People who believe facts are nothing think you'll fall for anything. Call it Niallism.
This is my last word (well, last words) on Niall Ferguson, whose Newsweek cover story arguing that Obama doesn't deserve a second-term has drawn deserved criticism for its mendacity from Paul Krugman, AndrewSullivan, Ezra Klein, Noah Smith, my colleagues James Fallows and Ta-Nehisi Coates and myself. The problem isn't Ferguson's conclusion, but how Ferguson reaches his conclusion. He either presents inaccurate facts or presents facts inaccurately. The result is a tendentious mess that just maintains a patina of factuality -- all, of course, so Ferguson can create plausible deniability about his own dishonesty.
Exhibit A is Ferguson's big lie that Obamacare would increase the deficit. This is not true. Just look at the CBO report Ferguson himself cites. Paul Krugman immediately pointed this out, and asked for a correction. How did Ferguson respond? He claims he was only talking about the bill's costs and not its revenues -- a curious and unconvincing defense to say the least. But then Ferguson reveals his big tell. He selectively quotes the CBO to falsely make it sound like they don't think Medicare savings will in fact be realized. Here's the section Ferguson quotes, with the part he ellipses out in bold. (Note: Pseudonymous Buzzfeed contributor @nycsouthpaw was the first to notice this quote-doctoring. The italics below are Ferguson's).
In fact, CBO's cost estimate for the legislation noted that it will put into effect a number of policies that might be difficult to sustain over a long period of time. The combination of those policies, prior law regarding payment rates for physicians' services in
Medicare, and other information has led CBO to project that the growth rate of
Medicare spending (per beneficiary, adjusted for overall inflation) will drop from
about 4 percent per year, which it has averaged for the past two decades, to about
2 percent per year on average for the next two decades. It is unclear whether such a
reduction can be achievedthrough greater efficiencies in the delivery of health care or
will instead reduce access to care or the quality of care (relative to the situation under
Ferguson completely changes the CBO's meaning. Why not just say he finds the CBO's analysis unconvincing, like Andrew Sullivan suggested, and leave it at that? Well, Ferguson tries that later -- but not before appealing to the authority of the CBO when the CBO is not on his side. The damage is done.
I don't want to go too far down this Ferguson rabbit hole -- we get it, he lied -- but I do want to answer his response to my fact-check. Ferguson's reading of my criticism was as lacking as his fidelity to facts. I tried to make clear that I was cataloging two categories of errors in his piece. There were untruths misleadingly framed as truths and truths misleadingly framed so as to be untruths. Or, as I put it, "a fantasy world of incorrect and tendentious facts."
Let's take a quick detour into the meta. Ferguson objects that I don't identify "a single error" and that I'm just offering my own opinions. The former is not true -- his description of Obamacare and its budgetary impact are demonstrably false -- but the latter is a legitimate point of debate. Ferguson prefers a very narrow definition of fact-checking; I do not think that is sufficient. Facts twisted out of context can be just as deceptive as outright falsehoods -- sometimes even more so, because you can cloak them in claims of truthfulness.
That said, I want to give Ferguson's rebuttal far more attention than it deserves. This is a tedious exercise, so feel free to skip to the next section. Below are a summary of my critiques in italics, his responses in bold, and then my reply to those. Whew! Let's go.
1. I criticized Ferguson for saying that stocks are up since January 2009, but private sector employment is down since January 2008. I pointed out that private sector payrolls are up 427,000 since Obama took office in January 2009.
NF: Both these statements are true. I picked the high point of January 2008 because it seems to me reasonable to ask how much of the ground lost in the crisis have we actually made up under Obama. The answer is not much. You may not like that, but it's a fact.
Ferguson's fact is deliberately misleading. A better way to make the argument he says he wants to make would be something like, "Private sector payrolls have added 427,000 jobs since Obama took office, but we are nowhere near out of our deep hole -- despite this growth, private sector payrolls are still 4.18 million jobs below their January 2008 peak."
2. I couldn't find Ferguson's source or replicate his result for real median household incomes.
NF: Well, either Newsweek starts publishing footnotes or Matthew O'Brien reads a little more widely than just official statistics, which generally lag months behind. The monthly data for Median Household Income Index (HII) is produced by Sentier
A footnote isn't necessary. A link would suffice. The Sentier numbers are a decent proxy for the official Census numbers, but there are some years where they move in opposite directions. I annualized and normalized the Sentier and Census figures and found an average 2.5 percent difference between their levels from 2001-2010. (I indexed both to 2000, since that's how the Sentier data are presented, and stopped in 2010 because that's the last year for which the Census has numbers). In other words, the Sentier figures are far from authoritative, and could use some context.
