• Brendin Mock, Something in the Water: "Most of this money, though, has not been used yet. When it is, it should translate into jobs for community residents. However, in wide-scale urban renewal schemes, as New Orleans learned after Hurricane Katrina, out-of-town workers are often brought in by the out-of-town firms that get the recovery contracts. And some of the recipient firms in Southeast D.C. are from outside the District: Chiarmonte Construction out of McLean, Virginia; Clark Design/Build LLC out of Bethesda, Maryland; and Chugach Government Services out of Alaska."
• Flora Fair, Free Market Protectionism: Cambridge Professor Ha-Joon Chang on the limits of capitalism: "And how does this connect to the world economy?
  Basically, a country needs to develop certain capabilities to engage with the global market, where everyone is so much more advanced than you are. Even to export pretty basic things like a cheap transistor radio, which used to be one of South Korea’s main exports. The country first needed to develop these industries on the protectionist subsidies and so on. But engaging in the world economy and protecting young producers is totally compatible.
  So you’re serving your own interests by educating yourself through others who have done it.
  That’s right. Isaac Newton famously said, “I can see further than other people because I stand on the shoulders of the giants.” So it would be madness for developing countries to even think that, “Oh, I can live on my own,” because you are effectively committing suicide then. During that period, you basically do things to promote these countries so that they can compete in the world economy on equal terms in due course. I mean, this kind of protection is very different from the North Korean kind of protectionism, because here you are protecting your economy so you can participate in the world economy on better terms. In the North Korea case, you are protecting your economy in order not to participate in the world economy."
• Jeff Faux, Industrial Policy: The Road Not Taken: "For its advocates, industrial policy seemed a no-brainer. The manufacturing sector was the generator of productivity and innovation. It had been the engine of America's rising prosperity and the bedrock of its political as well as economic power. Without America's capacity to become the "arsenal of democracy" -- churning out the tanks, ships, planes, and ordnance that overwhelmed its enemies across two oceans -- World War II might well have ended differently. The war's end left the U.S. as the dominant manufacturing power in the world for some three decades. But with large-scale U.S. government help, Europe and Japan reindustrialized and quite naturally began to regain their old markets and compete with U.S. companies at home."
  

Jacob Hacker, the godfather of the public option, came out in favor of the Senate bill and had this to say in its defense:

The public option was always a means to an end: real competition for insurers, an alternative for consumers to existing private plans that does not deny needed care or shift risks onto the vulnerable, the ability to provide affordable coverage over time. I thought it was the best means within our political grasp. It lay just beyond that grasp. Yet its demise--in this round--does not diminish the immediate necessity of those larger aims. And even without the public option, the bill that Congress passes and the President signs could move us substantially toward those goals.

So if I understand this right, the public option would have moved the country closer to the goal of universal health care than the bill does now. But I think the implication is also that a public plan is not necessary to achieve that goal. He goes on:

To be sure, the bill also contains a requirement on individuals to have coverage, which has become the main target of criticism from the left. Without the public option, this mandate amounts to forcing people to buy private insurance without creating an affordable public alternative with which insurers must compete.

But the correct response to this critique is to make the requirement less necessary by providing greater assistance with the cost of premiums and by facilitating enrollment in the exchange--in other words, by making coverage more attractive and easier to obtain.

So the goals of the public option could well be achieved with additional subsidies. But there is an important difference between subsidies in particular and a public option. Additional subsidies will most likely have to be means-tested. It can be a degrading experience submitting to a means test. It will also reinforce the notion that there are two health care systems in the country- one for lower income people and one for everybody else. This lessens social cohesion. Ultimately the difference between the Senate bill and the public option is the same as the difference between safety net policy and social insurance, the latter being preferrable. Social insurance is grounded in the recognition of the social dimension of governmental protections, while safety net policy undermines it.

