Conditioning on partisanship

Glad to see somebody's worked out the numbers on this one.

It's bugged me how American papers have been quoting Trump's continued high approval ratings among Republicans without doing much to correct for that the people most disgusted by Trump will have stopped identifying as Republicans.

John Holbein points to this piece, which tries to put some bounds on the effects. Just conditioning on stated past voting record won't do it where recall bias matters and where folks might not want to remember having supported something that's now kinda ugly. So they try to adjust for 'missing' partisans of the President's party relative to a baseline measure. The key figure is below, followed by the authors' discussion.

In the lower panel of Figure 2 [pictured above], we plot observed partisan approval rates, the bounds on the compositionally-corrected partisan approval rate, and 95 percent confidence intervals for the upper and lower bound during the first 163 days of each presidential term.23 The marker is the observed partisan approval rate, the first capped line extending out from the marker are the bounds, and the second set of capped lines are the 95 percent confidence intervals on the lower and upper bounds.

Trump’s observed partisan approval rates are very low compared to the same period during Obama’s first term, but are roughly comparable to Obama’s second term. More relevant for our analysis is how the bounds evolve over time. The lower bound on the compositionally-corrected partisan approval rate is quite low during Trump’s presidency. In 14 of the 23 weeks, the lower bound is below 0.8. With only one exception, the lower bound on Trump’s compositionally-corrected partisan approval rate is lower than the lower bound from the analogous poll during Obama’s second term. The observed partisan approval rate is partially an artifact of missing respondents who would have previously reported Republican partisanship. While President Trump’s observed partisan approval rate has received much attention, the data are also consistent with the possibility that his partisan approval rate is quite low relative to recent presidential history.

I'm surprised the lower bound of the adjusted interval is as high as it is. 

Things I don't properly understand: Trump edition

Over the past months bemusement has shifted to horror. Surely, any day now, a hefty contingent of the GOP establishment would announce something like the following:

We have fine Republican candidates running in this year's Presidential election. They are two Republican governors who stand for Republican values of individual liberty, responsibility, and fiscal prudence. They recognise that America is great, and has to be a lot better for a lot of people. But they know too that American greatness is built on a foundation of shared American values that are open to all who hold them, regardless of their racial or religious backgrounds. 

If the prospect of a Trump Presidency makes you fear not only for the future of our party but also for the future of our country, don't sit this election out. Staying home will not only hand Hillary Clinton the Presidency, it will also deliver her a Democratic Senate. If Hillary gets the Presidency and the Senate, just watch what she does to the Supreme Court.

And there is a far better alternative. Gary Johnson and Bill Weld. They are fine Republicans, who this year are running on a Libertarian ticket. And they do more to espouse the core Republican values that we all share than do either Trump or Hillary. So join with us, and with the millions of young Americans who have already figured this out, and support Gary Johnson for President.

I thought this was going to happen well before the cutoff for the Presidential debates - Johnson/Weld needed 15% in the polls to be allowed into the debates. And then it didn't happen, and kept not happening.

What the heck has gone wrong with the Republican Party that they haven't yet disavowed Trump? Can they really let this happen? If Trump loses with the backing of the GOP establishment, changing the GOP after the election will be harder. And if he wins...

Meanwhile, Immigration New Zealand is still taking applications. Our refugee quota is much lower than our skilled worker intake, so get in while there's time.

Update: looks like my problem was that I just wasn't cynical enough.

A good couple of years for people who pushed the most cynical interpretations of the modern republican party

— Modeled Behavior (@ModeledBehavior) September 23, 2016

I had thought that the GOP establishment had enough invested in the GOP and its long-term success that they'd act in the Party's best interest. That interest cannot be a rump party supported by white-identity disaffected people who will never be more than 25-30% of the population. But each instead seems to be looking out for his own career interest in that potential rump party. Tullock's rationality of revolution might apply, or they might not even be thinking about any divergence of interest. Either way, it is very grim.

America needs Bob Jones

Things were bad for National in the late 70s and in the lead-up to the 80s. Robert Muldoon, then Prime Minister, supported policies that, if continued, would be utterly ruinous for the country. But die-hard National voters would continue to vote National out of tribal loyalty. And no internal coup seemed in the offing.

Bob Jones, a property investor and National Party supporter, saw the mess. He established the New Zealand Party. It ran on an economically liberal platform, in the British sense of liberal. Free markets, an end to the license raj, and a place for National supporters to place their votes if they couldn't hold their noses and vote for Labour.

Bob intended to win. He lost the election, but his policy ideas won. The Muldoonist version of National died. Labour enacted many of the necessary reforms, and National was recast in more economically liberal lines.

Trump looks as bad for the Republicans as Muldoon was for National. But lots of died-in-the-wool Republicans could never vote Democrat.

Will there be a Republican who can stand up and say that a Trumpist version of the Republican Party does not deserve to win, that the Republicans would be better losing than having Trump as its elected President, and that the Republican Party is better than appeals to tribal racism?

Americans, and Republicans who care more about free markets and free people than about having their team win any particular election, really should watch the excellent documentary on New Zealand's 1984 election, and on Bob Jones.



Trump's likely to be the nominee. More worrying is that he's trading around a 20-25% chance of winning the Presidency. Sure, it's not likely to be as bad as many might think, but that doesn't make it not-bad. Just because an electoral system is more robust to madmen than you might think is no reason to go around letting madmen become President.

