Sunday, March 31, 2013

"Spartacus" Crushes the Tour of Flanders

Congrats to Fabian Cancellara, who forced the selection and then rode away on the cobbles from Peter Sagan and the rest of the field to win the Tour of Flanders by 1:26. I'm kicking myself for working this morning on class preps instead of watching the race on-line.

Saturday, March 30, 2013

Saturday Ride

Finally, some decent riding weather, with temps climbing above 50 this afternoon and sunny skies (although winds were gusting upwards of 20 mph). Dr. Jim and I rode the forest route from my house (up Old 37 to Anderson, then up Beanblossom into Morgon-Monroe State Forest, and west along the Forest Rd back to Old 37. A total of 25 miles in just about 90 minutes. Not too bad considering my lack of conditioning, due to winter training plans that were derailed by illness and injury. No doubt, wearing my new Team Treachery & Deceit kit, with Karl Raynor's initials on upper arms, helped motivate me. Overall, my heart rate is about 10-15 bpm higher, relative to power output, than it will be after I get some more training miles in my legs.


A Game and a Half

Thanks to Andy Klein and Ron Krotoszynski for including me in Friday night's outing to the "Sweet Sixteen" games in Indianapolis. We had great seats in the fourth row behind one of the baskets, and watched Louisville defeat Oregon pretty handily before Duke knocked off Michigan State in the second game. Actually, I only saw the first half of the Duke v. MSU game before hitting the road back to Bloomington. I listened to second half on the car radio. I took a several pics (on my phone) during the game. It's a bit tricky because of a slight delay in the camera's reaction; you have to sort of predict the shot. But here are a few photos that came out reasonably well:




Friday, March 29, 2013

Pollution Costs in China

According to an interesting story in today's New York Times (here), environmental degradation in China cost that country 3.5% of its gross domestic product (GDP) in 2010 or $230 billion. For the sake of comparison, in a recent article in the American Economic Review (here), Muller, Mendelsohn and Nordhaus estimated gross environmental damage in the US in 2002 at $184 billion, amounting only to 1.7% of US GDP in 2002 (which was approximately $10.6 trillion). Thus, China suffers approximately twice the economic losses to GDP from environmental degradation at the US (admittedly based on a comparison of statistics eight years apart).

No doubt a big part of the difference is the relative success of the US environmental protection program, which has provided large net economic savings according to both government and independent estimates (see, e.g., here and here). Factors affecting China's ability to control pollution costs likely include the fact that budget constraints on Chinese industry are soft, which means that they have little incentive to reduce emissions, regardless of legal requirements, taxes, or fees, plus the fact that China is still somewhere on the left-hand side of the Environmental Kuznets Curve (see here), where relatively low levels of per capita income are associated with high levels of environmental stress. An important implication of soft budget constraints among Chinese polluters is that whatever funds the Party-government plans to spend to reduce environmental degradation will be mostly wasted in the absence of structural reforms that harden budget constraints and reduce the conflicts of interest the Party-government inevitably faces as environmental regulator of economic enterprises it controls and relies on for production.

Thursday, March 28, 2013

Not Ready for Late Night

IU's men's basketball team really doesn't like playing games that start at 9 pm or later. Their two big home losses during the Big Ten season, to Wisconsin and Ohio State, were 9 pm starts. Tonight's "Sweet Sixteen" match against Syracuse didn't start until nearly 10 pm. On all three occasions, the IU players looked sleepy.

I don't blame them, I, too, was already sleepy when the game started. Unfortunately, the game was not exciting enough to wake me up. Some of the IU players (e.g., Cody Zoeller, Jordan Hulls, and Yogi Ferrell) never really woke up either.

UPDATE: A headline in Friday morning's Indy Star reads: "Indiana basketball: Victor Oladipo, Cody Zoeller not thinking about NBA after emotional loss" (see here). The gist of the article is that both players were concentrating fully on the NCAA championship and not their professional futures, which is as it should be. But Zoeller, at least, should seriously consider (or reconsider, as the case may be) whether he is ready to enter the NBA draft this year. On the evidence of last night's performance, and several other big games this season in which he was dominated by bigger, stronger bodies, NBA centers would chew him up and spit him out. He needs another summer and college season to build his upper body strength, and his mental strength. As for Oladipo, he's ready for the tough guys in the NBA, and has the all-around game to make it there.

