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.
Science says lasting relationships come down to—you guessed it—kindness and generosity.
Every day in June, the most popular wedding month of the year, about 13,000 American couples will say “I do,” committing to a lifelong relationship that will be full of friendship, joy, and love that will carry them forward to their final days on this earth.
Except, of course, it doesn’t work out that way for most people. The majority of marriages fail, either ending in divorce and separation or devolving into bitterness and dysfunction. Of all the people who get married, only three in ten remain in healthy, happy marriages, as psychologist Ty Tashiro points out in his book The Science of Happily Ever After, which was published earlier this year.
Social scientists first started studying marriages by observing them in action in the 1970s in response to a crisis: Married couples were divorcing at unprecedented rates. Worried about the impact these divorces would have on the children of the broken marriages, psychologists decided to cast their scientific net on couples, bringing them into the lab to observe them and determine what the ingredients of a healthy, lasting relationship were. Was each unhappy family unhappy in its own way, as Tolstoy claimed, or did the miserable marriages all share something toxic in common?
On Saturday, the GOP dispensed with concern about keeping up appearances—and put long-simmering anger on display.
Perhaps the most haunting memory of the night will be the audience. Previous presidential debates have banned cheering and booing. Saturday night’s Republican debate in Greenville was marked by both. Permitted or not, the rowdy crowd ventilated its feelings without concern for how it looked or sounded to the viewers at home.
This unconcern for appearances was a Republican theme of the weekend. Hours before the debate opened, news broke that Supreme Court Justice Antonin Scalia had died. Candidates Ted Cruz and Marco Rubio promptly issued statements opining that any appointing any replacement should be left to the next president. It’s not unheard of for candidates to express emotive positions adopted for political advantage. But that same evening, Senate Majority Leader Mitch McConnell joined in, with a statement ruling out any Senate action on any Supreme Court nominee, no matter who it might be.
The staunchly Catholic U.S. Supreme Court justice was known for his acidly conservative opinions, but ultimately, he prioritized the Constitution over the Church.
“How can the Court possibly assert that ‘the First Amendment mandates governmental neutrality between … religion and nonreligion’?” the U.S. Supreme Court Justice Antonin Scalia wrote in 2005, arguing that two Kentucky counties should be able to display the Ten Commandments in their courthouses. “Who says so? Surely not the words of the Constitution.”
This moment, with Scalia’s trademark snark, nicely sums up the paradox of how his religious views influenced his Supreme Court career. The justice, who died Saturday, consistently argued that the United States is fundamentally religious, meaning that the government shouldn’t have to avoid religious displays—nativity scenes on public property, prayers at townhall meetings, and the like. His Roman Catholic faith often seemed to lurk in the background of his opinions, especially in cases involving abortion and homosexuality. But above all, he was committed to a literal, originalist interpretation of the Constitution, along with strict attention to the texts of federal and state laws. His views didn’t always align with those of the Church, and he didn’t always side with people making religious-freedom claims.
The current system for gaining entry to elite colleges discourages unique passions and deems many talented students ineligible.
March madness is almost here. No, I’m not referring to the college-basketball playoffs; I’m alluding to the anxious waiting of young people and their families of word about their fate from the highly selective colleges of America. And I’m talking as well about those who are about to venture forth on the ritualistic campus tours to determine where they will apply next fall. What few of these families realize is how broken the admission system is at these selective colleges.
At these institutions of higher learning, the goal is to “shape a class,” which involves trying to admit qualified and diverse students who will learn from each other as well as from their experiences in the classroom. These are the students who have the greatest potential to use their education in productive ways and to contribute to their own well-being and to the needs of the larger society. Diversity is not defined here as solely pertaining to race, ethnicity, or gender, although that weighs on decisions, but also on a range of interests and talents that students can develop and share with others during their college years. These are high-minded goals.
Fredrickson, a leading researcher of positive emotions at the University of North Carolina at Chapel Hill, presents scientific evidence to argue that love is not what we think it is. It is not a long-lasting, continually present emotion that sustains a marriage; it is not the yearning and passion that characterizes young love; and it is not the blood-tie of kinship.
Rather, it is what she calls a "micro-moment of positivity resonance." She means that love is a connection, characterized by a flood of positive emotions, which you share with another person—any other person—whom you happen to connect with in the course of your day. You can experience these micro-moments with your romantic partner, child, or close friend. But you can also fall in love, however momentarily, with less likely candidates, like a stranger on the street, a colleague at work, or an attendant at a grocery store. Louis Armstrong put it best in "It's a Wonderful World" when he sang, "I see friends shaking hands, sayin 'how do you do?' / They're really sayin', 'I love you.'"
