Obama net approval ratings
The Bay Area Housing Crisis is caused by and can be solved by local government
Richard Walker, a professor emeritus of geography at UC Berkeley, has a new piece in the East Bay Express about the origins and solutions to the Bay Area housing crisis.
I admittedly don't know anything about Professor Walker, other than this one article. He presents some reasonable ideas and even some good policy solutions (rent control, eviction controls, low-income public assistance, etc.) As far as I can tell, he's on left, so I bet we'd agree on many issues.
That said, Professor Walker's analysis of the housing crisis is not good.
So I don't unfairly characterize his views, I'll quote them directly and respond.
This is a common argument: building more housing will help, but we nevertheless 'can't build our way out of the problem.'
This is wrong in two ways:
1) The only way for demand to be "out of control" is for demand to consistently outpace supply. So it's logically true that "building more housing cannot solve the problem as long as demand is out of control" because within that sentence is the assertion that demand will always be greater than supply. In other words, this paragraph is true in the same way "you cannot fix The Problem as long as The Problem still exists." True but meaningless.
2) Given that the demand for housing changes more rapidly than the supply can change (because it takes awhile to build homes, as Prof. Walker notes), Prof. Walker is correct to say that even a boom in housing construction may not be enough for supply to keep up with demand.
While Prof. Walker is once again technically correct here, he's misreading the problem. The housing crisis problem is not a binary problem, where it either exists or doesn't. The problem with out-of-balance supply-and-demand is a continuous pressure on the housing market. The slow pace of building makes it a harder and longer process to relieve that pressure, but every little bit helps. Every single additional unit added to the housing market turns the valve and releases some pressure, leading to lower prices than would be the case if that unit had never been built.
Other basic forces that are driving the Bay Area's housing prices upwards: People, money, consciousness, the Sun, the lack of worldwide plagues, and the Big Bang.
Yes, "growth" and "affluence," which is to say people earning more money, which is to say "demand," is a part of the problem. Hence supply-and-demand. And yes, finance contributes to the problem, in the sense "finance" means the flow of money throughout our economy and the Bay Area housing market is part of our economy. Geography? You bet, since we're talking about land here. The ocean is certainly inconvenient for building homes, but luckily we've invented ways to build up, not just out. We've also invented high-speed rail and public transportation and are inventing driverless cars and hyperloops, which will make it easier to live farther away from cities but remain connected. But both building up and building out require a focus on BUILDING.
There is always "demand" in an economy, unless everyone is dead. The relevance of demand is how it relates to supply. Even if the total amount of demand for housing in the Bay Area is accelerating, it would not be a problem if the supply of housing was also accelerating. And the less supply can keep pace with demand, the more the problems of demand will build up in the form of higher prices. So once again, the solution to the problem of too much demand is to increase supply.
Reminder: demand in an economy simply means the amount of money in the economy that wants to be spent on a good or service. Generally, one of the primary goals of a society is to increase how much money people have, so they have more money to demand things and pay other people who will have more money to demand other things. And so on. This is how societies--if they ALSO focus on the equally critical goals of equity, justice, and fairness--lift people out of poverty, increase happiness, increase the tax base for new public goods and services, and increase the amount of money that can be used for innovation and progress.
When the demand in an economy increases, like you're seeing in the Bay Area housing market, the healthy response from the market is to increase supply. Investors see and anticipate new demand for new housing and respond by building new housing. This new demand, which just means people or families wanting to buy or rent homes, will be able to find a willing supplier to meet their needs.
However, if supply cannot keep up with demand--perhaps because local zoning codes are designed to guarantee supply continuously falls further behind demand--then that increase in demand will not lead to those good things I mentioned, but will instead be captured by the owners of the existing supply of housing--landlords and property owners--in the form of higher prices. This is known as "rent seeking," and is closer to theft than honest profit-making. The resemblance to theft is because the increase returns on investment for these property owners is due to a failing of the market to increase competition to their business. Because no one can build new homes to compete with the homes already on the market, the existing landlords are PROTECTED FROM FAIR COMPETITION and can therefore jack up the price without improving what they are selling.
But I skipped over one important "basic force" Prof. Walker mentioned: inequality. Prof. Walker is correct for focusing on this, but he's drawing the wrong conclusions about how inequality and housing effect one another, so he's really missing the whole story.
The short version is: Inequality is making the housing crisis worse and the housing crisis is making inequality worse. That is, the causal arrow goes in both directions. Let's deal with one causal arrow at a time.
1) Inequality is making the housing crisis worse.
Prof. Walker correctly notes that rising inequality in the region is due in part to the dynamic tech industry leading to fantastic increases in incomes and wealth, mostly for the very rich, but even down to the "somewhat rich." That increase in income and wealth is putting additional pressure on the housing market, which leads to higher prices that only the rich can afford.
What Prof. Walker misses is that economic inequality becomes a much more devastating force in a tight, undersupplied housing market. Why? Because, by definition, in an undersupplied housing market, there are fewer houses available, but the same number of buyers who are demanding houses (not exactly, as new housing brings new demand too). If there are more buyers for every available unit, and if we live in a market-based economy, then there is more demand-side competition for every unit. Who do you think is going to win in this competition, the rich or the poor? If we had more supply of housing, then rich buyers wouldn't be competing with the non-rich over the same housing unit. The rich would spend their money at the new skyscraper and everyone else would spend their money at older, less expensive places. Instead, because we don't build enough, the rich are forced to seek what's available, which is older units that could have gone to someone else, someone with less money.
In an unequal economy like in the Bay Area, the failure to build enough new housing forces the poor to compete in a losing battle with the middle class, who themselves increasingly have to compete in a losing battle with the upper class.
In short, if you care to alleviate economic inequality, you should prioritize building new housing as fast as possible. Even shorter: the poorer you are, the more you suffer from an undersupplied housing market.
2) The housing crisis is making inequality worse
The housing crisis, and the lack of new building in particular, is worsening economic inequality in four ways:
A) Fewer jobs. In order to build new homes, you need to pay people wages to build them. Thankfully, construction workers in San Francisco and the Bay Area are much more likely to be protected and empowered by a union contract, and are further protected by prevailing wage laws. If we prioritized building new housing, we'd get more people into these good jobs, as all that "out of control demand" would be funneled to DEMANDING NEW WORKERS TO BUILD USEFUL STUFF.
People on the left frequently concern themselves with lost manufacturing jobs to overseas labor markets. But building new homes is a blue collar job that is in desperate need right now and can never be outsourced. And yet many on the left poo-poo the benefits of urban and suburban development. Sad!
B) Lower tax revenue for public services. Not only would a supply boom lead to high wages, which would be taxed, it would lead to a boom in local spending, which would also be taxed, and it would allow more people to move to the region, who themselves would be earning wages and spending their income, all of which would be taxed. That means more tax revenue to hire more people to work in good, union, public-service jobs.
C) Another related way insufficient housing increases inequality is that it acts as a barrier for people from other, poorer parts of the county and world, to immigrate to the region and participate in the local booming economy. This form of protectionism is as harmful, shortsighted, counterproductive, and immoral as blocking immigrants from other countries seeking a better way of life in wealthier countries.
