the obvious context (the fractional reserve system) as well as the point (the increase in the money supply created by the loans). I’ll explain this in more detail later this week for the six regulars who are actually interested in this sort of thing as well as any anklebiters who would like to revel in the possibility that I am wrong about something, but if you’d like to verify this for yourself, I would encourage you to plug a 0.75% reserve ratio into the table in the Wikpedia example – note that I was completely unaware of this table until about two weeks ago – and compare it to the Loan Multiplier of 133.33x to determine for yourself whether Mr. Eskildson’s “correction” is on target or not.

It should be noted, that this method only provides an estimate for the amount of interest collected over the course of the year, since this completely depends upon the number of loan-and-deposit cycles that occur over the course of the year as well as the three caveats mentioned in the book. Using the 10x example from Wikipedia would mean that $4.80 in annual interest is collected, which is neither the maximum $6.67 mentioned in RGD nor the $0.0599 which the reviewer claims is the correct amount.

WND column

Killing the Geese

Throughout history, poverty is the normal condition of man. Advances which permit this norm to be exceeded – here and there, now and then – are the work of an extremely small minority, frequently despised, often condemned, and almost always opposed by all right-thinking people. Whenever this tiny minority is kept from creating, or (as sometimes happens) is driven out of a society, the people then slip back into abject poverty. This is known as “bad luck.”
– Robert Heinlein, “Time Enough For Love”

It was astonishing to read of Republican Sen. John McCain’s recent radio attack on Barack Obama. Displaying an energy and vehemence that he somehow couldn’t manage to muster during the 2008 presidential campaign, when it actually might have mattered, he accused the man who defeated him of “leading an extreme left-wing crusade to bankrupt America.” But if America goes bankrupt, it will not only be the extreme left-wing that is to blame. After all, one can’t go bankrupt without having borrowed money from someone, and there is no current politician in America who has been more closely affiliated with the financial institutions to which so much debt is owed than John McCain.

24-0

Baltimore gets off to a dominating start in the first quarter. It really doesn’t look too promising for New England today; they just look hapless. Given the way Dallas and the New York Jets finished off their Week 17 opponents, Green Bay has to be feeling pretty confident. Dallas looked good and the Vikes will certainly have to show up to beat them, but they didn’t look like a team to be particularly frightened of either.

Mailvox: Sam Harris and the lost sheep

In which a skeptic’s email is quoted:

I’ve written you before as a skeptic. Remember the topic about Sam Harris? I was a college student who lost his faith after reading Harris and reading atheist blogs. Actually, I had been skeptical for some time before that, as some of you pointed out. I have now graduated with a Master’s…. Anyway, last November I found Christ. Before I was probably merely a nominal Christian. I thought I had to believe, not that I wanted to, to get into Heaven. But that’s all over. I had a personal experience after reading Darin Hufford’s book The Misunderstood God. I followed his instructions, and I felt Christ enter my life. My relationship with Christ has since deepened.

It should come as no surprise that the spurious reasoning offered by the New Atheists holds an amount of appeal to nominal Christians who have been taught to hide from their doubts rather than to embrace and examine them. Those who are not taught to think critically about the Christian faith, but are merely raised in it, are always going to be susceptible to the sophistry and faux rationality of the Sam Harrises of the world. A license to do evil without ramifications or remorse is always going to be tempting no matter how shallow the justifications for it happen to be. And Heaven is a very long way off in the eyes of the young, especially when more immediate earthly paradises are there for the taking.

Anyhow, I’m pleased to hear that another wayward sheep has elected to return to the Good Shepherd. No doubt his faith will be all the stronger for experience of indulging his doubts. Believing in belief is no substitute for actually possessing it.

End the Rooney Rule

It’s racist, pointless, and stupid:

Adam Schefter of ESPN reports that Carroll has agreed on a deal to take the job. According to Schefter, the only hangup is that the Seahawks can’t make the hiring official until they comply with the Rooney Rule by interviewing a minority candidate. Of course, at this point, if the Seahawks do interview a minority candidate solely to comply with the Rooney Rule, they would be making a complete mockery of the Rooney Rule. Vikings defensive coordinator Leslie Frazier has reportedly decided to sit for an interview after being assured that Carroll doesn’t have the job yet. Perhaps after reading Schefter’s report, Frazier will change his mind.

