Big and small targets

John Quiggin18 Comments

Tim Dunlop has raised the question of whether there are enough reasons to vote Labor, and the related question of whether Latham has adopted a small target strategy. Having taken the “Anybody But Beazley” line in response to the last round of the small target strategy, the latter idea is really scary.

In general terms, the notion of a small target strategy is refuted by Latham’s stance on Iraq, which I support. I think the occupation is now doing more harm than good and needs to be brought to a conclusion, or at least greatly scaled down, in the near future. Elections should be held before the end of the year, which would fit Latham’s timetable neatly.

More generally, I think the current talk of a small target strategy is due in part to the fact that Labor hasn’t gone after the government aggressively over Iraq, or even the travel scandal. This is a sound tactical decision, and doesn’t necessarily imply a small target strategy.

The big problem relates to tax and public expenditure and here the problem is not so much that Labor has a small target strategy as that it doesn’t have an agreed strategy at all. This is not surprising in itself, since, except at election time, the natural tendency of opposition is to say nice things to everybody without worrying about the budget constraint. But this won’t work well at an election. Labor needs to decide what it stands for, in particular on the general relationship between tax and services. I’ll be putting forward some proposals on this soon.

If it isn’t obvious, since the shameful events of 2001 (Tampa, SIEV X, Children overboard), there is nothing that would induce me to put this government anywhere other than last on my ticket. But I certainly hope for more from Labor than the almost-equally shameful capitulation we saw last time around.

Tim’s post has a lot of worthwhile comments, and links to others who have posted on this, including Steven Wade, Tubagooba, John Abercrombie and Ken Parish

Copenhagen Interpretation

John Quiggin10 Comments

How would you rank the following priorities for making the planet a better place?

* A major improvement in health in poor countries, saving millions of lives each year

* Substantial progress in reducing the rate of climate change, preventing large-scale species extinctions and other environmental damage

* New and improved advertisements for consumer goods
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Copenhagen Consensus

John Quiggin9 Comments

The results of the Copenhagen Consensus are out, and as predicted, that is, with climate change at the bottom of the list. I’ll give a more detailed response later on, but I thought I’d respond to this point in the Economist

The bottom of the list, however, aroused more in the way of hostile comment. Rated “bad”, meaning that costs were thought to exceed benefits, were all three of the schemes put before the panel for mitigating climate change, including the Kyoto protocol on greenhouse-gas emissions. (The panel rated only one other policy bad: guest-worker programmes to promote immigration, which were frowned upon because they make it harder for migrants to assimilate.) This gave rise to suspicion in some quarters that the whole exercise had been rigged. Mr Lomborg is well-known, and widely reviled, for his opposition to Kyoto.

These suspicions are in fact unfounded, as your correspondent (who sat in on the otherwise private discussions) can confirm. A less biddable group would be difficult to imagine.

On the contrary, as I suggested at the outset, a panel that included, say, Joe Stiglitz and Amartya Sen would have been considerably less biddable, as well as being better qualified to look at the issues in question.
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Re-form

John Quiggin3 Comments

Robert Samelson argues that we should stop using the word ‘reform’. I’ve grappled with this question for a long term, having been generally critical of the neoliberal policies generally referred to as “microeconomic reform”. I’ve tried all sorts of devices, such as the use of scare quotes and phrases like “so-called reform”, before concluding that the best thing is just to use the word in ways that make it obvious that I am not attaching positive connotations to it.

Over the fold is an old post on the subject (I needed to repost to fix broken links).
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Fed Fellow Fun & Fury

John Quiggin19 Comments

Among the many nice things about being a Federation Fellow, one of the nicest is the way it infuriates some of my opponents[1]. I mentioned the IPA a while back and now Peter Saunders of the Centre for Independent Studies has had a go in today’s Fin. He’s responding to a piece of mine developed out of this post on bracket creep, though the article switched the focus from Saunders to an earlier presentation of the same argument by Peter Costello. The same piece produced a somewhat incoherent letter from Sinclair Davidson of RMIT, who couldn’t come up with anything better than to say that my article was “drivel”.