You can see the effect this has had on interstate migration, from this recent post from Alex Tabarrok:
D) I mentioned earlier the lack of housing supply leads to rent-seeking from landlords and property owners. This worsens inequality in a hugely consequential way. A restrained, under-built housing market means existing property owners can charger higher rents with no additional effort, costs, or risk. Or they can simply watch their single-family home increase in value, which also means a corresponding increase in wealth.
What this means is that a greater and greater percentage of all the money in the Bay Area is going towards returns on property investments (capital). If capitalists are capturing more and more of the economy's total income, then that means workers are earning less and less. This is precisely the opposite of what we want to see. Unlike workers, who are most of the adult population, capitalists are a much rarer and more privileged breed--even if you include homeowners (which you should). And within the population of capitalists, including property-owning capitalists, the distribution of capital is extremely unequal, with most of the total capital owned by a select few who earn fantastic returns on the capital, which is then mostly passed down through inheritance or hidden in offshore accounts.
The Bay Area's neglect of building new housing is directly making this problem worse and is therefore one of the main contributors to rising wealth inequality in our country.
Thomas Piketty brilliantly identified this problem in his great book Capital in the 21st Century. Matthew Rognlie expanded on Piketty's research by discovering that the main reason capitalists were capturing a greater share of our nation's income is become of property ownership.
In short, by not building as much housing as possible, you only help existing property owners--who are overwhelming wealthy--who gain by charging higher prices, capturing greater rents mostly from the working class, and therefore increasing economic inequality.
Simply false. Geography quite obviously doesn't "operate on the demand side of the equation" (whatever that means) and the others are determined by both sides of the equation.
Prof. Walker's latest artful dodge is an impressive-sounding discussion of global capitalism and finance. He has some reasonable things to say, except they are entirely irrelevant to the discussion, because the rules of global capitalism are not problems to be fixed by local governments. Land-use regulations, though, are precisely the type of problem that can, should, and need to be fixed by local governments. Like now.
Once again, if supply is slow to adjust to demand, then it becomes more important--not less--to increase supply as fast as possible.
So build more housing, so more total housing stock comes on the market in any year. Help the markets from suffering from these bottlenecks. THIS IS THE ENTIRE POINT OF GOVERNMENT--TO PASS GOOD LAWS TO HELP THE ECONOMY AND SOCIETY FUNCTION IN A HEALTHY, EQUITABLE, AND FAIR WAY. Our current zoning laws that keep housing supply makes this problem worse and makes its citizens' lives worse.
Why do they anticipate even higher rents? Because they know the laws on the books, along with powerful political opposition, will prevent new housing (i.e. competition to their business) from entering the market.
So to stop the evil developers and landlords, you need to force them to compete with new developers and landlords, which is done by building more. Then they wouldn't be able to anticipate even higher rents. Then they wouldn't try to evict tenants and displace people. This actually works.
Surely Prof. Walker doesn't seriously think the proper solution to the housing crisis is to just wait for the economy to crash, wiping away trillions of dollars of wealth and millions of jobs, all to lower demand.
I, personally, would rather try to avoid a bust, and instead pay people who need good jobs to build new housing, so supply can increase, demand can be matched, and prices can stabilize in a helpful rather than harmful way.
If the city and the region focused on building new housing, then the nouveaux riches of the tech world who want to live in San Francisco wouldn't be outbidding working stiffs, families, artists, and the poor, because there would be enough housing for everyone.
Yes, this is exactly the problem. But because it exists in the suburbs from Palo Alto to Orinda doesn't exclude it from existing everywhere else in there region, which is the case. The exact same logic for fixing the problem in Palo Alto applies to everywhere else where the problem exists, including SF and the East Bay.
This defeatist attitude is in no way helpful, and has the effect of concealing how much of this problem is the direct result of local policies and politics, not the vague boogyman of contemporary capitalism, which again are not in the jurisdiction of local governance, unlike land-use regulation.
Yes to all this. Needs to be done yesterday.
But importantly, all these things work well and even act as complements to looser zoning regulations for dense development. There's no need to pit these ideas as competitors to major land-use reform.
I admittedly don't know anything about Professor Walker, other than this one article. He presents some reasonable ideas and even some good policy solutions (rent control, eviction controls, low-income public assistance, etc.) As far as I can tell, he's on left, so I bet we'd agree on many issues.
That said, Professor Walker's analysis of the housing crisis is not good.
So I don't unfairly characterize his views, I'll quote them directly and respond.
"But while it's true that we need to expand the region's housing supply, building more housing cannot solve the problem as long as demand is out of control, as it is today. There is simply no way housing could have been built quickly enough to avoid the price spike of the current boom."
This is a common argument: building more housing will help, but we nevertheless 'can't build our way out of the problem.'
This is wrong in two ways:
1) The only way for demand to be "out of control" is for demand to consistently outpace supply. So it's logically true that "building more housing cannot solve the problem as long as demand is out of control" because within that sentence is the assertion that demand will always be greater than supply. In other words, this paragraph is true in the same way "you cannot fix The Problem as long as The Problem still exists." True but meaningless.
2) Given that the demand for housing changes more rapidly than the supply can change (because it takes awhile to build homes, as Prof. Walker notes), Prof. Walker is correct to say that even a boom in housing construction may not be enough for supply to keep up with demand.
While Prof. Walker is once again technically correct here, he's misreading the problem. The housing crisis problem is not a binary problem, where it either exists or doesn't. The problem with out-of-balance supply-and-demand is a continuous pressure on the housing market. The slow pace of building makes it a harder and longer process to relieve that pressure, but every little bit helps. Every single additional unit added to the housing market turns the valve and releases some pressure, leading to lower prices than would be the case if that unit had never been built.
"Three basic forces are driving the Bay Area's housing prices upward: growth, affluence, and inequality. Three other things make matters worse: finance, business cycles, and geography."
Other basic forces that are driving the Bay Area's housing prices upwards: People, money, consciousness, the Sun, the lack of worldwide plagues, and the Big Bang.
Yes, "growth" and "affluence," which is to say people earning more money, which is to say "demand," is a part of the problem. Hence supply-and-demand. And yes, finance contributes to the problem, in the sense "finance" means the flow of money throughout our economy and the Bay Area housing market is part of our economy. Geography? You bet, since we're talking about land here. The ocean is certainly inconvenient for building homes, but luckily we've invented ways to build up, not just out. We've also invented high-speed rail and public transportation and are inventing driverless cars and hyperloops, which will make it easier to live farther away from cities but remain connected. But both building up and building out require a focus on BUILDING.
"All of these operate on the demand side of the equation, and demand is the key to the runaway housing market."
There is always "demand" in an economy, unless everyone is dead. The relevance of demand is how it relates to supply. Even if the total amount of demand for housing in the Bay Area is accelerating, it would not be a problem if the supply of housing was also accelerating. And the less supply can keep pace with demand, the more the problems of demand will build up in the form of higher prices. So once again, the solution to the problem of too much demand is to increase supply.
