October Course Evaluations

Please fill out the October 2011 course evaluations carefully and thoroughly. As usual, these are 100% anonymous.


Link to Course Evaluations

Research Paper Groups

Update: Andrea has joined Group 4

Please seek out your other group members. Start scheduling research sessions and meeting dates to appraise each other of your progress.

If you don't see your name above, that means you need to turn in your annotated bibliography. As soon as you do, I will assign you to a group.

The (Political) Economy of Ale in DC

Juan passed along this article which speaks directly to what we watched in Beer Wars. The well-traveled among you may have noticed that beer prices are higher in DC than just about anywhere else in the country (except, perhaps San Francisco and/or New York). This article tries to explain why.

The biggest markup on that cold one in your hand generally takes place at the retail level—the bars, restaurants, shops and supermarkets that sell beer directly to consumers. Here’s where D.C. propels local beer prices into the stratosphere... the tavern owner figures you can afford it. “The recession never really hit D.C.,” says Brian Kruglak, beer director at Jack Rose Dining Saloon..."

In other words, part of the answer is boring old supply and demand. DC has more well-off young people than almost anywhere else in the nation. That means there's high demand for all products here that appeal to young demographics, including beer. Beer is expensive in the DC metro for the same reason housing prices are so high.

But politics aren't completely absent from the equation.

The District’s neighborhood politics—which make it very easy for local residents to get in the way of liquor licenses, adding new costs for retailers—also pushes prices above where they’d be elsewhere... Most retailers I spoke with point to a standard mark-up of 40 percent on beer. But sometimes even that substantial margin doesn’t begin to cover the high rent and overhead... Add to that 40 percent figure a 10 percent sales tax on alcohol in the District, and us brewhounds are paying nearly 50 percent over wholesale prices for each six pack.

Beer is only the most obvious example, but this occurs with all sorts of products you buy. Very rarely is the answer just economics or politics; it's almost always both.

Ownership of Beer Brands and Varieties

Professor Phillip Howard at Michigan State University designed a fantastic infographic illustrating consolidation in the beer industry.

Who owns your (assuming you are of drinking age) favorite brand? Double click on the image below to zoom in and explore.
 

What is a scholarly source?

There seems to be some confusion over what does and does not count as a scholarly source. I posted some guidelines below to help you out with this. These are also posted under the Research Paper tab.

• Scholarly sources include articles from peer reviewed academic journals.
• Scholarly sources include books from university or other academic presses.
• Scholarly sources do not include textbooks.
• Scholarly sources do not include encyclopediae, dictionaries, atlases, or other tertiary-source reference literature.
• Scholarly sources include reports from intergovernmental organizations.
• Scholarly sources include primary records from government institutions.
• Scholarly sources do not include articles from popular magazines or non-peer reviewed periodicals (such as newspapers).
• Scholarly sources do not include Wikipedia or any other online sources unless they also conform to the categories above.
• If your source is not included in the categories labeled in blue, then it is not a scholarly source unless otherwise confirmed by your instructor.

Wapshott on Keynes, Obama and Jobs

I found this editorial when searching for a picture of John Maynard Keynes for my slides on Monday. It connects a topic we've been discussing--Keynesian macroeconomics--to a modern day issue: will the president be re-elected? Mr. Wapshott offers:

No president since 1948 has been elected with a jobless figure higher than 7.2 per cent, so with unemployment currently running at 9.1 per cent, he looks headed for certain defeat... With the White House admitting there is little chance unemployment will fall before the election next year, the president needs some good advice on how to get people back to work, and fast.

Fan or not of President Obama, things aren't looking that good for his chances next November. Keynes would say that the stimulus was a good start, but...

...the trillion dollar injection into the economy was far too small to do much good and in many cases went to the wrong people and was spent on the wrong projects... Keynes’s famous “multiplier,” by which every dollar spent is worth far more as it is passed from hand to hand, doesn’t work if the cash is placed under a mattress.

The article is a good read, whether or not you agree with Keynes, Obama or government stimulus. It helps clarify the issues that we've been discussing in class, plus reveals that Keynesian economics isn't a partisan issue. For instance, Keynes favored lowering taxes during recessions, a plan that Republicans have supported wholeheartedly.

Have We Hit Rock Bottom?

This article at WaPo argues that another recession is unlikely because there's simply no room left for the American economy to fall:

But auto sales have rebounded to only about 13 million a year, meaning that there is not as much room to fall if waning consumer confidence again leads Americans to become ultra-cautious.