Kling on Tullock on Hirschman

I'm impatiently awaiting delivery of the new biography of the late Albert Hirschman, who passed away last December at the age of 97. In the meantime, conservative-libertarian economist Arnold Kling has penned a dismissive review of the book (here), in an apparent attempt to match the derision Gordon Tullock displayed in his own nasty review of one of Hirschman's two masterworks, Exit, Voice, and Loyalty (1970).

I suspect I'll like the Hirschman bio a lot more than did Kling, just as I would suspect Kling would enjoy reading a biography of Gordon Tullock more than would I. After all, we all prefer reading about people whose work we admire. For the most part, I suspect, scholars are loathe to read biographies of other scholars we either disdain or simply find uninteresting (unless for the express purpose of tearing them a new one, so to speak).

In dismissing Hirschman's biography, Kling discounts Hirschman's influence, noting that he leaves behind few followers and no "school" of thought of his own, unlike (to take Kling's favored exemplar) Gordon Tullock. At least a few relatively objective reasons exist, however, to doubt Kling's claims about the relative influence of the two scholars:

For one, if you type the name "Albert O. Hirschman" into a Google Scholar search, it turns up 25,100 references, approximately 8,000 more references than are associated with a search of the name "Gordon Tullock." If, instead, one types in the name of their most famous books, respectively, Exit, Voice and Loyalty and The Calculus of Consent, the former has approximately twice as many references on Google Scholar as the later. Meanwhile, over at Amazon.com, Hirschman's Exit, Voice and Loyalty (the book Tullock ridiculed) currently ranks in sales 6,629 among all books, while Tullock's The Calculus of Consent (co-authored with James Buchanan) ranks 105,824.

I don't take these rough and ready indicators to suggest either that Tullock is not influential or that Hirschman is the more influential of the two (although I believe he is). I hope only to raise doubts about Kling's casual and disparaging implication that Hirschman is a relatively insignificant social scientist. Time may prove me wrong, but I expect that Hirschman's books (especially Exit, Voice and Loyalty and the hugely underrated The Passions and the Interests) will still be widely read and praised a century from now.

As for Gordon Tullock, whether his books will still be read a century from now likely depends on whether James Buchanan's name also appears on the cover. True, Tullock's name will always be associated the "school" of "public choice," which has become very influential. But it's worth noting that several of the greatest economists who ever have lived, including for example Kenneth Arrow and Tom Schelling, are not associated with a particular "school" of thought, unless that "school" of thought is all of social science, which is the same "school" that Hirschman broadly influenced.

Wednesday, March 27, 2013

Obligatory Blog Post on Same-Sex Marriage Cases

I believe federal law requires me to post something about the two Supreme Court cases on same-sex marriage argued yesterday and today in the Supreme Court. I share the lack of qualifications of most other commentators in that I'm not a Con Law expert and I don't know much about the actual constitutional issues involved. Unlike several other commentators, however, I did not pay careful attention to the oral arguments, in part because, unlike those other commentators, I don't believe anyone can predict outcomes based on the questions Supreme Court justices ask during oral arguments. In all probability, the outcomes were determined before the oral arguments took place. And it is pure guesswork to discern whether questions justices ask reveal their pre-determined positions.

Here is what I think I can say about the two cases (but don't expect anything particularly insightful): (1) the Court (with the exception of Justice Scalia) generally tries to decide cases with great politically salience, like these two, on narrow grounds, if at all possible; and (2) they both will probably be 5-4 decisions, one way or the other.

I'm very interested to learn whether any members of the Court can maintain a consistent position on federalism across the two cases. Regardless, it's heartening to know that in this day and age, when nothing gets through the Senate without a super-majority vote, our Supreme Legislature, err, Court still operates according to simple majority rule.

What I've Been Reading

After spending much of the semester reading, and learning a lot from, Alan Ryan's two masterful works On Politics and The Making of Political Liberalism, I've finally moved on to some other authors.

Margaret Paul, Frank Ramsey (1903-1930): A Sister's Memoir (2012). Ramsey lived only 26 years, but what an interesting life he led in that short time. This biography would be well worth the read even if Ramsey's intellectual achievements were not still so enormously relevant to mathematics, economics, and philosophy. All the Cambridge luminaries of the era, including Russell, Moore, Wittgenstein, and Keynes ran their ideas past Ramsey before publishing them. This isn't just a biography of a singular genius, though; it's also an insightful history of the University of Cambridge between the wars. A really fun and enlightening read.


