Government Fiscal Stimulus Does Not Speed Job Growth

DebtAndEmploymentGrowthGraph2019-02-17.jpgSource of graph: online version of the WSJ article quoted and cited below.

(p. A17) . . . is there evidence that stimulus was behind America’s recovery–or, for that matter, the recoveries in Germany, Switzerland, Sweden, Britain and Ireland? And is there evidence that the absence of stimulus–a tight rein on public spending known as “fiscal austerity”–is to blame for the lack of a full recovery in Portugal, Italy, France and Spain?
A simple test occurred to me: The stimulus story suggests that, in the years after they hit bottom, the countries that adopted relatively large fiscal deficits–measured by the average increase in public debt from 2011-17 as a percentage of gross domestic product–would have a relatively speedy recovery to show for it. Did they?
As the accompanying chart shows, the evidence does not support the stimulus story. Big deficits did not speed up recoveries. In fact, the relationship is negative, suggesting fiscal profligacy led to contraction and fiscal responsibility would have been better.

For the full commentary, see:
Phelps, Edmund. “The Fantasy of Fiscal Stimulus; It turns out Keynesian policies are correlated with slower, not faster, economic growth.” The Wall Street Journal (Tuesday, Oct. 30, 2018): A17.
(Note: ellipsis added.)
(Note: the online version of the commentary has the date Oct. 29, 2018.)

Global Warming Allows “Visionary Entrepreneurs” to Grow More “Superb” Sparkling Wine

(p. D4) . . . England, now in its third decade as a sparkling wine producer, is demonstrating that its bubbly output can be superb.
. . .
The early pioneers of English sparkling wine were bold, though idiosyncratic in the way of visionary entrepreneurs.
. . .
The growth in English sparkling wine is apparent all over the south of England. From Kent in the east through East and West Sussex, Hampshire, Dorset and as far west as Cornwall, new vineyards for sparkling wine are being planted at a dizzying rate. Winemakers who once imagined they were bound for France or Australia are instead staying home in England to make sparkling wine.
. . .
Nobody would mistake an English vineyard for one in Champagne. Walking through Gusbourne’s Boot Hill Vineyard with the winemaker Charlie Holland on a blustery, misty fall day, I noted that the rows of vines were far wider than one would find in Champagne, and the vines trained higher on their trellises.
In order to achieve ripeness in the colder English climate, the vines need to be planted less densely than in France, Mr. Holland said, to minimize the competition. And the vines need to have a denser canopy of leaves to promote photosynthesis, so the rows have to be wider apart so the leaves in one row won’t shade the fruit in another.
“It’s not the same parameters as in Champagne, and not the same ripeness levels,” Mr. Holland said.
Indeed, the Champagne region was once considered a marginal climate, on the blurry edge of the line at which grapes could reliably ripen. Thirty years ago, it was a struggle. Now, with climate change, the issue is whether Champagne is getting too warm.
The edge has now moved up to the south of England, where everybody agrees that the 2018 vintage was the biggest and best ever for sparkling wine.
“It was a fantastic, happy year for English wine,” said Tamara Roberts, chief executive of Ridgeview Estate in Sussex, a family operation that planted its first vines in the South Downs in 1995. It was so good that many estates spent the harvest scrambling for vats and tanks to hold the unexpected volume of wine.

For the full commentary, see:
Eric Asimov. “THE POUR; Great Bubbly From England, Believe It or Not.” The New York Times (Wednesday, Dec. 26, 2018): D4.
(Note: ellipses added.)
(Note: the online version of the commentary has the date Dec. 20, 2018.”)

