You've heard of an international market for superstar soccer players. We need an international market for superstar central bankers.
[ Reuters ]
Great Britain gets a lot of things wrong, like food and spelling. But here's something they get right: They're willing to poach the best central bankers from around the world for the top spots at the Bank of England.
The UK is hardly alone on this. They're just particularly aggressive about it. Their latest target is Mark Carney, the current chief of the Bank of Canada. Before that, though, they snatched up American economist Adam Posen -- an expert on Japan's lost decade -- to serve on their monetary policy committee. You've heard of an international market for superstar soccer players and Olympic coaches. This is an international market for superstar central bankers.
It got me thinking: How much is a good central banker worth? Consider this chart. The blue line shows where our economy could, and should, be if it had kept growing at its long-term trend since 2008. The red line shows where we actually are. The difference between the two is the so-called output gap. (Note: These dollar figures are not adjusted for inflation).
We're in about a trillion-dollar hole. And that's a trillion dollars every year. Even if we get "Morning in America: The Sequel" and the economy rapidly reverts to its long-term trend, we'll forever be $4 trillion poorer than we would have otherwise been.
Let's try a thought experiment. Say that Lars Svensson -- one of the world's top monetary economists and the current deputy governor of Sweden's central bank, the Riksbank -- could get our economy back to trend in half the time Ben Bernanke could. It's actually plausible-ish. Like Bernanke, Svensson spent his academic career championing unconventional monetary policy as a "foolproof" way to escape a liquidity trap. (Coincidentally, they were colleagues at Princeton). But unlike Bernanke, Svensson's Riksbank has been much more willing than Bernanke's Fed to experiment with these kind of heterodox policies. Perhaps unsurprisingly, Sweden's recovery has been the envy of the developed world. So I ask again: How much is a good central banker worth? Put simply, how much cash should we throw at Svensson to steal him away from Sweden?
That's another way of asking how long it will take the economy to return to trend. Here's where things get really depressing. According to Fed Vice Chair Janet Yellen, we won't get back to full employment until after 2018. If we assume the output gap will steadily shrink until then, that leaves us with roughly another $4 trillion in lost income. Maybe more. If Svensson really could double our recovery speed, he'd be worth $2 trillion to us. Even if that's being wildly optimistic, something on the order of hundreds of billions of dollars probably isn't. Tell me that wouldn't be worth paying Svensson a billion dollars a year. Maybe more.
The above suggestion is obviously a bit tongue-in-cheek ... but not completely. Right now, central bankers are paid almost entirely in prestige. Ben Bernanke is making just $199,700 this year. That's not to say that we need to pay central bankers more to attract the best ones. We don't. Economists really care about prestige.
This doesn't necessarily lead to the most efficient allocation of monetary economists. As Matt Yglesias pointed out, we'd ideally have economists prove their central banking chops in smaller countries before moving up to the big leagues of the Fed or the ECB or the Bank of England. Put a bit less diplomatically: Sweden is important, but it's a relative waste of Svensson's talents not to have him running a bigger central bank. (Not that I have anything against Sweden). Here comes the "to be sure" sentence: It wouldn't be enough just to import Svensson. As L.A. Galaxy fans can tell you, bringing in one (albeit, overrated) superstar like David Beckham doesn't help much if his teammates are only mediocre. We'd need to create a Federal Reserve board equivalent of the Super Friends for Svensson to make the biggest difference. We might even find out that we already have a superstar in Bernanke in that scenario.
Central banking should be a superstar profession. The difference between a top central banker and an average one can be astronomical, particularly when conventional policy is impotent. An efficient market would pay them accordingly. If the United States spent $10 billion assembling a central banking fantasy lineup of Lars Svensson, Stanley Fischer, Adam Posen, and Christina Romer, it would probably be a phenomenal investment. It'd pay for itself many, many times over. The biggest challenge is changing the norms around central banking. We shouldn't just consider the top American economists for the top spots.
We're a nation of immigrants. The Federal Reserve should reflect that.
We're all going to die and we all know it. This can be both a burden and a blessing.
In the heart of every parent lives the tightly coiled nightmare that his child will die. It might spring at logical times—when a toddler runs into the street, say—or it might sneak up in quieter moments. The fear is a helpful evolutionary motivation for parents to protect their children, but it's haunting nonetheless.
The ancient Stoic philosopher Epictetus advised parents to indulge that fear. “What harm is it, just when you are kissing your little child, to say: Tomorrow you will die?”he wrote in his Discourses.
Some might say Epictetus was an asshole. William Irvine thinks he was on to something.
“The Stoics had the insight that the prospect of death can actually make our lives much happier than they would otherwise be,” he says. “You’re supposed to allow yourself to have a flickering thought that someday you’re going to die, and someday the people you love are going to die. I’ve tried it, and it’s incredibly powerful. Well, I am a 21st-century practicing Stoic.”
People look to Amy Schumer and her fellow jokers not just to make fun of the world, but to make sense of it. And maybe even to help fix it.
This week, in a much-anticipated sketch on her Comedy Central show, Amy Schumer staged a trial of Bill Cosby in “the court of public opinion.” Schumer—her character, at any rate—played the role of the defense. “Let’s remind ourselves what’s at stake here,” she argued to the jury. “If convicted, the next time you put on a rerun of The Cosby Show you may wince a little. Might feel a little pang. And none of us deserve that. We don’t deserve to feel that pang.”
Her conclusion? “We deserve to dance like no one’s watching, and watch like no one’s raping.”
Ooof. This is the kind of thing that gets Inside Amy Schumer referred to as “the most feminist show on television,” and her act in general called, in a phrase that reveals as much about her craft as about Schumer herself, “comedy with a message.” But while Schumer’s work is operating at the vanguard of popular comedy, it’s also in line with the work being done by her fellow performers: jokes that tend to treat humor not just as an end in itself, but as a vehicle for making a point. Watch like no one’s raping.
