This term, I took a qualitative methods class where we talked a lot about post-modern ideas (Pretty unusual for a professional degree, right? Not at Berkeley!) Basically, post-modern thinkers deny that we can understand reality. To the post-modern purist, knowledge is nothing but a biased representation of a reality we can never know. The only useful occupation for a knowledge producer is to critique representations of knowledge, demonstrate who they really benefit, and empower marginalized people in the knowledge production process. This is done with qualitative research.

Maybe all knowledge is biased. What do I know? But in class I got really tired of the argument over bias. We need knowledge of the world to make progress, but at school we're caught between the post-modern critics who do not supply knowledge of reality, and the quantitative "scientists" who see universalities and rationality where there isn't any.

The more important debate is not between the post-moderns and the positivists, but between the positivists and the post-positivists, who argue over what methods can best describe reality. My instinct is that qualitative analysis has more uses than it's given credit for. But for qualitative methods to be useful, they must help us describe and analyze reality better than quantitative methods.

I argue that qualitative methods are a good way of describing the particular, as opposed to the universal. Quantitative analysis presuppose some degree of homogeneity. In order to count and aggregate data, you have to reduce reality to its homogeneous elements. Let's say you have you have two apples and two pears. They can only be added together at the most simplistic level of abstraction. They are all fruits, so you have four fruits. But in the process of reduction, you can lose essential facts about reality. They're no longer apples and pears- just fruits. Maybe you have two apples, but one grew in your backyard, and you planted the tree when you were a kid. The whole story of the apple is neglected in a quantitative analysis.

With human beings, the process of reduction becomes even more problematic. Are all people rational utility-maximizers? Are all capitalists cynical appropriators of labor? These are important insights about human nature, but they leave out a lot of what there is to know about people, and they aren't true in all times and places.

The particular is especially important to planners. We work in specific places and at specific times. This makes the problems we deal with different from other places in significant ways, and these differences are difficult to quantify. People in Berkeley, California, are motivated in different ways than people in the rest of the country, they have a far different history, and so on. Qualitative methods make the more "humanist" side of society more visible.

I don't think that means that different places can't learn from each other. But it does mean there's a limit to one-size-fits-all thinking. That's the most important insight the post-modernists have.

• Inside Higher Ed, No Letup From Washington: "Broad's last few words suggest the key difference between the Obama and Bush White Houses as many college leaders see it: While the Bush administration often seemed to dislike and disparage higher education, the Obama administration will be tough on colleges because its officials value higher education and believe it needs to perform much better, and successfully educate many more students, to drive the American economy."
• Stanley Fish, Does Reason Know What It Is Missing?: "The Liberal state, resting on a base of procedural rationality, delivers no such goals or reasons and thus suffers, Habermas says, from a “motivational weakness”; it cannot inspire its citizens to virtuous (as opposed to self-interested) acts because it has lost “its grip on the images, preserved by religion, of the moral whole” and is unable to formulate “collectively binding ideals.” The liberal citizen is taught that he is the possessor of rights and that the state exists to protect those rights, chief among which is his right to choose. The content of what he chooses — the direction in which he points his life — is a matter of indifference to the state which guarantees his right to go there just as it guarantees the corresponding rights of his neighbors (“different strokes for different folks”). Enlightenment rational morality, Habermas concludes, “is aimed at the insight of individuals, and does not foster any impulse toward solidarity, that is, toward morally guided collective action.”
• Dani Rodrick, The Return of Industrial Policy: "Nor is America’s embrace of industrial policy a matter of historical interest only. Today the US federal government is the world’s biggest venture capitalist by far. According to The Wall Street Journal, the US Department of Energy (DOE) alone is planning to spend more than $40 billion in loans and grants to encourage private firms to develop green technologies, such as electric cars, new batteries, wind turbines, and solar panels. During the first three quarters on 2009, private venture capital firms invested less than $3 billion combined in this sector. The DOE invested $13 billion."
  