How I learned to stop worrying and love the Trump

Yes, Trump would be a terrible, terrible President. But he'll be as institutionally constrained as the others. So things won't be as bad as you might think.

Here's me at The Spinoff, with a round-up of eight reasons that you're likely overestimating how bad things would be - and especially if you're used to a Parliamentary system with party-line votes.

A snippet:

4. I doubt Trump will feel much constrained by any of the things he’s mooted as policy during the campaign.

Trump isn’t running on policy, he’s running on mood. He clearly has some pretty crazy policy views, but he’s also pretty clearly making policy up as he goes, sometimes just to get an applause line. So long as whatever policy he winds up promoting is consistent with the mood he’s setting, whether it meets the letter of what he’s said in the campaign probably won’t matter much. Why?

5. Trump should be better than most at providing the symbols his supporters want, while gutting the substance, when he needs to.

Again, Trump isn’t really running on policy. He’s running on the long frustration felt by rather a few Americans. Working class, high-school-educated Americans living away from the coasts in ‘fly-over country’ have been the objects of elite derision for ages. Does Trump seem better or worse than most at providing the kinds of symbols his supporters crave, while not doing much of substance?

To be really clear: I am in no way saying it won't be bad. It just likely won't be as bad as you're expecting.

The really scary thing is that there seems to be a big constituency for what he's selling. Worry less about Trump, more about that.

Update: On that last point, see also Steven Mazie's piece over at Big Think.

What’s going on? Will Wilkinson, a former Big Thinker, tweeted this week that while he’s “not convinced Trump would be a disaster as president” — presumably because of the formidable constitutional, institutional, and political constraints that limit how much damage (or good) any president can do — he is “convinced a Trump win would be proof of a preexisting cultural disaster.” I think that’s just about right. ANew York Times analysis of exit polls from South Carolina and other survey data reports that Trump supporters are thoroughly intolerant of people unlike themselves. People who want to ban Muslims from coming into the United States, not so surprisingly, flock to Trump. But so do voters with bones to pick with other large, undifferentiated groups of people: gays, blacks, and foreigners, to name a few.

One-third of Trump supporters look fondly on the internment of Japanese-Americans during World War II, while only around one-tenth of Marco Rubio and John Kasich voters hold this discredited view. Seventy-eight percent of GOP voters in South Carolina say they oppose the idea that whites are a superior race, but only 69 percent of Trump supporters do. Seventy percent of Trumpites oppose the decision to lower the Confederate battle flag at the South Carolina statehouse in the wake of last year’s deadly shooting in a Charleston church, and 38 percent lament that the South did not win the Civil War. Maybe most alarmingly, nearly one in five Trump voters admits to opposing the Emancipation Proclamation, Abraham Lincoln’s 1863 move to free southern slaves. And a third of Trump supporters would like to ban gays and lesbians from entering the United States.

A Nation of Sugar Criminals [Updated: Crampton's been punked]

Update: The CBC show that produced the report is satire. So everything below falls under the "Eric's been punked again" file. I blame both Josh Gans's and Alex Tabarrok's earlier tweeting of the story. Previously in the "Crampton's been punked" file: Jim Henson meets Ayn Rand.

Thanks to the CBC's @Geoff_Turner for the heads-up.

Original post follows below.



Last year, it was the heist from the Canadian Maple Syrup Cartel.

Now we find out that Canadians have been smuggling Kinder Surprise Eggs to the Americans.

A 500 ft. tunnel running from the outskirts of Abbotsford, B.C. to a shed in Sumas, WA was detected late last week by Dale Lawson while he was walking his dog: "Buster got into this weird looking shed," say Lawson, "he comes out with chocolate in his mouth." 

Lawson, worried that his dog could get sick, took the chocolate and found it contained a plastic capsule. "I thought maybe it was drugs but when I opened it up it was a little plastic fox dressed like a queen. I called the police right away."

Police arrived just as Melanie Russet, Marg Spooner and Lynn Dodwell emerged from the tunnel with flats of chocolate eggs. The three were taken into custody and more arrests on both sides of the border are expected.

It's estimated that up to 800,000 eggs cross the border every year and while there have yet to be any reported fatalities, it's only a matter of time before a child chokes on a tiny house with googly eyes or a pen shaped like a ski.

First off, people like Dale Lawson exemplify everything that's wrong with America. If your government is evil enough to ban children from getting chocolate eggs with toys inside, and you find a tunnel being used by heroic candy smugglers to bring Kinder Surprise to American kids, your first thought sure as heck oughtn't be "Hey, let's call the cops about this little plastic toy fox dressed like a queen." The nation that overthrew George III over trivial levels of taxation now produces people who call in the cops for chocolates. Did Patrick Henry really say, "If you see anything weird, report it immediately"?

But the story does help to remind us of the futility of some kinds of bans. If smugglers can make a buck by sneaking Kinder Surprise Eggs under the American border....

USTR on NZ

The USTR has words of praise, and some minor critique, of New Zealand.* I read some of their critique also as praise.