Anyway, Saunders wants to argue that tax rates and economic incentives influence location decisions[2] and decides to use me as an example, saying that I moved to Queensland to take up the Fellowship[3] (he even quotes from this blog). In fact, as my handful of long-term readers may recall, I moved to Brisbane in late 2002 and didn’t get the Fellowship until March 2003. My reasons for moving were much the same as those of the other 50 000 people who made the same move that year, and are summed up here.

The Fin is subscription only, but I’ve added some relevant extracts over the fold

fn1. It’s not very noble of me to take pleasure in annoying my opponents, but I can’t deny that I do.

fn2. To be boringly serious, I don’t, of course, deny that incentives affect decisions, but I think there are many more significant incentives in our system than the top marginal tax rate.

fn3. Saunders is open to a tu quoque here, having recently moved to this high-tax hell from the dynamic UK.
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Fed Fellow Fun & Fury

John Quiggin19 Comments

Among the many nice things about being a Federation Fellow, one of the nicest is the way it infuriates some of my opponents[1]. I mentioned the IPA a while back and now Peter Saunders of the Centre for Independent Studies has had a go in today’s Fin. He’s responding to a piece of mine developed out of this post on bracket creep, though the article switched the focus from Saunders to an earlier presentation of the same argument by Peter Costello. The same piece produced a somewhat incoherent letter from Sinclair Davidson of RMIT, who couldn’t come up with anything better than to say that my article was “drivel”.

Anyway, Saunders wants to argue that tax rates and economic incentives influence location decisions[2] and decides to use me as an example, saying that I moved to Queensland to take up the Fellowship[3] (he even quotes from this blog). In fact, as my handful of long-term readers may recall, I moved to Brisbane in late 2002 and didn’t get the Fellowship until March 2003. My reasons for moving were much the same as those of the other 50 000 people who made the same move that year, and are summed up here.

The Fin is subscription only, but I’ve added some relevant extracts over the fold

fn1. It’s not very noble of me to take pleasure in annoying my opponents, but I can’t deny that I do.

fn2. To be boringly serious, I don’t, of course, deny that incentives affect decisions, but I think there are many more significant incentives in our system than the top marginal tax rate.

fn3. Saunders is open to a tu quoque here, having recently moved to this high-tax hell from the dynamic UK.
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Plausible deniability

John Quiggin8 Comments

Some readers might be tempted to disbelieve the assurances of Prime Minister Howard, Defence Secretary Ric Smith, General Cosgrove and others that none of their subordinates told them about the allegations of abuse and torture in Abu Ghraib, received as early as last October.

On the contrary, these assurances are all too believable. In the light of the “children overboard” business, and the more recent humiliation of Mick Keelty, what officer would be foolish enough to pass bad news of this kind on to his or her superiors? Far better to emulate Sergeant Schultz. This setup works brilliantly for all concerned, unless, of course, it should happen that our leaders actually need to be informed about something they would rather not hear.

Paradoxes and infinity

John Quiggin6 Comments

Following up my three-way classification of paradoxes,[1] I want to argue that paradoxes involving infinity are always of type-3, that is, the result of ill-posed problems or inappropriate ways of taking limits. (Much the same position is defended in the comments thread by Bill Carone). In fact, I’d argue for the following general principle, applicable to all models relevant to human decisionmakers.

Whenever a result, true for all finite n, is strictly[2] reversed for the infinite case, the problem in question has been posed incorrectly

To defend this, I rely on the premise that we are finite creatures in a finite universe. If a mathematical representation of a decision problem involves an infinite set, such as the integers or the real line, it is only because this is more convenient than employing finite, but very large bounds, such as those derived from the number of particles in the universe. Any property that depends inherently on infinite sets and limits, such as the continuity of a function, can never be verified or falsified by empirical data. Since we are finite, any result that is true for all finite n is true for us.
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