I hope he does. Frankly, I’m a little tired of black Minnesota defensive coordinators getting hired to be head coaches and win Super Bowls elsewhere. I wanted the Viking front office to fire Denny Green and promote Tony Dungy before he left for Tampa; I not only would have preferred Tomlin to Childress but would frankly have settled for David Chapelle in preference to Childress at the time. Now, the team has greatly improved under Childress and he appears to have stopped trying to prove that The Tarvaris Jackson Experiment is a starting NFL quarterback, so I can’t honestly say that I’d prefer the unknown quantity that is Frazier to the known strengths and weaknesses of Chilly.

But I do wish we could have some success without losing every doggone defensive coordinator who helps make it happen. Anyhow, it’s a ridiculous rule and it would be amusing to see the teams mock it more openly than they already are by interviewing black comedians, Hispanic gang leaders and young Asian violin prodigies. This is, by the way, your NFL playoff post… is there even a single individual here who likes Cincy today? Well, I think the Bengals and the Cowboys will make it through.

Pederasts and their atheist enablers

I found it difficult to believe that Uganda was on the verge of passing a law that would require the death penalty for merely being homosexual as various atheist sites have been reporting, especially since by all reports it is an extremely popular law. Unsurprisingly, about thirty seconds of research revealed that the critics of the law have played a little fast and loose in their portrayal of it. While homosexuality is illegal in Uganda and has been for more than 100 years, the death penalty attached to the new law is primarily intended to stop the homosexual rape of children and the disabled and passing on the HIV virus.

Given that Uganda is one of the third-world countries presently targeted by sex tourists and the country also passed laws against cannibalism and sex tourism recently, it should be perfectly clear that the law involves more than societal hatred for homosexuals. Now, I don’t support capital punishment in criminal law because I believe giving the state the power of life or death over its citizens is an inherently dangerous idea. Nor do I understand how locking up homosexuals in same-sex prisons is supposed to be an effective deterrent. I would not support a law like the anti-homosexuality bill being enacted in the United States since legality is not morality and homosexuals should be free to choose Hell in their own way, just like everyone else is.

However, the more pressing question is not why some Western Christians would fail to denounce this law, but rather, why those who so vehemently oppose it are defending the right of gay pedophiles to rape children. Now, it’s perfectly reasonable to take a position opposing the long-term jailing of individuals for the crime – and in Uganda, it has long been a crime – of engaging in homosexual acts, although it’s not actually all that reasonable unless you are normally in the position of expressing your opinion regarding Ugandan law. But life sentences for practicing homosexuals is clearly not the only thing most of these sites are complaining about because they are specifically referencing the death penalty.

This reaction against what is clearly a very popular law in Uganda highlights the anti-democratic aspect of Western progressivism. If the great majority of people in Uganda don’t want to put up with homosexuality, why should they? It’s clearly the sacred Will of the People, after all. And more importantly, how is this of concern to anyone who doesn’t live in Uganda, barring those who will have to give up their pedophile safaris in the future? Given their opposition to such laws, you would think that banning the mass importation of Ugandans and other like-minded third-worlders who will support similar laws here in the United States would be a more urgent issue, but ironically, importing third-worlders is a policy favored by most progressives.

There is, of course, a perfectly rational solution to the situation. Since Uganda doesn’t want its gays, and American progressives insist that gays and immigrants are good for a community, why don’t progressive communities across America simply encourage gay immigration from Uganda? Everyone wins! And it’s eminently practical too, since Uganda’s estimated 500,000 gays would make up less than one-third of the 1.8 million foreigners who annually immigrate to America.