• Robert Reich, The Final Health Care Vote and What it Really Means: "Medicare built on Franklin D. Roosevelt’s New Deal notion of government as insurer, with citizens making payments to government, and government paying out benefits. That was the central idea of Social Security, and Medicare piggybacked on Social Security. Obama’s legislation comes from an alternative idea, begun under the Eisenhower administration and developed under Nixon, of a market for health care based on private insurers and employers. Eisenhower locked in the tax break for employee health benefits; Nixon pushed prepaid, competing health plans, and urged a requirement that employers cover their employees. Obama applies Nixon’s idea and takes it a step further by requiring all Americans to carry health insurance, and giving subsidies to those who need it."
• Nancy Folbre, The Resentment Zone: Losing Means-Tested Benefits: "Many Tea Party enthusiasts would like to eliminate means-tested benefits altogether. That might make some people feel better. After all, if you’re not getting any benefits, you can’t complain about losing them. And maybe some people, comparing their relative position, look down rather than up. Intensifying the effects of poverty and unemployment could make those who barely escape them feel victorious. But I think many of the disaffected would welcome simpler, universal benefits, like extending Medicare as a choice to everyone or minimizing tuition and fees at public community colleges and universities."
• John Judis, Democrats Discover Their Base: "Health care reform would not have happened without the political skill and tenacity of House Speaker Nancy Pelosi, or without the last minute round of arm twisting by President Barack Obama. But equally important was the energetic public campaign that Obama and liberal and left-wing organizations waged on behalf of it. This campaign altered the chemistry of the debate within Congress and among Democrats. Democrats in Washington had come to understand that it was us versus them, with “them” being Republicans, Tea Partyists, and various business lobbies, but they can now recognize that there is a real “us” out there."
• EJ Dionne, Why Democrats are Fighting for a Republican Plan: "Republicans have said that they do not want to destroy the private insurance market. This bill not only preserves that market but strengthens it by bringing in millions of new customers. The plan before Congress does not call for a government “takeover” of health care. It provides subsidies so more people can buy private insurance. Republicans always say they are against “socialized medicine.” Not only is this bill nothing like a “single-payer” health system along Canadian or British lines. It doesn’t even include the “public option” that would have allowed people voluntarily to buy their insurance from the government. The single-payer idea fell by the wayside long ago, and supporters of the public option -- sadly, from my point of view -- lost out last December. They’ll be back, of course. The newly pragmatic Rep. Dennis Kucinich (D-Ohio) was right to say that this is just the first step in a long process. We will see if this market-based system works. If it doesn’t, single-payer plans and public options will look more attractive."
• I'm very happy that 31 million more people will get health insurance and the federal government will do some serious work to bring costs down. But it would have been better to have a plan based on the social insurance model, like the public option or a Medicare expansion/buy-in.
  

• Michael Sandel, Obama and Civic Idealism: "Unlike the anti-bigness liberalism of the progressive era and early New Deal, the social-welfare liberalism of FDR in 1944 is recognizable as the liberalism of our time. The great liberal causes of the 1950s, ‘60s, and ‘70s—civil rights, Medicare and Medicaid, racial and gender equality, federal support for education, a more generous welfare state—were about using government to provide equal opportunity and a social safety net, not about using government to rein in the political influence of big banks and corporations. Social-welfare liberalism seems a more practical doctrine than the anti-bigness version of earlier progressives. It is hard to imagine how to break up the large financial institutions and corporations that dominate modern economic life. And yet I believe it’s a mistake for contemporary liberals to give up on the old progressive project of exerting democratic control over economic institutions. In fact, it’s a mistake that has backfired on the Obama presidency. The initial reluctance of Barack Obama and his economic advisers to take a tougher line on the banks has led to a populist backlash that now threatens his agenda."
• Boston Globe, It's Money that Matters: "IDEAS: What are the psychological or sociological effects of inequality? Are you saying that the “social pain” you describe can be a cause of violence in unequal societies?
  WILKINSON: I think people are extremely sensitive to status differentiation and to being looked down on, or disrespected, and those often seem to be the triggers to violence. We quote an American prison psychiatrist who goes so far as to say he’s never seen a serious act of violence that wasn’t provoked by loss of face or humiliation, and so on. And in more unequal societies, status matters even more. People judge each other more by status. There’s more insecurity. And people at the bottom are more often excluded from the markers of status, the jobs and housing and cars, so they become even more touchy about how they’re seen."
• Department of Energy, Progress in Implementing the Department of Energy's Weatherization Assistance Program Under the American Recovery and Reinvestment Act: "Certain states also faced fiscal challenges that contributed to the delay in the implementation of the Weatherization Program. For example, because of budget shortfalls associated with the economic downturn, certain states were under hiring freezes that applied to all employees regardless of the source of their funding, including those tasked with weatherization-related work. In other states, progress was impacted because personnel involved with the program were subject to significant state-wide furloughs. Further, the approval of state budgets was delayed in states such as Pennsylvania as legislators deliberated over how to address overall budget shortfalls. Lacking staff, states were unable to perform required implementation tasks necessary to handle the large infusion of Recovery Act Weatherization Program funding."
  