Here's some praise:

Tariff rates in New Zealand are generally low as a result of several rounds of unilateral tariff cuts that began in the mid-1980s.  At 2.1 percent, New Zealand has one of the lowest average most favored nation (MFN) applied tariff rates among industrialized countries.  The average applied MFN tariff rate was 1.5 percent for agricultural products in 2009 and 2.2 percent for industrial goods.  In 2010, approximately 95 percent of all imports to New Zealand (by value) entered duty free.  Approximately 47.5 percent of New Zealand's MFN tariff lines are bound at zero duty rates, and 63.1 percent of lines are applied at zero.  The New Zealand government has stated that import tariffs will not be reviewed until 2013 and will remain at their current levels until at least 2015.

But they've a few critiques. They rightly note that our investment screening regime is a trade barrier to foreign investment in land; they're right. It's become politically arbitrary and needs to be fixed.

But I disagree rather strongly with two other assessments. They reckon it a bad thing that the draft patent reform bill would ban software patents; I don't. But I also don't expect that part of the bill to survive US pressure via TPP.

They also don't like that we let ISPs charge rights-holders, US or otherwise, NZ$25 for issuing an infringement notice. If each infringer really causes substantial damages, as rights-holders like to claim, the $25 shouldn't be an issue. But USTR says "The cost has deterred some rights holders from using the system."

USTR needs to think hard about optimal enforcement; it would be surprising if it were worthwhile to pursue enforcement action - which does impose real costs on both the ISP and the accused - where the damaged party doesn't reckon it worth $25. Heck, our small claims court charges $36.30 as its smallest possible fee for dispute resolution.

You need to pay the following fee to the Tribunal when you lodge your claim from 1 July 2011.
If the total amount sought under the claim is less than $1,000	$36.30
If the total amount sought under the claim is $1,000 or more but less than $5,000	$60.40
If the total amount sought under the claim is $5,000 or more	$120.80

If $25 deters US copyright giants from pursuing claims against alleged Kiwi infringers, it's amazing that anybody here is able to access our small claims system. Especially if infringements cost rights-holders $150k.

*HT: @PiratePartyNZ

Government make-work

One way America can work to solve its unemployment crisis: Hire one group to hand out free condoms for sex workers; hire another to consider those condoms as evidence that the bearer is a prostitute, arrest the bearer, and confiscate the condoms. It's win-win. Jobs for public health workers, police, judges, lawyers, condom-makers, the prison-industrial complex; hard to see any fault with it, really.

With the prostitution-free zones, prostitution is understood to be a crime of intent. No one is actually arrested in the act of having or agreeing to have sex for compensation; only for appearing as if they might do so. In the same vein, arresting officers in DC and throughout the US routinely search people suspected of prostitution for condoms, confiscating them as evidence of a crime. For some cops, condoms serve the function that marijuana does in a stop-and-frisk encounter (only there's no actual law against possessing or using condoms), unless a cop thinks you might be a sex worker or otherwise wants to move you along and into custody. 

Sex workers and health and human rights advocates have pointed out that it makes absolutely no sense for publicly funded police departments to confiscate condoms that publicly funded health departments make so widely available.

Washington DC confiscates condoms from sex workers; LA tries to make them mandatory for actors in pornographic videos (previous critique). I'd thought that optimal policy was "Condoms for some, miniature American flags for others!" Or combine the two (markets in everything, egads).

HT: @dr_alexpadilla

A lesson in contrasts

American legal scholars debate whether provisions in the latest defence appropriations bill would allow the government to hold citizens indefinitely without charge. Here's the latest summary:

The law provides that indefinite detention without charge may be imposed on anyone who has provided “substantial support” to groups that are “associated forces” of al-Qaeda; but it leaves undefined what constitutes “substantial support” and which groups might qualify as “associated forces.” Thus far, the lower federal courts have upheld detention of al-Qaeda or Taliban members, but not mere supporters, much less supporters of associated forces. And there is much dispute about whether the laws of war permit detention in those circumstances. Now Congress has essentially predetermined that question. Unless this and future administrations construe these provisions as limited by the laws of war, they risk authorizing detention that the laws of war would not. 

See also Volokh and Lawfare. And recall that American drug warriors have argued that marijuana users offer support to terrorist groups.

Meanwhile, in New Zealand, lawyers for the police have advised that sniffer-dog searches in schools breach students' civil rights, and so the police have stopped carrying out such searches, previously requested by the schools, pending further legal advice:

"Police are currently considering the legal implications regarding searches by drug dogs in schools," a spokeswoman said.

"Police understands the Ministry of Education is also working on good practice guidelines for schools so that they can search and confiscate items that may pose a safety risk."

She said police gave other support to schools, such as drug education, arranging counselling and prosecutions. "Where schools detect more serious drug offending, police become more actively involved."

Hutt Valley High School has historically had a police dog team conduct annual searches. But its request was refused this year "on the grounds that the police have no cause to search".

One cost of US dairy protectionism

One tangible cost of American dairy protectionism: baby formula prices.

In New Zealand, 900 grams of Heinz Infant 1 Gold Starter Formula costs $23.60 at Countdown. In $US terms, that's $20.68/kg. I often saw it for around the $18 mark on special when we were in that market.

In the US, the best comparison I can find is a 35 oz can of Enfamil at Safeway: $33. That's about a kilo. And, it's about the cheapest dry formula I can see on the Safeway site on a per ounce basis.

I can think of few other goods where the real New Zealand price is two thirds of the US price. Maybe the US formula has some kind of magic to it where it can make larger quantities of reconstituted drink, but I'd be a bit surprised.