The Senate bill is justified on humanitarian grounds, but that does not make it equal to a robust public plan that would be open to everyone and financed by society-wide contributions. So instead of just building on the Senate bill it would be nice to see progressives pursue the path that Theda Scokpol outlines:

After this Health Reform is signed by President Obama, we progressives should keep pressing Democrats to look for ways to use reconciliation procedures to improve the cost controls in health care. Reconciliation and the majority Senate voting it entails is MEANT to be used on public budget issues. Once the federal government is dispursing enhanced subsidies to cover all Americans and help employers afford health insurance, price increases in private insurance become an increasingly grave threat to the public good. Any measure that regulates private insurance prices or allows public plans to force price competition surely becomes fair game in Congressional tax and appropriations decisions. One possible advantage of the half of a loaf we get in this reform may be to make reconciliation more legitimate as a tool to introduce a true public option or a real Medicare expansion later, on the ground that they cut costs to the taxpayer. Progressives have to DEMAND that Obama and the Congressional leaders take that possibility seriously.

I'd also note that as far as I know reconciliation can very well be used for health care even if it did not reduce Medicare expenditures. The only real criterion to meet is that the legislation must have an impact on outlays or revenues- AKA the Byrd Rule.

• Ben Bernanke as Public Intellectual: Are you Serious?: "Prospect’s 2009 public intellectuals list contains many crimes against good sense. It was obviously right to include Paul Krugman, Robert Shiller, Elizabeth Warren and several others on the list. Nonetheless, the judges have cleaved to the conventional wisdom and nowhere more than when rewarding our failed central bankers. Mervyn King is bad enough, but the real villain included here is the current chairman of the US Federal Reserve, Ben Bernanke—the same mistake Time Magazine now seems to have made with their choice for Person of the Year. ... Failing to act on the bubble, and thereby giving us the worst downturn in 70 years, should be sufficient to disqualify Bernanke from any list of public intellectuals. Add to this his failure to place conditions on the life support loans to the banks and misleading Congress on a hugely important issue, and you have a figure who is definitely on the wrong list for this crisis."
• Children's Hospital Boston, Insurance Coverage Status Affects Mortality Rate in Pediatric Trauma Patients: "A study led by Heather Rosen, MD, MPH ... found that uninsured children were over three times more likely to die from their trauma-related injuries than children who were commercially insured, after adjustment for other factors such as age, gender, race, injury severity and injury type in an analysis of data from the National Trauma Data Bank. Moreover, publicly-insured children were 1.19 times more likely to die from trauma when compared with commercially-insured children."
• Zubin Jelveh, Yes, Inequality Really is Getting a Lot Worse: "Aguiar and Bils find that there is a big discrepancy in the savings rate they derive from the Labor Department's Consumer Expenditure Survey and the better known figure published by the Commerce Department. While the latter figure tells a story of declining savings, the former has savings increasing over the last 30 years to over 20 percent of income -- something which seems quite implausible. The discrepancy is most likely the result of people choosing to give out less information on questionnaires (which the Labor Department relies on). This non-response bias isn't the hardest data shortcoming to correct, but you have to know it's there. The Labor Department didn't address the issue until the 2004 survey, and the uncorrected data seem to be at the heart of the confusion here. Aguiar and Bils created a model to try and correct for the measurement error on the many years of data already collected. They report that, with the adjusted data, consumption inequality most likely grew by about 30 percent between the 1980 to 2007, which is roughly the same as the increase in income inequality over that period."
• Marion Nestle, Food and Climate Change: The NYC Summit: "While all of that is going on in Copenhagen, the Manhattan Borough President, Scott Stringer, along with Just Food, organized a food and climate change summit today at my university, NYU. More than one thousand New Yorkers signed up for thirty workshops at the amazing event. Why amazing? Because this summit is about advocacy for a more just and sustainable food system, and right now. ... Does advocacy for a food system that provides healthy food for everyone constitute a social movement? Look around the room at the summit. The answer is an unequivocal YES. Can one New York City Borough show the way. YES."
  