John Darwin, Unfinished Empire: The Global Expansion of Britain (2012). I'm not especially interested in the topic of Empire-building, but Darwin is such a fine and interesting writer, that the book is really hard to put down. I'm especially intrigued by his claim, for which he mounts a great deal of historical evidence, that "Empires were not made by faceless committees making grand calculations, nor by the 'irresistible' pressures of economics or ideology. They had to be made by men (and women) whose actions were shaped by motives and morals no less confused and demanding than those that govern us now" (p. xi)




Stephen T. Asma, Against Fairness (2013). An entertaining counter-attack against the forces of egalitarianism, which argues both positively (based on empirical studies) and normatively in favor of favoritism. The author is wise and witty, but perhaps a bit less counter-intuitive than he believes himself to be. Whatever the merits of fairness, I've never read anyone who believes that it is the only value in the world that should be maximized. And others before Asma have pointed out (though not in such a fun way) that a commitment to fairness as an independent maximand could reduce the welfare of everyone. See Louis Kaplow and Steven Shavell, Fairness versus Welfare (2009). Nevertheless, Asma is so pithy that his versions of the arguments are simply more fun to read. Who could gainsay his assessment of Spongebob, Squarepants (one of my favorite television shows to watch after a long day of brain usage) as a long-running "morality play"? On the other hand, his skills as an illustrator (his drawings litter the book) leave a good deal to be desired.

Meanwhile, I'm also reading several books, chapters, and articles for a conference paper I have to write on the international legal concept of "state responsibility" as it applies in the climate-change context.

"CBS Morning Advertising"

They actually call the show "CBS Morning News." I'm not a fan of morning news shows generally (or any network shows, for that matter), although I do like Charlie Rose, one of the co-hosts of the CBS program, which my spouse likes to watch it in the morning. I sat with her this morning and watched a segment during which Charlie and his co-host "interviewed" the president of Showtime, ostensibly to talk about the effects of changes in the way cable television providers are charging for delivery of programming.

During the interview, they discussed and showed clips from one or two of Showtime's original programs. Indeed, the overall tenor of the interview struck me as more of an advertisement for Showtime and its programs than an analysis of changes in how programming is delivered. So, just out of curiosity, I did a quick Google search and learned that Showtime is a wholly-owned subsidiary of CBS (see here). Surprise, surprise. Shouldn't the interviewers at least have an ethical obligation to disclose such a conflict (or, perhaps more appropriately in this case, coincidence) of interest?

Ironically, the CBS Morning News' disguised advertisement for Showtime came just after the show had criticized the bad taste of Nike's new advertisement for Tiger Woods.

Now you know why I usually do not watch so-called "news" programming (aside from the PBS Newshour, which I watch occasionally). It tends to be corrupted by network marketing concerns (i.e., self-advertising) and untrustworthy.

Tuesday, March 26, 2013

Indiana's Supreme Court Unanimously Upholds Voucher Program

USA Today has the story here. The full decision can be read here.

I do not have any opinion on the constitutional merits of the Indiana Supreme Court's ruling, but would just note that an obvious consequence of the ruling will be to transfer funds from ailing public schools to private schools, many (if not most) of which are church-affiliated. As a secularist, I find this redirection of public dollars to religious organizations troubling. But then, I'm also troubled that churches are exempt from paying property taxes.

MacLeod on Acemoglu and Robinson's "Why Nation's Fail"

Writing in the new issue of the Journal of Economic Literature (here), economist W. Bentley MacLeod of Columbia University pulls off a feat I would have thought impossible: in an otherwise fine review essay on Why Nations Fail (2012) by Daron Acemoglu and James Robinson (as well as another book I have not yet had the pleasure of reading), MacLeod manages to avoid citing anything written by Doug North (Nobel Memorial Prize, 1993) over the past 40 years. Perhaps that is the only way of reaching the conclusion that Acemoglu and Robinson have advanced truly novel arguments.

