Monday, February 8, 2016

Change and Decay

Marco Rubio got a lot of attention for repeating a talking point during Saturday's debate, but few people seem to have noticed how feeble the talking point was (although Ross Douthat acknowledged that it was 'not all that great to begin with').  The obvious flaws are that Barack Obama is not going to be a candidate in November and that all of the other Republican candidates have been critical of him too.  But it did make me wonder how Americans feel about "change" in general--there's a long tradition holding that we're attracted to change and novelty.  That reminded me that the World Values Survey asked people to place their own views on a ten-point scale running from "ideas that have stood the test of time are generally best" to "new ideas are generally better than old ones."  I wondered how the United States ranked on that question.  I took the 1995-6 wave, which was the last time it was asked in a wide range of nations.  The ranking of nations, with high numbers indicating more support for new ideas:

Colombia        8.21
Bangladesh 8.09

Dominican Rep. 6.19
Macedonia 6.12
El Salvador    6.05
Bosnia         6.01

Puerto Rico 5.95
Peru           5.92
Chile          5.86
Mexico         5.76
Spain          5.59
Norway         5.58
Sweden         5.54
Germany        5.51
Uruguay        5.47
Philippines 5.46
Venezuela 5.43
Croatia        5.42
South Africa 5.38
Romania        5.32
Bulgaria 5.31
Turkey         5.29
Argentina 5.23
New Zealand 5.20
China          5.16
Albania        5.12
Australia 5.08
South Korea 5.07
Poland         5.03
Finland        5.01

United States 4.97
Armenia        4.94
Estonia        4.92
Switzerland 4.84
Slovenia 4.80
Latvia         4.79
Moldova        4.78
Nigeria        4.72
Slovakia 4.62
Serbia         4.61
Lithuania 4.56
Czech Rep. 4.52
Hungary        4.43
Belarus        4.37
Georgia        4.37
India          4.22
Ukraine        4.21
Japan          4.16
Taiwan         4.15
Russia         4.11
Montenegro 4.11
Azerbaijan 3.77

The United States is in the middle, although a bit more towards the traditionalist side.  Beyond that, it seems like poorer nations tend to be more favorable towards new ideas, while nations of the former Soviet Union and eastern Europe give more support to tradition.  But nothing is very clear, which might be why the WVS dropped the question.  

I also ranked the nations by standard deviation:

Turkey          3.53
El Salvador 3.41
India           3.36
China           3.33
Nigeria       3.29
Venezuela 3.25
Moldova         3.09
South Africa 3.08
Peru         3.06
Dominican Rep. 3.04
Azerbaijan 3.00

Serbia         2.92
Puerto Rico 2.91
Montenegro 2.90
Macedonia 2.88
Georgia         2.88
Romania         2.80
Lithuania 2.74
Ukraine         2.73
Philippines 2.72
Bulgaria 2.70
Belarus         2.70
Bangladesh 2.67
Argentina 2.66
Mexico         2.65
Russia         2.60
Uruguay         2.59
Armenia         2.56
Chile         2.54
Slovakia 2.52
Latvia         2.50

Bosnia         2.49
Poland         2.47
Slovenia 2.47
Albania         2.45
Hungary         2.41
Croatia         2.38
Estonia         2.35
Spain         2.34
Switzerland 2.34
South Korea     2.27
Colombia 2.20
Czech Rep. 2.20
United States 2.19
Taiwan         2.15
Finland         2.11
Australia 2.06
New Zealand 2.03

Germany         1.97
Norway         1.86
Japan         1.85
Sweden         1.81

Now there's a very clear pattern:  affluent nations, including the United States, have less variation.  The highest-ranking nations have a bimodal distribution in which the most popular choices are 1 and 10.  In the United States, the most popular choice is 5, followed by 6 and 4. 

Friday, January 29, 2016

Aid and welfare

Many social scientists believe that universal social welfare programs are inherently more popular than means-tested programs.  The idea is that people come to regard universal programs as a right, while means-tested programs carry a stigma.  I've never been convinced by that, and have thought that college financial aid is an obvious counterexample--it's means-tested, and yet it's popular with the public.  At least I thought it was popular, but recently Sara Goldrick-Rab, professor of educational studies and sociology at the University of Wisconsin-Madison, wrote "efforts to make college affordable via targeted financial aid are divisive. Families that don’t get aid resent those that do. Over time, the purchasing power of programs like the Pell Grant has eroded for lack of political support, and recipients have been denigrated as lazy, 'academically adrift' and akin to 'welfare recipients.' Compare that to the solid support for Medicare and Social Security, which offer benefits to all senior citizens."*  So I did.

