The Great Boston Scarathon

Everyone seems to be gushing over the police work in Boston. I think the whole thing was a massive screw up. The perp escaped on foot, badly injured, dripping blood, and they could neither follow nor find him. Thousands of cops combed the area, but he was marginally outside their perimeter, and only about 1/2 mile from where the preceding fire fight took place. Oops. They lock down a city of over a million because 1 desperate, wounded criminal is on the lam. Meanwhile, in 1 day, there were at least 8 shootings in Chicago, but I digress.

How do they find the guy? Moments after the stay-inside order was lifted, a resident finds the perp hiding in the boat in his yard.

All of this because ordinary citizens were able to identify the two brothers from cell phone pictures and other videos. Other than actually publicizing the pictures and dragging the near-dead guy out of the boat, a law enforcement contingent of thousands accomplished very little, while ordinary citizens were responsible for almost everything that did not involve firing hundreds of rounds of ordnance.

MEH!

Two R's Missing 'Rithmatic

Wow - via Steve Benin at Maddowblog and Jared Berstein we discover that the oft-cited Reinhart and Rogoff study that "indicates" that a country's debt level leads to economic contraction at levels above 90% of GPD has been shown to be totally bogus.

They made an error setting up their Excel spreadsheet for the calculations, and the math came out wrong. [This is really inexcusable sloppiness]

Not only does this matter, it is REALLY important, because their study has been used as the justification for austerity by people like Paul Ryan who want to gut social programs in the U.S., and the economic union authorities in Europe who are destroying themselves with austerity.

It's still true that with correct math the data really does show higher debt *correlating* with lower [but still significantly positive] growth.  Here is Bernsein's graph showing the R&R results along with the corrected results.

However, even if R&R had gotten it right, the austerians are making two other fundamental [and ideologically driven] errors in judgment. First off, when you do a data mash-up like they did, it's easy to get the causation reversed. It's quite likely [and realistically seems very sensible] that slow growth causes the need for high debt, not the other way around.

Second, if a high debt to GDP ratio were really a problem, it would make more sense to grow GDP rather than go into an austerity mode that is likely to shrink GDP. [Exactly what happened in the U.S. to cause the "golden age" after WW II] This is the denominator effect. Make the denominator [here, GDP] larger, and the ratio becomes smaller.

This is really very simple. But it is way beyond the capability of somebody like Paul Ryan.

Critical analysis leads to the truth. But that will not matter to Ryan. His mission is to kill social security, not solve any of the nation's problems, and, as Bernstein points out, "It’s not like facts are driving this debate."

What The Hell ?!? Friday - Dude, Where in the Hell is my Recovery? Edition

Have you wondered why the recovery hasn't felt much like one?  Stagflationary Mark demonstrates why with this custom FRED graph of real wage and salary disbursements per capita (February 2013 dollars).

Mark often superimposes a trend line curve on the underlying data, but didn't this time.  No matter - it's easy to eyeball an exponential trend with an asymptote somewhere around $23,000.

So -- Where IS our recovery?  I've been wondering for a long time.

Another Ridiculous Facebook Thingie

Am I being over-imaginative in seeing a racist subtext in this

image of  BLACK SMOKE coming from THE WHITE HOUSE?