As I have written earlier on this blog (see here and here), aside from their extreme institutional determinism, the authors of Why Nations Fail do not seem to me to make any arguments that North was not advancing 20-30 years ago in books such as Institutions, Institutional Change, and Economic Performance (1990) and Structure and Change in Economic History (1982). For the most part, they just extended North's arguments with additional case studies and a more extreme conclusion denying any role to geography or environmental conditions in determining economic performance.

Monday, March 25, 2013

Spring Snow

Here's the way my drive home from school looked today:


























Saturday, March 23, 2013

Congrats to Coach Bob

Bob won the Hillsboro Roubaix Masters 50+ race today after launching an attack from 4+ miles out. I know that this was among Bob's target races for the early season; and he's been training hard for it throughout the winter. Way to go Bob.

Here's Bob holding the winner's trophy, appropriately enough a brick:




Bob has details on the race and his successful strategy on his blog, here.


From Google Reader to Feedly?

Switching is easy, but not seamless. The user interface requires some getting used to. For instance, Feedly requires three clicks, instead of one, to mark all items as read. Also, after items are marked as read they are not automatically deleted, but remain in view on the screen (in a lighter shade of grey). Feedly also incorporates lots of other stuff that many users of Reader (like me) might not want to use; but at least they're incorporated on a different page.

In sum, Feedly is a plausible successor to Reader, but I'm still hoping for something more Reader like, such as, for example, READER. I wonder if there's any chance that Google will remand its decision to jettison potentially millions of users who do not want to be forced to use Google+.

Thursday, March 21, 2013

Congress Is About to Shut Down NSF Funding for Social Science

According to a report in today's Chronicle of Higher Education (here), the Senate approved a measure to finance the federal government through the end of the year, which includes an amendment by Sen. Tom Coburn (R-OK) that would prevent the National Science Foundation (NSF) from approving grants  for social science projects unless the agency could certify that the research would promote national security or national economic interests. In support of his amendment, Sen. Coburn pointed to several social science research projects that he claims are a waste of taxpayer dollars, including studies of voter attitudes toward the Senate filibuster and cooperation between the executive and legislative branches. Senator Coburn complained that, even if such issues are "interesting ... to ponder or explore," they are not a good use of taxpayer dollars.

As part of a bill that would only be in effect through the end of the year (assuming it also passes the House), Coburn's amendment would not have a long-term effect on federal funding for social scientific research. However, it could create a somewhat greater risk that such a restriction might be made permanent going forward.

As a Co-Principal Investigator on one current NSF-funded project, I obviously support continued federal funding of social science research, and consider Sen. Coburn's amendment short-sighted and "penny wise but pound foolish." On the other hand, in an era during which federal funds increasingly are scarce, including for all scientific research, it's hard for me to gainsay an argument that funding for social science research projects, generally, should take a back seat to, say, cancer funding. That said, the total savings from cutting NSF funding of all social science projects (even without exceptions for those that would contribute to the national economy or national security) would be pretty miniscule as a percentage of the overall budget. In 2013, the total NSF spending on research in the social, behavioral, and economic sciences is just under $260 million (see here). That's less than the cost of a single F-22 Raptor fighter jet (see here, p. 59).

Wednesday, March 20, 2013

Porter on US Carbon Emissions

In today's New York Times, economic columnist Eduardo Porter has a column about reducing carbon emissions in the US to stabilize the global climate. Like just about everyone else, he recommends pricing carbon to account for its negative externalities and to create incentives to innovate new, cost-effective substitute fuels. Unfortunately, the column paints an overly optimistic picture of the future of carbon emissions in the US (under a business-as-usual approach).

Porter makes several good points about the relation between relative prices of energy resources and energy-efficiency improvements. And he's quite right about the importance of market-driven technological change, although he doesn't actually offer any examples to show that technological changes contributed to the fairly dramatic decline in carbon emissions observed since 2007. Indeed, his selection of 2007 as a base year for comparing carbon emissions indicates a bias in the analysis, which Porter does not explain.

US carbon emissions did begin a dramatic decline after 2007, as Porter observes, but virtually all of that decline had nothing to do with market-driven technological changes and very little to do with conversion from coal to natural gas. The lion's share of emissions reductions occurred simply because of the global economic depression (not recession) that resulted from the 2008 financial crisis. The chart below from the US Energy Information Administration shows just how closely all reductions in carbon dioxide emissions from the US energy industry over the past 40 years have tracked downturns in the overall economy. And since the US economy came out of depression in 2010, carbon emissions have bumped back up (albeit not yet to previous levels).

























