Summers on Meet the Press

I had been busy, and missed this, but this is Summers more or less at his best.

Check it out.

He was far from perfect, but I have to give him credit -- he did a good thing. We need him on TV more. I thought he should have focused more on the human aspects of why we need health care reform rather than arguing that slowing the growing costs of health care should increase competitiveness and talking about how Obama insists on doing health care reform in a balanced budget way, but it's larry summers we're talking about. And part of the reason I believe he can be so effective in this capacity is that, in fact, he thinks like a Republican. Republicans don't care if some poor person will get health care under Obamacare, but if businesses can cut costs and gov't can balance its budget, then! it's a winner.

I still need to see more performances like this (or better) before I'll change the blog title, however.

Thought Control in China

Chris Blattman offers his reflections on China, noting how remarkable it is that even well-educated Chinese do not think democracy would be good for China at present.

One small critique: his post was culturally very american. He takes it as self-evident that democracy is better than the alternative. He faults his hosts for not noticing that democracy works perfectly well in other large, diverse countries such as India, Indonesia, or Brazil. Here's the problem with that argument though: Chinese economic policy is better than Indian, Indonesian, or Brazilian economic policy. For that matter, it's better than America's economic policy in a wide variety of respects -- it's trying to reinstate universal health care, and it didn't have to have a bunch of halfwits in the Congress to sign off on it to get it. And its fiscal stimulus was much larger and quicker than ours, preventing a recession. And China has been able to pull way ahead of India despite having started out way behind after Mao's craziness through the 70s, which held China back for so long.

Here's one concrete policy where China leads India: throughout China, the government forces the students to learn in, and speak in Mandarin in schools. China has (had!) every bit of the linguistic diversity of India, but Democratic India will never vote to banish any of its regional languages. From a cultural point of view, of course, it's quite sad to see so many languages go by the wayside in China. I can't see why this isn't really smart economic policy, however... I'd say China's One-Child policy is another example of an absolutely brilliant development policy that could never have passed in a democracy. And one (fairly large) reason why India and Bangladesh are so poor today has to do with their (failed) population policies, which a smart dictator would simply not have allowed. Another area where China leads India, thanks to its not having democracy, is in where "direct" trains stop. In India, the "direct" trains between large cities stop in all kinds of small towns in between, owing to politics. My sense was that China was much better...

The problem with not having democracy happens if (when?) China gets a bad leader, like Mao. But China's leaders today look, to me, more like the beneficent dictator type.

And so I suspect that Chris Blattman failed to convince his hosts that China needs democracy...

Krugman Defends Summers...

I never thought I'd see the day...

I take this to mean Krugman backs Summers for Fed Chair/is trying to get in good with the White House...

Annoyed with the way Bernanke injected himself into the health care debate, by warning about long-term fiscal deficits (while simultaneously being a bit too slow on the QE, which would also help alleviate long-term debt), I'm also starting to come around to the idea of Summers at Fed. Not in an ideal world, of course, (and he wouldn't be my top pick) but it at least would get him out of the White House. The question is: Where would he do the least amount of damage?

And, although here at 'Economists for Firing Larry Summers', we do love Summers' infamous smackdown of the worthless RBC model, the critique (which Krugman links), was not quite 100% spot on. I'd post more, but, alas, the summer conference season is upon us, and it's time to work on those journal pubs...