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.
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The president’s belief in policies that can benefit all Americans is being repudiated by voters, in favor of a vision of politics as a zero-sum game.
The 2016 presidential race represents a vivid rejection of the Obama style. This is easy to miss: His approval ratings are climbing, and Hillary Clinton won the Democratic primary by running as his successor. But the two most dramatic and portentous campaigns of the year, Donald Trump’s vertiginous win and Bernie Sanders’s astonishing insurgency, both flew in the face of the Obama era’s premises.
The Obama style had two pillars. He brought to apotheosis the American political tradition of redemptive constitutionalism. This is the creed of Abraham Lincoln’s Gettysburg Address and Second Inaugural, Martin Luther King Jr.’s “I Have a Dream” speech, and Lyndon Baines Johnson’s nationally televised speech on the Voting Rights Acts of 1965, in which he promised, “we shall overcome.” Redemptive constitutionalism holds that democracy and equal freedom really are the nation’s foundations, that slavery and Jim Crow were terrible deviations from these principles, and that, if we manage to take them seriously, to live by them, Americans will finally be free together.
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Why is it that the more work I have to do, the more the Internet beckons me into its endless maw of distraction? Oh Lord, I will say, appealing both to myself and to whatever blog-God might be listening, I have an hour to finish this article.
But first, isn’t this Tasty video fascinating? I’ve never thought about making buffalo-fried cheese nuggets before, but now that I’ve watched a pair of disembodied hands prepare them so expertly, I should definitely head over to Amazon and Prime me some buffalo sauce.
This is how I found myself, exhausted after leaving work at 8 p.m. one day recently, flopping onto my bed, still in my pencil skirt, and clicking open a horrific, traffic-mongering slideshow linked from the bottom of an article I was reading. It was about Stars Without Makeup or What Child Stars Look Like Now or some other rancid meat for my hungry lizard brain.
It’s known as a modern-day hub of progressivism, but its past is one of exclusion.
PORTLAND, Ore.— Victor Pierce has worked on the assembly line of a Daimler Trucks North America plant here since 1994. But he says that in recent years he’s experienced things that seem straight out of another time. White co-workers have challenged him to fights, mounted “hangman’s nooses” around the factory, referred to him as “boy” on a daily basis, sabotaged his work station by hiding his tools, carved swastikas in the bathroom, and written the word “nigger” on walls in the factory, according to allegations filed in a complaint to the Multnomah County Circuit Court in February of 2015.
Pierce is one of six African Americans working in the Portland plant whom the lawyer Mark Morrell is representing in a series of lawsuits against Daimler Trucks North America. The cases have been combined and a trial is scheduled for January of 2017.
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Republicans and Democrats remain divided on the acceptance of the Black Lives Matter movement, how to address black Americans’ concerns, and the best way to improve race relations. This as the number of Americans who worry “a great deal” about race relations in the United States doubled from 17 percent in 2014 to 35 percent in 2016, after the advent of Black Lives Matter, according to a Gallup poll. A Pew Research Center survey found, however, that only 4 in 10 Americans support Black Lives Matter, with 40 percent of whites backing the movement compared to 65 percent of blacks. When partisanship is added to the mix, the polarization is particularly stark: 64 percent of white Democrats support the movement while 52 percent of white Republicans oppose it.
The State Department is reopening its investigation into Hillary Clinton’s emails, just as she puts a Justice Department investigation behind her.
Hillary Clinton is out of the frying pan and into the fire. On July 6, Attorney General Loretta Lynch announced that the Justice Department would not pursue criminal charges against the presumptive Democratic presidential nominee for her use of a private email server at the State Department. But the following day, with that criminal investigation closed, the State Department reopened its own probe into the emails, the AP reported.
State Department spokesman John Kirby told the AP that it would be looking at potential mishandling of classified information by Hillary Clinton and her top aides. Former officials could face administrative sanctions, including a loss of their security clearances—a step that would be both politically embarrassing for Clinton, and complicate efforts to staff a national-security team should she prevail in November.
The discrimination young researchers endure makes America’s need for STEM workers even greater.
When Joan was an undergraduate, in the 1970s, she asked her boyfriend why one of his roommates was finishing up a Ph.D. while another, in the same department, still had several years left.
“Barbara’s rigid,” her boyfriend said. His other roommate, Karen, had slept with her advisor, but Barbara refused to sleep with hers. Chuckling with approval, the boyfriend recounted how Karen had asked to use his waterbed, and left a pair of sexy underwear scrunched in his sheets.
Today, this kind of quid pro quo may be less common, but sexual harassment at universities persists. The spate of lawsuits, investigations, and recent resignations at the University of California, Berkeley, University of Chicago, and UCLA, accompanied by older cases leaked to the press and an increase in women going public about their experiences, have made that clear. Graduate students and postdocs are particularly vulnerable, because their futures depend so completely on good recommendations from professors. And STEM (science, technology, engineering, and math) students are more dependent than others. Their career progress hinges on invitations to work on professors’ grants or—if students have their own projects—access to big data sets or expensive lab equipment controlled by overwhelmingly male senior faculty.
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Akerman Hall is a gateway to the complex that houses the University of Minnesota’s Department of Mechanical Engineering. But wandering through it is more like an experience in archeology.
First, there’s the former airplane hangar, built in 1948 and renovated five years ago with alumni contributions into a state-of-the-art student lounge, faculty office, and lab. Then come drab cinderblock corridors and classrooms that also date from the 1940s and don’t look anywhere near as glamorous. Behind them, however, are more than $5 million of unseen upgrades the university was forced to make to elevators, sprinklers, fire alarms, and ventilation systems so old the school was buying replacement parts on eBay.
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Young bloggers loved the car. Young drivers? Not so much. After a brief burst of excitement, in which Ford sold more than 90,000 units over 18 months, Fiesta sales plummeted. As of April 2012, they were down 30 percent from 2011.
Don’t blame Ford. The company is trying to solve a puzzle that’s bewildering every automaker in America: How do you sell cars to Millennials (a k a Generation Y)? The fact is, today’s young people simply don’t drive like their predecessors did. In 2010, adults between the ages of 21 and 34 bought just 27 percent of all new vehicles sold in America, down from the peak of 38 percent in 1985. Miles driven are down, too. Even the proportion of teenagers with a license fell, by 28 percent, between 1998 and 2008.
Biology textbooks tell us that lichens are alliances between two organisms—a fungus and an alga. They are wrong.
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At 19, he got a job at a local forestry service. Within a few years, he had earned enough to leave home. His meager savings and non-existent grades meant that no American university would take him, so Spribille looked to Europe.