One of the meatier blogs I read is that of Gary Becker and Richard Posner. They have similar notions on extension of unemployment insurance: they’re ag’in it. Both of their entries are pretty cold, giving the impression that unemployed workers are widgets or disposable cogs in a machine. When discussing policy, that is appropriate to some extent – good policy can’t be abandoned every time a hard luck tale comes along. But, people aren’t objects, and so some consideration has to be given to the notion that we might want to treat people a little more delicately.

That said, here are a couple of the passages I found especially interesting.

Becker:

However, the actual large extension poses a major risk of creating an unemployment culture where men and women remain “ unemployed” for years. Once the period of unemployment becomes long enough, people begin to get the habits from being unemployed for a long time: they sleep late, develop various leisure interests, and at the same time their work skills depreciate from not using them for an extended period. Studies have shown that skill depreciation is a serious effect of being unemployed for a long time.

Some might retort that this argument is persuasive during periods of normal unemployment rates, perhaps 7% and under, but not when jobs are scarce, the unemployment rate is over 9%, and it is coming down slowly. There is merit to this response, but on the other hand, the JOLTS data show that even with the current high unemployment rates, about 4.5 4 million persons were hired in May 2010 (and about the same number are either being laid off or quitting their jobs). So for the most part, even the long term unemployed can find jobs if they are willing to take a cut in their earnings, and/or move to other industries and occupations.

This analysis leads me to the following conclusions. During bad times, 6 months of unemployment compensation may not be long enough, but the 2 years in the new law is too long. About 9 months of unemployment compensation would be the right length. Anyone unemployed longer than that would lose these benefits. If they want to work they should be forced to adjust, at least temporarily, to the bad economic environment, and accept jobs that they would turn down during good economic times.

Posner:

Far from being effective as stimulus, the extension of unemployment benefits will have two negative effects on employment. First, it will increase the opportunity cost of the recipient’s rejoining the labor force. Unemployment benefits are set lower than earnings to reduce the moral hazard that Becker discusses, but the gap between benefits and earnings is narrowed by the costs of work (such as commuting, and any disutility associated with work, such as fatigue and boredom) and by the benefits of household production and of leisure—and those benefits, unlike earnings, are not taxed. The gap is so small for many unemployed people that studies show that they do not begin a serious job hunt until their unemployment benefits are about to expire.

So extending or otherwise enhancing unemployment benefits, far from stimulating employment, is likely to reduce employment and so slow the pace of economic recovery.

Robert Sullivan, writing for Richmond’s Palladium-Item, has an article on Richmond’s scooter/moped ordinance. Apparently by August 1, scooters operated in the city must be registered with the city for a fee of $35. In addition, the following restrictions are imposed:

You have to be 15 or over, and anyone under 18 has to wear protective head gear. You have to carry a valid state ID or driver’s license. Speed limit of 25 mph.

I’ll be interested to see if anyone challenges the authority of the city to adopt this ordinance. I’m not immediately aware of anything prohibiting it, but there might be a state preemption argument to be made. The default setting under our Home Rule scheme is that municipalities have the authority to engage in regulation, but once the state steps into an area, municipalities aren’t allowed to regulate in that area anymore absent specific authority from the state. I’m not immediately aware of motor vehicle laws specifically pertaining to mopeds; but the State has adopted a system regulating motor vehicle traffic on Indiana’s roadways. So, it depends on how you define the scope of state activity for preemption purposes.

This article also caught my eye because a friend & I were discussing the use of mopeds and scooters yesterday. He’s an avid bicyclist, and he got the sense that people on bicycles were treated with more respect by people in cars than did people on mopeds and the like. Maybe it’s simply a speed differential thing – it’s just easier to get around bicycles. But, it could be a social stigma thing – there’s often an assumption that adults on mopeds or scooters are riding them because they’ve done something wrong; probably gotten their license yanked for a DUI or something. (I’ve heard them called DUI-mobiles or liquor-sickles.) More than once, I’ve heard it suggested that someone who gets their license pulled shouldn’t be allowed to operate a moped – the theory being that part of the punishment should be that the person isn’t allowed to operate motorized transport of any kind.

