Better Off?

October 31, 2007
Posted by Jay Livingston

“Are you better off than you were four years ago?” asked Ronald Reagan of Americans in a televised presidential debate with Jimmy Carter in 1980. Many people think that this question helped win the election for Reagan. That was then.

What about now? Back in August, I cited a New York Times article by David Cay Johnston showing that average income in 2005 was still lower than it had been in 2000. But I wondered why Johnston hadn’t used median income rather than the mean since the mean is so distorted by changes among the very rich.

Mr. Johnston has e-mailed an elbow in the ribs calling my attention to a Times article he wrote two weeks ago showing income changes for different income groups. I confess I hadn’t seen it (nor had any of the economist blogs I look at made mention of it.).

The message is basically the same. For all but the top 5%, incomes were still slightly lower in 2005 than they had been in 2000. But that’s not quite the whole story. The graph in the article shows both pre-tax and post-tax income.


Although pre-tax income for most people was slightly lower, thanks to the tax cuts, post-tax income was slightly higher. For the lower half of earners, average income in 2005 was $234 higher than in 2000. The graph also shows clearly that the big winners were the top 1%, whose pre-tax incomes were higher by about $18,000 but whose after-tax incomes were higher by nearly $65,000.

Were you better off after four years of Bush? For most Americans, the answer was, “Slightly.” For those at the very top, the answer was, “Yes, quite a lot, thank you.”

In Apprehension How Like a Guide

October 29, 2007
Posted by Jay Livingston

About.com is looking for a few good guides. A “guide” runs a topic area., posting news, providing links to articles and Websites, and keeping a blog. If you’re a blogger, you might already be doing much of what about.com wants. And About.com pays money.

A reader of this blog passed along the info that about.com needs a sociology guide, but I’ve turned it down and am putting it out there for you. Other guideless topics up for grabs include Race Relations, Moroccan Food, Bladder Cancer, El Paso TX, and . . . well, the list is pretty long.

It was hard to pass up all that loot. “If your page views grow you will never make less than $725 per month and it's likely you'll make much more than that over time (in some cases we have Guides who earn in excess of $100,000 per year)”.

Let’s see – 20 hours a week, $725 a month. It works out to roughly $8.50 an hour.

Primaries and Markets

October 27, 2007
Posted by Jay Livingston

My friend Marty Schram, who is a Real Journalist and not a blogger, had a column this week about what he calls “Campaign Calendar Leap-Frog.” So far, four states have rescheduled their presidential primary elections to come earlier than the traditional firsts, the Iowa caucuses and the New Hampshire primary. Other states may join in the madness.

I see it as an example of classic laissez-faire – a negative example.

The Market is supposed to be a magical invisible hand that transforms self-interest into public good. Through each participant pursuing his own self-interest, the competition in the market generates the greatest amount of total satisfaction. Therefore, all we need to do is stop regulating and let people pursue their self-interest, and everyone will be better off.

The classic counter example is the guy who stands up at the ball game to get a better view. He’s doing what’s best for himself. But by standing, he blocks others’ view, so they in turn stand, and so on until everyone winds up standing for the entire game rather than sitting comfortably. Even if the Red Sox win, everyone winds up worse off than they were before.

The primaries are doing the same thing, though in the dimension of time rather than height. Michigan and Florida have decided that it is in their interest to have an early primary. They’re probably right. Early primaries bring lots of candidates with lots of money to spend. But then Iowa, still wanting to be first, has to leap frog its caucuses back to January 3, 2008. Maybe other states will get in the race as well. New Hampshire may hold its 2008 presidential primary in 2007.
In the free market of primary scheduling, most of the states will wind up worse off than they were before. More crucially, the system will probably not be as good at doing what the primaries are supposed to do – giving the public the candidates it wants and that can best serve their parties and the nation.

Maybe the free market doesn't always have mojo.

(Marty has a neat solution – regional primaries. But that would require a very visible hand of regulation telling each state when to hold its primary.)

Search Committee

October 23, 2007
Posted by Jay Livingston

Wicked Anomie has created search engine for searching sociology blogs. Apparently, you too can cobble together websites for a customized search engine - once you figure out how to do it in Google. But the Caped Crusader (I think that's a cape she's wearing in the picture/icon) has done it for us. You can even add it as a widget to your own blog, as Anomie has done.

If you want your blog or site included, tell Anomie, and she'll put you on the list.