Does American policy really wish to transfer money from poor mothers buying formula to relatively wealthy members of the dairy compacts?

Meanwhile, in Canada, The Real Canadian Superstore will sell you 730 grams of store brand formula for $15: $25.70 NZ per kilo. But I'm not sure that a sale flyer price of a store brand is a fair comparison.

Affirmative action

A Chinese IT outsourcing company that has started hiring new U.S. computer science graduates to work in Shanghai requires prospective job candidates to demonstrate an IQ of 125 or above on a test it administers to sort out job applicants.

In doing so, Bleum Inc. is following a hiring practice it applies to college recruits in China. But a new Chinese college graduate must score an IQ of 140 on the company's test.

An IQ test is the first screen for any U.S. or Chinese applicant.

The lower IQ threshold for new U.S. graduates reflects the fact that the pool of U.S. talent available to the company is smaller than the pool of Chinese talent, Bleum said.

...

Moreover, unlike many of the larger IT offshore development companies, Bleum is focused on long-term engagements with its clients, not on one-time projects. Over time, it hopes to hire 100 to 500 U.S. workers to help support North American customers.

So says Computerworld, HT Slashdot. [Note the piece is a year old now]

So, is it differential thresholds for the Americans because they bring complementary skills that are relatively scarce in China? Or are they being hired for entirely different positions in tech support while the Chinese workers handle the harder programming problems? Tough to tell from the article.

Preventing arbitrage

Pharmaceuticals are cheaper in Canada than in the States. Even in the absence of Medicare this would likely be the case; income-based price discrimination would have cheaper prices in Canada for goods characterized by very very high fixed costs and trivial marginal cost (adjusting for that the price of everything is higher in Canada). But price discrimination can only be maintained if you make it hard to arbitrage. Car trips to Canada are relatively pricey, but internet sales aren't.

How to prevent re-import this way? Beat the crap out of Google:

Department of Justice

Office of Public Affairs

FOR IMMEDIATE RELEASE

Wednesday, August 24, 2011

Google Forfeits $500 Million Generated by Online Ads & Prescription Drug Sales by Canadian Online Pharmacies

Internet Search Engine Accepted Advertisements from Online Canadian Pharmacies that Targeted U.S. Consumers and Illegally Imported Controlled and Non-Controlled Prescription Drugs into the United States

Ouch. The DoJ's argument is disingenuous though:

“The Department of Justice will continue to hold accountable companies who in their bid for profits violate federal law and put at risk the health and safety of American consumers,” said Deputy Attorney General Cole.  “This settlement ensures that Google will reform its improper advertising practices with regard to these pharmacies while paying one of the largest financial forfeiture penalties in history.” 

I call BS. Prosecution protects a price discrimination scheme and consequently works to keep drugs cheaper for Canadians; in the absence of restrictions on arbitrage, drug companies would have to charge Canadians US prices and would forgo profits in doing so.

If Google is to be policeman for international price discrimination regimes, I wonder what Google's policing costs are.....

We don't know how lucky we are... (a continuing series)

Kiwis often rightly complain about bad regulations here. But they too often assume that America is better. And so I like occasionally pointing to regulatory insanity in the States.

Item the First, courtesy of Radley Balko:

A few years ago, Kris Swanberg, having been laid-off from her job as a Chicago Public School teacher, remembered she received an ice cream maker as a wedding gift. TheChicago mom fished it out of her kitchen cabinet and eventually started a new career. Today Swanberg’s Nice Cream — on offer at local Whole Foods and farmers markets — is considered a star of Chicago’s rich and beloved artisanal ice cream scene, one that could be shut down entirely by state rules, she recently learned. She says that a couple of weeks ago a representative from the Illinois Department of Public Health came to Logan Square Kitchen and informed her she’d have to shut down if she did not get something called "a dairy license." Swanberg and others in her field had operated for years now without ever hearing of such a thing and, indeed, they say, the City’s Department of Business Affairs and Consumer Protection, to whom they applied for business licenses, never informed them they would need one to operate. To get this license Swanberg wrote, in an email, she would have to:

1. "Work out of our own space. Currently we work out of the Logan Square Kitchen."
2. "Have our product tested once a month for bacterial levels."
3. "Change all of our packaging and labels to meet state standards."
4. "Purchase a pasteurizer, which from what the state tells me will be about $40,000 or use a pre-made ice cream mix."

... Although the state is focusing on Swanberg first, other artisanal ice cream makers in Chicago are concerned they might be next. "I have to be worried. I am in too deep to cut my losses now," said a fellow ice cream maker who asked that her name not be used. "This is my life and passion, so I don’t want to be shut down. "Our biggest thing is wondering whether or not there is a way, considering the organic and local food movement, to change the regulations so that small local producers are not being regulated in the same ways as massive creameries — I mean, this is what they enforce for Haagen Dazs." Indeed, IDPH confirmed that these small operations are governed by the very same rules that apply to billion dollar ice cream companies. And although Illinois recently passed the The Illinois Local Food Entrepreneur and Cottage Food Operation Act, (currently awaiting Gov. Pat Quinn's signature) which suggests that the different sets of rules should govern tiny food operations and giant corporations, the bill does not apply to ice cream. Until she gets her license, Swanberg says she must stop putting product on the shelf. She hopes to meet with her fellow ice cream makers to figure out a plan that can allow them to deliver the same quality while abiding by state rules.