Ken Bode has a column in the Indy Star commenting on deeply anti-Semitic propaganda being distributed at Tea Party gatherings.

Now, if you attend some tea party meetings in Indiana, a different kind of challenge is emerging. On the information tables, along with candidate brochures and handouts from right-wing blogs, is a stack of DVDs, one of them titled “Rothschild’s Choice: Barack Obama and the Hidden Cabal Behind the Plot to Murder America.”

As described in breathless narration over ominous, pounding, suspenseful music, the cabal is made up of Jewish financiers and billionaires, run today by Lord Jacob Rothschild, the 4th Baron. Along with Jewish-run secret societies and globalist organizations, their control of Barack Obama has turned him into a water boy to their causes.

Obama is a Zionist puppet, goes the argument, supported by Timothy Geithner, Ben Bernanke, Barney Frank — all Jews, all part of the banking system, all tools of the conspiracy. “David Axelrod,” says the narrator, “That’s right, he had a Jewish campaign manager.”

Sounds like this is a lot of rehashed crap with some more current names plugged in here or there. I recall being 13 or 14 first seeing this sort of stuff on bulletin board systems I was dialing into with my Commodore 64. And I know it was old then.

Is the Tea Party a racist? I think the “movement” is so incoherent, it’s difficult to ascribe any particular attribute to it. What we know is that it consists of people who are mad. They’re mad about a lot of different things. They seem to make a lot of noises about “taking their country back.” (From whom isn’t usually articulated.) However, the “movement” seems pretty uniformly white. And they seem to be more opposed to government spending that might help people of color than spending that might be used to blow up people of color. In fairness, that might not have a racial component at all; simply the notion that military spending = good & domestic spending = bad.

At the end of the day, I think the Tea Party folks have at the very least a perception problem. Standing up to their own who are pushing this anti-Semite garbage, and doing so in a very visible way, might be a good first step. For those who disagree with it, anyway.

I forget if we’ve discussed this phenomenon here before or not, but I recall hearing this notion in the recent past, and I was reminded of it by a discussion at Mike Kole’s site regarding copy fees (his specific post had to do with wildly unrelated subsidies and hidden taxes).

Anyway, the notion is this: price caps often act as price magnets. (Now I recall, I heard it from a commentator on NPR discussing maximum rates on payday loans). I’m obviously not a free market purist, but this is at least something that do-gooder regulators should keep in mind. When the government sets a cap, it saves industry competitors the trouble of having to conspire to restrain trade – the price is effectively fixed for them.

My particular experience had to do with medical copying fees. 760 IAC 1-71-3 (pdf) sets maximum prices for your medical records of $20 for any pages 1-10; $0.50/page from 10-50; and $0.25/page thereafter. I forgot the exact wording but the medical provider I got my records from had a notice that suggested, without explicitly stating, that the fees were mandated by statute as opposed to being a maximum fee. (“Oh, we wouldn’t charge such outrageous prices for copies, but darn it, the mean old government is *making* us.”)

When I heard that Sen. Lugar was voting in favor of Obama-court nominee, Elana Kagan, and the subsequent uproar from some quarters accusing Lugar of being a RINO (Republican In Name Only), I opined that something had jumped the shark: conservatism, Lugar, or the folks pissed off by Lugar.

Matt Tully has a column in the Indy Star on how tiring the partisanship is. I tend to agree. I don’t have a Broder-esque desire for bipartisanship just for the sake of bipartisanship. Where there are fundamental policy disagreements, I think you should compromise where you can, and fight it out the best you’re able and let the dust settle where it may when the votes come down. But, in D.C., it’s not even about policy so much anymore. It’s basically “my team rules, your team sucks” and you shape your policy arguments to fit that basic premise. If the other team adopts your policy, you don’t agree, you run from the policy. It’s about winning the game, not about governing, and it’s stupid.