3. I criticized Ferguson for saying that half of Americans don't pay taxes, since that's only true of federal income tax.
NF: In other words, my fact is true. Because I specifically said "taxable return." You don't tend to record your sales tax payments on those.
This is wrong. Other taxes like state income tax and certain excise taxes also come on taxable returns. Even more wrong is when Ferguson writes that "we are becoming the 50-50 nation -- half of us paying taxes, the other half receiving the benefits." Ferguson does not address this unequivocal error.
4. I said debt-to-revenue was not the measure that "really mattered" when assessing fiscal health.
NF: Again, O'Brien is offering here an opinion as a fact. He should read my book The Cash Nexus (2001) to understand why he doesn't know what he is talking about. Governments don't pay interest and redemption with GDP but with tax revenues. If it were easy to increase the tax share of GDP, we wouldn't be heading for a fiscal cliff. My numbers are correct and can be checked using the IMF's World Economic Outlook online database.
Ferguson is right. It is my opinion that debt-to-GDP is more relevant than debt-to-revenue. But that's a widespread opinion. It's the measure Harvard professor and former IMF chief economist Ken Rogoff looked at when he tried to figure out what level of indebtedness hurts growth. Countries can't pay debts in GDP, but it is much easier to increase taxes than it is to increase GDP. Ferguson inadvertently makes that point himself when he says the chance of hitting the fiscal cliff shows how hard it is to increase the tax share of GDP. He apparently doesn't realize that hitting the fiscal cliff would increase the tax share of GDP!
5. I said that Ferguson seemed to contradict himself on the stimulus and the debt.
NF: This earlier statement does not contradict my article. As anyone who looks at the data knows, the stimulus had a positive but very short-run impact and failed to achieve self-sustaining growth in the way Keynesians hoped.
For his part, Ferguson has looked at the data so closely that he erroneously thinks the surge of Census hiring in 2010 shows the short-run impact of the stimulus. This mistake aside, the point remains that Ferguson 1) supported the stimulus, 2) criticizes the stimulus for not doing enough, 3) criticizes Obama for too much spending.
6. I said that the "$222 trillion fiscal gap" Ferguson cited from economist Larry Kotlikoff was a meaningless number -- chery-picked to make the debt sound worse than it is.
NF: Well, O'Brien is welcome to share his opinion with Larry Kotlikoff, the world's leading authority on generational accounting and long-term fiscal stability. What he can't claim is that my statement is factually inaccurate. As for the argument that current low borrowing costs mean we don't need to worry about the debt--which is like saying that mortgage default rates in 2006 meant we didn't need to worry about subprime--that has been comprehensively demolished in a new paper by Carmen and Vincent Reinhart and Ken Rogoff.
Kotlikoff is projecting policies that won't continue forever, forever into the future. You can choose to believe him or not. I consider it a scare number that Ferguson highlights to make our debt sound scarier. In either case, Ferguson's subprime analogy is meretricious. Yes, financial markets sometimes get things wrong in big ways, but our debt is not the same as an option-ARM mortgage. We certainly need fiscal consolidation over the medium-turn, but there's no reason for investors to dump Treasuries en masse -- despite Ferguson's repeated and repeatedly wrong predictions to the contrary. Markets think our credit risk is lower now than when Obama took office, as this chart from Credit Suisse of credit default swaps on Treasuries shows.
7. I pointed out that we haven't adopted Basel III's banking capital requirements yet.
NF: But I didn't say that we had already implemented Basel III. So that's another fact "checked" and found to be ... correct.
Ferguson is right. He didn't explicitly say Basel III had already been implemented. He just strongly implied it. Why criticize Obama for not forcing banks to comply with a regulation if that regulation is not in effect? And not tell your readers the regulation is not in effect?
8. I criticized Ferguson for saying that Obamacare does not do things that it does.
NF: Now let's check O'Brien's facts. So the ACA "tackles the long-run explosion of Medicare costs." Right. That's why the net cost of Medicare is still projected by the CBO to treble from 3.2 percent of GDP to between 9 and 10 percent by 2087.
The CBO thinks Obamacare will slow the increase in Medicare spending. Full stop. Ferguson should know this. It's the sentence he lopped off from the CBO report in his doctored quote. Also notice Ferguson doesn't dispute that the provisions he said were not in Obamacare are in fact in Obamacare.