Porter sort of acknowledges that "the great recession and the world's sluggish recovery have depressed energy use." And he expects that carbon emissions will "tick up ... as the economy recovers." But he gives far less credit than deserved to the overall effect of the depression, and is too quick to credit the US with "serendipitous success" in reducing emissions.

Porter also recognizes that "regulations have contributed to the process" of reducing GHG emissions," although I'm not sure how true that is. At least he admits some role for regulations in the process, and is not arguing that we can just leave carbon emissions reductions to energy-efficiency improvements resulting from purely market-driven technological improvements.

I wouldn't for a moment deny that market-driven technological improvements are an important component of a long-term strategy to reduce GHG emissions. And I certainly agree with Porter that pricing energy at social-cost levels is important, and that the large-scale switch to natural gas has positive implications for US carbon emissions (if not methane emissions), at least so long as natural gas remains substantially less expensive than coal. But he should have been more forthright about what really was driving the reduction in carbon emissions after 2007. It was the economy, and nothing but the economy.

Tuesday, March 19, 2013

Thanks to the Center for the Study of Institutional Diversity at ASU

Many thanks to Marco Janssen, Marty Anderies, and the staff at the Center for the Study of Institutional Diversity (CSID) (see here) at Arizona State University for hosting my presentation yesterday. I gave a talk on work I'm doing with Mike McGinnis and Graham Epstein to improve and combine Lin Ostrom's two analytical frameworks: the Institutional Analysis and Development (IAD) framework and the Social-Ecological Systems (SES) framework.

Lin was a co-founder of the CSID at ASU, which remains a close sister organization to the Ostrom Workshop at IU. The comments I received at yesterday's presentation in Tempe will certainly help Mike, Graham, and I as we continue our work on this project. I'll next be presenting parts of the project at upcoming conferences at the University of Minnesota (in April) and Bar-Ilan University in Tel Aviv (in May), as well as at the annual meeting of the International Society for New Institutional Economics in Florence (in June).

Congratulations Dean Klein

My dear friend Andy Klein has just been named Dean of the IU McKinney School of Law, where I taught for 20 years before moving down to Bloomington two years ago. I expect Andy to do wonderful things at McKinney. He's a great scholar, teacher, and colleague with proven administrative skills. He has served as Vice Dean of the law school (during trying times) and most recently has been Chief-of-Staff to IUPUI Chancellor Charles Bantz. His appointment as Dean of the McKinney Law School is great news for the entire Indiana University community.

Wednesday, March 13, 2013

Say It Ain't So

I just learned from my Google Reader feed that Google Reader will no longer be available after July. This is on the heels of Google's announcement last fall that it will no longer be supporting the iGoogle home page service after this year. As a user of both services, but especially of Google Reader, I'm troubled by Google's increasing pressure to funnel all its users into its lame Google+ platform, with its silly circles, which is supposed to challenge Facebook. But Google+ is to Facebook as Bing is to Google's search engine - a second-rate, late-to-the-party imitator.

I'd be happy to receive recommendations of other selection-based agglomeration services available after Google Reader goes away.

Spring Break Activities

I'm working hard on a chapter for an edited volume on the information or knowledge commons. The tentative title for my chapter is "What Elinor Ostrom's Work Can (and Cannot) Teach Scholars About Intellectual Property and the Knowledge Commons." The most important lesson from the chapter may be its warning against trying to use Lin's analyses of natural common-pool resources to draw normative lessons about the structure of IP rights and obligations.

I've written about 15 (single-spaced) pages in the last five days, and expect that I'm a bit more than half way done with a solid draft. hope (and really need) to finish the draft before classes resume next week because, in addition to class preps, I have another paper to write for a conference in Amsterdam May. That conference is on the concept of "state responsibility" in international law, and my paper will delve into the difference between "state responsibility" (de jure) and states that actually take responsibility, in the context of global climate policy.

