💶 | Saying Yes to Everything

Progressive spending needs focus<!–

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New and notable progressive economic ideas from around the world.

Too Many Goals Make it Hard to Say No

One of the best reads this month has been Ezra Klein’s “The Problem With Everything-Bagel Liberalism”, in which he discusses the causes of our inability to build infrastructure – railways, bridges, wind farms and, most of all, homes. In particular, what role liberal and progressive politics have to play.

Liberalism is much better at seeing where the government could spend more than at determining how it could make that spending go farther and faster.

He shares many examples of how liberals and progressives try to achieve too much from infrastructure spending – sustainable materials, local union jobs, gender and ethnic diversity in the workforce, local suppliers, low cost and fast delivery – so that it becomes impossible to meaningfully optimize any one of them.

Government needs to be able to solve big problems. But the inability or the unwillingness to choose among competing priorities — to pile too much on the bagel — is itself a choice

When the President, Prime Minister or the Senior government official in charge of a project doesn’t set singular goals it leaves the project teams completely unequipped to prioritise or make difficult trade-off decisions. 

It reminds me of the famous Steve Jobs quote on focus:

People think focus means saying yes to the thing you’ve got to focus on. But that’s not what it means at all. It means saying no to the hundred other good ideas that there are. You have to pick carefully. I’m actually as proud of the things we haven’t done as the things I have done. Innovation is saying ‘no’ to 1,000 things.

Does this mean that the policy goals of union employment, diverse teams or carbon neutral developments are bad goals? Of course not. But using infrastructure projects to try achieve all of them doesn’t work, no matter how nice it would be if it did.

NYT: The Problem With Everything-Bagel Liberalism Link
Nikasen: Why Buy America Is Bad Law Link
Noah Smith: Industrial Policy Doesn’t Have to Succeed Right Away Link

“Greedflation” is Mainstream

This will be the last week for a while I talk about the “greedflation” narrative, which highlights that about half of our recent inflation has been driven by corporations raising prices far in excess of cost rises, banking historic profits. Earlier this month we spoke about how the ECB finally (and seemingly grudgingly) accepted the truth to the narrative. This week, most mainstream financial reporters were talking about it.

As early as last May, Aidan Regan wrote “Corporate profiteering is at the root of the inflation crisis, not wage demands” in the Business Post, and took a well deserved victory lap last week with another great piece on the topic.

Bloomberg: We’ve All Been Way Too Accepting of Inflation Link
Fortune: One of the world’s oldest and largest investment banks warns ‘Greedflation’ has gone too far Link
Guardian: Greedflation: are large firms using crises as cover to push up their profits? Link
Business Post: Corporate profiteering is a clear case of greedflation Link (€)



Jobs Remain High

Interest rates have been rising throughout the world, but in every developed country (from what I can see) employment numbers remain at or near historic highs.

In the US, there are more young men employed than at any other point in history.

The CO2 Decoupling

Every country in this chart has reduced their CO2 emissions while also increasing income (as measured by GDP). The rich countries, of course, have historically high emissions per capita to begin with, but I still think it’s worth remembering that being prosperous and sustainable aren’t contradictory goals. There are reasons for optimism.

Source: Our World In Data Link



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