Reminder: demand in an economy simply means the amount of money in the economy that wants to be spent on a good or service. Generally, one of the primary goals of a society is to increase how much money people have, so they have more money to demand things and pay other people who will have more money to demand other things. And so on. This is how societies--if they ALSO focus on the equally critical goals of equity, justice, and fairness--lift people out of poverty, increase happiness, increase the tax base for new public goods and services, and increase the amount of money that can be used for innovation and progress.
When the demand in an economy increases, like you're seeing in the Bay Area housing market, the healthy response from the market is to increase supply. Investors see and anticipate new demand for new housing and respond by building new housing. This new demand, which just means people or families wanting to buy or rent homes, will be able to find a willing supplier to meet their needs.
However, if supply cannot keep up with demand--perhaps because local zoning codes are designed to guarantee supply continuously falls further behind demand--then that increase in demand will not lead to those good things I mentioned, but will instead be captured by the owners of the existing supply of housing--landlords and property owners--in the form of higher prices. This is known as "rent seeking," and is closer to theft than honest profit-making. The resemblance to theft is because the increase returns on investment for these property owners is due to a failing of the market to increase competition to their business. Because no one can build new homes to compete with the homes already on the market, the existing landlords are PROTECTED FROM FAIR COMPETITION and can therefore jack up the price without improving what they are selling.
But I skipped over one important "basic force" Prof. Walker mentioned: inequality. Prof. Walker is correct for focusing on this, but he's drawing the wrong conclusions about how inequality and housing effect one another, so he's really missing the whole story.
The short version is: Inequality is making the housing crisis worse and the housing crisis is making inequality worse. That is, the causal arrow goes in both directions. Let's deal with one causal arrow at a time.
1) Inequality is making the housing crisis worse.
Prof. Walker correctly notes that rising inequality in the region is due in part to the dynamic tech industry leading to fantastic increases in incomes and wealth, mostly for the very rich, but even down to the "somewhat rich." That increase in income and wealth is putting additional pressure on the housing market, which leads to higher prices that only the rich can afford.
What Prof. Walker misses is that economic inequality becomes a much more devastating force in a tight, undersupplied housing market. Why? Because, by definition, in an undersupplied housing market, there are fewer houses available, but the same number of buyers who are demanding houses (not exactly, as new housing brings new demand too). If there are more buyers for every available unit, and if we live in a market-based economy, then there is more demand-side competition for every unit. Who do you think is going to win in this competition, the rich or the poor? If we had more supply of housing, then rich buyers wouldn't be competing with the non-rich over the same housing unit. The rich would spend their money at the new skyscraper and everyone else would spend their money at older, less expensive places. Instead, because we don't build enough, the rich are forced to seek what's available, which is older units that could have gone to someone else, someone with less money.
In an unequal economy like in the Bay Area, the failure to build enough new housing forces the poor to compete in a losing battle with the middle class, who themselves increasingly have to compete in a losing battle with the upper class.
In short, if you care to alleviate economic inequality, you should prioritize building new housing as fast as possible. Even shorter: the poorer you are, the more you suffer from an undersupplied housing market.
2) The housing crisis is making inequality worse
The housing crisis, and the lack of new building in particular, is worsening economic inequality in four ways:
A) Fewer jobs. In order to build new homes, you need to pay people wages to build them. Thankfully, construction workers in San Francisco and the Bay Area are much more likely to be protected and empowered by a union contract, and are further protected by prevailing wage laws. If we prioritized building new housing, we'd get more people into these good jobs, as all that "out of control demand" would be funneled to DEMANDING NEW WORKERS TO BUILD USEFUL STUFF.
People on the left frequently concern themselves with lost manufacturing jobs to overseas labor markets. But building new homes is a blue collar job that is in desperate need right now and can never be outsourced. And yet many on the left poo-poo the benefits of urban and suburban development. Sad!
B) Lower tax revenue for public services. Not only would a supply boom lead to high wages, which would be taxed, it would lead to a boom in local spending, which would also be taxed, and it would allow more people to move to the region, who themselves would be earning wages and spending their income, all of which would be taxed. That means more tax revenue to hire more people to work in good, union, public-service jobs.
C) Another related way insufficient housing increases inequality is that it acts as a barrier for people from other, poorer parts of the county and world, to immigrate to the region and participate in the local booming economy. This form of protectionism is as harmful, shortsighted, counterproductive, and immoral as blocking immigrants from other countries seeking a better way of life in wealthier countries.
You can see the effect this has had on interstate migration, from this recent post from Alex Tabarrok:
D) I mentioned earlier the lack of housing supply leads to rent-seeking from landlords and property owners. This worsens inequality in a hugely consequential way. A restrained, under-built housing market means existing property owners can charger higher rents with no additional effort, costs, or risk. Or they can simply watch their single-family home increase in value, which also means a corresponding increase in wealth.
What this means is that a greater and greater percentage of all the money in the Bay Area is going towards returns on property investments (capital). If capitalists are capturing more and more of the economy's total income, then that means workers are earning less and less. This is precisely the opposite of what we want to see. Unlike workers, who are most of the adult population, capitalists are a much rarer and more privileged breed--even if you include homeowners (which you should). And within the population of capitalists, including property-owning capitalists, the distribution of capital is extremely unequal, with most of the total capital owned by a select few who earn fantastic returns on the capital, which is then mostly passed down through inheritance or hidden in offshore accounts.
The Bay Area's neglect of building new housing is directly making this problem worse and is therefore one of the main contributors to rising wealth inequality in our country.
Thomas Piketty brilliantly identified this problem in his great book Capital in the 21st Century. Matthew Rognlie expanded on Piketty's research by discovering that the main reason capitalists were capturing a greater share of our nation's income is become of property ownership.
In short, by not building as much housing as possible, you only help existing property owners--who are overwhelming wealthy--who gain by charging higher prices, capturing greater rents mostly from the working class, and therefore increasing economic inequality.
"All of these [factors, e.g. growth, affluence, inequality, finance, business cycles, and geography] operate on the demand side of the equation, and demand is the key to the runaway housing market."
Simply false. Geography quite obviously doesn't "operate on the demand side of the equation" (whatever that means) and the others are determined by both sides of the equation.
"First, housing is a big-ticket item that normally requires a mortgage, and an excess of credit will exaggerate people's ability to purchase houses. California had the most overheated mortgage markets during the housing bubble of the 2000s, and our financial institutions have not been substantially reformed. Finance is subject to dramatic swings, and the pressure becomes unbearable at the peak of the cycle. Furthermore, footloose capital from around the world has once again been flooding into the Bay Area in search of high returns, whether as venture investments in hot start-ups, stock holdings in tech giants, or purchases of mortgage bonds. All the wealth in tech is not generated locally, nor is all housing demand."
Prof. Walker's latest artful dodge is an impressive-sounding discussion of global capitalism and finance. He has some reasonable things to say, except they are entirely irrelevant to the discussion, because the rules of global capitalism are not problems to be fixed by local governments. Land-use regulations, though, are precisely the type of problem that can, should, and need to be fixed by local governments. Like now.