In 1997 a Pew survey asked "if you were making up the federal budget this year, would you increase spending, decrease spending, or keep spending the same for...."  In 2011 it asked almost the same question, just substituting "budget for the federal government" for "federal budget."  Ten items were asked in both years, including "financial aid for college students."  I summarize the results by giving percent who said increase minus percent who said decrease:

                                              1997 2011  change
The public school system                      60   43    -17
Combating crime                               55   21    -34
Health care                                   50   17    -33
Financial aid for college students            43   28    -15
Social Security                               37   29     -8
Medicare                                      36   28     -8
Environmental protection                      32   10    -22
Scientific research                           31   13    -18
Military defense                              -9    1    +10
Government assistance for the unemployed     -13   -1    +14

Support for spending on most programs was lower in 2011 than 1997, which I think was because there was more concern about the budget deficit.  But the drop for financial aid was not especially large.  It was the fourth most popular program in 1997 and tied for third in 2011.  

So there's no evidence that the declining value of Pell grants reflects lack of popular support--I would guess that it's a consequence of the general squeeze on discretionary spending.  As far as the popularity of different spending programs, my hypothesis is that it's about whether the recipients are regarded as "worthy" rather than whether they are means tested.  Old people and students are regarded as worthy.  So are the working poor, which explains why programs like the Earned Income Tax Credit don't encounter much opposition.  Programs that help working-age people who don't have jobs are a different story. 

*There were no links to sources, so I don't know who compared recipients of financial aid to welfare recipients.  I haven't read "Academically Adrift" but from the reviews it sounded like its criticism was directed more at colleges and universities than at students who received financial aid.  

Saturday, January 23, 2016

No new taxes

In 2012 a CNN/ORC poll asked "Which of these statements comes closest to your view?...Taxes on wealthy people should be kept low because they invest their money in the private sector and that helps the economy and creates jobs. Taxes on wealthy people should be kept high so the government can use their money for programs to help lower-income people."  36% favored "kept low," 56% "kept high," and 8% had no opinion.  In 2011 the figures were 34% and 62%.  The question was also asked in 1990, 1991, and 1992, when 18-20% said "kept low" and 69% said "kept high."

That is, there was a substantial move towards saying that taxes on wealthy people should be "kept low" between the early 1990s and the 2010s.  My guess is that it resulted from Republican voters following their leaders.  In 1990, a bill raising top tax rates was passed with support from George H. W. Bush and a substantial number of Republicans in Congress.  After Bush lost his bid for re-election in 1992, a bill raising top tax rates further was passed over the unanimous opposition of Republicans in Congress.  In 1994, the Republicans gained majorities in both houses of Congress for the first time in 40 years.   Those events seem to have convinced Republican politicians that it's never a good idea to support increasing taxes, even on people with high incomes. It seems reasonable that when ordinary voters hear all of the people they trust advocating the same position, some of them will switch over to that position.

This has a connection to the larger issue of whether a moderate candidate might get support in the Republican primaries.  David Brooks says yes, while Paul Krugman says no:  "Trump, Cruz, and Carson with the support of roughly two-thirds of likely Republican primary voters . . . do we really imagine that any significant fraction . . . consists of moderate voters who just don’t realize what they would be getting?"  I think Brooks is right, or at least could be right--to some extent, more moderate candidates would create more moderate voters.

Friday, January 15, 2016

What, me worry?

When I turned on the Republican debate yesterday, one of the moderators was asking a question that noted the fall in stock prices during the past couple of weeks, and continued "if this escalates like it did back when Barack Obama first assumed the presidency, what actions would you take......"   As Paul Krugman observed, the question was misleading on several levels, one of which is that stock prices have risen substantially during Obama's time in office.  Krugman goes on to say "It would be interesting to poll Republicans about what happened to the stock market under Obama; my bet is that many, perhaps a majority, believe that it went down."  Of course, there's a general tendency to perceive the facts in a way that supports your preconceptions, so it would be even more interesting to compare the perceptions of Republicans and Democrats over Republican and Democratic administrations, and I set out to do this.