Yesterday was the 6th Annual golf outing for the benefit of the Legal Aid Corporation of Tippecanoe County. I haven’t gotten the money count, but I think it may have been as successful as we have had yet. A lot of credit goes to 1st Source Bank which stepped up and became the major sponsor. The folks at 1st Source seem to be a solid addition to the Lafayette community. Huge credit also goes to Gregg Theobald, a local Lafayette attorney, who has taken the bull by the horns and turned a fair-to-middling event and turned it into a very good event. There were a good number of hole sponsors, including my own Hoffman, Luhman & Masson, but I want to give special thanks to Triclinic Labs. They had no prior relationship to Legal Aid, and stepped up with a hole sponsorship basically because I’m friends with one of their employees. Among other things, they provide chemical analysis – for example litigation support in intellectual property claims involving chemistry.

Legal Aid provides legal services to indigent citizens of Tippecanoe County in civil, non-fee generating cases. For criminal cases, the government provides attorneys. And, in cases where there is a pot of money at the end, poor people can find attorneys willing to take the case on contingency. But, in civil cases where there is no money to be made — for example a case involving the termination of parental rights — people need lawyers, but can’t get them without organizations like Legal Aid.

Our outing this year was at Coyote Crossing, and we had 50-55 people come and play. Because I know you were wondering, my foursome came in 4th out of 13 or 14 foursomes. And, I got lucky and won the closest to the pin hole. (This hole has been pretty lucky for me – #17 at Coyote – it’s the second closest to the pin I’ve won in the last month or so, and probably the 4th time I’ve won the closest to the pin on that hole over the past 5 years.)

Anyway, thanks to everyone involved; and hopefully it gets even better next year. Times are tough, and non-profits like Legal Aid are taking it on the chin. So, any money we can send their way is very useful.

I couldn’t help but think of that old Lincoln assassination joke when I read a paragraph in the write up about the shootings at the Black Expo in Indianapolis this weekend. Ten children were shot (fortunately with, apparently, minor wounds) on Saturday. (Also see Indiana Barrister).

The episode, marring what was described as an otherwise successful, 11-day Summer Celebration that drew hundreds of thousands to the city, prompted a host of questions[.]

I’m sorry. If 10 kids get shot, you can’t have an “otherwise” successful event; anymore than the performance at Ford’s Theater was otherwise successful the night Lincoln was shot.

The main incident apparently wounded 9 people; there was an unrelated incident, described as a “tussle” where a 15 year old who was in the group but not in the particular altercation got shot in the leg.

This is ridiculous. I don’t know what the problem is, specifically. I guess it’s not a black issue because most black people at the event were not involved in the violence. It’s not a gun ownership issue because most gun owners never shoot anyone illegally. But, that said, this sort of thing doesn’t seem to happen at, say, the gay pride events.

Officials said there was a simple formula for the violence: thousands of children unleashed without parental supervision and too many guns illegally owned and used.

One shooting victim was found with a .32-caliber handgun. Weapons confiscated separately from the shootings included a .22-caliber handgun, a 9 mm handgun and a loaded AK-47 assault rifle.

“I am mad as hell,” said Rev. Harrison.

“I am sick and tired of us making excuses for some of our young people. There was a lot of gang activity taking place. We need to deal with the real issues. Some of our kids are out of control.”
. . .
[V]iolence has found Summer Celebration’s final weekend before. In 2006, five people were wounded in two Downtown shootings. In 2007, two teenage girls were arrested after, police said, one fired a gun into the air.

One of the problems is simply adolescent males (of any race . . . or, looking at the animal kingdom, species, really). If we could somehow take weapons out of the hands of all males, ages 16 – 30, I imagine the damage done by assaults would drop precipitously. And if wishes were horses, beggars would ride.

I guess the take away from this incident is to supervise your kids, teach them guns aren’t toys, and keep them away from events with high concentrations of adolescent males.

In the past couple of days, I came across some musings on Hoosier values that struck me. The first is from a 1948 novel called Raintree County by Ross Lockridge, Jr. It’s a book full of gauzy writing which is set in Indiana through much of the 19th century. The second is from an excellent post by the Urbanophile examining Columbus, Indiana.

