Month: July 2023

The city of Los Angeles is thinking about starting up a public bank:

The City Council voted in October 2021 to study the viability of forming a city-owned bank and to create a business plan for doing so. With new political leadership and support from a number of community organizations, the city is now preparing to devote $460,000 toward the study’s first phase.

A public bank’s decisions would be driven by the needs of Los Angeles communities rather than private shareholders, advocates say, leading to investments in projects and people normally disregarded by Wall Street.

This is not like postal banking, where ordinary people can keep small savings accounts and make small loans. This is a commercial bank that would fund worthy projects that big corporate banks won't touch.

And it sure sounds like a bad idea to me. If the City Council wants to hand out money based on politics instead of creditworthiness, well, they already do that. It's their whole job. Who needs a bank for that?

The only thing that comes to mind is that they think it will stretch their spending capacity. Instead of giving $1 million to an affordable housing project, they can capitalize a bank for $1 million and then loan out $10 million. Hooray! In addition, of course, the city-owned bank can, if it wishes, make riskier construction loans than private banks; perform faster underwriting; aid in faster land acquisition; and just generally charge everyone less than a Wall Street Bank would.

But is that wise? Are commercial banks really ripping off Los Angeles? Or are they being normally prudent in their decisions? If they are, LA would be ill-advised to be less prudent.

There are limited occasions when markets are distorted enough that government funding is a better bet. Health care is an example. So is highway building. But I'm not so sure about banks. At most we might want to increase lending by providing loan guarantees, and even that's questionable unless the city is awfully sure their credit judgment is better than JP Morgan's. Beyond that, there are lots of banks and lots of competition in the private sector. We should probably leave the banking to them.

In hindsight, a lot of people overestimate how many schools were closed during the pandemic. In reality, about half were fully open for the 2020-21 school year and upwards of 90% for the 2021-22 school year. And yet, the evidence so far suggests that kids fell behind considerably anyway and haven't made up any ground this year.

I'm not familiar with NWEA, but they take a fresh crack at this topic using the results of the MAP Growth reading and math test given to 6.7 million students. Here's the basic result:

Elementary school students are about 2-3 months behind their pre-COVID selves, while middle-school kids are more like 4-6 months behind. What's even worse is that in the current school year they appear to be falling even further behind:

The authors are pessimistic:

Addressing these gaps will take sizable and sustained effort....While many districts are offering academic programs this summer, these programs are typically offered to a small share of students and do not include enough additional instruction to catch up the average student....As such, it will be next to impossible for districts to build in the additional schooling time necessary to allow for student recovery before the expiration of ESSER funds next year

The New York Times has a similar take:

Research suggests that high-dosage tutoring — which pairs a trained tutor with one to four students, at least three times a week, for a full year — can produce gains equivalent to about four months of learning. But it is expensive and difficult to scale. A federal survey in December found that just 37 percent of public schools reported offering such tutoring.

I really seem to have guessed wrong about this. I believed, basically, that kids are resilient and would make up any lost learning in pretty short time. That may still happen, but it sure hasn't happened yet. The NWEA research is consistent with the most recent NAEP test scores, which make it clear that students have sustained substantial and persistent declines in learning thanks to COVID.

The other shoe drops:

The Biden administration said it intends to move forward with the long-promised sale of F-16 jet fighters to Turkey, hours after that country’s president withdrew his objections to extending membership of the North Atlantic Treaty Organization to Sweden.

National-security adviser Jake Sullivan rejected suggestions that advancing the sale to Ankara was directly linked to President Recep Tayyip Erdogan’s decision to let Stockholm into the alliance, saying there was no such quid quo pro.

Translation from diplo-speak: We could hold out as long as those bastards could. It's been planes for Sweden all along, and they bloody well knew it.

Alternative: Turkey never really cared about barring Sweden from NATO. It was just performative bullshit for the home crowd. And the US never cared about the F-16s. It's just an ancient design for the export market anyway. So Blinken and Erdogen finally got together, breathed a collective "Meh," and that was that.

I've noticed lately an odd mythology building up about how scientists were all wet about the COVID vaccine stopping transmission of the virus. There's an element of truth to this, but it's far from the whole story:

• What's true is that although the vaccine was effective against transmission early on, that's not the case with the Delta and Omicron variants. Today, if you get COVID even after being vaccinated, you can still shed the virus and infect others. The odds of transmission are lower, but not by a lot.
• However, the vaccine does have a protective effect. If you've had the standard 2-dose series of one of the mRNA vaccines, it cuts down your chances of getting the virus by upwards of 30-50% (though the effect wanes over time). This is why, after vaccination rates got high enough, we started to see a sustained drop in population test positivity:
  .
  

So: although it's technically true that the COVID vaccine has only a very modest effect on transmission, in practice it does a great deal to slow the spread of the virus.

I don't want to overstate things. The primary effect of the vaccine is still the same: it strongly reduces the odds of getting a serious case of COVID, and with it, long COVID. However, it also does a reasonable job of protecting against infection entirely, which obviously lowers the overall transmission rate of the virus.

The bad news about the COVID vaccine is less that it's ineffective and more that its effectiveness wanes considerably over time. If we want to keep COVID at bay, it's pretty clear that boosters are going to have to become an annual event, just like the flu shot.

Turkey—aka Türkiye—suddenly abandoned its long opposition to Sweden joining NATO earlier today. No explanation, as near as I can tell. Very weird.