“A Litigious, Protective Culture Has Gone Too Far”

(p. A1) SHOEBURYNESS, England — Educators in Britain, after decades spent in a collective effort to minimize risk, are now, cautiously, getting into the business of providing it.
. . .
Limited risks are increasingly cast by experts as an experience essential to childhood development, useful in building resilience and grit.
Outside the Princess Diana Playground in Kensington Gardens in London, which attracts more than a million visitors a year, a placard informs parents that risks have been “intentionally provided, so that your child can develop an appreciation of risk in a controlled play environment rather than taking similar risks in an uncontrolled and unregulated wider world.”
This view is tinged with nostalgia for an earlier Britain, in which children were tougher and more self-reliant. It resonates both with right-wing tabloids, which see it as a corrective to the cosseting of a liberal nanny state; and with progressives, drawn to a freer and more natural childhood.
. . .
(p. A12) Britain is one of a number of countries where educators and regulators say a litigious, protective culture has gone too far, leaching healthy risks out of childhood. Guidelines on play from the government agency that oversees health and safety issues in Britain state that “the goal is not to eliminate risk.”

For the full story, see:
ELLEN BARRY. “In Britain, Learning to Accept Risk, and the Occasional ‘Owie’.” The New York Times, First Section (Sunday, March 11, 2018): A1 & A12.
(Note: ellipses added.)
(Note: the online version of the story has the date MARCH 10, 2018, and has the title “In Britain’s Playgrounds, ‘Bringing in Risk’ to Build Resilience.”)

“Puttin’ On the Ritz”

(p. C9) The Savoy, which opened in 1889, was glamorous and cosmopolitan, an antidote to Victorian stuffiness. Its owner, Richard D’Oyly Carte, the backer of Gilbert and Sullivan’s comic operas, had a theater next door, and his ambition was to create a modern luxury hotel the likes of which had never been seen. To fulfill his vision, in 1890 he turned to Escoffier and the Swiss hotelier Ritz, a man known for his impeccable taste, and in short order the two men, who’d had a previous success at the Grand Hotel in Monte Carlo, made the Savoy into the most famous and profitable hotel and restaurant in the world.
“Ritz & Escoffier,” Luke Barr’s entertaining narrative history, reads like a novel (complete with cliff hangers and descriptions of the characters’ private thoughts). Both of its subjects had grown up poor, but were opposites temperamentally.
. . .
Neither man had to use the stairs at the Savoy, since the hotel had six elevators, the largest ever seen in Europe, which D’Oyly Carte called “ascending rooms.” There were 400 guestrooms and an unheard-of number of bathrooms–67 all told, many en suite and at no extra charge. (The recently opened Hotel Victoria provided just four for 500 guests.) The Savoy also had electric light that you could switch on or off in your room without getting out of bed, also at no extra charge.
. . .
. . ., D’Oyly Carte gave Escoffier and Ritz free rein from the start. The restaurant became enormously popular, a gathering place open to all who could afford it: aristocrats, the nouveau riche, royalty, Jewish bankers and fur traders (Jews weren’t freely accepted in society at the time), and stars of the theater and opera. Formal evening dress was de rigueur in the dining room and women were admitted–except those of “doubtful reputation and uncertain revenue,” who arrived unaccompanied, wearing makeup and large hats. Mr. Barr writes, “An extravagant hat worn in the evening, Ritz had discovered, was a sign of trouble.” But Ritz not only gave ladies’ banquets, he also successfully campaigned to change the laws against eating out on Sundays. Soon those formerly grim at-home evenings of “cold joint and gloom” became the most fashionable times of the week to dine at the Savoy.
. . .
Ritz had opened the hotel’s doors to anyone with money wearing the right clothes. The old social rules were broken. Mr. Barr comments, “Indeed, there was an element of decadence in the Savoy’s brand of luxury–it was this decadence that made it modern, the sense that pleasure was to be celebrated.”

For the full review, see:
Moira Hodgson. “‘Modern Hospitality.” The Wall Street Journal (Saturday, March 31, 2018): C9.
(Note: ellipses added.)
(Note: the online version of the review has the date March 30, 2018, and has the title “‘Ritz & Escoffier’ Review: Modern Hospitality.”)

The book under review, is:
Barr, Luke. Ritz and Escoffier: The Hotelier, the Chef, and the Rise of the Leisure Class. New York: Clarkson Potter, 2018.