9. I criticized Ferguon's partial history of the Simpson-Bowles commission and the debt ceiling standoff. He left out the part about his fiscal hero, Paul Ryan, nixing a deal both times.
NF: So that's another fact "checked" and found to be correct. And if you want to gauge the president's share of the responsibility for the failure of a fiscal grand bargain, read Matt Bai in The New York Times.
I didn't say it was incorrect, just incomplete. Ferguson harangues Obama for not tackling the long-term debt, and names Paul Ryan as a counter-example of someone serious about getting our proverbial fiscal house in order. It seems relevant that one of those people (Obama) offered a long-term debt deal, and the other (Ryan) turned down that deal.
10. I said it was silly to blame Obama for China's GDP likely passing ours in the near future, since they have more than four times as many people as we do.
NF: Well, there you have it. It "doesn't really matter" that for the first time since the 1880s the United States is about to cease being the world's largest economy. Fact checked, found to be correct, and countered with an utterly naive opinion.
Ferguson's argument is one without any implications. The Solow Model tells us poorer countries should generally grow faster than richer countries -- in other words, they should converge. It's unclear what Ferguson thinks Obama should do to repeal this law of economics. Start a trade war? That would certainly hurt China's growth, but at great cost to ourselves as well. In any case, Ferguson doesn't say. Fearmongering replaces arguments.
11. I said the government had helped created our middle-class society thanks to pushing mass education.
NF: Fact checked and--oh no! I really did get that wrong. It was the government that created the middle class, as well as the Golden Gate Bridge! Remind me to tell Karl Marx about this. It will come as news to him that, contrary to his life's work, the superstructure in fact created the base. (Come to think of it, this is going to come as shock to a lot of American liberals too. Imagine! The state actually created the bourgeoisie! Who knew?)
If thinking that public goods can help the economy makes me a communist, then I'm a communist. And so was Adam Smith.
Is this nit-picking? Maybe. Ferguson gets some facts wrong. Ferguson gets some facts right, but frames them incompletely. Why the outrage? Because he's treating facts as low-grade and cheap materials that are meant to be bent, spliced and morphed for the purpose of building a sensational polemic. Even more outrageous is that his bosses didn't mind enough to force him to make an honest argument, or even profess embarrassment when its dishonesty came to light.
Let's try a counterfactual. Say Ferguson hadn't made his big errors about Obamacare. Then his smaller errors of omission would not seem quite so serious -- or deliberate. But Ferguson did make his big errors. And he defends these omissions with more elisions. It makes it impossible not to read his entire piece as an effort to deceive. Ferguson should consider what kind of grade he would give an undergraduate who turned in a paper that treated facts and counter-arguments so cavalierly.
Of course, it's not just Ferguson. There is an epidemic of Niallism -- which Seamus McKiernan of the Huffington Post defined as not believing in anything factual. It's the idea that bluster can make untruths true through mere repetition. We expect this from our politicians, not our professors. Consider Mitt Romney's attacks on Obama for supposedly eliminating the work requirement in welfare. That sounds damning, unless you know it's a complete lie -- as Alec MacGillis of The New Republic has tirelessly pointed out. Or consider the economic white paper Romney's campaign put out. As EzraKlein has pointed out, the papers Romney's team cites do not say what they say they say. In other words, Romney's team draws conclusions from these papers that the authors who wrote them do not agree with. Romney adviser and Stanford professor John Taylor defended their work on the grounds that they quoted their sources accurately. This was never in dispute. The question was whether they selectively quoted their sources, not whether they selectively quoted their sources accurately.
We live in a post-truth age. That's the term David Roberts of Grist coined to describe the way the way lies get amplified in our media ecosystem. (If I were feeling cynical, I might say we live in a pre-truth age -- maybe things have always been this deplorable). It's bad enough when politicians do it. It's even worse when journalists do too. Now, everybody has biases and those biases unwittingly slant the way we frame facts -- myself included. That's why I try to follow best practices of writers like Felix Salmon. I try to show my work, and admit when I make mistakes. The irony is that there's an academic who would probably agree with all of the above. His name is Niall Ferguson. His early academic work was as good as his punditry is bad. It's a shame that Niall Ferguson wasn't the Niall Ferguson who wrote the Newsweek story.
Thursday’s terrorist attack in Paris did not “help” Marine Le Pen.
Following Thursday’s terrorist attack on the Champs-Elysees in Paris, which killed one police officer and wounded two others, Donald Trump made a prediction. “The people of France will not take much more of this,” he wrote on Twitter. “Will have a big effect on presidential election!” It seemed like the American president was implicitly backing one of the leading candidates in that election, the National Front’s Marine Le Pen, who has campaigned on rooting out Islamic extremism from the Republic and practices a Trump-like brand of populist-nativist politics.