The Watts Towers silhouetted against the morning sun. Simon Rodia spent 33 years building his towers, and then finally gave up because he was getting old and he got tired of battling the city for permits.

Will robots take away all our jobs? Steven Rattner says no:

Almost exactly 60 years ago, Life magazine warned that the advent of automation would make “jobs go scarce” — instead, employment boomed.

Now, the launch of ChatGPT and other generative A.I. platforms has unleashed a tsunami of hyperbolic fretting, this time about the fate of white-collar workers....A breathless press has already begun chronicling the first job losses.

....[But] when it comes to the economy, including jobs, the reassuring lessons of history (albeit with a few warning signals) are inescapable. At the moment, the problem is not that we have too much technology; it’s that we have too little.

....Higher worker productivity translates into higher wages and cheaper goods, which become more purchasing power, which stimulates more consumption, which induces more production, which creates new jobs. That, essentially, is how growth has always happened.

Rattner takes us through the usual well-worn history of the abacus and the Luddites and his old handheld calculator to make his point. Sure, these things put some people out of work, but eventually new and more plentiful jobs took their place. "This is how growth has always happened."

I've just about given up trying to understand how smart people can believe this. We've had precisely one (1) genuine Industrial Revolution, and yes, it turned out fine. But why does anybody think that n=1 is predictive of every future revolution?

The Industrial Revolution mostly replaced muscle power. We still needed lots of brains to keep running things. The Digital Revolution will replace brains too. By definition, if we eventually develop true artificial intelligence it will be able to do anything a human brain can do.¹ This means, by definition again, that any new jobs created by AI can also be performed by AI better and more cheaply than people. There will be virtually nothing left for us.

How is this not obvious? Help me out here. We could, of course, address the AI revolution by flatly banning robotic labor in a wide range of situations. Or maybe we'll end up with worker riots, except putting the torch to robots instead of powered looms. Who knows?

But short of artificial solutions like that, true AI really has no plausible endpoint except mass unemployment. This will obviously require a huge rethink of how we compensate people once hourly work is out of the picture, but hourly work will indeed be out of the picture. People really need to pull their heads out of the sand on this.

¹If you don't believe true AI is possible, that's a whole different argument. It's probably not one you can win, but at least it's an argument.

The LA Times reports that rental life is grim everywhere, but especially in California:

Minimum-wage workers shouldn't bother trying to find a two-bedroom apartment anywhere in the country.

According to a new federal report, "in no state, metropolitan area, or county in the U.S. can a worker earning the federal or prevailing state or local minimum wage afford a modest two-bedroom rental home at fair market rent by working a standard 40-hour work week."

....A California renter need to earn $42.25 an hour to afford a two-bedroom unit, the most in the nation, according to the study. The mean hourly wage for California renters is $33.67.

There's something to this. Not about the federal minimum wage, though, which currently affects only 1.2% of working adults. It's irrelevant to any serious discussion.

But rent in California is indeed very high, especially in metro areas. An average worker renting an average two-bedroom apartment in a metro area paid 32% of their monthly paycheck toward rent in 2014. Today it's more like 39%. On the other hand, there's also this:

The average worker today has $4,500 left after paying rent. Adjusted for inflation, this is about 4% higher than the $3,400 left over after paying rent a decade ago. The increase would be more if not for the overall decline in real wages over the past few years:

California is the worst rental market in the country, but even here things haven't changed all that dramatically over the past ten years.

The US citizenship test is due for an upgrade and apparently "some advocates" fear it will get harder. There's a bit of angst over the history section, but mainly it's about changes to the English skills section:

U.S. Citizenship and Immigration Services proposes that the new test updates the speaking section to assess English skills. An officer would show photos of ordinary scenarios — such as daily activities, weather or food — and ask the applicant to describe the photos.

In the current test, an officer evaluates speaking ability during the naturalization interview by asking personal questions the applicant has already answered in the naturalization paperwork.

I'm not sure why asking for a description of a picture is inherently any harder than asking personal questions. I suppose it has to do with these personal questions only requiring the applicant to parrot things they've already written elsewhere?

In any case, this sounds to me like a good change. Surprisingly, perhaps, I've never taken the increasingly popular liberal view that it's borderline racist to insist on English fluency from immigrants who want to become citizens. English proficiency is culturally critical in the United States—not to mention just plain practical—and doing our best to insist on a common language is a good thing, not a bad one.

Of course, this isn't something to get too worked up about since all the evidence in the world shows that English fluency develops strongly in second-generation immigrants and is complete by the third generation. Still, insisting on at least a decent basic level of English language competence should not be too much to ask of people who want to live in the United States forever.

In the summer the water is always warm off the Gulf Coast of Florida. But this summer is off the charts:

"Not sure I've ever seen the water around Florida look quite like this before... at any time of year," says Brian McNoldy, the researcher at the University of Miami who created the map. The purple mass stretching from the coast off Miami, around to Cape Coral, and then up to Tampa shows that water temps there are currently over 90°F.

Plus both the Arctic and Antarctic ice masses are setting record lows. And there's been yet another "1000-year" flooding in upstate New York. Those floods sure seem to occur a lot more often than every thousand years these days, don't they?

Oh, and we've just endured the hottest few days on earth in the past 100,000 years. Perhaps it's time to do something more serious about climate change than hold a few talking shops?