For class I'm reading The Black Metropolis, a classic study of segregated African-American neighborhoods in Chicago around World War II. It still holds up pretty well today. Something I wanted to highlight from it shows how advocates influenced public opinion about poverty and discrimination back then.

Whenever an institution in the Negro community launched a drive for funds, the evidences of community disorganization were emphasized in the press in order to stimulate charity. On one occasion, a city-wide drive against syphilis involved the uncritical publication of statistics and maps which suggested that the Black Belt was a "cesspool of disease" (the actual words of one newspaper). Such publicity helped to fix the reputation of Midwest Metropolis during the Depression. A new liberal daily, the Sun, appearing in 1941, inaugurated a less sensational approach to Black Belt problems, but the reputation of the area was already fixed. The existence of these conditions has become a convenient rationalization for keeping Negroes segregated. The University of Chicago (with properties tangential to the Black Belt), neighborhood property owners' associations all around it, and the Chicago Real Estate Board have visualized restrictive covenants as a permanent cordon sanitaire.

Something similar came up in a different reading on the first federal law providing for public housing subsidies. Originally the "housers" pushed for a public system that served the working classes and middle classes, gradually being extended to the poor. But what they got instead was a quasi-private system for most and a public system that segregated the poor and made them vulnerable to urban renewal. This was caused in part by the arguments they used.

Although the slum argument may have redounded to the detriment of the program, the housers probably couldn't not have sold a federal public housing program without it. "It may have been the wrong technique," Ernest Bohn admitted to Cather Bauer in 1941, "but it did get housing started. I wonder where we'd be today if we had not scared [the hell] out of people about conditions in the slums, and would have just talked about beautiful little cottages with white picket fence around them." Thus, when Franklin Roosevelt signed the Wagner-Steagall bill into law on September 1, 1937, he established a low-income program strongly oriented toward the poor and slum clearance.

Arguably, the housers would not have achieved anything if they hadn't appealed to fear and stereotypes. But the article points out that the housers never tried to build a movement to support their cause. They had to rely on sensationalism because they didn't have the grassroots power to achieve broader social change.

Lacking time to nurture a grassroots campaign that would have provided a permanent political base for the program, public housers waged a masterful smoke-and-mirrors strategy by persuading allies to fight for their program. Housers relied upon antislum arguments, a tactic that provided to be a double edged sword. Although effective in winning supporters, these appeals encouraged lawmakers to emphasize the relatively narrow aims of slum clearance and aid to the very poor.

There are diminishing returns to sensationalism and humanitarianism. But even more importantly, without a social movement behind you, there's only so much you can accomplish stalking the halls of Congress, and the temptation is great to take a short cut, which could undermine your cause in the long run by establishing flawed programs.

• Tony Judt, What is Living and What is Dead in Social Democracy?: "Let me offer an example. It is cheaper to provide benevolent handouts to the poor than to guarantee them a full range of social services as of right. By "benevolent" I mean faith-based charity, private or independent initiative, income-dependent assistance in the form of food stamps, housing grants, clothing subsidies, and so on. But it is notoriously humiliating to be on the receiving end of that kind of assistance. The "means test" applied by the British authorities to victims of the 1930s depression is still recalled with distaste and even anger by an older generation. Conversely, it is not humiliating to be on the receiving end of a right. If you are entitled to unemployment payments, pension, disability, municipal housing, or any other publicly furnished assistance as of right—without anyone investigating to determine whether you have sunk low enough to "deserve" help—then you will not be embarrassed to accept it. However, such universal rights and entitlements are expensive. But what if we treated humiliation itself as a cost, a charge to society? What if we decided to "quantify" the harm done when people are shamed by their fellow citizens before receiving the mere necessities of life? In other words, what if we factored into our estimates of productivity, efficiency, or well-being the difference between a humiliating handout and a benefit as of right? We might conclude that the provision of universal social services, public health insurance, or subsidized public transportation was actually a cost-effective way to achieve our common objectives. Such an exercise is inherently contentious: How do we quantify "humiliation"? What is the measurable cost of depriving isolated citizens of access to metropolitan resources? How much are we willing to pay for a good society? Unclear. But unless we ask such questions, how can we hope to devise answers?"
• Howard Wial, David Brooks' Innovation Agenda: The Limits of the Market: "The problem is that overall these things don’t go far enough. Policies to boost inputs to innovation and create innovation-friendly markets would be enough to get us enough innovation only if the companies that actually do the innovation were the self-sufficient, perfectly informed, atomistic competitors of textbook economics. In the world of textbook economics, there’s no need for government to worry about how innovation actually takes place because the market will reward companies that somehow figure out innovations that add value and punish companies that don’t keep up. But real-world business firms, as a growing number of economists recognize, aren’t like the firms of textbook economics, especially when it comes to innovation. Some don’t know how to innovate or even copy the innovations of others—and the market doesn’t always reward the innovators and punish the others."
  