This theory makes sense so long as we don't suffer a strong external shock, such as a terrorist attack, an oil shortage or--perhaps more immediately--a sovereign default in Europe.

According to classical economic theory, this is exactly how recessions are supposed to work: 1) economic transactions purge unprofitable concerns from the economy; 2) eventually production and prices stabilize at more sustainable levels; 3) pessimism abates; 4) growth resumes; 5) employment rises.

On the other hand, the Keynesian would argue that these corrections can be so painful as to be disastrous, that they're unnecessary, and that, while this should work out in the long run, "...in the long run we're all dead."

What do you think?

September Evaluation Results

I have gone over the preliminary course evaluations and this is what I have learned so far:

• You seem pleased with lectures, but you wish they could be a bit more dynamic.
• You enjoy the texts.
• You don't enjoy the articles as much.
• You'd like the lectures to parallel the readings better.
• Discussion could be more effective.
• Some of you like the responses, some of you don't.

Going forward, I will work harder to link readings to lectures and demonstrate their relevance. I may also revise some of the future readings so that they are more relevant (and hopefully, interesting). I'll also see if I can find ways to incorporate more multimedia into my lectures to link conceptual ideas with more common topics.

Let me know if you agree or disagree with this assessment, especially if I'm missing something. Feel free to suggest ways that we can improve the class in these areas. You can comment below, anonymously if you prefer.

Raw data is available below the jump if you're particularly interested.

Steve Jobs: 1955-2011

Earlier this evening, Apple, Inc. announced that co-founder, Chairman and former CEO Steven P. Jobs had passed away after a long battle with cancer.

With the possible exception of Bill Gates, no other individual so thoroughly epitomized the modern American political economy than Mr. Jobs. He is to the American consumer today what Henry Ford was to previous generations. He led a once-beleaguered personal computer maker to the commanding heights by investing in innovation, ingenuity, and ease.

Because he understood that these qualities are the true American comparative advantage, Steve succeeded where others had failed.

Those who knew me growing up knew that Steve Jobs was my formative idol. He didn't just influence the products I bought, but also the goals to which I aspired and the expectations that I set for myself and others. Steve changed the way I looked at the world, and that change for the better. I will miss him like an old friend.

Goodbye, Steve, and thank you.

American Political Influence in 1900

The American political system, and specifically the Electoral College, was deliberately designed to empower land-owners. Under this system, even the sparsest states (and the most agricultural states) get at least one Electoral vote. This means that the influence of an individual vote in a land-rich state will always be greater than the influence of an individual vote in a heavily populated, and thus labor- or capital-rich state. See below which states voters were most empowered by the Electoral College:

Voters per Electoral Vote in 1900
Voters in redder states more influential, voters in bluer states less.
However, even the Electoral College could not rig the system sufficiently in favor to overpower labor- and capital owners in the more populous states. See below the states with the most electoral votes at the turn of the previous century

Electoral Votes per State in 1900
Redder states have more electoral votes, bluer states fewer.

Al Jazeera: China warns against US currency bill

Belen forwarded along this news item that gets right at what we've been talking about in class:

China's foreign ministry has said it "firmly opposes" a bill pushed by the US Senate that will allow the country to impose duties on countries that undervalue their currencies. In a statement posted on China's official government website on Tuesday, the ministry said the US was "using the excuse of 'currency imbalances'" to adopt protectionist trade measures that violated World Trade Organisation rules… The Senate voted on Monday to advance legislation designed to press China to let its currency, yuan, rise in value.

Think about why China might be so concerned about keeping their currency cheap, and why the United States (or certain constituencies within the US) would have an interest in making the Chinese currency more expensive.

Finally, is this a good idea? Why or why not?

September Course Evaluations

Please take the time to fill out this preliminary course evaluation. I like to conduct early evaluations so that I can A) correct problems mid-stream and B) make the class more interesting and informative.

These evaluations are absolutely anonymous, and they will have an impact on the course going forward. I hope to attain 100% saturation. The link is posted below.