Economics and evolution

Scott Hatfield of Monkey Trials brings an interesting series of posts by David Sloan Wilson to our attention:

One important theme that emerged was the yawning gap between economic theory and evolutionary theory. Economists are very smart people, but when smart people take off in the wrong direction, they go a very long way. As Eric Beinhocker (one of the participants) recounts in his book The Origin of Wealth, neoclassical economics was originally inspired by physics and led to an enormous body of formal theory based on assumptions that are required for mathematical tractability but that make no sense from an evolutionary perspective…. If economics and evolution are different paradigms with a yawning gap between them, then it will be very difficult to get from one to another in an incremental fashion. Every time we try to make one assumption in economic theory more realistic from an evolutionary perspective, it will conflict with the other assumptions and will be resisted by those accustomed to the economic paradigm. Scientific progress will require comparing the two paradigms as package deals and accepting or rejecting them on that basis.

I have to say that it is refreshing to see an evolutionist admitting that perhaps economists may actually be intelligent, (their recent performance notwithstanding), and simply have a different way of looking at things. This is much preferable to the defensive shrieking and finger pointing we have come to expect from biologists forced to confront basic economic concepts. Unfortunately, the response to perfectly reasonable questions like “what is the average rate of evolution?” tends to be some variant of “You know nothing about evolution or science and the reason I can’t answer any of your questions is because you’re stupid!”

Well, that’s helpful. I’m much more convinced that you know what you’re talking about now….

Now, the Walrasian-Keynesian neoclassical formalist paradigm to which Wilson refers was a detour from the earlier and in many ways superior economics of Turgot and the School of Salamanca and it certainly has many weaknesses. Since I favor the Austrian School, I am by no means wedded to the mathematical assumptions and artificial equilibria which Wilson implicitly questions. However, despite the gaps, I also see many similarities between what has now evolved into a Samuelsonite Neo-Keynesian macroeconomic orthodoxy and the Neo-Darwinian orthodoxy of the evolutionists. Both scientific consensuses are highly intolerant of criticism, produce predictive models that are reliably wrong, and take an approach that should be labeled “Kuhn’s Ostrich” toward anything that might threaten their current dogma.

Unfortunately for the sake of evolutionists who are actually interested in improving their theories rather than defending their dogma, the time scale on which they operate prevents their theoretical flaws from being exposed as rapidly as is the case with illegitimate economic orthdoxies. Pure Keynesian general theory was vanquished during the recession of the 1970s, the two Japanese Lost Decades eviscerated the monetarist heretics of the Chicago School, and the current contraction should cause the collapse of the SNK synthesis over the next decade. The false dichotomy of monetarism vs Neo-Keynesianism has already been exposed; whether the successor is some Minskyite Post-Keynesian doctrine, the Austrian school, or, as I expect, a blending of the two with a strong dash of behavioral economics, economics will be greatly transformed.

While I have hopes for genetics eventually putting the final stake through the tattered remnants of TENS that still survive the modern synthesis, it’s quite clear that in the absence of an unexpected Kuhnian crisis, biology will continue to be handicapped by its reliance on what is at its core nothing more than a quasi-medieval philosophical foundation rather than a properly scientific one. But Wilson’s perspective is an unusual one and I expect to follow his Paradigm series with interest.

I am, however, more than a little dubious of Wilson’s attempt to construct an analogy fitting paradigms into evolutionary stable strategy. “Intriguingly, paradigms can be regarded as the intellectual equivalent of local stable equilibria in complexity theory and adaptive peaks in evolutionary theory.” This sounds suspiciously like Dawkins’s “meme” nonsense to me, especially in light of Wilson’s obvious awareness of the risks inherently involved in adapting concepts from one discipline into another.

Adios 401k

The Market Ticker smells smoke coming out of the treasury market:

Now this is a guaranteed rape job. In a short conversation this noontime that CNBC apparently has omitted from their archives (Why’s that folks?) Rick Santelli was talking about a potential to effectively force money into the Treasury market. Where would they get this?

From your 401k and IRA accounts!