From Raintree County:

It was because of this code that everyone in Raintree County, including Johnny Shawnessy, understood and, after a fashion, adulated Flash Perkins. It was the code of the early Hoosier, the backwoodsman or river man, a type already becoming extinct in Indiana. The code of Flash Perkins was the code of a people who had become great fighters and talkers in a wilderness where there was not much else a man could do for diversion but fight and talk. It was the code of the tellers of tall tales who tried to live up to their tales. It was the code of a competitive people, who had fought the Indian and a still greater antagonist, the wilderness itself, the stubborn, root-filled pioneer earth, the beautiful and deadly river, the sheer space of the West. It was the code of breezy, cocky men, who had n fear in heaven or earth they would admit to. The code involved never hitting a man who was down, never turning down a drink, never refusing to take a dare, never backing out of a fight – except with a woman. The code involved contempt for city folks, redskins, varmints of all kinds, atheists, scholars, aristocrats, and enemies of the United States of America.

The Urbanophile – The Columbus Indiana Values Proposition:

1. Bedrock Hoosier Values. Let’s not forget again that the people of Columbus are, above all, Hoosiers. And the best of Indiana values play a key roles in the city’s success. These include thrift, hard work, faith, patriotism, community, hospitality, modesty, family, and yes, that uniquely Hoosier orneriness. Urban sophisticates may mock these straightforward values at times, but they are many of the values that built America.
. . .
As much as I love Indiana, I must repudiate its overwhelming tendency towards the active discouragement of the pursuit of excellence and improvement. This attitude is a disease that affects the entire Midwest, and does perhaps more than any single other thing to hobble it.

It’s a long standing condition. When my father came out of the service, he was berated by my grandfather for deciding to enroll part time in college. My grandfather thought it was a total waste. Thank goodness my dad had enough Hoosier orneriness to do what he wanted. Last year I ran across an old neighbor who went to my high school about a decade before I did. He recounted how, upon telling the guidance counselor he planned to attend university, he was told there was no way anyone from such a small school could ever make it in college and he should be a welder instead. Today he has a master’s degree and a significant professional position. I remember myself in school hearing a repeated refrain of how there were lots of people “with book learning but no common sense.” Admittedly, in my case that might have been true, but I think it shows an attitude that doesn’t just not value education, but actively despises it.

Like most generalizations (I love the irony in that set up), descriptions of what constitutes Hoosierness is going to be inaccurate in a lot of cases. Also, I’ve noticed a lot of what people feel is unique about their own location from state-to-state is often fairly common. (E.g. – “Don’t like the weather in [insert state], wait 15 minutes and it will change.”) But, I think Hoosiers took to heart the virtues of the common man; things like discipline, hard work, thrift, and loyalty. The flip side of this is a distrust of characteristics that might raise an individual above the pack. A nail that sticks up tends to get pounded down.

The topics of architecture (something distinctive in Columbus, IN) and 19th century Indiana (the subject of Raintree County) made me think of a discussion I had recently concerning Indiana’s courthouses. I don’t know how we compare to other states, but I’m often struck by the impressive architecture of our courthouses. By and large, they are these remarkable and imposing structures; in most counties, they are the centerpiece of the county seat. But there is no way in hell present day Hoosiers would build them today for future generations to enjoy. Even though our populations are far larger than when the courthouses were built, and even though we’re more productive, modern day politics simply would not allow for that expenditure of resources. Probably our courts would be squirreled away in strip-malls.

In any case, the Massons have been Hoosiers for the last 150 years, so I guess we share in the good and bad of the state. And, I’ll try to instill in my kids the virtues of hard work, thrift, loyalty and all the rest. But, I suppose we’re oddities in that we do embrace the fancy book-learnin’. Even so, I probably won’t let any of them get too big for their britches, as the saying goes.

James Galbraith has a pretty good summary of the roots of the financial crisis at The New Republic. I will summarize the summary. (Eventually, if we abstract this enough, it’ll boil down to “stuff happened, people got screwed.”)

1. The regulatory framework for financial institutions was weakened, allowing the casino to open.

2. The lack of standards led to fraudulent practices in the home mortgage industry – applicant financial information was mostly unverified; appraisals were little more than fabrications; mortgages built to fail were created (e.g. consumers were sold loans with teaser rates that would reset into something unsustainable.)

3. These notes would be bundled together, AIG or some other “insurer” (without anything close to the assets necessary to cover the risk) would essentially guarantee the value of the loans. Ratings agencies would proclaim these notes sound investments with little basis for making such a claim. And with this fairy dust sprinkled over the big shitpile, the notes were sold as AAA investments to pension funds and the like.