• Council Speaker to Unveil Policy on Food for the City: "Christine C. Quinn, the City Council speaker, is to unveil a long-term plan on food policy on Monday, a plan she says goes beyond the issues of trans fats and sugary sodas to address the production, transportation and sales of food in New York City. Her initiative, called FoodWorks New York, is meant to build on the efforts of the Bloomberg’s administration’s food policy coordinator, Benjamin Thomases, whose office improves access to food for low-income New Yorkers. Mayor Michael R. Bloomberg first established the food policy coordinator’s office in 2007. “I don’t believe we have ever fully looked at our sources of food from beginning to end, maximized their potential and minimized their negative impact,” Ms. Quinn said in an interview last week. “We’re losing an opportunity for the food we eat, and the money we spend on food, to create jobs and employ New York City residents. ... We’ve had hunger relief efforts, we’ve had pro-nutrition efforts. But we haven’t had a plan that’s pulled it all together, and seen the potential that food has from the moment it is pulled from the ground to the moment it hits the table.”"
• Daniel Little, Alleviating Rural Poverty: "What theories and values ought to underlie our best thinking about global economic development? Along with Amartya Sen (Development as Freedom), I believe that the best answer to the ethical question involves giving top priority to the goal of increasing the realization of human capabilities across the whole of society (The Paradox of Wealth and Poverty: Mapping the Ethical Dilemmas of Global Development). We need to put the poor first. However, I also believe that our ability to achieve this goal is highly sensitive to the distributive structures and property systems that exist in poor countries. The property institutions of developing countries have enormous impact on the full human development of the poor. As a result, ethically desirable human development goals are difficult to attain within any social system in which the antecedent property relations are highly stratified and in which political power is largely in the hands of the existing elites."
• Tom Jacobs, Stereotypical Images Can Overwhelm a Nuanced Text: "In a troubling corollary to the truism that a picture is worth 1,000 words, a new study suggests stereotypical imagery can largely negate the central point of a lengthy text. ... The scholars concluded that "regardless of the photographers' and/or editors' intent ... the most stereotypical photographs were the ones that ultimately stuck in the viewers' minds." Presumably as a result, "readers exposed to the visual narrative — even when combined with the textual narrative — expressed more stereotypical views of the subjects than those exposed to the text only.""
  