• NY Times, A Diploma in 10th Grade?: "The Times reported this week that under a program starting next year, some high school sophomores in eight states will have a chance to earn a diploma and head straight to community college. To do so, however, they will have to pass academic tests known as board exams. If they don’t pass the tests in the 10th grade, they can take them again in their junior and senior years. The National Center on Education and the Economy, the nonprofit group that is organizing the program, says that students will have to meet basic requirements before they go to college and that it hopes this will reduce the need for remedial classes in college."
• Matt Yglesias, The Spending Tug: "I’ve previously mentioned Kinder & Kam’s US Against Them: Ethnocentric Foundations of American Opinion but it helps shed some light on this issue. They use National Election Survey data and show that if you restrict your attention to white Americans then ethnocentric views (both in terms of positive views of whites and negative views of non-whites) is correlated with hostility to means-tested welfare programs. The relationship remains statistically significant even when you control for partisanship and for self-described political beliefs regarding egalitarianism and limited government. But if you look at views on social insurance programs—Social Security and Medicare—you get the reverse result. Ethnocentrism is associated with support for increases in Social Security and Medicare spending, again even when you control for partisanship and self-described political beliefs regarding egalitarianism and limited government. And what seems to matter here isn’t dislike for non-whites, but positive solidaristic feelings about other white people."
• Wall Street Journal, SBA-Backed Loans are Bright Spot in Gloomy Climate: "SBA-backed loans in the past have made up only a small portion of overall small-business loans—around 7% to 8% according to the SBA's estimations, and as little as 1% by other counts. But thanks to stimulus-related measures, SBA loans this year could be "pushing 10% to 15%," according to industry expert Bob Coleman, who keeps a pulse on SBA lending through his independent publication, the Coleman Report. Business owners who have been turned down for conventional loans say they're having better luck applying for SBA loans. Dale McCoy, who owns Lite Metals Company Inc., a foundry in Ravenna, Ohio, says he approached several banks between June and October but was unable to get approval for a $735,000 loan to cover debt on the company's purchase of a small, captive foundry specializing in airplane wheels that is currently profitable."
  

• Contra Costa Times, Stimulus housing plan slow to take shape: "A year into a $6 billion federal program to buy up, rehab and sell abandoned properties in hard-hit neighborhoods, the bulk of the first $40 million in Bay Area grants remains unspent. Cities and counties are struggling to get their hands on the right homes, competing with cash-carrying investors and thwarted by banks reluctant to put foreclosed houses on the market. The creeping pace of the Neighborhood Stabilization Program seems to defy both the idea of rapid federal stimulus and the fast flow of houses bobbing into foreclosure — one every 18 minutes in the Bay Area. Housing experts say its troubles are partly attributable to red tape and overwhelmed banks, but mostly to what they never anticipated: a surge in the market for beleaguered properties."
• Harley Shaiken, Put the brakes on Toyota's NUMMI plant closure in Fremont: "President Barack Obama mentioned "jobs" 23 times in his State of the Union address, underscoring that the fragile recovery is bypassing millions of Americans. About the last thing the economy needs is a major plant closing. Nonetheless, Toyota is going ahead with plans to close the New United Motor Manufacturing Inc. assembly plant — a joint venture started in 1984 with General Motors — in Fremont, on April 1. Nearly 5,000 NUMMI jobs will evaporate and up to 50,000 jobs are at risk, including those at 1,000 suppliers throughout the state, according to the company's own numbers. At stake for thousands are homes, college educations and a middle-class lifestyle that came out of decades of hard work."
• NY Times, In Detroit, Is There Life After The Big Three?: "CRUISE the blighted streets that shoot off in either direction from 8 Mile Road, and the scars of the automotive crisis abound. “For sale” signs adorn the front of long-shuttered metal, paint and tool-and-die shops. And at factories still in business, the small number of cars in the parking lots testify that the shops are working below capacity. But pull into the bustling headquarters of W Industries, a compound of imposing black structures at 8 Mile and Hoover Street, and you’ll encounter a more hopeful vision of Detroit’s future. Once an exclusive supplier to the auto industry, this machine tool and parts company is rolling in new business."
  