Here, I can buy beer at local farmers' markets that's brewed in a guy's garage and small batch organic yogurt from guys who I really doubt had to get a freaking dairy licence to make it. And where the US sends armed police squads, guns drawn, after folks selling raw milk, here organic raw milk sales are booming (though still under constraint) and (except for the armed offenders squad) our police are unarmed.

Item the Second: US nutritional/calorie regs on chain restaurants may wind up killing consumer choice at Dominos. Because large chains have to post calorie counts for every menu item, and because Dominos allows wide variation in toppings on pies, the number of potential calorie count items gets rather high. Go back to your stats text and read the section on permutations and combinations.

As Klein points out, a lot of the big corporations that the administration targets with these regulations completely miss the mark and end up saddling small business owners like the people who own Domino's franchises. Klein quotes one franchise owner who worked his way up from his job as a pizza delivery boy in the 1980s to owning four Domino's franchises in Maryland. The franchises average about 40k a year in profit. The new menu regulations could cost as much as $4,700 a year to maintain the new menus. "There are so many different things that I have to do right now that are just completely unnecessary that take away from our profits," the franchise owner tells Klein. "When does it end? When does this stuff end? Just give a small business guy a break and let me take care of my customers and take care of my people."

We don't know how lucky we are in this country.

But Peter Thiel does (first couple minutes):



From abroad, America looks increasingly like a boot stomping on a human face.

Constructing history at the museum

Where new Chinese museums suppress recent failings [1/20], American ones almost require the visitor to wear sackcloth and ashes [2/20].

At the elaborately renovated National Museum of China in Tiananmen Square, visitors interested in the recent history of the world’s fastest rising power can gaze at the cowboy hat that Deng Xiaoping once wore when he visited the United States, or admire the bullhorn that President Hu Jintao used to exhort people to overcome hardship after the Sichuan earthquake in 2008.

But if their interests run to the Cultural Revolution that tore the country apart from 1966 to 1976 and resulted in millions of deaths, they will have to search a back corner of the two-million-square-foot museum, which will complete its opening this month, for a single photograph and three lines of text that are the only reference to that era.

...

Officials rejected proposals for a permanent historical exhibition that would have discussed the disasters of early Communist rule — especially the Great Leap Forward, a political campaign and resulting famine that killed more than 20 million. Some organizers also wanted a candid appraisal of the Cultural Revolution, a decade-long attack on traditional culture and learning, but that effort was squashed.

Instead, the authorities decided that the exhibition on contemporary China should focus, as did the museum before its extensive makeover, on the party’s triumphs.

Another permanent exhibit, on China’s ancient history, also presents an idealized version of the past. It tells the uplifting story of Chinese ethnic groups pulling together to create “brilliant achievements.”

Meanwhile, in Los Angeles:

Before you are submerged within the museum’s theatrically darkened central galleries, before you learn how the cafes and intellectual life of the Weimar Republic gradually gave way to the annihilationist racial fantasies Hitler outlined in “Mein Kampf” — before, that is, you experience a variation of the Holocaust narrative with its wrenching genocidal climax — there are other trials a visitor to the Museum of Tolerance here must pass through.

You must first choose a door. One is invitingly labeled “Unprejudiced”; the other, illuminated in red, screams “Prejudiced.” No contest. But one door doesn’t open; the other does. Here, evidently, we must admit we are all prejudiced, not just the guards at Auschwitz.
...
The Museum of Tolerance is not alone. Even a modest museum devoted to the Holocaust, like the one that opened in 2009 at Queensborough Community College, offers testimonials by students about how the Holocaust has taught them about tolerance and the evils of discrimination.
...
Though Yad Vashem in Israel and the United States Holocaust Memorial Museum in Washington have remained relatively immune to such sweeping moralizing, in most institutions and curriculums, the Holocaust’s lessons are clear: We should all get along, become politically active and be very considerate of our neighbors. If not, well, the differences between hate crimes and the Holocaust — between bullying and Buchenwald — are just a matter of degree.

In China, none were to blame for the Great Leap Forward's killing millions, and certainly not the Chinese Communist Party and Chairman Mao. In America, everyone's a little bit responsible for the Holocaust.

Converting individual ignorance into collective wisdom

Results from the latest CNN poll on Americans' estimates of US Federal government spending.

If you take the median estimate of the proportion of the budget taken up by each programme, and sum across all programmes, the US spends 137% of its total expenditures. Net interest on the debt is not a listed category.

Here are median public estimates of US government spending along with actual 2010 figures (where easily obtained from Wikipedia).

Programme	Estimated proportion	Actual proportion
Medicare - the federal health program for the elderly	20%	12.8%
Medicaid - the federal health program for the poor	15%	8.2%
Social Security	20%	19.6%
Military spending by the Department of Defense	30%	18.7%
Aid to foreign countries for international development and humanitarian assistance	10%	0.8%*
Pensions and benefits for retired government workers	10%	?**
Food and nutrition assistance for the poor, including the program that used to be known as food stamps	10%	2.8%*
Housing assistance for the poor	7%	1.34%
Corporation for Public Broadcasting funding for public television and public radio stations	5%	.1%***
Federal funding for elementary, secondary and higher education	10%	1.8%****

*Sourced from 2012 budget proposal as I can't easily find it for 2010
** No clue where to find this one; it'll be mixed in as part of each department's funding
*** Sourced elsewhere; too small a proportion to make it into any of the big figures
**** Includes a bunch of training programs that might not be considered part of these categories, sourced from 2012 proposed budget.