• Duncan Green, Is Growth with Equity Getting Old?: "Growth with Equity has been one of the development industry’s overarching economic narratives for over a decade (Oxfam published ‘Economic Growth with Equity: Lessons from East Asia’ in 1998). OK, it’s better than just ‘Growth’, and where it’s been achieved, it has an unrivalled impact on poverty, but thinking has moved on in a number of areas, and G+E is starting to look distinctly threadbare. I’ve been putting up posts on this blog on different aspects of this, but here’s a synthesis ... 3. The importance of volatility and unpredictability: economic issues are usually discussed in terms of stocks (eg of assets) and flows (e.g. average incomes). However, virtually all serious studies of poor people’s lives show that it is uncertainty and unpredictability that is often the defining, and most dreaded, feature of ‘ill-being’. This has led to increased interest in a range of mechanisms to reduce vulnerability to such sudden shifts, including social protection, enhanced social capital, disaster risk reduction, keeping health and education free at the point of use etc."
• Robert Frank, How to Run Up a Deficit, Without Fear: "... there are really only three basic truths that policy makers need to know about deficits: First, it’s actually good to run them during deep economic downturns. Second, whether deficits are bad in the long run depends on how borrowed money is spent. And third, eliminating deficits entirely would not require any painful sacrifices. ... To eliminate deficits, we need additional revenue. The encouraging news is that we could raise more than enough to balance government budgets by replacing our existing tax system with one that taxes activities that cause harm to others. Called Pigovian taxes by economists — after the English economist Arthur Cecil Pigou — such levies create a burden that is more than offset by the reductions they cause in costly side effects of everyday activities."
  

• Jon Marcus, A Mid Atlantic Miracle: How Maryland Held the Line on College Costs: "A handful of states have tried to fight the tide. Florida and Ohio put tuition caps on their state universities two years ago, but lifted them this summer in the face of economic woes. Missouri just imposed a two-year tuition freeze on its public universities, but only after having allowed big tuition increases over the last few years. For the most part, state-level elected officials and university administrators have been content to indulge in a tacit conspiracy, allowing school expenditures to rise unchecked while the costs of paying for them are shifted away from taxpayers and onto the backs of students and their families. It’s gotten to the point where some states are considering completely shutting off taxpayer support for their flagship universities—letting them become, in effect, like private institutions, able to hike tuition and cater to the upper middle class as much as they please. There’s one state that has fairly successfully bucked the higher-tuition trend, however: Maryland. The approximately 150,000 students who attend the eleven campuses that make up the University System of Maryland—from the ivy-covered flagship University of Maryland in College Park to historically black Bowie State University in Prince George’s County—are paying the same tuition this fall that they did the previous academic year, and the year before that, and the year before that.
• Ben Ehrenreich, California Scheming: "The neoliberal chickens, though, have been waddling home, and they began taking roost before the current financial crisis hit. In 2007, students hit the streets to protest educational "reforms"--cuts, fee hikes, increasing privatization--in Austria, Canada, France, Germany, Greece, Hungary, Israel, South Africa, Spain and the United Kingdom. Public funding of nearly all of most prestigious US state university systems has withered, resulting in student protests in Arizona, Colorado, Massachusetts, Michigan, North Carolina and Wisconsin. "There's a national trend to the privatization of state universities," says the economist Nancy Folbre, author of the forthcoming Saving State U. "It's all part of the same picture."
• Catherine Hoxby, The Changing Selectivity of American Colleges: "This paper demonstrates that competition for space--the number of students who wish to attend college growing faster than the number of spaces available--does not explain changing selectivity. The explanation is, instead, that the elasticity of a student's preference for a college with respect to its proximity to his home has fallen substantially over time and there has been a corresponding increase in the elasticity of his preference for a college with respect to its resources and peers. In other words, students used to attend a local college regardless of their abilities and its characteristics. Now, their choices are driven far less by distance and far more by a college's resources and student body. It is the consequent re-sorting of students among colleges that has, at once, caused selectivity to rise in a small number of colleges while simultaneously causing it to fall in other colleges. I show that the integration of the market for college education has had profound implications on the peers whom college students experience, the resources invested in their education, the tuition they pay, and the subsidies they enjoy. An important finding is that, even though tuition has been rising rapidly at the most selective schools, the deal students get there has arguably improved greatly."
  