So I hear a new jobs bill could be in the works. It would of course be great to have more funding for job creation, but I wonder if this next round could improve on the last stimulus's approach to doing economic development. One possibility would be to include funding to build up capacity to administer ARRA funds for economic development more effectively. Beefed-up administration could improve the stimulus's effectiveness in three ways.

The first is funding for outreach and marketing. A bewildering array of opportunities have been made available for businesses, workers, and consumers. People don't know what the're eligible for. Local governments, under pressure from budget cuts and new demands, often do not have the capacity or will to reach out to them. This can have a particularly harmful effect on low-income communities and small-to-medium sized businesses, both of which have historically had difficulty accessing benefits and services. They'll only be further cut-off if something isn't done to improve outreach.

There's also solid evidence that outreach matters. An evaluation of California enterprise zones found that areas that did marketing and outreach had more job creation than areas that did not. The evaluation was just written up in the latest issue of the Journal of Policy Analysis and Management. It has a subscription wall, but here's a summary of their key findings:

Zones vary in their demographic and economic conditions. They also vary because local zone management is responsible for marketing and outreach, coordinating other incentives, and other economic development activities in the zones, and zone administrators make different choices about which of these activities they engage in and choose to emphasize. The evidence suggests that the enterprise zone program has a more favorable effect on employment in zones that have a lower share of manufacturing and in zones where managers report doing more marketing and outreach activities; as it turns out, this latter result has some parallels to findings from earlier literature on heterogeneity in the effects of enterprise zones (discussed below).

Another administrative need is for greater planning. Locals need sector-focused plans and the capacity to execute them to get the most out of their ARRA funding. ARRA itself is very complex and there's a risk that traditional policy silos will prevent locals from integrating related programs, like the many initiatives targeting sectors in the "green" economy. Further, governments need to coordinate the ARRA-funded development initiatives with local programs and conditions. Research needs to be done on the needs and priorities of local businesses. Each local and regional economy has its own strengths and weaknesses. Administrators need to know what local conditions are like to develop an effective plan.

Finally, programs need to be evaluated. At the very least there should be funding to solicit input and feedback. This will not only improve program design but could provide more convincing evidence that stimulus programs are working.

Fundamentally, the next stimulus should set-aside funding to build up capacity at the local level. In exchange the Obama administration should find greater job creation and better evidence of the impact the stimulus is having in particular places. It's also worth recalling that the New Deal-era programs weren't just a series of isolated public works projects. They were coordinated and managed by new governing bodies like the Tennessee Valley Authority and the Maritime Commission. The same kind of vision needs to be supplied to restore job growth today.

There's been an interesting back-and-forth between Ryan Avent and Alec MacGillis over urban development-guru Richard Florida. Defending Florida, Avent most clearly explains his thinking in this section of his first response to MacGillis's American Prospect article criticizing Florida.