The Republican frontrunner repudiated a long litany of party orthodoxies in a contentious debate—but will that hurt his candidacy, or help it?
Donald Trump blamed the Bush administration for failing to heed CIA warnings before 9/11; denounced the Iraq War for destabilizing the Middle East; defended the use of eminent domain; promised to save Social Security without trimming benefits; and credited Planned Parenthood for “wonderful things having to do with women's health.”
He’s fresh off a crushing victory in New Hampshire, and the prohibitive favorite in the polls in South Carolina. Will his flouting of Republican orthodoxy sink his chances—or is it his very willingness to embrace these heterodox stances that has fueled his rise?
Even his rivals no longer seem certain of the answer. Jeb Bush, at one point, called Trump “a man who insults his way to the nomination.” He sounded like a man ruing a race that has run away from him.
A profanity-filled new self-help book argues that life is kind of terrible, so you should value your actions over your emotions.
Put down the talking stick. Stop fruitlessly seeking "closure" with your peevish co-worker. And please, don't bother telling your spouse how annoying you find their tongue-clicking habit—sometimes honesty is less like a breath of fresh air and more like a fart. That’s the argument of Michael Bennett and Sarah Bennett, the father-daughter duo behind the new self-help book F*ck Feelings.
The elder Bennett is a psychiatrist and American Psychiatric Association distinguished fellow. His daughter is a comedy writer. Together, they provide a tough-love, irreverent take on “life's impossible problems.” The crux of their approach is that life is hard and negative emotions are part of it. The key is to see your “bullshit wishes” for just what they are (bullshit), and instead to pursue real, achievable goals.
"It was rich, a perfect match for my body and myself."
For a long while, and I really don't wish to say when it was or how many years it lasted, I chose to live in what was perhaps the worst insubordination of our times: I had no sex life. It is true that those years were in large part filled with sensuality, when dreams alone gratified my longings, but what dreams! And if I felt drawn to anything, it was only in my thoughts, but what thoughts. . .
I realize now what that life was made of: a life in no way insignificant; on the contrary, it was rich, a perfect match for my body and myself. Yet nothing was simple, and these words I write would once have seemed leaden to me, so ashamed was I at times of my singularity, a strangeness worse than difference. Everyone knows that even people who are different have a certain sexuality worthy of the name, things to show for it, defeats they can lay claim to. Whereas we, the loners, an army that does violence only to itself, a small tribe, unavowable and hence unknowable in number, we understand instinctively that speaking out will allow the world to send us deeper into exile--and foster the kind of stupid nonsense people say about whatever they cannot comprehend. They turn us into scapegoats who reassure all others on this point: however problematic their carnal pleasures might be, we offer proof, through our most definite exclusion, that their circumstances are still better than nothing.
Trump’s prescient opposition to the invasion is an important part of his claim to sound judgment. And he is making it up. I would know.
I respect and admire Donald Trump (yes, I wrote those words to begin a sentence) for flat-out arguing to GOP crowds that the Iraq war was a catastrophic mistake.
It was additionally amazing and heartening to see him, in last night’s WWE-style brawl-debate, finally call B.S. on a persistent and amazing claim by the otherwise-generally-reality-based Jeb Bush. When pressed about the Bush-Cheney record on office, Jeb’s final line of defense throughout the campaign has been, “whatever else you can say my brother, he kept us safe!”
Yes, perfectly safe! Except for, ummm, that one time. Trump finally had the lack of politesse to say so directly to Jeb Bush, only to receive boos from the crowd.
The iconic conservative justice, who died Saturday at age 79, left an indelible stamp on the nation’s courts, its laws, and its understanding of itself.
Antonin Scalia, the judicial firebrand who stood as the intellectual leader of the U.S. Supreme Court’s conservative wing during his three-decade tenure as a justice, died Saturday at a ranch in western Texas. He was 79 years old.
“He was an extraordinary individual and jurist, admired and treasured by his colleagues. His passing is a great loss to the Court and the country he so loyally served,” Chief Justice John Roberts said in a statement on behalf of the Court.
President Obama, who will have the opportunity to nominate Scalia’s successor, offered his sympathies to the justice’s family on Saturday night. “He will no doubt be remembered as one of the most consequential judges to serve on the Supreme Court,” he said.