• Economic Opportunity Institute, A Tale of Two Recessions: "A new analysis of Washington [State]’s economy reveals that many hallmarks of middle-class life—owning a home, sending the kids to college, having health care, and building a retirement nest egg—have become
  increasingly unattainable for local families. .... Even as costs have increased, today’s households and workers have less income than was the norm just a decade ago. Worse yet, most middle-income Washington families hadn’t even dug out of the economic hole created by the last recession before the “Great Recession” of 2008-09.
• Gordon Berlin, Workforce Investment Act Reauthorization: Will the Past be Prologue?: " ... this is an extraordinary moment for employment policy. The life course of nearly one of every five would-be workers (comprising the unemployed, the underemployed, the too discouraged to look, and involuntary part-time workers) will be determined in some measure by what we do here today and in the weeks and months that follow, up to and beyond the reauthorization of the WIA."
• Nicholas Wade, We May Be Born with an Urge to Help: "... biologists are beginning to form a generally sunnier view of humankind. Their conclusions are derived in part from testing very young children, and partly from comparing human children with those of chimpanzees, hoping that the differences will point to what is distinctively human. The somewhat surprising answer at which some biologists have arrived is that babies are innately sociable and helpful to others. Of course every animal must to some extent be selfish to survive. But the biologists also see in humans a natural willingness to help."
• Vivian Gornick, The Lost Radical: "Among the most influential of the turn-of-the-century modernists was an Englishman whose life embodies the cultural revolution that characterized his moment. Unlike the names of other modernists that have become iconic—from Sigmund Freud to Emma Goldman to Virginia Woolf—his has long languished in historical obscurity. Now, however, with the publication last year of Sheila Rowbotham’s impressive biography, Edward Carpenter: A Life of Liberty and Love, we have a richly informative account of a man whose mind and spirit are, perhaps, even more resonant today than they were during the world-changing time in which he labored to achieve a value system that would place inner liberation firmly at its center. The story of Carpenter’s life is not only a striking tale of social courage, it is also a brilliant example of how modernism itself accumulated in one crucial sensibility."
  

• Matthew Yglesias, The High Price of Scholarship: "The rise of digital technology makes it possible to disseminate ideas for almost no money. That’s something that’s created big problems for a lot of commercial institutions, but it’s been a boon for most non-commercial ones—all kinds of DC think tanks and advocacy organizations, for example, have much broader reach thanks to our ability to cheaply distribute ideas around the world over the internet. But academic publishing seems oddly resistant to this trend. But almost every major university in the world seems to be expending funds on activities that have less social value than nearly-free distribution (public domain books on kindle seem to usually cost about $2) of the results of their scholarship would have. And on a selfish basis, I assume that the kind of people inclined to write books about the history of early modern philosophy are more interested in finding an audience for their work than in making a quick buck—that doesn’t seem like a profit-maximizing sort of field of endeavor."
• Tom Jacobs, The Invisible Woman of Color: "A just-published study suggests black women experience "a qualitatively different form of racism" that contributes to them not being "recognized or correctly credited for their contributions." On an unconscious level, African-American females are "treated as interchangeable and indistinguishable from one another," according to University of Kansas psychologists Amanda Sesko and Monica Biernat. ... In [a] second study, participants listened to a recorded conversation among eight college students, and were shown photos of the discussion participants as they spoke. Afterwards, they were asked to match specific statements with photos of the people who spoke them. "Black and white women were more likely to be confused with each other than black and white men," the researchers report. "Participants were more likely to incorrectly attribute statements made by black women to other targets than they were to misattribute white women's, black men's or white men's statements.""
• Jonathan Cohn, Health Reform will Make You Rich!: "Well, OK, maybe not rich. But it should mean higher wages, if it includes the tax on expensive health policies. That's according to Jonathan Gruber of MIT, who's been studying this and just released a new memo on the subject. As he did previously, he reverse-engineered numbers from the Joint Committee on Taxation to extrapolate wage growth. His findings? "Worker wages rise by $55 billion by 2019 This amounts to almost $700 per insured household in 2019. Worker wages rise by $234 billion in aggregate over this time period This is also a very progressive wage adjustment. In every year, the share of wage gains accruing to those with incomes below $100,000 is about two-thirds of the total, and the share of wage gains accruing to those with incomes below $200,000 is over 90% of the total.""