Noah Smith wrote a pretty compelling op ed in Bloomberg on Tuesday demonstrating that worries about a robot apocalypse–the eclipse of human labor by machine labor–are unfounded. He points to the rather steady employment-to-population ratio, the positive correlation between IT investment and jobs, and low productivity growth as proof that robots do not, in fact, cost at least the macroeconomy jobs. (We can't necessarily make assertions microeconomically.)
This is a bad thing.
The "economic anxiety" narrative of the Trumpian moment is back under the microscope this week thanks to a NYT op-ed that cited some new research in Politics & Society.. The article and the op-ed alike are riddled with the sort of neoclassical assumptions that have hampered the discussion of fascist political economy and its role in elevating Trump to the White House.
In Mutual Aid, Peter Kropotkin describes how non-capitalist societies managed disasters:
As to the social characters of the mediæval guild, any guild-statute may illustrate them. Taking, for instance, the skraa of some early Danish guild, we read in it, first, a statemet of the general brotherly feelings which must reign in the guild; next come the regulations relative to self-jurisdiction in cases of quarrels arising between two brothers, or a brother and a stranger; and then, the social duties of the brethren are enumerated. If a brother's house is burned, or he has lost his ship, or has suffered on a pilgrim's voyage, all brethren must come to his aid. If a brother falls dangerously ill, two brethren must keep watch by his bed till he is out of danger, and if he dies, the brethren must bury him–a great affair in those times of pestilences–and follow him to the church and the grave. After his death they must provide for his children, if necessary; very often the widow becomes a sister to the guild. (141, Dover Books edition, emphasis added)As we can see, non-capitalist societies had very different ways of managing disasters. Here, Kropotkin describes five, perhaps six, different events that capitalism would handle with insurance. Fire insurance, boat insurance, health insurance, and life insurance would be the capitalist alternative to the duties described here.
Further bolstering my theory that anyone who describes themselves as a researcher on extremism is a fucking idiot, Eoin Lenihan has been caught with his pants down in his recent "anti-antifa" study (probably also deserves scare quotes) and the conspiratarian sphere is not happy.
Since the Democratic Party and its enabling non-profits have recently staked their hopes on an electoral process that they have insisted for over a year was compromised by foreign actors, I have been thinking about the consistent failure of electoral strategy in light of fascist upsurge. What history demonstrates time and again, from the Pact of Pacification to the Sermon on the Mount, is that a brutal government cannot be thwarted through obsequiousness. Liberalism, understood not as a political orientation but a governmental paradigm, ultimately proves impossible. Whatever is won in the moral spectacle of violence cannot make up for the literally everything that is materially lost. Suffering is suffering. Dying is dying. Below, I present five texts that tackle different aspects of the logic and application of liberalism which prefigures its own demise.
Shawn Rosenberg - Against Neoclassical Political Economy: A Political Psychological Critique
Ed White - The Value of Conspiracy Theory
Frederick Shauer - Uncoupling Free Speech
The other day, Branko Milanovic wrote a blog post detailing his reservations of the Palma index. For those unfamiliar, Palma is a proposed substitute for the Gini index. Whereas Gini measures the longest perpendicular distance between the Lorenz Curve -- which shows the percentage of overall income going to given percentages of the population -- and a line representing complete equality, Palma is a simple ratio between the incomes of the top 10% and the bottom 40%.
Palma came about as the result of an observed regularity in inequality data showing that the 50% of the population between these two quantiles doesn't change that much in the short run. Unlike Gini, Palma is not on a particular scale (Gini can range from zero to one), and thus may be difficult to use in cross-country and intertemporal comparisons.
Milanovic's beef with Palma seems to be in its construction. His basic problem revolves around this immobile middle. In particular, what do you do if the middle does change? I think this is a valid concern, but Milanovic gives little indication as to why Gini is substantially better.
Gini itself has its own problems. Given that it presumes a relatively smooth exponential income distribution, any irregularities can throw off the index.
My major point of contention with Milanovic here is not so much on the superiority of one index over the other, but rather the implication that we should invest ourselves in finding a superior index for inequality. Indices, merely by virtue of distilling the data from an entire economy down to one number, are inherently going to be problematic in terms of universal application. The choice of index (or indices if you're into that whole "robustness" thing) should be guided by the data you have and the questions you intend to answer.
Gini is a pretty good measure of whether incomes are skewed towards the rich, but it doesn't give a very clear picture of the degree of stratification. Palma fills in this gap by focusing exclusively on the rich and poor rather than where the middle is. There are of course many other indices to choose from when investigating inequality, each with its own ideal application and limitations. It is our duty as data scientists to approach each problem with the appropriate tools rather than attempting to force a particular approach as the one-size-fits-all tool.
Different horses for different courses.