I find it very difficult to believe that the fiscal and monetary authorities would be that stupid. On the other hand, perhaps they’re just that desperate. California is on the verge of melting down again, house prices are looking ready to start collapsing soon, and the only reason that U3 unemployment isn’t worse is because the size of the labor force continues to shrink despite continued immigration.

Mailvox: an atheist economist considers TIA

SS writes back:

Thank you for taking the time to answer my last email in considerable length on your blog. I wrote with questions about your latest book and professed an interest in reading The Irrational Atheist at some later date. I managed to finish it on a long flight back to the US a few days ago, and after a few days to think about it, I think you wrote a very good book that ought to be required reading for any atheist wanting to take on religion and especially Christianity.

While I can’t speak for the reactions of most atheists, I hope you won’t mind if I make a few observations and ask a few questions of my own.

(1) I think your tripartite criticism of the Dawkins-Harris-Hitchens group was both reasonable and accurate. I haven’t read either of Harris’s books (and have no intentions of doing so), and have been greatly underwhelmed by some of Hitchens’s public debates with people who actually know what they are talking about. I was not particularly convinced by Dawkins’s book either, but I didn’t quite realise how little he actually knows about religion until I read your dissection of his book.

(2) I particularly liked your division of atheism and atheists into the High Church and Low Church varieties. I started out as what you call a High Church atheist, but as my political beliefs changed to a more libertarian bent I found myself repulsed by just how militant many atheists- particularly the European variety- have become. In a recent interview with PJTV, author David Berlinski called atheism an “adolescent” view, and I think he’s got a point. If atheists really want to build a coherent argument, we have to stop sounding like a bunch of stroppy teenagers. I think your book makes this point very effectively.

(3) I am curious, though: why is it that in your chapter regarding the perceived Christian misdeeds of the past, you have excluded the Spanish conquest of the Americas, or the forceful introduction of Christianity into Scandinavia? If I understand your writing correctly, you argue that one should not judge a religion by its followers, and vice versa. But I think your argument would have been greatly strengthened by looking at one or both episodes, and at the reactions of the Catholic Church in particular to the grievous misdeeds carried out in its name in Central and South America during the 16th Century. I think that if you had addressed this, your argument would have been nearly airtight.

(4) Your point regarding the “red hand of atheism” is spot-on. It is an absolute travesty that my fellow atheists rarely, if ever, recognise that atheist Communism and Socialism is responsible for the deaths of tens of millions of innocent people. Since becoming a libertarian a few years ago I’ve been disgusted by the apologies made by atheists for the horrific abuses of Communism, particularly in China and Russia, and it is completely unacceptable that atheists cannot recognise their culpability in promoting an essentially evil view of government. Until we repudiate the hedonistic and left-wing philosophies that pass for considered thought among the New Atheists, we do not deserve to be taken seriously in questions of morality and government.

(5) Your point about the way in which atheists construct our systems of morality is well made, and I take your argument about “moral parasitism” without offence. I am yet to be fully convinced, however- though I agree with both you and John Locke that atheists have a very hard time trying to prove that we are “moral”. (Given the awful record of atheists with political power, I think we’ve got a long way to go.) I think that the remarkable similarities that are found in the moral systems of various religions and civilisations demonstrates that it is possible for morality to “evolve”. This is not to say that all moral systems are equally acceptable. Suffice to say that I think I have a lot more reading to do in this area before I can fully agree or disagree with your argument.

In his email, SS also informed me that my surmise was correct and he is an LSE guy. Which is unsurprising, given that he is obviously more intelligent than the run-of-the-mill Dawkinsian atheist – it’s interesting to see the very different way TIA is viewed when seen from the perspective of someone who has come to it by way of RGD. I suspect economists will tend to be a little more open-minded than either physicists or biologists on average due to the speed with which the orthodox scientific consensus is regularly shown to be inadequate. This makes it much more difficult to shut off one’s brain and accept a doxastic division of labor based on credentialed authority. SS wrote later in his email: “Four years later, I’m convinced that the economic theory I learned is nearly useless. Maths, though, was great fun- and rather more useful.” He actually has 11 points, so I’ll address the first five today and save the rest for next week.