One of the consequences of deregulation was that insurers like AIG were allowed to use proprietary risk models as a way of determining the assets necessary to insure these financial products. The risk models did not accurately reflect the actual risk. Using these proprietary models is a little like trying to develop an encryption system with no external tests. You might mean well, and it might even look great to you; but without neutral or even hostile parties whaling away on it, you can’t know how effective it will be in the real world. And the short-term financial incentives were stacked toward encouraging rosy predictions.

Robert Reich suggests that the rising percentage of the country’s wealth appropriated by the very wealthy was the proximate cause of the meltdown:

Consider: in 1928 the richest 1 percent of Americans received 23.9 percent of the nation’s total income. After that, the share going to the richest 1 percent steadily declined. New Deal reforms, followed by World War II, the GI Bill and the Great Society expanded the circle of prosperity. By the late 1970s the top 1 percent raked in only 8 to 9 percent of America’s total annual income. But after that, inequality began to widen again, and income reconcentrated at the top. By 2007 the richest 1 percent were back to where they were in 1928—with 23.5 percent of the total.

Each of America’s two biggest economic crashes occurred in the year immediately following these twin peaks—in 1929 and 2008. This is no mere coincidence. When most of the gains from economic growth go to a small sliver of Americans at the top, the rest don’t have enough purchasing power to buy what the economy is capable of producing. America’s median wage, adjusted for inflation, has barely budged for decades.

(emphasis added). (It’s a little odd to me that, when the owner of capital uses superior bargaining power to extract more work for less pay, that’s just business. When the masses, using the tool of government, uses superior bargaining power to extract more pay for less work, that’s tragically unfair. Seems to me either a basic sense of fairness or a mercenary willingness to use any tool available in negotiation should be applied to both scenarios equally.) Both articles suggest strongly that President Obama has missed a trick here; he had an opportunity to right that which went wrong and, instead, seems inclined to go back to business as usual. Because he didn’t take Big Money to the woodshed, we’re doomed to repetition because the underlying problems have not been addressed.

I don’t think I’m too unusual in my tendency to project. Whatever is happening to me is probably what is happening to other people. (See, I just did it right there.) When I see a news story with parallels to my own life, I am more likely to notice while I kind of ignore the stories that I don’t relate to, further skewing my bias.

Anyway, as part of our recent cross-town move, we dropped our telephone land line service, opting to rely on our cell phones instead. That’s why I noticed this story about Indiana State University’s plan to drop dorm telephone service since students have shifted to using cell phones.

The rise of the cell phone has been pretty dramatic. I considered myself a bit of a late adopter, not getting one until the year 2000 or so. Over the last decade, the things have become ubiquitous and are making themselves nearly indispensable as they morph from phones to Internet access points. In fact, they have probably contributed to me talking on the phone less.

I tend to dislike speaking on the phone if communicating otherwise is an option. The notion that both people have to be available for communication at the exact same time to exchange an idea is just so primitive; like the idea that the sun is a God, cans tied together with string, or fax machines. And, with the phone, there’s a need to pad that communication with small talk of one degree or another. (I suspect the person at the other end isn’t actually concerned with how I am; they probably just want me to perform a task or meet them at a certain time.) I’m sure we are losing something by trading telephone conversations for texts and e-mails, but whatever it is can’t be that deeply embedded, telephone conversations have only been around for a few generations in any case.

Another oddity of the cell phone revolution is that you’re no longer calling a place; you are calling a person. So, I suppose that land lines will remain viable for those scenarios where communicating with a place is more important than a particular person (e.g., calling a restaurant or other business). As long as I’m musing, I wonder how long it will take to abandon phone numbers. I already have trouble remembering the darn things since I don’t use the number pad very often – instead just picking “John Smith” out of a list. If we do move away from numbers, whatever we use will need a unique identifier – there are a lot of John Smiths out there – but the 10 digit phone number is a relic of old technology and isn’t strictly necessary.

If I had an editor, he or she could probably wring a paragraph of coherence out of this hot mess of a blog post, but I don’t, so this is what you’re getting on a Sunday morning.