Unfortunately, I couldn't find any questions about how people thought that the stock market had done, but an NBC/Wall St Journal poll taken on September 19-22, 2008 asked "Thinking ahead to a year from now, do you think that the value of the stock market will be much higher, somewhat higher, about the same, somewhat lower, or much lower than it is today?"  This was just the time when the financial crisis was getting serious.  It hadn't yet affected stock prices, but it was about to:  the Dow dropped 25% between September 22 and October 22.

The survey asked the question only of people who said they had at least $5,000 invested in stocks (about half of the respondents).  Of those, 42% expected stocks to be higher, 29% about the same, and 22% lower--7% said they weren't sure.  As it turned out, the Dow was about 10% lower on Sept 22, 2009 than on Sept 22, 2008, and the Nasdaq composite index was about 2% lower.

The survey also asked about vote intentions.  A comparison of expectations by voting intention:

                              Higher         Same         Lower
McCain                     55%             31%          14%
Obama                      36%             31%          33%

Expectations are a combination of two things--what people think about the chances of each candidate winning, and what people think will happen if each candidate wins.  The survey didn't ask about those, so it's not possible to say why expectations were different.  But for whatever combination of reasons, McCain supporters and conservatives were more optimistic about the stock market.  This didn't reflect demographic differences between McCain and Obama supporters:  men were a little more optimistic than women, but there were no clear differences by education, income, age, or race.

[Data from the Roper Center for Public Opinion Research]

Sunday, January 10, 2016

Class, status, and Trump

In 1955, a book called The New American Right appeared, with contributions from the historian Richard Hofstadter and sociologists Daniel Bell, Seymour Martin Lipset, Talcott Parsons, and David Riesman (there was also one from the historian Peter Viereck--I don't know much about him and in some ways he didn't seem to fit with the others).  The basic idea was that there was a distinction between "interest politics" and "status politics."  Interest politics was about trying to get material benefits.  It was basically rational--for example, it's easy to understand why low-paid workers would support an increase in the minimum wage and owners of businesses that employ them would oppose it.  This doesn't necessarily mean they are correct--there might be ways in which an increase in the minimum wage would hurt workers or help businesses--but there's an obvious connection between the end and the means.   "Status politics" was about reacting to changes, usually declines, in status.  It was basically irrational, focusing on finding scapegoats and defending or attacking symbolic targets.  The authors saw McCarthyism as an example of status politics.

In 1963 an expanded version appeared called the Radical Right.  Despite (or more likely because of) the all-star lineup supporting the interest politics/status politics analysis, it soon fell out of favor among sociologists.  It's not exactly forgotten, but it doesn't get much attention in contemporary research.  However, it has survived among journalists and the "educated public" (Obama's notorious "clinging to God and guns" remark in 2008 is an example).  I don't know whether that's because people get it from the originals (Hofstadter's books still seem to be widely read) or because they independently reinvent it.  This relates to Trump because many or most accounts of his support (e.g. from Eduardo Porter and Thomas Edsall) see it in pretty much the same way that Hofstadter et al. saw support for Joe McCarthy or later the John Birch society.    Hofstadter et al. thought that the core of McCarthy's support came from parts of the middle class, while Edsall and Porter say that Trump's comes from working class men, but the underlying idea is the same.  In the 1950s, independent businessmen and farmers were being marginalized by the rise of large organizations; now, working-class men are being marginalized by the decline of industry.  In both cases, the declining groups lash out in ways that make psychological but not logical sense.

Although I think that the interest vs. status politics distinction has some value, I don't think it applies very well to Trump's support.  Although Trump has been vague on the details, he's been very clear about the general direction of his proposed economic policy.  He'd deport as many illegal immigrants as possible and protect American industry by high tariffs.  These aren't attacks on symbolic targets, but straightforward responses to the economic problems of workers without educational credentials.  If you think of the number of jobs as fixed, then if undocumented immigrants have jobs, there are fewer left for American citizens.  Similarly for international trade--people see it as taking jobs (and pay) from Americans.  Of course, virtually all economists would say this way of looking at things is wrong, but you don't have to get into things like "purity and disgust"  or anxieties over masculinity to understand its appeal.