September Course Evaluation for POLI 487

A Libertarian Case for Government Protection of the Environment

A great post at Bleeding Heart Libertarians makes the case that libertarians—who are typically vehemently opposed to government intervention in market transactions—should favor government-regulated environmental protections. I'll let the author, Jason Brennan, do the heavy lifting:

1. Pollution and other kinds of environmental externalities impose costs upon others… [a violation of] people’s property rights…
2. Government regulation of environmental issues is USUALLY/OFTEN/SOMETIMES effective, and is USUALLY/OFTEN/SOMETIMES more effective than using courts to defend the rights mentioned in premise 1…
3. Therefore, government should have the right to issue environmental regulations in order to protect property rights, rights to life, and rights to health.

It's a loaded claim, that environmental regulation is on the same level as protecting private property in terms of the government's responsibility to its citizens.

Do you agree or disagree with the premises listed above? Share your thoughts on this topic if you have some.

Reminders

Don't forget to submit your reading and lecture responses via email by 10 AM, Wednesday, September 21. Afterwards, you can still submit your responses for half credit (and attendance verification). Remember, I'm still grading solely on submission, not quality.

I've posted the slide from Monday's class including my response-writing tips on the Slides page. And remember:

• Read actively.
• Summarize and evaluate readings (the text and one article, minimum) and lecture.
• Requires about four paragraphs 
• Write in a word processor first and save it.
• Email the file or the plain text to me.

"Maybe you coulda done this whole 'hit 'em where it hurts' thing before America slid into an unstoppable sh*t spiral."

From Jon Stewart:

The Daily Show with Jon Stewart

As usual, Mr. Stewart's firing on all eight cylinders. There's a lot going on in this clip: both sides are taking heat; criticism of the apparent sublimation of the president's "Hope and Change" candidacy; easy jokes about the facial expressions of old white (and sometimes orange) men; and of course a little bit about politics and economics.

Possible points of discussion:

• What can the state (and, specifically, the presidency) do to grow the economy?
• What should the state do during a recession?
• How might the interests of those in the White House and Congress affect how they vote on economic policy legislation?
• In what way might House and Senate Republicans take issue with the American Jobs Act?

Week 4 Assignments and Notes

If you'll glance at the top of the blog, I have created a new "Readings" page. On this page, all your non-textbook readings will be easily accessible for upcoming assignments and past reference. Links will fill in as I post new material.

Since I'm falling behind a bit, I decided to shake up the syllabus next week. The lecture and discussion on information, which we haven't gotten to yet, moves to Monday 9/19. I shall combine that class with the class on technology, originally scheduled for Wednesday 9/21. Finally, I'm moving the class on sectionalism to Wednesday 9/21.

The only way this should affect you is that I recommend you read the Kurth piece for Monday and the Trubowitz piece on Wednesday.

Finally, following the comment system fiasco, please submit reading responses via email in the future.

The Costs of September 11th

While we can't measure the value of the 3,000 lives lost on September 11th, 2001, we can measure the economic toll the country has paid—and continues to pay—since that fateful Tuesday morning. MarketWatch has a thoughtful take:

A recent study by Brown University pegs the total costs of post-Sept. 11 actions by the U.S. at $3.2 trillion to $4 trillion — and counting… Care of veterans, for example, could add up to an additional $1 trillion over the next 40 years, the study estimated. And interest payments on the national debt could take decades to pay off.

War is expensive—a fact we'll touch on a few times this semester. Is there a price that's too high to pay to keep America safe?

Week 3 Assignments and Notes

I have replaced the online reading for Monday, 9/12 with another from the same author, Ian Fletcher. It's very short, but pay close attention to his argument and evaluate it as best you can.

The online reading for Wednesday, 9/14, is a scholarly article by Raymond Vernon of the Harvard Business School, "International Investment and International Trade in the Product Cycle." The prose is rather thick, so take your time. Also, take note of his comments on American industrial production and the time during which he made them.

Finally, here's a YouTube movie from some guy (I have no idea who he is, but he does a good job) explaining what comparative advantage is (and how it differs from absolute advantage).

Assignments for September 7

Click here to fill out the introductory survey for the course. This will suffice as lecture/reading response for this week. These results will not be shared with the rest of the class.

Reading assignment (in addition to Rivoli): Stiglitz, "Anatomy of a Murder: Who Killed the American Economy?"

And in case you want a PDF version, here's a link to the course syllabus. 

Gold May Not Be As Safe As You Think

Economists suggest gold investments are risky

"In the long run, gold has gone up," Thomas said. "But in 2000 the price of gold was $300 an ounce. It has gone up six-fold since then, and it might go up higher than what it is right now. It's gone up too fast -- it's a bubble."

--PhysOrg.com