Tomorrow, my son and I are off to visit my father in Scottsdale. I'll take advantage of the time there to make a presentation next Monday at the Center for the Study of Institutional Diversity at ASU, a sister school of IU's Ostrom Workshop. My talk will be about work I'm doing along with Mike McGinnis and grad-student Graham Epstein to combine and improve the Institutional Analysis & Development (IAD) and Social-Ecological Systems (SES) frameworks. We're hoping to get some good feedback from Marco Janssen, Marty Anderies, and their colleagues in Tempe before we start writing the first of what will likely be several papers on that topic.

Meanwhile, I also have a research assistant spending part of his Spring Break in a small town in northern Mississippi, search county records relating to a case I teach in first-year Property, about which I've long had a hypothesis. I'm hopeful that the information he brings back will either support or falsify my hypothesis. If the evidence is supporting, well, that will mean another writing project for me to get to sooner rather than later.

CL: Arsenal at Bayern

Arsenal need to win 3-0 to take the tie (after losing the first leg 3-1 at home). Can they do it? Well, stranger things have happened, but not many. I'll be watching, but not with much enthusiasm or hope. The Gunners have really tried my support this year (and I still think Wenger, although one of the all-time great managers, needs to resign).

UPDATE: An fine early goal by Giroud has no doubt raised the hopes of many an Arsenal fan, but I'll be highly skeptical until the final whistle ends. I can easily imagine Arsenal going ahead 3-0 and then conceding an easy, heartbreaking goal in second-half stoppage time.

UPDATE: All fairness to the Gunners. They scored a second goal in the second half, and Bayern were scared. Still, they couldn't pull off the big upset. Unfortunately, Arsene Wenger will probably crow about this result, and claim that it proves his team is on the right track (which would be the wrong lesson to learn from this Cup tie).

Monday, March 11, 2013

Cycling Buddies

Having failed all winter to get up to Indy for any indoor-training sessions with Coach Bob and the rest of the group, I finally made it up last week for the final session of the season, which happily coincided with the birthday of Sandy Raynor, widow of our dear friend and colleague Karl Raynor. Many of my closest friends in the world were at the session, and we all went out for dinner afterwards.

I suffered a mishap even before the training session started: my seat clamp bolt broke and I tumbled from the bike, gaining a few cuts, scrapes, a sore hip, and wounded pride. Fortunately, Coach Bob found a stand-by bike (albeit a bit small for me); Larry helped me swap out the pedals; and I got the seat height adjusted well enough - just in time to start the first set.

Coach Bob has more on the training session, our friend Karl, his wife Sandy, and all the afters at his blog, here.

Here are a couple of pics from the training session, courtesy of friend and teammate Adam Perler, who in  addition to being an excellent podiatrist, is also a very strong cyclist (he'll be competing in the Master's national track races this summer) and a gift photographer (see his website here). Note the yellow heart-shaped patches on the jersey sleeves, which display a well-muscled arm and the initials "KR," in honor of our friend Karl.



The old-guys row (from right to left): Phelgar, the good Dr. (giving the thumbs up), Larry, Woz, and me.





















Happy Birthday Sandy! (I was happy to see her riding a beautiful Bianchi). From left to right: Kenny G., Woz, Larry, Phelgar, Coach Bob, me, Sandy, Big Frank, Terry, and Dave.

























And just to show what a wizard Adam is with a camera, he actually makes me look like I belong on a bike!

Thursday, March 7, 2013

On China's New Carbon Tax Plan

Last month, Xinhua news service announced (here) that China would introduce a new carbon tax, along with new taxes on conventional polllutants, which has received generally favorable commentary (albeit with questions) from the Common Resources blog of the well-respected think tank Resources for the Future (here) and in the Washington Post (here). A more skeptical voice comes from GreenBiz.com (here), which doubts that any such tax would have enough of an effect on China's carbon emissions to make a difference for climate change.

In my view, all of the commentary so far misses the main problem with a carbon tax (or any environmental tax) in what is still largely a command economy in China: taxes are market-based instruments that require well-established market institutions to function at all, let alone achieve specified environmental goals. Most especially, for taxes to be effective the enterprises that are subject to them must operate under hard budget constraints, which means that they must have a competitive market-based incentive to minimize costs of production, including internalized pollution costs. Typically, firms operating in command economies operate under soft budget constraints, where production levels rather than profitability are the most important (often the only) measures for firm survival. Key work on this issue (though not focused on environmental problems) was done by the Hungarian economist Janos Kornai. His famous 1986 article on "The Soft Budget Constraint" (here) and his monumental book 1992 book on The Socialist System (Princeton) are must reading.