"Second, the housing market does not behave like eBay because supply is slow to adjust to demand. It takes a long time to build new units and most people stay in the same residence for years."
Once again, if supply is slow to adjust to demand, then it becomes more important--not less--to increase supply as fast as possible.
"Hence, only a small percentage of total housing stock comes on the market in any year — normally less than 5 percent — and markets suffer from intense bottlenecks. As expansive demand chases limited supply over the course of a business cycle, prices accelerate ahead of new building."
So build more housing, so more total housing stock comes on the market in any year. Help the markets from suffering from these bottlenecks. THIS IS THE ENTIRE POINT OF GOVERNMENT--TO PASS GOOD LAWS TO HELP THE ECONOMY AND SOCIETY FUNCTION IN A HEALTHY, EQUITABLE, AND FAIR WAY. Our current zoning laws that keep housing supply makes this problem worse and makes its citizens' lives worse.
"Speculators and landlords intensify the pressure as they buy properties, evict tenants, and displace people in anticipation of even higher rents."
Why do they anticipate even higher rents? Because they know the laws on the books, along with powerful political opposition, will prevent new housing (i.e. competition to their business) from entering the market.
So to stop the evil developers and landlords, you need to force them to compete with new developers and landlords, which is done by building more. Then they wouldn't be able to anticipate even higher rents. Then they wouldn't try to evict tenants and displace people. This actually works.
"The good news is that booms go bust, sooner or later. Construction will overshoot the market, as it always does, and then prices will fall by 10 to 20 percent, as usual."
Surely Prof. Walker doesn't seriously think the proper solution to the housing crisis is to just wait for the economy to crash, wiping away trillions of dollars of wealth and millions of jobs, all to lower demand.
I, personally, would rather try to avoid a bust, and instead pay people who need good jobs to build new housing, so supply can increase, demand can be matched, and prices can stabilize in a helpful rather than harmful way.
"If the nouveaux riches of the tech world want to live in San Francisco (even if they commute to Silicon Valley), they have the means to outbid working stiffs, families, artists, and the poor; the result, as we've seen, is a city that has become richer and whiter with remarkable speed."
If the city and the region focused on building new housing, then the nouveaux riches of the tech world who want to live in San Francisco wouldn't be outbidding working stiffs, families, artists, and the poor, because there would be enough housing for everyone.
"The greatest distortion to housing markets is the demand by the wealthy for exclusive, leafy, space-eating suburbs from Palo Alto to Orinda. These favored enclaves reduce overall housing supply by using low-density zoning to block the high-rises and apartments that provide moderate priced homes (not to mention low-income public housing)."
Yes, this is exactly the problem. But because it exists in the suburbs from Palo Alto to Orinda doesn't exclude it from existing everywhere else in there region, which is the case. The exact same logic for fixing the problem in Palo Alto applies to everywhere else where the problem exists, including SF and the East Bay.
"So is there no recourse? Since the biggest sources of the housing crisis lie in the general conditions of contemporary capitalism — the tech boom, gross inequality, frothy finance, boom and bust cycles, and the power of the elites — local reforms can only do so much. Without a major political upheaval for financial control, higher taxes, equality, and more public spending, we are in for perennial housing crises. The housing market can never heal itself under existing conditions."
This defeatist attitude is in no way helpful, and has the effect of concealing how much of this problem is the direct result of local policies and politics, not the vague boogyman of contemporary capitalism, which again are not in the jurisdiction of local governance, unlike land-use regulation.
"But some things can be done locally. Rent control with reasonable annual increases works quite well to dampen overheated markets. Eviction controls are critical, along with other restrictions on speculation. Demands for set-asides for low-income units are another proven strategy, along with development fees. Land trusts have worked well for open space protection in the Bay Area, and could work for housing, but will require major funding. And a real commitment of earmarking money for low-income housing by the federal government — on a scale to match the money going to highways — is a must."
Yes to all this. Needs to be done yesterday.
But importantly, all these things work well and even act as complements to looser zoning regulations for dense development. There's no need to pit these ideas as competitors to major land-use reform.
Trump Delegate Math Still Adds Up
Originally posted at PredictWise.com
For the #NeverTrump-ers, yesterday was a rare day of good news. We finally got a new poll of Wisconsin, and it showed Trump at 35%, trailing Cruz’s 36%, and several points behind Trump’s national average of 44%. Even before this poll dropped, the betting markets already viewed Cruz as the favorite in Wisconsin.
Yet, the markets still view Trump as the overwhelming favorite to become the nominee. PredictWise currently views him as 79% favorite, which is where he’s been hovering for weeks.
Trump’s continued status as the favorite may seem surprising given his weakness in Wisconsin and his narrow path to victory. But it makes sense:
Trump can still win Wisconsin, he can win delegates in Wisconsin despite losing the state, he can make up for the delegates lost later, he can still win on the first ballot (or later ballot) if he falls short of 1,237 pledged delegates.
TRUMP CAN STILL WIN WISCONSIN
PredictWise currently believes he has a 41% chance at winning the state. For some perspective, those odds aren’t much lower than Stephen Curry making a wide open three-point shotand are higher than Ted Williams getting a hit in 1941.
TRUMP CAN WIN DELEGATES WHILE LOSING WISCONSIN
Even if he loses the state-wide vote in Wisconsin (and the 18 statewide delegates that are given to the winner), he’ll win some delegates. Assuming he narrowly loses to Cruz, he could carry three to five of Wisconsin’s eight congressional districts. Each CD is a Winner-Take-All election worth 3 delegates, so Trump could end up with 9, 12, or 15 delegates even while losing the state overall. If Trump narrowly wins the state, he’d probably get 33 or 36 delegates, so we’re talking about 18-27 delegates at stake.
TRUMP CAN MAKE UP FOR THE LOSS LATER
Trump can make-up for those 18-27 delegates lost in Wisconsin but running up the score in New York (April 19 | 95 “Winner-Take-Most” delegates), Connecticut (April 26 | 28 WTM), Maryland (April 26 | 38 WTM), and Rhode Island (April 26| 19 proportional), which have a combined 180 delegates. With Cruz’s limited appeal in this region and Kasich’s bumbling campaign, Trump winning big in the remaining Northeast states is increasingly likely. Indeed, the newly released markets think he’s an 88% favorite in NY, 76% in CT, 74% in DE, and 71% in in MA, and 78% in RI.
Or he can make up for a loss in Wisconsin with a surprise win in any one of Nebraska (May 10 | 36 WTA), Montana (June 6 | 27 WTA), or South Dakota (June 6 | 29 WTA). While these three states are in the midwest/Big Sky region, which is where Trump struggles the most and Cruz does his best, they are relatively strong Trump states according to Nate Cohn’s national map of Trump support. Trump has decent odds of carrying one of these states.
That same map from Cohn also shows Trump polling stronger than expected in Oregon (May 17 | 28 proportional), Washington (May 24 | 44 WTM), and New Mexico (June 7 | 29 proportional). If Trump does well in those states, he could offset a loss in Wisconsin.