Early Industrial Workers’ Living Standards Improved Over Their Lifetimes

(p. C6) Historians have long debated whether the Industrial Revolution was a net benefit to those who labored in the mills. The first generation of workers generally enjoyed higher wages and liberation from the confines of rural life. Yes, there was child labor, but one girl who entered a New England mill at age 11 recalled: “It was paradise here because you got your money, and you did whatever you wanted to with it.” In her book “Liberty’s Dawn” (2013), Emma Griffin studied those early industrial workers longitudinally and found that their living standards improved markedly over a lifetime.
. . .
William Blake’s “dark Satanic Mills” are now brightly lit in China, but are they still infernal? Today, Mr. Freeman reports, Foxconn offers “a library, bookstores, a variety of cafeterias and restaurants, supermarkets, . . . swimming pools, basketball courts, soccer fields, and a stadium, a movie theater, electronic game rooms, cybercafés, a wedding-dress shop, banks, ATMs, two hospitals, a fire station, a post office, and huge LED screens that show announcements and cartoons.” But Chinese worker dormitories impose a positively Victorian regime of moral supervision: no drinking, gambling or visiting the opposite sex. Work rules are draconian. And surveillance cameras are everywhere (though, come to think of it, we have plenty of those in the West).
Ultimately, Mr. Freeman can’t decide whether industrialism represents progress or dystopia, and that ambivalence reflects his clear eyes and fair-mindedness. He often lets workers speak for themselves, and they don’t always agree. Xu Lizhi, one of those Foxconn employees who killed himself, was also a poet: “They’ve trained me to become docile / Don’t know how to shout or rebel / How to complain or denounce / Only how to silently suffer exhaustion.” But another worker from a small Hunan village was amazed by his company dormitory: “I had never lived in a multi-story building, so it felt exciting to climb stairs and be upstairs.” Mr. Freeman reminds us that, benevolent or tyrannical, the factory was an exponential leap in the human experience.

For the full review, see:
Rose, Jonathan. “The Very Symbol of Modern Times; Workers’ paradise or soul-deadening dystopia? Why society remains of two minds about the factory.” The Wall Street Journal (Saturday, Feb. 24, 2018): C6.
(Note: ellipsis between paragraphs, added; ellipsis within paragraph, in original.)
(Note: the online version of the review has the date Feb. 23, 2018, and has the title “Review: The Very Symbol of Modern Times; Workers’ paradise or soul-deadening dystopia? Why society remains of two minds about the factory.”)

The book under review, is:
Freeman, Joshua B. Behemoth: A History of the Factory and the Making of the Modern World. New York: W. W. Norton & Company, 2018.

The book by Emma Griffin, mentioned above, is:
Griffin, Emma. Liberty’s Dawn: A People’s History of the Industrial Revolution. New Haven, CT: Yale University Press, 2013.

High Energy Costs Killed 15,000 of the Poor in Britain in Winter of 2014-2015

(p. A15) Higher costs from policies like stringent emissions caps and onerous renewable-energy targets make it even harder for the poorest citizens to afford gas and electricity.
. . .
In the U.K., the cost of electricity has increased by 36% in real terms since 2006, while the average income has risen only 4%. Environmentalists point out that energy usage has fallen as a result. But they ignore the fact that the poorest households cut back their consumption much more than average, while the richest have not reduced electricity consumption at all. Meanwhile, the share of income the bottom tenth of Britons spend on energy has increased rapidly, to almost 10%, while the share of income spent by the top tenth is still under 3%.
One 2014 poll shows that one-third of British elderly people leave at least part of their homes cold, and two-thirds wear extra layers of clothing, because of high energy costs. According to a report in the Independent, 15,000 people in the U.K. died in the winter of 2014-15 because they couldn’t afford to heat their homes properly.
Climate change is a real challenge for every country, but we need to maintain some perspective. The United Nations’ climate-change panel estimates that global warming could cause damage amounting to 2% of global gross domestic product toward the end of the century. That makes it a problem, but not the Armageddon produced by some feverish imaginations.