My own 1998 book, Instituting Environmental Protection: From Red to Green in Poland, is about the failure of environmental protection under socialism in Poland, which during the 1970s created the world's largest system of environmental taxes. Those taxes proved uniformly ineffective in reducing pollution emissions because of a combination of soft-budget constraints and the same kind of regulatory conflicts of interests that persist in China today. In 1970s Poland and in China today, government officials, who are trying to maximize their career prospects, which depend ultimately on meeting production targets, will not allow production to be hampered by pesky environmental taxes. In communist Poland, central planners obsessed with meeting production and economic growth targets simply offset assessed environmental taxes with increased budget allocations for affected firms. Is there any reason to expect different outcomes in China today? If so, someone will have to explain the organizational and/or institutional differences that should lead to a different outcome.

I've just begun a research project on environmental taxation in China with a Chinese PhD student in public finance. Hopefully, our work will illuminate current organizational and institutional impediments to successful environmental taxation (including carbon taxes) in China, and what steps might be taken to minimize those impediments.

In the meantime, the Chinese government already has announced that is backing away from the announced plan to introduce a carbon tax this year.

Tuesday, March 5, 2013

Just in Case I Wasn't Clear After the Tottenham Match...

Arsene Wenger should resign immediately as Manager at Arsenal. A statue immediately should be built in his honor alongside Thierry Henry's (and, while were at it, how about one for Dennis Bergkamp?). He is, after all, the greatest manager in Arsenal's history.

Meanwhile, Arsenal  shareholders should boot Stan Kroenke out the door and back to the US, where they play a brand of football he actually understands. Either they should replace him with Usmanov (with or without David Dein in tow), or take the dirty oil money from the Middle East, which is reported to be within the reach of Arsenal's proudly and prudishly pristine hands.

This is not the time to focus on the glory of competing for fourth place - or has Wenger now changed his goal a Europa League place? Face facts: the season is over. Even if Arsenal should manage, amazingly, to reclaim fourth place, what would be gained, other than another season in which they attempt to replicate the same feat against ever-improving competition?

Now is the time for a complete reboot, a house-cleaning; out with the old as well as the inept. Enough experimenting with players with great "potential" but limited actual ability, such as Walcott, Ramsey, and Oxlade-Chamberlain. Out with lumbering defenders like Mertesacker and Vermaelen. Enough emergency signings of mediocrities like Arteta, let alone scrubs like Santos, Squillace, Bendtner, Chamakh, Arshavin, Giroud, and the list goes on and on. It is time to become more like other, competitive teams and throw around tens of millions to bring in proven, world-class players to rebuild around Wilshire, Cazorla, Sagna, and perhaps one or two others of the current squad.

But perhaps I'm being too hard on what is, on paper, a pretty decent current squad of players. Maybe it's not really lack of talent that has doomed Arsenal this season. Each week, one reads about problems with defensive coverage or lackadaisical starts to games, in which Arsenal have to fight from behind. Perhaps those problems indicate not so much a lack of talent as a lack of proper coaching and motivation. Those are problems that stem from the top. I don't think there's any question that Arsene Wenger still holds to the same coaching philosophies that won silverware ten years ago. The problem is, they don't anymore, in part because so many other coaches have paid him the ultimate compliment of replicating his methods. Times have changed, but Wenger has failed to change with them. That is the sign of a closed mind and a fatal level of self-confidence, which Arsenal can no longer afford.

Remember the definition of insanity: doing the same thing over and over again, but expecting a different result. That's what Wenger has been selling Arsenal fans for the past seven years. It's time to put a stop to the insanity.

The Best Diplomat We Can Afford During the Sequester?


Sunday, March 3, 2013

Could This Be Wenger's Waterloo?

It should be. After saying for the past few weeks that Arsenal could not afford to give up any more points in the League, and after saying this past week (in an apparent state of delusion) that Arsenal could finish second in the League, his team gave up two (lame) first-half goals to arch rival Tottenham Hotspurs and lost 2-1.

Arsenal have some great talent on their team - Cazorla, Wilshire - but not nearly enough of it to compete either in the League or in cup competitions. Even if Wenger were right to claim that they could finish second in the League, what other top manager would aspire to such a meaningless goal? Alex Ferguson would sooner retire than aspire to a second place finish. And the really sad thing is, such modest aspirations are completely out of Arsenal's reach.