TRUMP CAN STILL BE THE NOMINEE WITHOUT 1,237 PLEDGED DELEGATES
Trump doesn’t need 1,237 delegates at the end of primary elections to become the nominee. Between the end of the primaries on June 6 and the beginning of the Republican Convention on July 18, there are six weeks for each campaign to lobby all the unbound delegates to come their way. After voting is over, there will be 106 unbound delegates to work with. There will also be another 98 delegates who were pledged to candidates that have since dropped out, but are now free to support whichever candidate they prefer. That means there will be over 200 unbound delegates for Trump to showcase his “Art of the Deal” superpowers.
If Trump wakes up on June 8 with 1,236 delegates–one short of a majority–he’s all but certain to convince one of those 200+ unbound delegates to support him. If he instead wakes up with 1,100 delegates, he’ll struggle to convince 137 delegates, especially since in this scenario he must have stumbled down the stretch with some surprising losses.
You can visualize the logic with this graph I sketched up:
Taken together, these four points explain why the betting markets remain so confident about Trump’s chances. He can still win Wisconsin, he can still win delegates in Wisconsin despite losing the state, he can make up for the delegates lost later, and he can still win if he falls short of 1,237 pledged delegates.
Trump State-by-State Delegate Race
Originally posted at PredictWise.com
May brings us five elections:
Indiana on May 3
Nebraska on May 10
West Virginia on May 10
Oregon on May 17
Washington on May 24
The betting markets currently believe Trump is the overwhelming favorite to become the GOP nominee. This is despite Trump winning less than 40% of the popular vote, less than 50% of pledged delegates, and actually being below his delegate targets according to Aaron Bycoffe and David Wasserman. Are the markets overrating Trump?
At this point, there are only three plausible outcomes of the Republican race:
1. Trump earns a majority of pledged delegates (1237+) and becomes the nominee.
2. Trump falls short of a majority, but convinces enough unpledged delegates to get on the Trump Train, allowing him to emerge victorious in Cleveland.
3. Trump falls short of a majority, can’t get enough unpledged delegates to cross over, and someone else emerges
.
Here’s why the betting markets think the first two outcomes are much more likely than Trump losing.
MARCH
Trump currently needs 542 more pledges delegates to reach a majority (1,237) and become the presumptive nominee. Even though he’s won less than half of delegates now, the terrain ahead is favorable for his chances.
This Tuesday, Trump is likely to add 58 delegates to his count. PredictWise thinks Trump has an 87% at winning Arizona, which is a winner-take-all state with 58 delegates. Such a victory should weaken the sting of his near-certain blowout loss in Utah, which the markets think Cruz is the 94% favorite. Recent polling also suggests Cruz will clear 50% of the vote in Utah, giving him all 40 delegates.
Taken together, Arizona and Utah will give Trump 58 new delegates, expand his lead over Cruz by 18 delegates, and leave him 484 delegates short of a majority.
APRIL
The first half of April is the barren part of the election season. There are only three contests, and two of them don’t even have a public preference vote (North Dakota and Colorado). That leaves Wisconsin as the contest of note.
Wisconsin is hard to predict. There are no betting markets, no recent polls, and even its geography and demographics don’t give many hints. It borders states won by Cruz, Rubio, and Trump. It’s a midwestern, very white state, which sound good for Cruz, but it also has a low share of very conservative, frequent church-attending evangelicals–which Cruz needs. The polls we do have point to a Trump lead–but it’s a small one, and maybe now nonexistent.
Wisconsin is also a “winner-take-most” primary, so the winner of the state gets a disproportionately high amount of the state’s delegates. As we saw in Missouri, a tiny shift in the the vote outcome has huge ramifications for the allocation of delegates. For now, let’s follow the evidence we have and say Trump narrowly edges out Cruz in Wisconsin, and takes home most of its 42 delegates.
The final two weeks of April will likely be Trump’s best stretch of the election. It will have to be for him to reach 1237. On April 19th is Trump’s home state of New York and its 95 delegates, most of which are allocated at the congressional district level–three delegates at stake per CD. The winner of each CD gets 2 delegates, unless they reach 50% of the vote, which gives them all 3 delegates. Recent polling, and what we know about Trump’s supporters, suggest New York may be the first state he wins with over 50% of the vote. If he does so, he’s likely to capture nearly all 95 delegates.
One week after New York comes Connecticut, Delaware, Maryland, Pennsylvania, and Rhode Island. These five states combine for 172 delegates, although 54 of Pennsylvania’s will remain unbound. That means 118 delegates are at stake, and are allocated on a mix of winner-take-all, winner-take-most, and proportional rules. The little polling we do have, along with geographic and demographic indicators, suggest this is favorable Trump territory and he’ll take home most of those 118 delegates.
Assuming he wins Wisconsin, New York, Connecticut, Delaware, Maryland, Pennsylvania, and Rhode Island, Trump will gain between 220 and 240 delegates, on top of the 58 he’d get from Arizona. For the sake of argument, let’s assume he wins 230, which would leave him 254 delegates short of 1237.
MAY
May brings us five elections:
Indiana on May 3
Nebraska on May 10
West Virginia on May 10
Oregon on May 17
Washington on May 24
There is virtually no polling on these five states, but we do have this detailed national polling map, from Nate Cohn. From this, along with what we know about Trump’s base, Trump is a big favorite in West Virginia, a favorite in Indiana, and competitive in Nebraska, Oregon, and Washington. If you assume he wins WV, IN, narrowly wins or loses in OR and WA, and loses NE, Trump should end up with around 100 delegates, bringing him within 154 delegates of 1237.
JUNE
The last day of the primaries is June 7th, when Montana, New Jersey, New Mexico, South Dakota, and the biggest prize of them all–California–vote. At stake are 303 delegates–of which Trump will need to win around half of them.
New Jersey is easy to predict for Trump. Numerous polls and indicators suggest that NJ is one of Trump’s best states. New Jersey allocates its 51 delegates on a WTA basis, so if you subtract that from the 154 he needed, he’s now only 103 delegates short of a majority.
New Mexico only has 24 delegates to give out, and it does so on a strict proportional basis, so it doesn’t really matter if Trump wins or not. The little polling we do have and what he know about the demographics point to Trump winning at least a 1/3 of the vote–so let’s assume he wins 8 of the 24 delegate. Trump is now only 95 delegates short.
South Dakota and Montana have a combined 56 delegates, all of which are awarded to the winner. While Trump seems to fare better in these two states than the rest of Big Sky and the midwest, let’s assume Cruz hangs on and takes all 56 delegates. Trump still needs 95 more, but he has 169 to play with in California.
California only awards 10 delegates to the statewide winner. 3 delegates are given to the winner of each of the 53 congressional districts–159 delegates total. Polling suggests Trump has a state-wide lead over Cruz, but Cruz’s support typically tends to be concentrated in pockets of deeply conservatives areas, whereas Trump enjoys broader and more evenly-distributed appeal. This positions Trump to win most of CA’s districts, even if he’s running even with Cruz at the state level. If he does so, Trump will get most of those 159 delegates, pushing him over 1237 and becoming the nominee.