Then Trump dispelled any doubt about his message. The attack, for which ISIS has claimed responsibility, will “probably help” Le Pen’s chances, the American president told the Associated Press, “because she is the strongest on borders and she is the strongest on what’s been going on in France.” (This despite the fact that the Champs-Elysees attacker was a French citizen ensconced well within French borders.) Trump didn’t explicitly endorse Le Pen. But he effectively endorsed her sales pitch to voters. “I believe whoever is the toughest on radical Islamic terrorism and whoever is the toughest at the borders will do well at the election,” Trump said.
“Somewhere at Google there is a database containing 25 million books and nobody is allowed to read them.”
You were going to get one-click access to the full text of nearly every book that’s ever been published. Books still in print you’d have to pay for, but everything else—a collection slated to grow larger than the holdings at the Library of Congress, Harvard, the University of Michigan, at any of the great national libraries of Europe—would have been available for free at terminals that were going to be placed in every local library that wanted one.
At the terminal you were going to be able to search tens of millions of books and read every page of any book you found. You’d be able to highlight passages and make annotations and share them; for the first time, you’d be able to pinpoint an idea somewhere inside the vastness of the printed record, and send somebody straight to it with a link. Books would become as instantly available, searchable, copy-pasteable—as alive in the digital world—as web pages.
The early results out of a Boston nonprofit are positive.
You saw the pictures in science class—a profile view of the human brain, sectioned by function. The piece at the very front, right behind where a forehead would be if the brain were actually in someone’s head, is the pre-frontal cortex. It handles problem-solving, goal-setting, and task execution. And it works with the limbic system, which is connected and sits closer to the center of the brain. The limbic system processes emotions and triggers emotional responses, in part because of its storage of long-term memory.
When a person lives in poverty, a growing body of research suggests the limbic system is constantly sending fear and stress messages to the prefrontal cortex, which overloads its ability to solve problems, set goals, and complete tasks in the most efficient ways.
Will you pay more for those shoes before 7 p.m.? Would the price tag be different if you lived in the suburbs? Standard prices and simple discounts are giving way to far more exotic strategies, designed to extract every last dollar from the consumer.
As Christmas approached in 2015, the price of pumpkin-pie spice went wild. It didn’t soar, as an economics textbook might suggest. Nor did it crash. It just started vibrating between two quantum states. Amazon’s price for a one-ounce jar was either $4.49 or $8.99, depending on when you looked. Nearly a year later, as Thanksgiving 2016 approached, the price again began whipsawing between two different points, this time $3.36 and $4.69.
We live in the age of the variable airfare, the surge-priced ride, the pay-what-you-want Radiohead album, and other novel price developments. But what was this? Some weird computer glitch? More like a deliberate glitch, it seems. “It’s most likely a strategy to get more data and test the right price,” Guru Hariharan explained, after I had sketched the pattern on a whiteboard.
By antagonizing the U.S.’s neighbor to the south, Donald Trump has made the classic bully’s error: He has underestimated his victim.
When Donald Trump first made sport of thumping Mexico—when he accused America’s neighbor of exporting rapists and “bad hombres,” when he deemed the country such a threat that it should be contained by a wall and so clueless that it could be suckered into paying for its own encasement—its president responded with strange equilibrium. Enrique Peña Nieto treated the humiliation like a meteorological disturbance. Relations with the United States would soon return to normal, if only he grinned his way through the painful episode.
In August, Peña Nieto invited Trump to Mexico City, based on the then-contrarian notion that Trump might actually become president. Instead of branding Trump a toxic threat to Mexico’s well-being, he lavished the Republican nominee with legitimacy. Peña Nieto paid a severe, perhaps mortal, reputational cost for his magnanimity. Before the meeting, former President Vicente Fox had warned Peña Nieto that if he went soft on Trump, history would remember him as a “traitor.” In the months following the meeting, his approval rating plummeted, falling as low as 12 percent in one poll—which put his popularity on par with Trump’s own popularity among Mexicans. The political lesson was clear enough: No Mexican leader could abide Trump’s imprecations and hope to thrive. Since then, the Mexican political elite has begun to ponder retaliatory measures that would reassert the country’s dignity, and perhaps even cause the Trump administration to reverse its hostile course. With a presidential election in just over a year—and Peña Nieto prevented by term limits from running again—vehement responses to Trump are considered an electoral necessity. Memos outlining policies that could wound the United States have begun flying around Mexico City. These show that Trump has committed the bully’s error of underestimating the target of his gibes. As it turns out, Mexico could hurt the United States very badly.
