Just becaue Yglesias says so?

Brad wants Yglesias to get a fair shake, over and over and over, until we are shaken. The fair shake is usually the government health insurance programs, and Yglesias raises the usual:

Yglesias » Is Repealing the Affordable Care Act Secretly About Replacing It With a Different Secret Law?: In a word: No. But don’t tell wonk-turned-hack Douglas Holtz-Eakin who explains:

Replacing PPACA with real health-care reform that delivers quality care at lower costs. That is what the repeal vote is really about.

I always forget if I’m allowed to use the word “bullshit” on an official CAPAF website (that was a mention—thanks Professor Goldfarb!), but I think this is best analogized to the solid waste of a male bovine. This just isn’t how public policy works. We change (or “replace”) laws all the time, and it doesn’t happen by first repealing predecessor laws tout court and then gesturing vaguely at a replacement. My guess is that Holtz-Eakin has a bunch of ideas about ways to improve health care policy in the United States relative to the post-ACA status quo. My guess is that I even agree with some of those ideas. The way to get those ideas enacted is to start explaining them to the press and the public and start talking to members of congress about turning them into bills.
At this point I’m not actually sure what the repeal vote is “really” about, but it’s definitely not about starting concrete conversations about further changes to the American health care system.

First, there is no rule that says repeal, reversion or replacement is not part of any reorganization of government law. Congress does not write in stone and repeal is part of the Congressional tool kit, available to the current Congress.

Second, talking about the health business may actually involve talking about patients and doctors and leaving government out of the discussion.

Third, Talking about the health business may include admitting to Congressional ignorance of individual transactions, and our own inability to measure medical affairs on a fine grain.

There is huge amounts of evidence that further involvement of Congress in health insurance will incur very high adjustment costs over the next few years, likely to trigger multiple debt crisis.  The safest thing to do is delay until we figured out the economy.  Let's not forget, it is the household that pays for debt crisis. Yglesias, Pelosi and Obama have stepped into a government mess that will delay recovery for some time.

Modeling exchange rates

I avoided this topic for some time because I could see no way that exchange rates were anything but a very noisy channel.  This paper,  from a Thoma post, pioneered some related results.  The authors, Johansen and Juseliu did the following (from my five minute read of the paper):

They found that purchase parity differences are adjusted and these in turn adjust the internal interest rates, these the interest rate differentials alter the exchange rate as a second, relatively independent process. The two processes are separated because the agent just assumes imperfect information to reduce transaction costs.
But how did they get the two processes separated? The modeled the long swings, the secondary process, as a series of linear, discontinuous trends. And they made sure the trends chosen introduced minimal variations within measurement error. Then took the trends out and found the remaining process obeyed PPP adjustments. (I did the quick scan)
They did time dependent channel theory. Next time they will do time independent analysis and find that given the channel noise there is an optimum two partition of exchange trades. Economists do their homework.

What would be the simple undergraduate method of modeling exchange rates?
Get the original sequence of trades, if you can, or scale the time series by volume, so as to eliminate any time smoothing done by the brokers.  Then take the sequence and run them through the Windowed Huffman encoder and watch the encoding tree, just like we did with bankers.   But it will be a high noise channel, traders have bad entanglement across oceans.

Robert Puentes fails the entanglement test

Many people, including economists, “understand that we’re going to have to do that [electronic roadpricing] one day,” said Mr. Puentes of the Brookings Institution. However, he added, “we're just not there yet, technologically or institutionally. There’s a whole bunch of hurdles that have to be crossed.”

He was quoted in an article regarding the loss of gas taxes and their replacement. So I look at his blog to see if he investigated any technical deficiencies in electronic road pricing., no, not recently.  Mostly his blog is about creating more government planning than is necessary. The the technical limits are gone, but the institutional limits are increasing via the work of Mr. Puentes.

Government is subject to cost benefit analysis

Don Boudreaux believes government cannot be analyzed, we must assume government provides personal services to voters.  Hence his efficient government results in a flat tax per person, which is an assumption that government is analyzable by vote.

His theoretical norm emphasizes the free association of individuals.. His economic theory does admit of analysis of monopolies, the efficient emergence of natural monopolies.    That theory delivers the result that monopoly services are provided according to wealth.