In general, Americans overestimate the proportion of spending on all these parts of the budget.

Let's deflate things by asking how Americans rank programs relative to spending on Medicare. Even if the total amount spent is kinda ridiculous, maybe folks get the rank order and relativities approximately right. In the table below, Medicare is numeraire.

Programme	Estimated size relative to Medicare	Actual size relative to Medicare	Relative inflation or deflation
Medicare - the federal health program for the elderly	1	1	1
Medicaid - the federal health program for the poor	0.75	0.64	1.17
Social Security	1	1.5	0.65
Military spending by the Department of Defense	1.5	1.5	1
Aid to foreign countries for international development and humanitarian assistance	0.5	0.06	8
Food and nutrition assistance for the poor, including the program that used to be known as food stamps	0.5	0.2	2.3
Housing assistance for the poor	0.35	0.1	3.4
Corporation for Public Broadcasting funding for public television and public radio stations	0.25	0.001	32
Federal funding for elementary, secondary and higher education	0.5	0.14	3.6

On the big ticket items, they're not far out. Folks correctly guess that military spending is about 150% of Medicare spending, even if they've no clue about the actual proportion of the budget taken up by either.

It's on all the small programmes that folks massively overestimate spending. But, somewhat surprisingly, it's not overestimates of programme spending that seem to drive partisan opposition. Tea Party supporters give roughly the same estimates of foreign aid and public broadcasting spending as do Tea Party opponents: 31% of supporters and 34% of opponents correctly identify public broadcasting as taking up less than one percent of the federal budget. And a lot more Tea Party opponents radically overestimate spending on public broadcasting: 22% of Tea Party opponents think spending on public broadcasting is over 10% of the federal budget; only 9% of Tea Party supporters overestimate things that badly.

It would be awfully interesting to have the raw data to see if individual-level misperceptions of federal spending correlated with desired changes in the budget. But that's unlikely to be the driving force. 37% of Tea Party supporters (to 8% of Tea Party opponents) want public broadcasting funding eliminated entirely; differences in perceived spending on broadcasting were fairly trivial.

More worrying is that there's no support for funding decreases to any of the major spending items. 12% support decreases in Social Security spending - the single largest budget item. 37% supported decreased military spending; 30% want it increased. 14% support decreases in Medicare spending; 24% support decreases in Medicaid spending. Medicare, Medicaid, Social Security and Military spending make up about sixty percent of the budget. It'll be tough to balance the budget on the back of cuts to public broadcasting and foreign aid.

Update: it is especially troubling that there is more support for Medicaid cuts than for Medicare cuts. The former helps poor people. The latter helps old people regardless of income.

Pacific free trade

My guest blogging continued at Pileus during the quake with one queued post there appearing.

Is it better to have a serious free trade deal among a smaller set of countries, or a weaker deal that brings in the States?

I’d put decent money that, if America signs onto the deal, there’d be years of costly arbitration before New Zealand had any kind of increased access to American dairy markets. For starters, American dairy farmers would argue that failure of the New Zealand competition authorities to prosecute New Zealand dairy cooperative Fonterra as a monopoly constituted a subsidy under US law and justified counterveiling duties. Never mind that Fonterra has to rely on farmers voluntarily choosing to supply it with milk rather than supply one of its competitors, and that it’s legally required to supply some of its milk to some of its competitors, while the US dairy compacts and market orders are state-enforced cartels that do everything but shoot potential competitors. If the United States was happy to continue trade action against imports of Canadian softwood in the midst of Hurricane Katrina rebuilding, despite NAFTA, why ought we expect any better for New Zealand dairy?

In exchange for the illusion of access to American dairy markets, we’d likely get some pretty restrictive copyright and intellectual property rules. The hubub over investor protection provisions don’t much worry me – odds are that such provisions would only give a slap to the parts of our Overseas Investment Act regulations that need the slap.

Catch the whole thing at Pileus.

After I submitted the post to Pileus, the University's PR office called asking if I could handle an interview from Canterbury Television (at my office) on the Trans-Pacific Partnership and US/NZ trade. Serendipity! I accepted for 2 PM. I don't know whether the reporter was in or out of the CTV building when it collapsed at 12:50. I could have scheduled for one o'clock, which would have guaranteed out of office by 12:50, but I'd already booked in for a late lunch. And nobody knew what was coming.

Stifling innovation

Kiwis often express incredulity when I tell them how much worse regulation can be in the States as compared to here.

Kiwi vodka company 42 Below started out when a guy named Geoff built a still at his house and started distilling his own vodka. He started inviting friends around, then started selling to friends who owned bars. That turning out well, he decided to go pro: quit the day job and focus on vodka. About eight years after starting up his home brew still, he's bought out by Bacardi. Awesome success story.

Now consider how things would have turned out had he started in the States.

I was talking with a buddy of mine last night: a lawyer currently working for the state, getting his MBA on the side. He’s been researching the possibility of setting up a distillery firm, and we talked about it for close to an hour. Very interesting stuff, and he’s got some great ideas for how to break into the market and his unique angle.