The Islamic State is no mere collection of psychopaths. It is a religious group with carefully considered beliefs, among them that it is a key agent of the coming apocalypse. Here’s what that means for its strategy—and for how to stop it.
What is the Islamic State?
Where did it come from, and what are its intentions? The simplicity of these questions can be deceiving, and few Western leaders seem to know the answers. In December, The New York Times published confidential comments by Major General Michael K. Nagata, the Special Operations commander for the United States in the Middle East, admitting that he had hardly begun figuring out the Islamic State’s appeal. “We have not defeated the idea,” he said. “We do not even understand the idea.” In the past year, President Obama has referred to the Islamic State, variously, as “not Islamic” and as al-Qaeda’s “jayvee team,” statements that reflected confusion about the group, and may have contributed to significant strategic errors.
For those who didn't go to prestigious schools, don't come from money, and aren't interested in sports and booze—it's near impossible to gain access to the best paying jobs.
As income inequality in the U.S. strikes historic highs, many people are starting to feel that the American dream is either dead or out of reach. Only 64 percent of Americans still believe that it’s possible to go from rags to riches, and, in another poll, 63 percent said they did not believe their children would be better off than they were. These days, the idea that anyone who works hard can become wealthy is at best a tough sell.
Caves and tunnels have always been part of human life.
Caves and tunnels have always been part of human life. We've grown more adept at shaping these underground shelters and passages over the millennia, and today we dig for hundreds of reasons. We excavate to find both literal and cultural treasures, digging mines and unearthing archaeological discoveries. We use caverns for stable storage, for entertainment, and for an effective shelter from natural and man-made disasters. And as the planet's surface becomes ever more crowded, and national borders are closed, tunnels provide pathways for our vehicles and for smugglers of every kind. Collected below are more recent subterranean scenes from around the world.
What it’s like to watch a komodo dragon get dissected
Try to imagine how hard it would be to skin a Komodo dragon.
It is harder than that.
The problem is that the giant lizard’s hide is not just tough and leathery, but also reinforced. Many of the scales contain a small nugget of bone, called an osteoderm, which together form a kind of pointillist body armor. Sawing through these is tough on both arms and blades.
I’m at the Royal Veterinary College, about 20 kilometers outside of central London, watching four biologists put their shoulders into the task. A Komodo dragon, which recently died in London Zoo for unexplained reasons, lies on a steel gurney in front of them. Their task, over the next three days, is to dissect it and measure all of its muscles. So, first, the skin must come off.
The danger of uploading one’s consciousness to a computer without a suicide switch
Imagine a supercomputer so advanced that it could hold the contents of a human brain. The Google engineer Ray Kurzweil famously believes that this will be possible by 2045. Organized technologists are seeking to transfer human personalities to non-biological carriers, “extending life, including to the point of immortality.” My gut says that they’ll never get there. But say I’m wrong. Were it possible, would you upload the contents of your brain to a computer before death, extending your conscious moments on this earth indefinitely? Or would you die as your ancestors did, passing into nothingness or an unknown beyond human comprehension?
The promise of a radically extended lifespan, or even immortality, would tempt many. But it seems to me that they’d be risking something very much like hell on earth.
New research confirms what they say about nice guys.
Smile at the customer. Bake cookies for your colleagues. Sing your subordinates’ praises. Share credit. Listen. Empathize. Don’t drive the last dollar out of a deal. Leave the last doughnut for someone else.
Sneer at the customer. Keep your colleagues on edge. Claim credit. Speak first. Put your feet on the table. Withhold approval. Instill fear. Interrupt. Ask for more. And by all means, take that last doughnut. You deserve it.
Follow one of those paths, the success literature tells us, and you’ll go far. Follow the other, and you’ll die powerless and broke. The only question is, which is which?
Of all the issues that preoccupy the modern mind—Nature or nurture? Is there life in outer space? Why can’t America field a decent soccer team?—it’s hard to think of one that has attracted so much water-cooler philosophizing yet so little scientific inquiry. Does it pay to be nice? Or is there an advantage to being a jerk?
Along with the Nancy Drew series, almost all of the thrillers in the popular teenage franchise were produced by ghostwriters, thanks to a business model that proved to be prescient.
In the opening pages of a recent installment of the children’s book series The Hardy Boys, black smoke drifts though the ruined suburb of Bayport. The town's residents, dressed in tatters and smeared with ash, stumble past the local pharmacy and diner. Shards of glass litter the sidewalk. “Unreal,” says the mystery-solving teenager Joe Hardy—and he's right. Joe and his brother Frank are on a film set, and the people staggering through the scene are actors dressed as zombies. But as is always the case with Hardy Boysbooks, something still isn’t quite right: This time, malfunctioning sets nearly kill several actors, and the brothers find themselves in the middle of yet another mystery.
Reforms were slow to take hold in Cincinnati, but when they did, they drove down crime while also reducing arrests.
CINCINNATI—Citizens were throwing stones and beer bottles at police officers in front of City Hall, and Maris Herold didn’t understand what they wanted.
She was a police officer herself, and knew that her department had made some missteps. Most recently, an officer gunned down a 19-year-old unarmed black man, Timothy Thomas—the fifteenth black man to die at the hands of police in five years.
But, Herold knew, the police were investigating the incident. They were listening to the community. They were working 12-hour shifts to protect the city from looting and fires, though the disturbance would soon turn into the worst riots in the U.S. in a decade.
“I was like, ‘We’re doing everything right, obviously the police officers made mistakes and we’re trying to get to the bottom of it,’” she told me recently. Herold, who joined the police force after a career in social work, couldn’t understand what more the police could do to make amends with the community.