Why would Austrians fail to apply efficient monopoly theory to the optimum organization of government?  They are fearful, fearful of results that might appear in a dysfunctional government and cause the wrong reaction, So the Austrian deliberately allocates more imprecision to government affairs than science requires.

The optimal partition of index funds from individual stocks

Use the  method on the optimal political aggregation of mini-states. his comment of mine from the Thoma blog might help:

Exchange rates, stock markets and other index style asset trades have restricted ability to partition the market because they maintain an aggregate measure. The investor is stuck with very many index funds with accurate info in each, or very few indices with little accuracy in each. We accept great imprecision when we rely on any combination of stocks and indices.
We need that math paper Thoma referenced on finding the best available partitions of a limited set viewed through an imprecise channel. With that paper we can minimize the heteroskedacity of index funds. Then we can hold some funds until the variances spreads, and the math paper tells us how to rearrange the indices.
In other words, the proper mix of value investing and index investing to gain the lowest transaction costs overall.

Ireland going Greco-Iceland

Jack H Barnes has some details.

Are corporations very personal?

Chief Justice John Roberts noted AT&T was arguing that because the word "person" can apply to corporations under the Freedom of Information Act (FOIA), which covers public requests for information, "personal" should also apply. "I tried to ... come up with other examples where the adjective was very different from the root noun," Roberts said. "It turns out it is not hard at all. You have craft and crafty. Totally different. Squirrel, squirrely."

Asks Justice Roperts, trying to weasel out of his last blunder. He claims a change from noun to adjective doesn't get the robot passed the rights threshold. OK, I have many counter examples where personal was applied to corporations, as in:
"Boy that jackass Supreme Court is going to grant more personal rights to corporation"
That comes up a lot in common usage.

Alice Rivlan wants more debt and spending

It means promising to work actively with Congress to control the rising debt.

 The debt still rises in Rivlan's plan like an addict, it is always one more round.

Their excuse, always the same, we need to borrow to cover interest costs! I thought that was endgame thinking.

The predicted arangement of political states under minimal requantization

Consider the case that that congressional districts reorganize and return a unicameral legislature of one representative per group.  What is the predicted configuration?

The extremes are one group per district, each district gets one representative, and the other extreme is one state, one senator.  The actual solution will be some combinatoric sum equal to the number of state.  I could wait for the mathematicians to publish their paper, or take a shot myself.  My claim is that the distribution will be a sampled version of this or this lognormal.  As a sampled spectrum if say the spectral spreads overlap by 15%.
 Take the wealth distribution as lognormal, and fit it with a discrete set of overlapped gaussian samplers.  Take the resulting wealth segments and fit them to the best approximation of contiguous group of districts.

So, I assume the aggregate economy is a maximum entropy wealth production network.  Further the minimal government arrives with the same accuracy of the aggregate economy at equilibrium, 15%.  The I find the best term definitions across geography that match maximum efficiency and is completely coherent.

Stopping there, I do the eyeball guess and figure we will have about 5 super wealthy, 20 city states, with 15 suburban states, and 10 large rural states.   The median group gets median services at median price.

Let's reconsider Citizen's United

Kling is working the issue.

What rights should management have, acting on behalf of shareholders?

Citizen's Unitited management on behalf of their shareholder, wants the same free speech right as any other person and is governed by law.

Then we make if a crime for individuals to engage in certain electioneering activities around election time. In the case of Citizen's United, they were equally prohibited from film releases, as any other individual, when the film was ruled too political too near.

As individuals Management already had the same rights, those were not restricted. We could rewrite the law to say, individual management acting on behalf of shareholders have these extra restrictions. Hell, we could make if mandatory life in prison for any management to act on behalf of shareholders. They still have unrestricted individual rights, never taken from them without judicial approval.

If this was a rights case, then did any of Management appear on docket with the Supremes claiming some restriction of individual rights? Where did some individual transfer limited Individual right to another?  How did the Robot get born?

No, Roberts in his ignorance gave citizen's rights to robots. They now have the right to drive, did you know that? Say GM Onstar is talking with a remote cab, out loud.  That Onstar robot has the right to say 'Kiss my ass', regardless of who is in the cab.