For the first time in modern French history, neither candidate is from a major party.
Marine Le Pen, the candidate of the far-right National Front, is through to the second round of the French presidential election, where she will face Emmanuel Macron, the independent, who won Sunday's first round with 23.7 percent of the vote. Le Pen won 21.7 percent. It's the first time in French history that neither candidate from a major political party is in the second round runoff. It's also the first time a far-right candidate is in the second round since 2002 when Le Pen's father, Jean-Marie Le Pen, lost to Jacques Chirac.
Macron and Le Pen’s strong showings Sunday, which saw an approximately 77percent voter turnout (slightly lower than the 79 percent who voted in the first round in 2012), signaled a rebuke of the political establishment that has dominated French politics for decades. Macron launched his centrist party in August 2016 after he quit his role in President François Hollande’s Socialist government, and despite the party’s youth it boasts a quarter of a million members. Meanwhile, Le Pen’s FN secured the most votes it has ever received in its nearly half-century history, surpassing the 18-percent first-round finish it saw in 2012.
Inside Walmart’s curious, possibly ingenious effort to get customers to build up their savings accounts
Late last summer, Dawn Paquin started keeping her money on a prepaid debit card from Walmart instead of in a traditional checking account. The wages from her factory job—she works from 9 p.m. to 5 a.m., inspecting blades on industrial bread-slicing machines—now go directly onto the Visa-branded card, which she can use like a regular debit card, though unlike most debit cards, it is not linked to a checking or savings account. She made the switch after a $4 check she wrote to buy coffee for herself and a friend tipped her checking account below the required minimum and triggered $100 in overdraft fees.
This was before she got the factory gig, and she wasn’t working full-time. Paquin lives in Salem, Illinois, where, she told me recently, if you don’t have a college degree, your job choices are “fast food or factory.” Money was extremely tight. “I kind of had a bit of resentment about banks after that,” she said dryly.
Tracking the controversies, allegations, and investigations into the president and his administration
Donald Trump entered the White House as one of the most scandal-tarred presidents in American history—what his imbroglios may have lacked in depth, they made up in variety, encompassing legal, ethical, and sexual controversies. (In a twist, one of Trump’s few competitors for the crown was his rival, Hillary Clinton.) They ranged from race discrimination to mafia connections, from petty hypocrisies to multimillion-dollar alleged frauds.
Now that Trump is president, some of those controversies have continued to shadow him. But the presidency has also occasioned a whole new set of disputes. Looming largest is the question of whether his campaign colluded with Russian agents to interfere in the election, a question being investigated by the FBI as well as panels in both houses of Congress. They also include ethical and legal questions surrounding members of his cabinet, his allegation that Barack Obama spied on him before the election, and various conflicts of interest.
A boring juice product sold itself as the next great technology phenomenon. There was only one way things could go.
Juicero is a startup that sells a $400 machine that squeezes packets of diced fruit and vegetables to produce fresh juice. A person might assume that a product so simple and boring, yet weirdly expensive, couldn’t possibly attract the entire internet’s derision. A person would be wrong.
It’s best to begin this story in March of last year, when the New York Timespublished a profile of the company’s founder Doug Evans, a former Army paratrooper who had already started and sold the successful Organic Avenue line of cold-pressed juices and healthy snacks. Evans was not a Silicon Valley veteran, but he spoke like one, rhapsodizing his product with quasi-religious grandiosity. “Not all juice is equal,” he told The Times. “How do you measure life force? How do you measure chi?”
Neither Emmanuel Macron nor Marine Le Pen is from one of the two political movements that have dominated the country for decades.
Emmanuel Macron and Marine Le Pen have little in common on the face of it. Macron, who exit polls project as the winner of Sunday’s first round presidential election in France, is a political neophyte. His centrist, globalist, pro-EU policies, are antithetical to the populist movements sweeping the West. Le Pen, who finished second in Sunday’s election, is an embodiment of that movement: Her far-right National Front (FN) has festered on the fringes of French politics for decades. She is against immigration and the EU, and a strong advocate for nationalism and borders.
But what unites Macron and Le Pen, who will face off in a second round on May 7, is that they each represent a backlash against the political movements that have dominated modern France. For the first time in a recent presidential runoff in the country, neither of the two candidates will be from the traditional center-left and center-right movements.