I’ve written before about 23 Things They Don’t Tell You About Capitalism. But last night, I came upon a lecture that Chang gave in support of the book at the London School of Economics. I’ve embedded it below. If you haven’t read the book, you should at least listen to the lecture.

In the lecture, he talked about something I quite remember. He made the point that it was a myth that people were paid what they are worth. You hear this kind of nonsense a lot from the likes of Ayn Rand and Friedrich Hayek and really any free market absolutist. The idea is that the market is never wrong. If you are paid $20 million per year, it is because that’s what the economy — more or less God the way these people see it — has decided what you are worth.

And really, since the late 1970s, I’ve heard this nonsense from a lot of people. It is very much a matter of faith. Because there is absolutely no evidence for it. And there is plenty of evidence that it just isn’t true. But Ha-Joon Chang provided a great thought experiment regarding two bus drivers: one in Sweden and the other in India. Bus drivers in Sweden make 50 times as much as bus drivers in India. Is the Swedish bus driver really worth 50 times as much as the Indian?

Well, I know what the free market absolutists would say: yes! You see, the Swedish bus driver is transporting people who pay more money. Therefore, this bus driver is worth the greater amount. But this is a very abstract view of the world. It is something that the free marketeers don’t much want to discuss: value is meaningless. In this way of thinking, the bus driver is not primarily driving but rather conning people to pay him for transporting them.

As a matter of reality, it is almost certainly the case that Indian bus drivers are better because they have worse and overcrowded equipment and drive on worse roads. If you transported the Indian bus driver to Sweden, they would have no trouble doing the job. Moving the Swedish bus driver to India would not work out nearly as well.

It got me thinking. Ha-Joon Chang doesn’t speak English all that well. He has a very bad accent. But his writing is great — certainly as good as mine. Now he also happens to be one of the best economists in the world. So I don’t have to compete with him for writing jobs. But if he can write English so well, there must be plenty of other people from South Korea who can write English as well as I can and who would be willing to write 2,000 word articles about XML for less than I charge. And that’s one country — one that doesn’t even have a history with the English language; imagine what it must be like in India!

By American standards, I’m still pretty poor. But even still, I get by very nicely. Compared to people in other countries, I’m rich. And that’s an accident of birth — just as surely as it is for Donald Trump. Not that I’m comparing myself to Donald Trump. We are quite different. First, I’m actually good at my job (even if over-paid) and Trump is not. Second, I do understand my privilege (even if I’d likely still be very surprised just how much my standard of living would go down in a truly fair world).

There are other things to think about, of course. Most measures of health and happiness are based upon local inequality, not global or absolute inequality. But I think it does us all good to remember just how talented the human family is, and that we should feel good about being part of that. We are all special in our way. But that’s not something that we Americans need to be reminded about.

On this day in 1776, Thomas Paine published (anonymously) Common Sense. As regular readers know, I greatly admire Paine. But not for Common Sense. Don’t get me wrong. Paine was an amazing rhetorician. But there was always a sense with him that he was at heart a rabble-rouser. The content of the pamphlet strikes me as overblown, given what the colonists were going through. And then it is taken to a whole other level in the 13 pamphlets of The American Crisis.

I admire Paine for his more sober writing: The Rights of Man and The Age of Reason. And it is interesting to look at his reputation in the United States with regard to this. In as much as he is considered a hero, it is because of Common Sense. But it contains passages like this that could have been written by a modern glib libertarian:

To be fair, Common Sense is more closely argued than that passage indicates. But still: is this how Americans see the government today? I don’t think so. Yet this is what Paine is loved for. Meanwhile, it was with The Rights of Man that made Americans start to turn a jaundiced eye toward him. And then they actively hated him after The Age of Reason. But these are great works of the Enlightenment. Paine understood the intellectual currents of the time. And typically, most Americans wanted to push back against them. Paine saw that the future laid in humanism, and America became focused on the Second Great Awakening.

Afterword

On this day in 1927, Metropolis was also released. It was hard not to write about it, because it still amazes me that it wasn’t that respected when it first came out. It blows my mind even today. No one has improved on cinema since then. But I’ve discussed it to some extent in the past, Fritz Lang.

Jonathan Chait wrote a great and thorough article earlier this week, Being Less Crazy Than Donald Trump Does Not Make Marco Rubio “Moderate.” In it, he went through all of Rubio’s positions to show that he is on the hard right of his party. Chait made a good point of the fact that Rubio goes around talking about his education reform idea. But he does it so he doesn’t have to talk about his extreme positions. In addition, his education program is tiny. It would be like Hitler going around campaigning on the idea of the Volkswagen. But our media would just report about the Volkswagen, just as they are reporting about Rubio’s “moderation.”