But the funny part is that probably 45 minutes of that hour was spent talking about his strategy in light of the manifold regulatory hoops and tax laws he has to navigate. Between licensing and taxes, which as you can imagine for hard liquor are absurd, his business model is 100% dominated by meeting the requirements of the state. Some examples: before you can boil an ounce of alcohol, you need local, state, and federal licensing in place. You can’t get the federal until you have the state and local in place, and getting all three takes anywhere from 8-24 months. The problem is that to fill out the paperwork you have to have the facility, equipment, stock, etc. all in place and ready to go; you can’t fill out paperwork for a nonexistent distillery. So he’s looking at having to hold a facility with the equipment for two years while the feds sit around.

Sure, things vary state by state. And Maryland is pretty bad. But you have to break the law if you want to start up as a distiller in Maryland:

While he’s got some good ideas for recipes and techniques, he’s never actually distilled liquor himself because that’s also very illegal in MD. Here’s the one place where he will probably have to break the law, though, because if he’s not allowed to distill until he’s got a permit, and if he can’t get a permit unless he’s got everything ready to go (and is thus paying for it), just when is he supposed to get the knowhow to produce a decent batch of alcohol? So I think he’s going to get some equipment, put it in his basement, and during the two years it takes to get official approval get a few recipes and techniques perfected.

Bootleggers and baptists. In this case, the big guys get regulations that keep out new entrants; the baptists get their usual jollies.

We don't know how lucky we are in this country! We don't know how luuuuccckkyyyyy we areeeee....

Overreporting religiosity

It seems that the Americans aren't really that much more religious than everyone else; they just are more likely to lie about it:

Finally, in a brand new paper, Philip Brenner at the University of Michigan's Institute for Social Research compared self-reported attendance at religious services with "time-use" interviews in the United States, Canada, the Netherlands, Germany, France, Norway, Finland, Slovenia, Italy, Spain, Austria, Ireland, and Great Britain. Brenner looked at nearly 500 studies over four decades, involving nearly a million respondents.
Brenner found that the United States and Canada were outliers—not in religious attendance, but in overreporting religious attendance. Americans attended services about as often as Italians and Slovenians and slightly more than Brits and Germans. The significant difference between the two North American countries and other industrialized nations was the enormous gap between poll responses and time-use studies in those two countries.
Why do Americans and Canadians feel the need to overreport their religious attendance? You could say that religiosity for Americans is tied to their identity in a way that it is not for the Germans, the French, and the British. But that only restates the mystery. Why is religiosity tied to American identity?

My first cut would be a Kuran preference-falsification argument. The US got stuck in a bad equilibrium. Membership in a Christian church is a prerequisite for social life in a lot of small towns, and for political life even in bigger places. Anyone signaling atheism shuts himself out of a whole lot of small town life (see comments here too).

That just pushes the problem back a level though: why did the US wind up in that equilibrium while other places didn't? Why might you have to fake religion to get by in places in the States, but not elsewhere? Candidate explanations:

• Strong Tiebout sorting. Atheists moved from the small towns to the cities. But would you have to fake religion to get by in small town New Zealand or Europe? I doubt it, but haven't data.
• For historical reasons, more social services were traditionally provided by religious organizations and religious-affiliated friendly societies. That set a norm of faking religion to get along. Though the welfare state and regulation replaced/displaced a lot of that since the 1920s, it's hard to break a preference falsification norm. The first ones to break it would be the weird high demanders, and that would dissuade rather than encourage others from breaking the information cascade.
• There's cultural divergence between the small towns and big cities. Signalling atheism suggests allegiance with a bundle of other hostile attitudes. If you share the other values of the community but are atheist, and if the folks most likely to reveal atheism are the ones who don't share the community's other values, then you'd sooner falsify on the one margin than be thought to be defecting on the others.

I don't pretend any of those are particularly good explanations.

Trading places: North American edition

Remember when the US had the war on drugs and Canada had relatively lax laws, or at least lax enforcement in British Columbia?

California's having a referendum on legalizing pot. Meanwhile, Terence Corcoran writes on the coming law & order crackdown in Canada:

Mr. Nicholson was accompanied by some of Canada’s top police chiefs as he explained how the government needed to escalate its war on organized crime. The government, he said, had enacted regulations that, effective immediately, would give police new powers to crack down on a long list of activities that are already covered under criminal law as relatively minor offences.

The list of crimes now considered serious is worth a close look, especially in the context of Mr. Day’s concern about unreported crimes. They include:

- Keeping a common gaming or betting house;

- Betting, pool-selling and bookmaking;

- Keeping a common bawdy house;

- Trafficking in barbiturates and other chemical drugs;

- Trafficking in any quantity of cannabis;

- Importing, exporting, producing barbiturates.

Under the new get-tough regulations, keeping a common bawdy-house or selling a couple of ounces of marijuana will now bring maximum prison sentences of “at least” five years in prison. A low-level operator of a bawdy-house could also face five-year prison terms.

More important for police and prosecutors, under the organized crime umbrella, the full force of the gang-war and drug-war crime-fighting machine will be unleashed on small-time players who may appear to have organized-crime connections. These include wiretaps, tougher bail regimes, the ability to seize the proceeds of crime, sentencing conditions and parole rules.