Trump could easily stumble and fall short. If he loses Wisconsin and Indiana, he’d have sweep nearly all of the delegates in the Northeast and California, or make up the difference with surprise wins in Nebraska, South Dakota, or Montana. So while Trump has an obvious path to a majority, he also is walking on an obviously narrow path.
The markets nonetheless remain confident in Trump’s position, because if he doesn’t get to 1237 by June 7th, he’s almost certain to be within striking distance and close enough where he could convince a handful or two of unpledged delegates to join the dark side and vote Trump.
While it’s easy to imagine elite Republicans conspiring to deny Trump the nomination if given an opportunity, such a conspiracy will be much harder to pull off in reality. One of the defining traits of this election has been the total lack of competence from the Republican establishment. Another defining trait has been Trump’s large, frenzied, and violent base of support–a base that’s currently the largest faction of the GOP rank-and-file. While it would make for a great script in House of Cards, it’s hard to imagine the bumbling Republican elite boldly standing up to the powerful, enraged mob of Trumpism, and giving the nomination to Paul Ryan, Mitt Romney, or anyone else they think could and should beat Hillary. Instead they’ll do what they’ve been doing all along:
Lose to Trump.
This time is different: Republican anti-establishment candidates are doing better than ever
I’m curious if the current GOP mania with outsider, anti-establishment candidates is just a temporarily blip that will correct itself. After all, the 2012 Primaries had Santorum, Cain, and Bachman all temporarily leading in the polls. 2008 had Huckabee and Ron Paul, each of whom had some success.
So I downloaded all GOP National Primary polling data from the last three elections, and grouped all the candidates into two camps: “Establishment” and “Anti-Establishment.”
For 2008:
Establishment Candidates: McCain, Romney, Guilianni, Fred Thompson
Anti-Establishment: Huckabee, Ron Paul
2012:
Establishment: Romney, Perry, Gingrich, Huntsman
Anti: Santorum, Bachmann, Cain, Ron Paul
2016:
Establishment: Bush, Rubio, Walker, Fiorina, Kasich, Christie, Jindal, Graham, Pataki
Anti: TRUMP!, Carson, Cruz, Huckabee, Rand Paul, Santorum
If you include Fiorina in the anti-establishment camp, then the trend is even more pronounced.
While it’s still more likely than not that the establishment will get their way, after looking at this graph, this election cycle really does seem different. The long term trends over the past 9 years show a steady decline in establishment support, which matches up with what we’re witnessing in Congress and the overall difficulty the GOP has had in controlling the Tea Party.
How 1,000-year lifespans could remake the economy
Originally posted at The Week
If anti-aging research develops as some predict, this pattern could change. The boundaries of growing up and growing old greatly limit our options in life. Our entire physical prime is spent figuring out our career path, earning money, raising a family, and saving. Removing the cap of old-age decline would open up a lot of possibilities. People could choose multiple careers and areas of study. They could also have more freedom over when to raise kids and when and how often to take long breaks (instead of a single retirement and annual small vacations). Your whole working life could change — as would the priorities you make at each stage of your life. Here's what a lifespan could look like:
Read in full at The Week
The rise of the global middle class is our best hope to stop climate change
Originally posted at The Week:
This unknown innovator may discover a breakthrough in computer architecture that helps us leap past our approaching quantum limits. By doing so, he or she will push our accelerating rates of innovation, which is central to all hopeful tech predictions. She or he may invent super-efficient solar cells or usable fusion energy. She or he may play a crucial role in the development and integration of 3D printing, robotics, and artificial intelligence. This may lead to new industrial production, capable of quickly scaling these technologies to deal with the scope of climate change.
This ever-expanding pool of talented, non-WEIRD people may be the ones who protect this planet. But economic and social discrimination of women and minorities, in developing and advanced societies alike, still exists and places harmful limits on our potential. Despite some remarkable anti-poverty achievements, 1.2 billion people still live on less than a $1.25 a day and 774 million people are illiterate, 64 percent of whom are women.
The faster we achieve universal equal opportunity, the faster we can reverse climate change and take on other challenges.
Read in full at The Week.
Todoist and Pomodoro or: How I Stopped Being a Stressed, Unproductive, and Procrastinating Asshole
One of my favorite things about academia is the day-to-day flexibility afforded. That said, it comes with certain challenges. One of the biggest challenges is how unstructured most days are and how many distractions are present. These distractions can be enjoyable (FB, Twitter, Netflix) and unenjoyable (Gmail, less-urgent tasks, etc.). Combined with my natural procrastination tendencies, this has the potential to be a serious problem. It left me less productive than I wanted to be while also causing me to feel 1) overwhelmed, 2) unsure of progress, 3) stressed. This is a deadly combination of my work time being sub-optimally productive and my fun time being sub-optimally fun, since I’m stressing about my progress.
After some brief time management research and reflection, I’ve come up with a solution that has achieved the following (early) results:
1. More efficient work time
2. Better, more focused work.
3. More confidence. I now have record of my productivity, removing much of the self-doubt.
4. More enjoyable, relaxing, and recharging fun times.
5. Because of 1-4: More productive output with work, school, chores, and self-improvement (gym + other good habits).
The main thing I did was to start using the Freemium App “Todoist.” It’s nothing more than a To Do List application, but with a clean interface, some nifty features, and available everywhere (PC, Mac, iOS, Android, etc.). This helps your daily engagement with the app.
With Todoist, I forced myself for the first week to put in and schedule every task that took more than a few minutes to complete. This includes recurring tasks (Todoist has a great feature to handle recurring tasks!) like regular chores around the house, regular blocked time for clearing out my Gmail Inbox, creating my weekly questions for discussion section, etc. By having these recurring tasks, they show up on my daily to-do list with zero marginal effort. This means I removed much of the mental fatigue and stress that comes from trying to remember what I need and want to do. It also makes it much easier to actually develop the habit of keeping a daily to-do list.
Todoist also has great collaborative features. So Rachel and I have a shared “project” for tasks that are for each of us. Bobby and I have a shared “project” for getting in shape (“BEEFCAKE Project”), which allows us to keep tabs and motivate each other.
After a week of being happy with this, I decided to broaden what I would use Todoist for, and started including recurring “life goals.” These included daily goals that I wanted to achieve but rarely did. Things like flossing, brushing twice a day, taking nutritional supplements, 30+ minutes of light+ exercise, 30+ minutes of fresh air, etc. They also include longer-term goals, like regular updates with my dissertation committee, paying down debt, etc.
After another happy week, I stumbled across a popular time-management method: the Pomodoro Method.
All you do is:
1. Create a daily to-do list (which Todoist makes super easy!)
2. Estimate how long each task would take to complete.
3. If a task takes more than 30 minutes, break it up into sub-tasks.
4. Create a certain amount of daily units of time where you will focus all your time and energy on completing that task. These units of time are “Pomodori,” which sounds dumb, but don’t worry too much about that. (The most common is 8-10 pomodori a day).