The truth is that the three Republican candidates for president — Donald Trump, Ted Cruz, and Rubio — are all extremists. They really don’t disagree about anything except how they ought to talk about their policies. In as much as they have policy differences, they all belong to Trump who looks liberal compared to the other two. So we have one candidate who the media currently has no problem calling an extremist, and he is the least extreme. Currently, of course, Ted Cruz is surging in the polls. And Brian Beutler thinks this is a good thing, Ted Cruz Is Exactly What the Political System Needs. It is subtitled, “Why Republicans and Democrats alike should welcome his nomination.” But for the second time in a week, I find myself very much in disagreement with him.

To start with, Beutler makes the argument that it would teach the Republicans a lesson. The media have been making this argument for decades. The conservative base always claims that they lose because they don’t run a “real” conservative. But this is not an actual argument. It is axiomatic. If a Republican loses the presidency, it is because they were not conservative enough. What every conservative “knows” is that the only reason any Republican ever loses any race is because they aren’t conservative enough. It’s like the old line, “I don’t know how Romney lost; everyone at the club voted for him!”

But the really dangerous assumption is that Ted Cruz would lose the general election. I don’t see that as a given at all. He could be Hitler pushing a new kind of car and he would win if the economy falls into recession next year. But there is another thing that will go on. As soon as it becomes clear who the Republican nominee will be, the elites will rally around him. They will talk about him as though he were just a garden variety Republican. (And they’ll be right, but not in the way they imply.) And so the mainstream media will not cover any of these three as though they are freaks. It will be the usual “Republicans are equal and opposite to Democrats.” If anything, we will see articles about how extreme Clinton is and how moderate Ted Cruz is.

The last thing that the American media ever want to do is admit that anything is wrong in the good ol’ USA. They act rather like a dysfunctional family at Christmas. “Don’t do anything to upset dad. Let’s just pretend that everything is okay.” But everything is not okay in America. We have a substantially better healthcare system today than we had seven years ago. Cost trends are down; access is up. It is the first step we’ve taken on the healthcare front to join the other advanced nations of the world. But every one of the GOP candidates wants to get rid of it on day one. They want to make life infinitely harder for the poor and middle class at the same time that they want to funnel huge amounts of money to the rich. This is a program that should appeal to at most 5% of the population. Yet it is a program that roughly 50% of the people will vote for.

There is something really wrong in America. And a big part of it is that upper class journalists keep insisting that nothing is wrong. It doesn’t matter if you vote for Ted Cruz or Hillary Clinton. Tweedledum and Tweedledee. But in fact, the decision really does represent the difference between millions of people dying. I know that sounds hyperbolic. But lack of healthcare kills people. Ever wider access to guns kills people. Lack of food kills people. Pretty much everything the modern Republican Party stands for kills people.

But on the television media and in the mainstream press, about all you’ll hear is that Cruz is polling well in Texas and Clinton in New York. And otherwise, there is no real difference.

Timothy B Lee and Soo Oh are mostly right, We Just Got Some Really Great News About the Economy. I wouldn’t say “great news,” but the new jobs report is quite good news and the economic recovery keeps on keeping on. We added 292,000 jobs last month. And the estimates from the two previous months were revised up by a total of 50,000 jobs. So that means that the economy created 2.7 million jobs last year. That’s very good, but still less than 2014, when 3.1 million jobs were created.

It’s not all good news, however. The employment to population ratio (for prime age workers 25-54 years old) is stuck at 77.4%. To give you an idea of what this means, it was 80.0% in January 2008. It was 81.9% in April 2000. This is not a sign that people have gotten lazy. And given it only deals with people at least 25, it mostly filters out people going to school. And given it only deals with people under 55, it mostly filters out people who are retired. So our low rate (which has increased substantially from its nadir of 74.8% in December 2009), simply indicates that there are not enough jobs around.

Let’s do a rough calculation. The employment to population ratio for prime age workers is roughly 2.5% below where it was before the financial crisis. That represents about 3.5 million workers. And I continue to believe that full employment is not 5% (Much less 5.5% or 6%!) but rather 4%. So that represents another 1.5 million workers, for a total of 5 million workers. So if we continue to gain jobs at a rate of 292,000 per month, we will be back at full employment in a year and a half. Of course, no one expects the economy to continue to grow at this rate. It is more reasonable (but hardly assured) that we will see 200,000 jobs per month, which is over two years. For people who have been waiting for seven years, that’s still a long time.