But what makes a successful clump changes over time. The economics that underpinned the older manufacturing economy supported clumps that don’t necessarily make economic sense today. With declines in transportation and communication costs, it became affordable to move plants away from expensive city land, and that’s precisely what many businesses did. In cities that were also home to a substantial knowledge economy sector, this ultimately proved to be a boon. By outsourcing their manufacturing (and later, their back office) components, firms could reduce the overhead on the offices of those who still needed to be in the city, improving margins (and making more room in the city for others who needed to be there, thus increasing the return to everyone of being in the city).

The result is a world where the key to urban success is a critical mass of workers with high levels of what economists like to call human capital. And because there are returns to scale at work, there is an element of the zero sum here. Or to put it another way, the world where every big city has its own fair share of talent is not a stable equilibrium; it will decay into a world with haves and have nots. And indeed, that’s what we have seen in recent decades. Educational levels in cities one hundred years ago strongly predict educational levels in cities today. And cities with high shares of college graduates have absorbed more than their share of new college graduates in recent decades.

The main problem with this argument is that it fails to account for the role of foreign competition. Transportation and communication breakthroughs not only enabled companies to disperse their operations all over the world; they enabled foreign companies to import cheaply and compete with U.S.-produced goods. Starting in the 1960s, U.S. manufacturers lost substantial market share in a variety of goods to foreign competitors, and many economists attribute the economic stagnation of the 1970s to the inability of U.S. industries to compete with foreign companies. In the 1980s, with the aid of deregulated markets, companies were able to return to profitability only through mergers and extensive outsourcing to low-wage countries.

Human capital levels are important, but the bigger issue is why they are important. Of course, the rise of high-tech clusters and Richard Florida's creative enclaves are part of the story. But so is the role of the global dispersion of production, which has given rise to new forms of agglomeration. Global production networks need to be coordinated, and these jobs typically require high levels of education and specialized knowledge, and therefore are subject to agglomeration in a few select cities, creating jobs in business and financial services. While this process has helped revive some American cities, it also creates a need for a massive industry engaged in speculative finance.

The financial crisis has shown just how unstable this arrangement is, and perhaps it has also demonstrated that the returns to this system of production are declining. After all, at some point, industry will drive labor costs as low as they will go.

Finally, the increasing importance of human capital does not necessarily mean that high-wage manufacturing in America is dead. One option is to take a "clusters" approach to regional development, which the Brookings Institutions' Metropolitan Policy Program is promoting. Others include adjusting the terms of trade, spreading best practices and innovations through manufacturing extension programs, reducing workforce shortages and upgrading existing workforce skills.