Arsene Wenger is a man of genius who revolutionized the game in many ways, and Arsenal fans should forever be grateful for what he brought their club over many years. But Wenger is congenitally incapable of revising his approach to personnel, tactics, or finances to fit new times. Other teams have successfully replicated his methods; and a massive amount of evidence collected over several years indicates that his old methods no longer suffice.

He consistently loses his best players (and, mark my words, he will lose Wilshire sooner rather than later, if Arsenal continue to struggle), and pretends that mediocrities like Giroud, Arteta, and Santos to replace them, and re-signing mediocrities like Walcott (who could not start for any team currently above Arsenal in the League Table), are more than adequate replacements.

The once mighty Arsenal Football Club, which not long ago challenged the likes of Man U and Barcelona for global dominance, now finds itself keeping company of teams like Liverpool (which has also fallen on hard times), Everton, and (dare I say it) Swansea.

Throughout it all, and against the weight of all the evidence, Arsene Wenger remains supremely confident in his own genius. It is time for him to retire. Not at the end of this season, but this evening.

Saturday, March 2, 2013

Cannondale Takes Top Two Places at Strade Bianchi

Moreno Moser, who attacked in the final 20 km, held off a hard chasing group to take this year's edition of the Strade Bianchi, which finished in Siena. His teammate Peter Sagan took second, followed by Rinaldo Nocentini, and a very frustrated Fabian Cancellara, who was basically marked out of the race but still imposed his will on the chasing group, virtually forcing his markers to chase down their own teammates in final kilometers of the race. Lacking any teammates of his own in the lead groups, he had to do virtually all the work himself.

Still, a deserved win for the attacking Moser.

Friday, March 1, 2013

DC Circuit Upholds Polar Bear Listing as "Threatened" Species Under ESA

As a legal matter, the decision is neither surprising nor ground-breaking; it simply reconfirms that the DC Circuit defers to agency decisions, as long as they are supported by substantial evidence in the record. The case may, however, have heightened significance because of its direct relation to climate change - polar bears are the first species to be placed on the Threatened Species List under the Endangered Species Act because of habitat loss (melting sea ice) resulting from rising global mean temperatures. It is not yet clear, however, how much purchase this will give the Executive Branch in dealing with anthropogenic emissions of Greenhouse Gases, which contribute to climate change, in order to protect polar bear habitat.

Among the highlights from the court's decision:
The Listing Rule rests on a three-part thesis: the polar bear is dependent upon sea ice for its survival; sea ice is declining; and climatic changes have and will continue to dramatically reduce the extent and quality of Arctic sea ice to a degree sufficiently grave to jeopardize polar bear populations. See Listing Rule, 73 Fed. Reg. at 28,212. No part of this thesis is disputed and we find that FWS’s conclusion – that the polar bear is threatened within the meaning of the ESA – is reasonable and adequately supported by the record.
                                                            *     *     *
[S]everal of Appellants’ challenges rely on portions of the record taken out of context and blatantly ignore FWS’s published explanations. Others, as the District Court correctly explained, “amount to nothing more than competing views about policy and science,” on which we defer to the agency.
                                                            *      *      *
Significantly, Appellants point to no scientific findings or studies that FWS failed to consider in promulgating the Listing Rule. At oral argument, Appellants’ counsel acknowledged that Appellants do not claim that FWS failed to use the “best scientific and commercial data available” as required by 16 U.S.C. § 1533(b)(1)(A). See Oral Argument at 25:22. Rather, “Appellants merely disagree with the implications of the data for the species’ continued viability.
Where, as here, the foundational premises on which the agency relies are adequately explained and uncontested, scientific experts (by a wide majority) support the agency’s conclusion, and Appellants do not point to any scientific evidence that the agency failed to consider, we are bound to uphold the agency’s determination. Therefore we affirm the District Court’s decision to uphold the Listing Rule.
The entire decision can be read here.

In-depth Interview with Steve Reich

By Alexis Petridis at The Guardian (here). Reich's Music for 18 Musicians, released when I was in college in 1976, profoundly influenced my musical sensibilities. He's among the most original and consistently interesting composers alive today.