5. Break up those Pomodori with a 5 minute break, and a 30 minute break after you complete 4 of them.
6. Assign your tasks to each Pomodori.
7. When you start working on a Pomodori, set a timer for 25 minutes.
8. When you complete your Pomodori, mark it as completed and take a 5 min break.
9. Rinse and repeat.
The “official” Pomodori method is strict with this method, but I think it works as a more general advice that should be adapted to fit the user. I’ve integrated it with Todoist by simply doing the following:
1. Creating a “Pomodoro” Project in Todoist.
2. Within that project, I created 10 week-daily recurring Pomodori’s (1st Pomodori, 2nd, 3rd, etc.).
3. These now automatically populate my daily to-do list.
4. I then arrange all my daily tasks underneath each Pomodori.
5. I then go through the day, with my timer, marking them off 1 at a time.
When I’m done with the list, I can do whatever I want for the rest of the day and not feel guilty by what I “should” be doing. I now have an adaptable and flexible structure placed on my life.
This won’t be for everyone and every lifestyle. Some have the inherent work ethic and focus to not need any prodding. Some may have a boss who unfortunately does the prodding for them. But for me, so far, this has been a great boon to my life.
If I were Dictator...
With power, I would dramatically reshape America.
In general, I think neoliberals are right that the private market is the best engine for growth and rising living standards, and that government regulation, ownership, and intrusion distorts and reduces economic efficiency However, this is not absolutely true--some markets require heavy government regulation (finance) to protect capitalism from itself and some markets (health care insurance) just don't work as well as when they are government-run. The power of capitalism also creates temporary and permanent losers who need to be shielded from the creative destruction of the market. This is a moral issue, but also an economic one: cushioning the blows from capitalism allows the "losers" to more quickly reintegrate into the market, which leads to long-term economic growth. Strong social safety nets also create freedom since they reduce economic risk and therefore encourage otherwise uncertain but potentially beneficial investments. I.e., if you have job with benefits, you may not want to quit it to start your own business if that means you have to go without health care for you and your family. Economic growth is also not the sole purpose of public policy--equality is important as well.
I also think the libertarians are right that personal freedoms should not be infringed upon unless the social costs are too high (i.e. "negative externalities"). This is why I think drugs, prostitution, and gay marriage should be legal...but guns shouldn't be.
Finally, American political institutions are a total mess and need radical reform.
So, if I had the power, here's how I'd change America:
1. The Fed should drop inflation/unemployment targeting and switch to NGDP Growth Targeting: This would greatly smooth out the volatility of the business cycle and make steep economic downturns unlikely and short-lived.
2. Health care insurance should be provided for everyone by the federal government (Single Payer System). Private insurance companies can provide supplemental insurance. This would expand coverage, reduce costs (due to increased bargaining power and lower administrative costs), remove these costs from private business (since they are no longer paying for insurance), and remove all volatility in coverage (i.e. losing health care insurance after losing your job).
7. Increase the gas tax and chain it to inflation. Needed to help fund infrastructure and gas consumption is an activity that should be discouraged.
8. Eliminate all tax breaks (including for owning homes, marriage, etc.). These are hidden spending programs, most of which are harmful, and on the aggregate are definitely harmful. They also overly complicate tax filing, which is again wasteful.
10. Eliminate minimum wage laws. Given current political constraints, I support a high minimum wage, but it's not the ideal policy to reduce poverty and raise living standards. It raises the cost to do business, which is passed along to the consumer and the unemployed (or eats into profits), and isn't the best way to target those in need.
12. Install a "guaranteed minimum income" law (to reduce poverty and cushion employment adjustments). Everyone, given a few requirements (such as citizenship, employment, college, or attempts at employment, etc.), should receive a minimum amount of money (maybe something like $15 - 20,000). This would be done via direct government cash transfers. Yes, this will de-incentive some to really look for work or really work hard for a raise, but this is not a wide spread problem and is drastically outweighed by the moral and economic benefits.
15. Reduce defense spending dramatically. Maybe something like 2-3% of GDP. It's currently around 5%, double the world average and makes up over 40% of world defense expenditures. This is wasteful and probably needlessly encourages military endeavors that do more harm than good (see: Vietnam, Iraq, etc.).
16. Create an independent "infrastructure bank." Staffed by public policy experts, this would have its own large budget and would be charged with targeting worthy and needed infrastructure projects (HSR, highways, smart power grids, etc.).
17. Strengthen unions via card check rules, eliminate "right to work" laws, and other measures. Maybe even create sector-wide unions who represent all workers in that sector (i.e. Sweden). Probably less needed if all the other stuff on my list existed, but they do help address economic and political inequality since workers face greater collective actions problems than business.
19. Deregulate many zoning laws. Most of these creative terrible incentives, raise property costs, and make cities less efficiently designed.
20. Universal pre-K education. A good investment for future productivity gains.
21. Government(s) should fund all public colleges and universities and make tuition free. A good investment for future productivity gains.
22. Aggressive pro-immigration policy. Working-age population growth helps fund the government and leads to long-term productivity gains.
23. Aggressive expansion of free trade zones. Free trade good.
In general, I think neoliberals are right that the private market is the best engine for growth and rising living standards, and that government regulation, ownership, and intrusion distorts and reduces economic efficiency However, this is not absolutely true--some markets require heavy government regulation (finance) to protect capitalism from itself and some markets (health care insurance) just don't work as well as when they are government-run. The power of capitalism also creates temporary and permanent losers who need to be shielded from the creative destruction of the market. This is a moral issue, but also an economic one: cushioning the blows from capitalism allows the "losers" to more quickly reintegrate into the market, which leads to long-term economic growth. Strong social safety nets also create freedom since they reduce economic risk and therefore encourage otherwise uncertain but potentially beneficial investments. I.e., if you have job with benefits, you may not want to quit it to start your own business if that means you have to go without health care for you and your family. Economic growth is also not the sole purpose of public policy--equality is important as well.
I also think the libertarians are right that personal freedoms should not be infringed upon unless the social costs are too high (i.e. "negative externalities"). This is why I think drugs, prostitution, and gay marriage should be legal...but guns shouldn't be.
Finally, American political institutions are a total mess and need radical reform.
So, if I had the power, here's how I'd change America:
Economic Policy:
2. Health care insurance should be provided for everyone by the federal government (Single Payer System). Private insurance companies can provide supplemental insurance. This would expand coverage, reduce costs (due to increased bargaining power and lower administrative costs), remove these costs from private business (since they are no longer paying for insurance), and remove all volatility in coverage (i.e. losing health care insurance after losing your job).
3. Overall taxation should be more progressive and shouldn't have arbitrary brackets, but instead a granular taxation rate (i.e. every additional dollar taxed at a fractionally higher rate).
4. Eliminate all income taxes (personal, payroll, corporate) and capital gain taxes. While currently necessary to fund our government, they are far from ideal. They distort incentives in anti-growth ways and are overly complicated, therefore wasting money and time on filings and rewarding trickery.