• Aaron M. Renn, Will Anyone Stand Up For American Industry?: "There's a positive reinforcement cycle at work. The less we manufacture, the less we can manufacture. We slowly lose the skills, the facilities, the institutions, and the culture that enable a robust manufacturing economy to thrive. Eventually, we won't be able to recover. Maybe we won't even want to. The less we make, the less we want to make. As we become unmoored from our agro-industrial roots, we fail to see them as central to our national identity and frequently treat them with hostility. As Douglas and Wildavsky put it in Risk and Culture (1982): A larger proportion of the population of working age was disengaged from the production process than had been before. The economic boom and educational boom together produced a cohort of articulate, critical people with no commitment to commerce and industry. Increasingly, Americans have no personal experience with industry, and even no family experience with it. What was once common is just another niche, much like military service has become. This means most people have little familiarity or affection for industry, agriculture, or energy production. Many, especially urban dwellers, view most productive industry as a negative, as a source of blight where once others saw jobs and a strong tax base.
• Harold Meyerson, Without a movement, progressives can't aid Obama's agenda: "In America, major liberal reforms require not just liberal governments, but autonomous, vibrant mass movements, usually led by activists who stand at or beyond liberalism's left fringe. No such movements were around during Carter and Clinton's presidencies. For his part, Obama won election with something new under the political sun: a list of 13 million people who had supported his campaign. But he has consistently declined to activate his activists to help him win legislative battles by pressuring, for instance, those Democratic members of Congress who have weakened or blocked his major bills. To be sure, loosing the activists would have brought problems of its own: Unlike Roosevelt or Johnson, who benefited from autonomous movements, Obama would be answerable for every loopy tactic his followers employed. But in the absence of both a free-standing movement and a legion of loyalists, Congress isn't feeling much pressure from the left to move Obama's agenda."
• John Judis, Barack Obama, You Remind Me of Herbert Hoover: "Most economic commentators have focused on the “financial crisis” and ignored or downplayed the crisis in the productive core. In the broadest terms, this crisis goes back to the 1970s when the U.S. began to lose market share--and in some cases entire industries like consumer electronics--to European and Asian competitors. It abated somewhat in the 1990s with the emergence of new computer/telecommunications/internet industries, but it became acute again in the early 2000s with the dotcom-telecom bust, which underlay the recession of 2001-2. There was a brief uptick in private non-residential investment in 2005-6, but according to the Bureau of Economic Analysis, it began to decline in 2007 and has continued to do so. In the third quarter of this year, at the same time that economists were trumpeting the recession’s end, investment in non-residential structures fell 19.8 percent and in industrial equipment 4.8 percent from the previous quarter."
• NY Times, For Working Families Party in New York, Power Brings Challenges: "Bill de Blasio, New York City’s new public advocate, is a lifelong Democrat and a likely future mayoral contender. But ask him to name the most innovative political force in the state, and he points to the Working Families Party. “On the issues they care about, from minimum wage to tenant issues to development, they are absolutely definitional — they can set the debate at the city and the state level,” Mr. de Blasio said." .... Since its founding in 1998, the Working Families Party has accumulated a handsome pile of scalps, and prodded and sometimes dragged Democrats to the left. This year it successfully championed a so-called millionaire’s tax and a bill to train workers and weatherize houses — and its troops helped push Mr. de Blasio to victory. Its ambitions, too, remain outsize: Leaders have seeded chapters across the nation. “They are the only state party that’s a full-time party with ideas,” said Ed Ott, former political director of the Central Labor Council. “You call the Democratic Party in between an election, and it’s a ghost town.”"
  

• Nick Kristof, The Role of Microfinance: "Unfortunately, till very recently, there was little rigorous evidence on either side—is microcredit transformative or ruinous? However this is changing now, thanks to the courage and vision of a few leading MFIs (including Spandana in India, Al Amana in Morocco, First Macro Bank in the Philippines, Compartamos in Mexico) that have allowed researchers (each of us was involved in one or more of these) to evaluate rigorously the impact of their programs. We now have results from two (Spandana and First Macro Bank)."
• Bob Burtman, The Revolution Will be Mapped: "Joyner displays a series of maps showing the Coal Run neighborhood, a handful of streets located just outside the city limits of Zanesville in central Ohio. The first map provides a simple baseline, showing the city water plant and the boundary between the city and Coal Run, a part of Muskingum County. The second map adds water lines, which serve only the northern half of Coal Run. Successive maps add the residences in Coal Run, note which residences have water and which don't, and break down their occupancy by race. The last map puts all the data together, and the picture suddenly comes into sharp focus: Almost all the white households in Coal Run have water service, while all but a few black homes do not. The institute's maps played a vital role in a federal jury's decision last year to award the excluded Coal Run residents almost $11 million in damages from the city of Zanesville and Muskingum County. The supporting evidence was strong on its own: African-American residents without water had made repeated requests over a period of almost 50 years to remedy the inequity, to no avail. Instead, they had to haul water from the plant or pump it from wells contaminated with sulphur and oil from old mining operations. In the interim, Zanesville had extended its water lines on numerous occasions to new, predominantly white developments that were farther away from the water plant than Coal Run."
• John Gray, The end of a dream: "Unreality is the defining feature of the ideas that have been in vogue over the past decade. The grandiose delusions with which the new century began have not been abandoned. Instead, they have been shrunk to a size at which they can still be maintained. The small world of British politics provides many examples of this tendency. Rather than acknowledge that neoliberalism has failed, politicians in all three main parties are seizing on a succession of intellectual gimmicks for solutions to the problems that the ideology has created. Gladwell's blink, Sunstein and Thaler's nudge, the wisdom of crowds - these and other ephemera of the airport bookstore are being taken up, promoted and then forgotten in the floundering attempt to deal with a crisis that is only in its early stages."