One of the most hilarious things that I found about the Florida voting fiasco in 2000 was the Democrats’ cheerful willingness to advance the proposition that uninformed morons, unable to read a ballot or punch a hole all the way through a flimsy piece of cardboard, were a key (in fact, apparently essential) part of their constituency (a notion that I mercilessly mocked a couple years ago). Shamelessly, and utterly innocent of how foolish it makes them look, they’re apparently still at it.
Guest
Those who read the byline on the last three posts will notice that I have a guest blogger, Sam Dinkin. Sam is a regular contributor to The Space Review, but wants to start publishing (on both space, and other topics) more than once a week. So if the rate of new content picks up noticeably in the next few days, that will be why.
Off To International Space University
I will be in North Dakota presenting a paper today and tomorrow so I won
Capital Surplus Not Trade Deficit
Hand wringing: An excessive expression of distress: handwringing by some experts over the state of the economy.
There is a lot of hand wringing about the trade deficit. We are shipping people slips of paper and they are shipping us cool stuff to use. Sounds like a decent trade to me.
But even if we are worried that the celebration will end some day, here are some good reasons not to worry about the flip side of the trade deficit, the capital surplus.
We have an economy in the United States that is well capitalized. We also attract skilled workers from around the world. One estimate of world capital concludes that the human capital stock exceeds the physical capital stock.
If you take the 60% more that college educated people earn at midlife and multiply it by the number of college educated people, the 40 million college educated people in the United States are worth $1T a year to the US economy. They would cost us a lot more if we could not import them from overseas because they very much increase the returns from other assets in our economy. They are so cheap to rent because they are so common.
This puts the value of the college education portion of the human capital stock at about $20T or about twice annual GDP. This fraction of GDP is similar to the number another researcher gets for the total human capital stock in Chile.
Of the 160 million people 25 and over, about 25% have a college education up from 5% in the mid 1950s. If we continue at that 0.4% increase per year, that gives us an extra $300B/year in extra human capital stock.
If you look at another component of capital, the housing stock, there are about 72,000,000 homes in the US worth an average of $290,000 including the land or another $20T in capital stock. That average price appears to be growing at about $8,000/quarter or about $2T/year. That is just the single family housing stock, not commercial and industrial real estate, not multi-family, not equipment and not environment and infrastructure.
If you add all the human capital growth to the growth and appreciation of physical stock in the United States, you can quickly see that we can sell capital stock forever at a $666B/year rate and still continue to grow our capital stock by trillions per year. If we have $200 trillion in human and physical capital (using the envelope theorem to invert our domestic product by one over the interest rate) in the US almost all held by US citizens, selling 0.33% of it every year even as we grow it by many times more than that is no big whoop.
Whoop: Equal to the word
If They Really Want Social Security
AARP types should be flexing their political muscle to cash in and fully fund social security. They should not pussyfoot around trying to keep social security payments high every year. It is a political battle every year as the report on how well the social security trust fund is doing comes out, much like China before permanent normal trade relations (PNTR).
Instead, they should get Congress to fully fund social security and privatize it at the same time by distributing bonds to all seniors. The bonds that they would distribute would magically make appear the trust fund that has not exactly been on the books since the original Social Security Act of 1935. An individual version of the Pension Benefit Guarantee Corporation can monitor each senior
Vanity Press
Well, it sounds like Alan Binder’s book may be less interesting (or interesting in a different way) than I originally thought.
On page 722 he describes one NASA manager as an “incompetent jerk engineer”. On page 710 Binder refers to another NASA manager as a “arrogant, fat little bastard” and after repeating this compliment dozens of times, adds “pompous” to his tirade on page 728. On page 421 he refers to someone else as a “back stabbing SOB”. And so on. If I spent 5 more minutes I am sure I’d find more examples of gratuitous name calling.
Sounds like an editor was in order–in fact, badly needed. This is a shame, as I’d previously had a pretty high opinion of Dr. Binder.
One Brain-Dead Government Agency Down
And hundreds more to go. Still, this is worth breaking out a bottle of bubbly for.
Missed Opportunity For Moron Interaction
Better luck next time, Thomas.
There Goes The Sun
Partial solar eclipse this afternoon. I’ll have one of the best views in the US, if the weather clears. It should be about 45% occlusion in Palm Beach County.
I Didn’t Think So…
I was too busy to comment at the time, but when I saw this post at NASA Watch the other day, I said “Huh?”
In recent days [Courtney] Stadd has made it known to people that he would be interested in the position of Deputy Administrator – if asked.
My own sources indicate that Courtney could have had the administrator job, back before O’Keefe was picked, but didn’t want it because he couldn’t afford to take it, and didn’t want to become as consumed with it as he’d have had to in order to even hope to straighten out the agency. So why would he now be interested in playing second banana to Mike Griffin, when the workload would be just as high, and the pay and authority less? As Keith notes, however, Courtney has denied it (as I would have expected).