Author: Patrick Appel

by Patrick Appel

Matthew O’Brien spells out why the Euro is doomed:

The euro is the gold standard minus the shiny rocks. Both force countries to give up their ability to fight recessions in return for fixed exchange rates and open capital flows. But giving up the ability to fight recessions just makes it easier for recessions to turn into depressions. And that puts all of the pressure on wages to adjust down when a shock hits — the most painful and destructive way of doing things.

Avent runs with the comparison:

The gold standard was a powerful idea which delivered unquantifiable benefits and unquantifiable costs. The powerful fear of the unknown kept the gold standard intact even as the costs of Depression mounted. But once the dominoes began falling, they fell quickly. Even America, with enormous gold reserves and therefore, seemingly, a strong interest in maintaining the standard, only remained on gold for two more years after the system began to unravel in 1931. The threat that disaster might befall any euro member to drop out may continue to keep economies in line. But America represents a wild card that wasn’t present in 1931: a very large and very rich economy not on the prevailing standard and not suffering for it. The gap between the euro zone and America is the counterfactual, the but-for path, that helps illustrate just how damaging the single currency has been. Leave the euro area and you may not immediately spring back to that alternate path, leaders around the periphery may think, but at least you’ll stop sinking, and you can sell your wares to the world’s healthy economies at a steep discount relative to your neighbours.

by Patrick Appel

It was recently announced that a key aspect of the ACA, as it applies to small businesses, will be delayed for a year in most states. Suderman explains:

[E]xchanges in the majority of states won’t be offering health plan choice to small business owners. For all practical purposes, then, the law’s exchanges will offer nothing to small business owners and employees. As health policy professor (and ObamaCare supporter) Timothy Jost noted in Health Affairs when the delay was first proposed, the choice option was the “primary benefit” offered by the law’s small business exchange system. Without that option, he wrote, it’s “unclear what advantage” those exchanges would actually offer to small employers over currently available insurance options. The Chamber of Commerce seems to agree. As USA Today notes, it issued a statement saying that because of the delay, small business insurance purchased in the health exchange, “will be of little or no value to employers, or by extension, their employees.”

Joe Klein blames the administration:

This is a really bad sign. There will be those who argue that it’s not the Administration’s fault. It’s the fault of the 33 states that have refused to set up their own exchanges. Nonsense. Where was the contingency planning? There certainly are models, after all—the federal government’s own health benefits plan (FEHBP) operates markets that exist in all 50 states. So does Medicare Advantage. But now, the Obama Administration has announced that it won’t have the exchanges ready in time, that small businesses will be offered one choice for the time being—for a year, at least. No doubt, small business owners will be skeptical of the Obama Administration’s belief in the efficacy of the market system to produce lower prices through competition. That was supposed to be the point of this plan.

Casey Mulligan looks at other ways Obamacare could impact businesses.

by Patrick Appel

Dana Goldstein analyzes the Atlanta public school cheating scandal:

The extent of the top-down malfeasance under Beverly Hall may be unprecedented, but as I report in this Slate piece, there is reason to believe that policies tying adult incentives to children’s test scores have resulted in a nationwide uptick in cheating. An investigation by the Atlanta Journal Constitution found 196 school districts across the country with suspicious test score gains similar to the ones demonstrated in Atlanta, which statisticians said had only a one in 1 billion likelihood of being legitimate. A 2011 study by USA Today of test scores from just six states found 1,610 instances in which gains were as likely to be authentic as you are likely to buy a winning Powerball ticket. Absent independent, local investigations of suspected wrongdoing—which are rarely conducted—we simply cannot know the full extent of the cheating, which makes it difficult to assess whether the United States ought to continue down the road of tying teacher and administrator pay and job security to kids’ standardized test scores.

Chait yawns:

Edward Glaeser proposes a solution:

Teacher cheating isn’t an excuse to give up on standardized tests. It is a reason to administer them properly. Just imagine if college admissions tests were given by individual teachers rather than by the College Board. Teachers would have a huge incentive to help their favored students; the College Board, therefore, administers tests at well-monitored sites. If the U.S. is going to use standardized tests to evaluate teachers or schools, it should pay the extra price of using an external agency, such as the College Board.

by Patrick Appel

Julia Shaw recommends getting married early:

Sometimes people delay marriage because they are searching for the perfect soul mate. But that view has it backward. Your spouse becomes your soul mate after you’ve made those vows to each other in front of God and the people who matter to you. You don’t marry someone because he’s your soul mate; he becomes your soul mate because you married him.

Amanda Marcotte counters:

Most people grasp the relationship between young marriage and divorce intuitively, but statistics shore up the case. As the average age of first marriage goes up, the divorce rate goes down. State-by-state statistics show similar correlations between lower average age of marriage and higher divorce rates.

TNC injects some humility into the debate:

I don’t know how it is for other people, but my sense is that any long-term relationship, any long happy marriage, has had points when its primary advocates could see the end. And not a theoretical end, an actual end; a path untaken, but very much possible. Where I differ with Shaw isn’t in the advantages she sees in marrying young, but in the certainty and determinism.