5. Switch to a consumption-based taxes (that are modified so they remain progressive). This would be our new main source of revenue. They would include a Value Added Tax and a "Income minus savings and investments" tax that is progressive. These taxes are the most simple, hardest to dodge, and have the fewest economic distortions.
6. Install a financial transaction tax. This isn't necessary to raise revenue (although that's a bonus), but to throw some sand in the gears of a financial system that is too fast moving and reduce financial volatility.
7. Increase the gas tax and chain it to inflation. Needed to help fund infrastructure and gas consumption is an activity that should be discouraged.
8. Eliminate all tax breaks (including for owning homes, marriage, etc.). These are hidden spending programs, most of which are harmful, and on the aggregate are definitely harmful. They also overly complicate tax filing, which is again wasteful.
9. Eliminate agriculture subsidies. Terrible policy that mostly benefits those who don't need it, makes us fatter, and increases the national deficit.
10. Eliminate minimum wage laws. Given current political constraints, I support a high minimum wage, but it's not the ideal policy to reduce poverty and raise living standards. It raises the cost to do business, which is passed along to the consumer and the unemployed (or eats into profits), and isn't the best way to target those in need.
11. Expand unemployment insurance. It should be more generous and lengthier--this is a main cushion against the inevitable problems of capitalism and is also a powerful automatic stabilizer of aggregate demand (Keynesian policy without all the politics!)
12. Install a "guaranteed minimum income" law (to reduce poverty and cushion employment adjustments). Everyone, given a few requirements (such as citizenship, employment, college, or attempts at employment, etc.), should receive a minimum amount of money (maybe something like $15 - 20,000). This would be done via direct government cash transfers. Yes, this will de-incentive some to really look for work or really work hard for a raise, but this is not a wide spread problem and is drastically outweighed by the moral and economic benefits.
13. Increase capital-to-debt requirements for banks that go higher with more systemic risk they pose. Instead of outlawing "too big to fail banks," which do benefit from economics of scale, try to prevent their systemic risk.
14. Specify that financial institutions that do need to be bailed out are done so on very onerous terms: wiping out shareholders, nationalizing, etc. The government should absolutely always bail out companies that pose systemic economic risk, but should minimize moral hazard as much as possible. This does that.
15. Reduce defense spending dramatically. Maybe something like 2-3% of GDP. It's currently around 5%, double the world average and makes up over 40% of world defense expenditures. This is wasteful and probably needlessly encourages military endeavors that do more harm than good (see: Vietnam, Iraq, etc.).
16. Create an independent "infrastructure bank." Staffed by public policy experts, this would have its own large budget and would be charged with targeting worthy and needed infrastructure projects (HSR, highways, smart power grids, etc.).
17. Strengthen unions via card check rules, eliminate "right to work" laws, and other measures. Maybe even create sector-wide unions who represent all workers in that sector (i.e. Sweden). Probably less needed if all the other stuff on my list existed, but they do help address economic and political inequality since workers face greater collective actions problems than business.
18. Install congestion fees on busy freeways and roads. Road space is a scarce public good and should not be given away for free. When its most in demand, it should be most expensive. This would raise revenue, incentivize less driving, and dramatically reduce traffic (saving time, money, energy, and sanity).
19. Deregulate many zoning laws. Most of these creative terrible incentives, raise property costs, and make cities less efficiently designed.
20. Universal pre-K education. A good investment for future productivity gains.
21. Government(s) should fund all public colleges and universities and make tuition free. A good investment for future productivity gains.
22. Aggressive pro-immigration policy. Working-age population growth helps fund the government and leads to long-term productivity gains.
23. Aggressive expansion of free trade zones. Free trade good.
24. Abolish the United States Postal Service - Not really needed anymore.
Politics:
1. Eliminate the United States Senate - Not needed, dysfunctional, and distorts public policy towards areas where most people don't live.
2. Eliminate the Electoral College and replace with national popular vote - All together stupid. Makes voting a pointless exercise for most, incentivizes campaigns to spend all their time and energy in narrow parts of the country, and can lead to anti-democratic outcomes (see: George W. Bush).
3. Install proportional representation for the House - Eliminates problems of Gerrymandering, safe-districts, and wasted votes. Allows for some 3rd party representation.
4. National holiday for election days - Voting should be a celebration and made as easy as possible. Giving the people the day off does both.
5. National early-voting by mail and the internet (if it's proven sufficiently safe). Again, voting should be as costless as possible and waiting in long lines is a big cost (particularly for minorities who Republicans don't want to vote!).
6. Supreme Court term limits - I don't really see the point of lifetime appointments--allows people to hang around too long and time up their retirement to benefit their party. Give them 20 years--that's plenty of time to learn the job and become an absolute expert.
7. Eliminate presidential term limits - We have term limits in the wrong place. Unlike the Supreme Court, we already have a de facto term limit on presidents: elections. Presidential term limits are not needed and are anti-democratic.
8. Eliminate debt ceiling - Dangerous, serves no purpose, and inherently illogical.
9. Eliminate Hastert Rule in House - Pushes public policy towards the extremes. Anti-democratic.
Social Policy:
1. Legalize gay marriage - Or just get the government out of the marriage business all together, grant civil unions to straight and gay couples alike, and allow private institutions to do their own ceremonies.
2. Legalize marijuana - A mostly harmless drug (both personally and socially) who's illegality benefits criminals, wastes public resources, criminalizes non-criminal behavior, and infringes on personal liberty for little reason.
3. Legalize or Decriminalize all other drugs - Unlike marijuana, most other drugs are sufficiently harmful that we should try to reduce their consumption. But they should be treated as health problems and infractions. I'm less sure on whether they should be legalized or merely decriminalized.
4. Legalize prostitution - Prostitutes should should have the same rights and protections as any other worker (including unions!). Illegal prostitution probably reduces the overall prevalence of prostitution, but does so at great costs by making it more unhealthy, exploitative, and violent.
5. Ban all guns (or at least all hand guns and high-powered rifles) and institute a national buyback program to try to get existing guns off the street - While guns and hunting do have important family and cultural connections, they impose severe public costs. Yes, such draconian measures will not eliminate guns and gun violence, and the imminent arrival of 3D printers will make it that much harder to eliminate guns, all measures should be done to reduce the amount of guns in society.
Foreign Policy (I'm least interested in this...):
1. A general liberal-institutionalist outlook grounded in conservative, pragmatic realism. I'd try to strengthen international institutions so the U.S. doesn't have to be the World Police. I'm too ignorant to have specifics on how this is done.
2. I'd like to promote democracy and capitalism where its lacking, but I'm not sure how that's done effectively. Intervention doesn't seem to work, so perhaps "leading by example" and grass-roots support for pro-democratic groups and organizations.
3. Reduction if not elimination of troops in taking out terrorists.
4. Relative increase in drone attacks used for targeted killings. Must come with greatly increased transparency on how applied to American citizen terrorists.
5. Much more balanced approach to the Israel-Palestine conflict, including explicitly criticizing Israeli actions.
That's all I got for now. I'm curious to see how I change over time. I wish I wrote something like this 10 years ago so I could laugh at my younger, dumber self.