(1) I think one really has to read at least one of Harris’s books in order to appreciate how reliably awful his reasoning is. Hitchens, on the other hand, can be skipped because he doesn’t even attempt to make a case. His book is little more than a series of unconnected anecdotes, declarations, and complaints.

(2) One of my goals in writing TIA was to embarrass the atheist community into throwing out the likes of Dawkins and Harris in favor of developing a more intelligent, more rational atheism with a broader historical perspective. This is important; I read an article in a UK paper recently that was calling for an alliance between European Christians and secularists to deal with the rising tide of Islam, and that’s simply never going to happen so long as the atheist community is dominated by the rabid Christian haters. One of the more remarkable things I’ve noticed about atheists over the last few years is how utterly ignorant of history they tend to be.

(3) Since TIA was a response to the various atheist books, not an general Christian apology, I saw no reason to introduce defenses that were outside that context. The omission of such historical events initially surprised me when I read the books, given their goal of attacking Christianity, until I realized that the New Atheists know virtually nothing about the historical conversion of Northern Europe, the colonization of Central America, or the Belgian atrocities in the Congo. As anyone who has read Summa Elvetica knows, some of the theological issues surrounding these events are of interest to me, but they weren’t relevant to TIA.

(4) Yes, I tend to agree. The transparent attempts of militant atheists to disassociate the historical actions of militant atheists from their known atheism is intellectually shameful. However, I don’t think the needed repudiation is particularly likely, despite the Randians and Michael Shermer’s pro-Austrian perspective, due to the logical consequences and philosophical implications of godlessness.

(5) The “remarkable similarities that are found in the moral systems of various religions and civilisations may demonstrate that it is possible for morality to ‘evolve'”. Or they may indicate that God has written His Law in the human heart and the various divergences from it are to be expected as the result of societies falling away from it to varying degrees. Or, as I contend, the similarities are not be anywhere nearly as similar as those who don’t study history believe them to be.

Not so fast

Markku is under the impression that he managed to catch me making a mistake about God’s knowledge of the design imperfections of His Creation. I think I can demonstrate that this is not correct:

“I think Jesus was the fix for a design gone haywire.”

Can’t be.

1Pe 1:19-20 But with the precious blood of Christ, as of a lamb without blemish and without spot: Who verily was foreordained before the foundation of the world, but was manifest in these last times for you.

Now, Markku is correct to the extent that the verses make it clear that Jesus cannot have been a fix conceived subsequent to the problem. However, I think Markku is making a mistake in equating Jesus Christ’s existence and potential mission with the actual sacrifice of his life here. Since we already knew that the Word was with God from the start, his existence before the foundation of the world isn’t in question from a Biblical perspective. However, we can also see that the foreordaining does not refer to his “precious blood”, although I agree that the reference is still in the context of him redeeming Man. This distinction between the potential redemption and fact of the redeeming sacrifice is perhaps more apparent in other translations.

NIV: For you know that it was not with perishable things such as silver or gold that you were redeemed from the empty way of life handed down to you from your forefathers, but with the precious blood of Christ, a lamb without blemish or defect. He was chosen before the creation of the world, but was revealed in these last times for your sake.

Now, Markku’s interpretation is potentially correct, as it indicates that God was aware from before the beginning of the possible need to send Jesus Christ to redeem Man. The Redeemer was chosen from the start, but not revealed until later. But this does not make his interpretation necessarily correct because it is perfectly plausible that God would have understood that Man was capable of falling and had a backup plan prepared in case of such an event.

As a programmer – a very good programmer, as a matter of fact – Markku is well-equipped to understand the concept of an if/then structure created during the design phase. So, while these verses from 1st Peter certainly permit his interpretation of a scripted scenario of Fall and Redemption, they fall short of conclusively proving it. This means that my interpretation of an unscripted scenario remains Biblically tenable and it is possible that Jesus was the predetermined fix for a design with multiple potential outcomes.