Colby Cosh is trenchant:

Bill C-95, the “criminal organization” amendment to the Criminal Code passed in 1997, has borne its inevitable fruit. Devised to calm the spirits of a fearful nation, the law bent civil liberties into new and fascinating shapes. It created a new offence:

467.11 (1) Every person who, for the purpose of enhancing the ability of a criminal organization to facilitate or commit an indictable offence under this or any other Act of Parliament, knowingly, by act or omission, participates in or contributes to any activity of the criminal organization is guilty of an indictable offence and liable to imprisonment for a term not exceeding five years.

Which sounds fair enough, but be sure to check out the convenience-of-the-Crown caveats in subsection (2):

(2) In a prosecution for an offence under subsection (1), it is not necessary for the prosecutor to prove that

(a) the criminal organization actually facilitated or committed an indictable offence;

(b) the participation or contribution of the accused actually enhanced the ability of the criminal organization to facilitate or commit an indictable offence;

(c) the accused knew the specific nature of any indictable offence that may have been facilitated or committed by the criminal organization; or

(d) the accused knew the identity of any of the persons who constitute the criminal organization.

To put it another way, you can conceivably be tried for “participating in or contributing to” a criminal organization even if it didn’t get around to committing any crimes, you didn’t do anything to help it actually commit crimes, you didn’t know what particular crimes it might be thinking of committing, and you couldn’t possibly pick anybody else in the group out of a lineup.

How long 'till the liberals who moved North, picking Martin over Bush, start heading South again?

Marginal deterrence for the incarcerated

The most sensible critique I've heard of National's Three Strikes policy for New Zealand is that the abolition of parole gets rid of marginal deterrence for inmates.  If time off for good behaviour is gone, then there's no incentive for good behaviour.  And that can be pretty costly.  Of course, this could be fixed by "added time on for bad behaviour", but it's pretty plausible that the administrative costs of the parole regime are a lot lower than the extra time when it comes to burden of proof issues.  An alternative framework would keep the Three Strikes law as it is, but add on an extra margin to all sentences that would be abated in case of good behaviour.

@CrimeEconomist points to some decent evidence favouring ensuring that there's always a margin.

"They said, 'Commissioner, you've got to get them something,'" recalls Epps. "'You've got these guys locked up in a cell, 80 square feet, with Plexi on the door. It's not air-conditioned. So when they shout out or hurt someone, what can you do?'"

After consulting with Sparkman, Epps decided the MDOC would try a different -- and deeply counterintuitive -- approach. It would respond to the worst outbreak of prison violence in recent history by loosening the controls on Unit 32. The inmates would be given a chance to return to the general prison population by displaying good behavior. Unit 32 would have group dining, recreational activities and even classes.

After all, says Sparkman, "What have we got to lose?"

 It worked.  And so too did their enhanced parole system.

By November, the change in attitudes and operations at Unit 32 was palpable. So was the improvement in relations between the MDOC and ACLU. In November, the MDOC entered into a supplemental consent decree with the group, this one focused on classification, mental illnesses and use of force. Austin and Kupers, who had first come to Unit 32 as expert witnesses for the plaintiffs, now effectively became consultants to the MDOC in improving conditions. It was clear that the effort to reform Unit 32 was on the cusp of becoming a major success. But instead of pausing to savor Unit 32's transformation, Epps pushed for something even more ambitious, changing the 1995 "truth in sentencing law" that had doubled Mississippi's incarceration rate and tripled its costs.

For help in the statehouse, Epps turned to Simmons, who introduced SB 2136, which made nonviolent offenders eligible for parole after serving 25 percent of their sentences. One of the law's unusual features was that it was retroactive: As written, some 3,000 inmates -- 12 percent of the state's prison population -- would become eligible for parole immediately, if the governor signed the bill -- which he did in April 2009.

Of course, eligibility for parole does not automatically result in inmates being granted parole. Those decisions resided with a state Parole Board, whose members were appointed by the governor. To ensure that the board increased its rate of parole, Epps turned once again to Austin, who developed a parole "risk instrument" based on a generation of peer-reviewed research about which inmates are likely to recidivate and which aren't. Previously parole members had relied mainly on their guts. With the new instrument in place, the parole grant rate soared, from roughly 30 percent to more than half. As the result of the new law, between April 2009 and August 2009, 3,100 inmates were reduced early, with virtually no public notice and no controversy. Had the state Legislature not passed the bill that raised the parole rate, Austin estimates that state lawmakers would have had to add another 5,000 beds to the prison system over the course of the next decade, at a cost of around $200 million.

My best read of the evidence is that increased use of incarceration was responsible for the biggest part of the explainable part of the drop in crime rates in the US in the 1990s.  But there are lots and lots and lots of people in prison who don't need to be there.  The bang for the buck is in keeping locked up the habitual violent offenders and in ensuring that penalties for repeat violent offending are harsher than for first time offending.  But subjecting minor drug users and dealers to mandatory lengthy sentences is a good way of ramping up the costs of prison with no particular benefit for the folks paying to keep them in prison.

Chinese communism

William Watson points to the latest Pew survey on global attitudes to free markets.

China tops the scale in support of the free market. Germany also beats the United States. As does Brazil. And France is only one point behind the US.

And while 93% of Chinese surveyed say trade is a good thing, only 66% of Americans agreed.

If they ever re-make Red Dawn with China invading the US, which side do we cheer for?