This brings us to the Federal Reserve. This jobs report does not exonerate the recent rate hike. For one thing, the economy hasn’t had time to adjust to it. But the other thing is that the the economy doesn’t have to tank for the Fed to be hurting it. As I’ve just discussed, there are roughly five million people who would like jobs who can’t find one. Wage growth this last year was 2.5% — just above the core inflation rate for the year of 1.8%.

This brings up another question: when was the core inflation last substantially above the Fed’s 2% target? You have to go back 20 years to get even up to 3% for the year! The average core inflation over the last 15 years (1.95%) has been less than the Fed’s target, yet it is terrified that it might might go over the target. It is clear that despite its legal mandate, the Fed has no target; it has a ceiling. It will work to stop low inflation, but it only freaks out about inflation dipping above 2%.

I really hope that the economy will really start to take off now and that this jobs report is just the start. But I seriously doubt that. The most likely case is that it will continue to improve at the mediocre 200,000 jobs per month. At the same time, the Republicans will do everything they can to stall the economy. I mean, look at the following graph. This is what the Republicans have done to keep Americans out of work:

That’s a two million job gap right there. And given a 50% multiplier effect (which is probably low), if the Republicans had allowed the government to grow as it always did after past recessions, we would more or less be at full employment. If that were the case, the Fed could do almost anything it liked and I wouldn’t complain. But despite this jobs report, we are still in the middle of a very fragile recovery, and the Federal Reserve should be doing everything it can to help — and not just please bankers who want larger returns on their “investments.”

Shakezula over at Lawyers, Guns & Money, wrote, Predictable Predictions — ObamaCare Edition. It’s about two conservative predictions about Obamacare: that it would cause employers to cut hours so that they didn’t have to provide health insurance; and that the Medicaid expansion would lead to job cuts. As Shakezula noted, “Two predictably wrong predictions.” But I have to admit to being totally exhausted by the whole thing.

Of course the predictions were wrong. The people who made them never intended for them to prove to be right. This is how the Republican Party works. They have thrown every possible negative consequence at Obamacare hoping that something would stick. Note: stick, not be right. It is the tactical use of fear. And the Republicans are brilliant at it. They aren’t involved in rational debate. They are rather involved in a kind of anti-apologetics where they are just trying make the best sounding argument for what they believe on faith (or for other reasons regardless).

The Republicans were never afraid that Obamacare wouldn’t work. They talked about it failing all the time, of course. That was their major argument against it: that it was a big government program destined to fail. But if that were the case, they could have stood back and watched it fall. But they haven’t done that because their great fear all along has been that it would succeed.

And look what those losers in Congress finally managed to do. After almost six years and over 50 votes to repeal, the Republican controlled Congress managed to send a repeal bill to President Obama. Obama, of course, will veto it, and they know it. But this is what passes for success among the Republicans: a slightly less humiliating defeat. But I guess the real thing they are doing is sending a message: elect a Republican president this year and people like me can be totally screwed.

Sarah Kliff and Soo Oh at Vox put together a great chart, Here’s How Much Obamacare Has Cut the Uninsured Rate in Every State. The only state where the uninsured rate has gone up is in bright red Wyoming. This may be why Wyoming is currently discussing accepting the Medicaid expansion. But this isn’t just about the Medicaid expansion. Lots of states that didn’t expand Medicaid are seeing uninsured rates go down because of the exchanges. Texas has seen its uninsured rate go down by roughly a quarter. So I guess it’s really important to repeal Obamacare and stop these positive outcomes.

The conservative movement is based mostly on the idea of hatred. Conservatives see the world about winners and losers. They are like those people who whine about little league baseball where everyone gets a trophy. “What’s the point of playing a game if there isn’t a clear winner and loser?!” I’ve never understood this, but to the conservative brain it seems axiomatic. So if the poor don’t suffer, the game of life is not being played properly.

What makes humans most amazing as a species is not our big brains; other species have impressive brains. What we are great at is communication. And what has really allowed us to advance is the storage of information. This is why science operates at a breakneck speed. And as a result of this, we don’t have to worry so much about evolutionary pressures. We can control our birthrates. We can feed everyone. We can see to it that everyone has a reasonably contented life. Or we could do all these things if we could get the roughly one-third of the human race to stop believing that they can only be happy if others are miserable.

The Republican Party has taken it to a whole new extreme where they want to see the vast majority of people suffer so that the rich and power can feel just a little bit better about how awesome they are. The Republicans in Congress want to see to it that I don’t have healthcare; meanwhile, a bunch of terrorists think that the federal government is a tyranny because it won’t give rich people free land. The American conservative movement is such an amazing combination of evil and stupid that it’s hard to imagine outside of satire.