As I've mentioned before, political elites tend to steer clear of economic nationalist policies--presumably because they've been influenced by expert opinion and don't think that they would work.  What's unusual now is that they have a prominent advocate, and that public confidence in political elites is very low.  We had a similar situation in 1992, which gave rise to Ross Perot, who had a similar economic appeal.

Wednesday, January 6, 2016

Imagine there's a heaven

Vanity Fair and 60 Minutes regularly sponsor survey questions on unusual topics.  In a 2012 survey co-sponsored with the NY Times and CBS News, they asked "Assuming they both exist, which do you think is more important for the human race - Heaven, to reward the good, or Hell, to punish the evil?"  Although the meaning of "more important" is open to interpretation, my guess is that most people understood it as asking which made more difference for behavior.

About 85% said heaven, and only 10% said hell (5% volunteered that they were equally important). When combined with a fairly small sample (less than 1000 respondents), that means there's not much power to detect group differences.   However, I looked at what seemed like the most plausible candidates:

1.  Politics:   there was no clear difference between people who had voted for McCain and Obama in 2008.  People who said they hadn't voted were a bit more likely to choose hell.  There also was no clear difference by self-described political ideology.  There was a hint of a tendency for the extremes (very liberal and very conservative) to be more likely to choose hell, but it wasn't statistically significant.  The choice of hell seemed more common among Tea Party supporters and people who said the country was on the wrong track.

2.  Demographics:  Men and less educated people may have been more likely to choose hell, but the evidence wasn't strong.  There were no clear differences by income, race or Hispanic ethnicity.  Age made a difference:  younger people were more likely to say hell was important.

3.  Religion:  Now we get something:  people who said they had no religion were considerably more likely to say hell--22% compared to only 9% for people who named a religion.  The differences between Protestants and Catholics were not statistically significant (there weren't enough Jews or Muslims to say anything definite).  There was a separate question on whether they thought of themselves as evangelical or born-again Christians--there was no difference between those who did and those who didn't.

There seemed to be a tendency for people who were disgruntled or alienated to choose hell.  That makes sense, since it could be regarded as the more cynical answer.  The absence of a clear left/right difference is interesting, since soft-hearted vs. tough or optimistic vs. pessimistic views of human nature have often been proposed as a key difference between left and right.

[Data from the Roper Center for Public Opinion Research]

Tuesday, December 29, 2015

Race to the bottom?

    A few months ago, four economists writing in support of Jeb Bush's tax plan said we are experiencing "the weakest economic expansion since World War II."  I was going to do a post on that subject, but didn't get around to it.  I was reminded of the issue when Paul Krugman posted a figure showing better economic performance under Obama than under GW Bush.   If Obama is the worst, how could Bush have been even worse?

   The National Bureau of Economic Research provides dates of the beginning and end of recessions (an expansion is anything that's not a recession).  Those go back to the 1850s, but modern data on GDP go back only to 1947, so I looked at recessions and expansions since then.  The current expansion has indeed had the slowest average growth rate, breaking the record previously held by the 2002-7 expansion, which broke the record previously held by the 1991-2000 expansion.  You may notice a pattern here.  This is a scatterplot of average GDP growth in expansions since the late 1940s--the x axis is just a sequence number.

There's definitely a pattern there--the average growth keeps getting smaller.  Hopefully that won't go on forever.  The good news is that the average duration of expansions has tended to increase.  The latest one, which started in the third quarter of 2009, is already longer than average, and is still going on. Another way to make the same point is to say that recessions are becoming less frequent.

But maybe Obama should have done better, since  "recoveries tend to be stronger after deep recessions," according to the report I quoted above (p. 4).  Here is a scatterplot of average quarterly growth by average quarterly growth in the preceding recession.

There's no clear relationship--you could call it a positive relationship with one glaring exception (the 2001-7 expansion), but "stronger recovery after a deep recession" implies a negative relationship. You could also define depth of the recession and strength of the recovery by the total growth (average times number of quarters), but no relationship is visible that way either.

So under Obama, it's been slow expansion, but almost all expansion (everything except the first quarter or two); with GW Bush, it was slow expansion and quite a bit of time in recession.