More crazy talk from the Pigou Club

Mankiw boasts of more publicity for his pro gas-tax club. This publicity includes commentary by Economics correspondent Chris Farrell.

When asked by the interviewer:

"Now just saying the word "tax," if you're running for President or if you are President or I mean who's gonna buy this? "

Farrell responds"

"if you package a gas tax, not only as part of energy security but part of attacking global warming and leading toward a more sustainable environment, there are ways that you can manipulate this situation so that the word "tax" doesn't quite have the negative connotations which you have rightly raised. And it's more like environmentally-conscious, attacking global warming . . . "

Who really believes that? No matter how you package it as a sizeable environmentally beneficial thing (even if people think it really is which is questionable anyway), most people don't internalize envrionmental costs that much. Without the state of Washington, no one would care enough about the environment enough to pay more at the pump! Let's see one of you pigouers try and sell it based on the above quoted publicity - - -

'My fellow Americans, we are going to make you pay a dollar more in gas (albeit phased in) for every gallon of gas you buy. But don't worry, you're helping to save the environment. What's that? you don't care that much about the environment? What's that? If you cared all that much about the environment, you would have purchased less gas or drove less in the first place? Why is your face turning red? Are you chasing me!? What is that pie doing in your hand!!?'

How many academics and others think free trade can hurt the world's poor?

Mankiw says that nobody does. I wish I was as popular as he.

Clive Crook's theft of reason

Clive Crook said: "On grounds of economic efficiency, the case for a bigger gas tax is unassailable."

BS - political rhetoric

I've seen pro gas taxers (yes, I still refuse to improperly call you pigovians because I think Pigou, if he were still alive, would be against this gas tax idea too) make some reasoned arguments for a gas tax. But, there are equally (and in my opinion more persuasive) strong arguments against such a tax increase. So to say that "a schedule" of gas tax increases will DEFINATELY be efficient (or, rather, more efficient than other alternatives previously discussed)is ridiculous and shameful.

Many posters on Mankiw's blog have debated these issues and then try to back their ideas up with theory or empirical evidence. Clive Crook just says it; it must therefore be so?

And beyond that, as I mentioned in a recent post last week, it is a mistake that economists continue to make when they detach efficiency from equity. When economists and 'thinkers' push (ignore) the problem of equity onto other fields, it leads to these kinds of black-and-white, rhetoric-filled statements.

Not quite.........

Mankiw has a post scolding college econ profs for not doing enough to persuade the average Joe that free trade is a good thing.

I really think Mankiw is not giving the average Joe (or average college goer at least) enough credit. I think most people recognize the gains from free trade that specalizations by different countries can provide. What they take issue with, I think, is that it always seems to be the same people/sectors that get the benefits of the bigger pie, while the same unskilled factory workers (which make up a big chunk of the population) and sectors like farming, etc. continue to get the shaft.

People will always be against free trade until policy is such that these "losers" in the free trade game are better compensated for their losses. Economists are very quick to ignore this problem and are fast to say, "let's talk about efficiency, not equity." The problem is that the two are inseparable in reality....

Laundry as Job location incentive....

This is a priceless (and local Indianapolis!) piece about how some companies are coming up with innovative ideas to keep (or attract) young workers to their corporation(s). How about at-work laundry? Sign me up baby!

IQ and Education

As discussed on Mankiw's latest post, I'm having some serious problems with Charles Murray's articles (2) (3). I understand the idea that IQ could create an upperbound as to how far education can take a person. My problem is he seemingly pulls these IQ constraints from a top hat. He writes:
"There is no magic point at which a genuine college-level education becomes an option, but anything below an IQ of 110 is problematic. If you want to do well, you should have an IQ of 115 or higher. Put another way, it makes sense for only about 15% of the population, 25% if one stretches it, to get a college education."

Where do these numbers come from? I didn't see a cite. Am I just not seeing it? This just smacks of elitism to me. ...Or maybe I just don't have the IQ to grasp it. Couldn't it just as well be that a typical 4 year college is worthwhile and useful to everyone with an IQ of at least 100, or maybe 90? Who's to say where that bound is?

Beyond that, I do believe 'g' exists. What I DON'T buy into at all is the idea that once you reach a given education level, all formal education after that is pointless or (personally) inefficient due to your IQ. People always have room to improve - they always have room for intellectual growth, no matter what their IQ.

One problem with IQ as a measure is that it is a very narrow definition of innate intelligence. There are lots of different kinds of intelligence. Luckily our colleges understand this which is why, more and more, fields and disciplines are creatively expanded to work different peoples' brains. Besides, people also need to have the 'free will' to dream.

The Rudy's of the world need to try, and if they fail, they may just be more the wiser for it.

CAFE change vs. Tax hike for gas: ongoing debate

There is an ongoing discussion regarding the merits of reformed CAFE (as previously posted) vs. a gas tax hike.

For those interested in the CAFE reform, and the analyses behind it, I have linked some papers regarding it (see the right side of my blog under the heading "CAFE reform."