For the full commentary, see:
Bjorn Lomborg. “Climate-Change Policies Can Be Punishing for the Poor; America should learn from Europe’s failure to protect the needy while reducing carbon emissions.” The Wall Street Journal (Saturday, Jan. 5, 2018): A15.
(Note: ellipsis added.)
(Note: the online version of the commentary has the date Jan. 4, 2018.)

Victorian Britain Was “the Most Innovative, Advanced, Sophisticated and Prosperous Economy on the Planet”

(p. A19) Britain rose to global power over a long 18th century that began in 1688 with the Glorious Revolution and closed at Waterloo in 1815. Decline marked the 20th century, especially with the loss of both empire and commercial dynamism under the strain of two world wars. David Cannadine’s “Victorious Century” charts the period between–one in which Britain could be seen as the most innovative, advanced, sophisticated and prosperous economy on the planet.
. . .
Mr. Cannadine presents the liberal spirit of progress as the hero of his tale. It guided Britain through conflicts, social disparities and political transitions while pointing toward a better society.

For the full review, see:
William Anthony Hay. “BOOKSHELF; The Spirit of Progress; Britain managed to balance change and continuity as turmoil and revolution overtook the Continent. Still, the change proved decisive.” The Wall Street Journal (Tuesday, Feb. 20, 2018): A19.
(Note: ellipsis added.)
(Note: the online version of the review has the date Feb. 19, 2018, and has the title “BOOKSHELF; Review: The U.K.’s ‘Victorious Century’; Britain managed to balance change and continuity as turmoil and revolution overtook the Continent. Still, the change proved decisive.”)

The book under review, is:
Cannadine, David. Victorious Century: The United Kingdom, 1800-1906, The Penguin History of Britain. New York: Viking, 2017.

Britain’s Peaceful Ceding of Global Dominance Was a “Shining Exception”

(p. A13) At Harvard, the scholar Graham Allison, with a research team, has studied the historical precedents for power transitions, and his findings are not encouraging. In almost every case, he discovered, conflict was the result. The perennial danger, he explained in “Destined for War,” published earlier this year, is that the weakening greater power will force a confrontation with its growing rival in order to stem its own decline, as Athens did with Sparta in the Peloponnesian War. The results can be disastrous, as they were for Athens.
The shining exception to the pattern is the peaceful shift in global dominance between 1870 and 1945. Kori Schake, a research fellow at the Hoover Institution, tackles this subject in “Safe Passage: The Transition From British to American Hegemony,” a remarkable and timely chronicle–living history of the best sort.
. . .
In the 1840s, the two powers clashed over the Oregon Territory. Britain, though stronger militarily, accepted a compromise that endures to this day in the U.S.-Canadian border along the 49th parallel. Then, during the Civil War, London resisted the temptation to halt the rise of a competitor-power by supporting the Confederacy–say, by breaking the Union blockade. Britain’s reasoning, in this case, rested on the self-interested desire to maintain the integrity of the blockade weapon for its own use and, in part, on a growing abhorrence of slavery.
As a result of such decisions, a peaceful transition–a “safe passage”–became possible. Its core logic, in Ms. Schake’s view, was a mutuality of ideological and geopolitical interests, a realistic grasp of shifting military and economic power, and a kind of political cross-pollination: The United States, to paraphrase Ms. Schake’s formulation, became more imperial as Britain became more democratic.

For the full review, see:
Brendan Simms. “BOOKSHELF; Make Way for the New Boss; The world’s dominant nation, as it weakens, often goes to war with its growing rival. In the 19th century, power transferred peaceably. Why?” The Wall Street Journal (Wednesday, Dec. 27, 2017): A13.
(Note: ellipsis added.)
(Note: the online version of the review has the date Dec. 26, 2017, and has the title “BOOKSHELF; Review: The ‘Safe Passage’ From British to American Hegemony; The world’s dominant nation, as it weakens, often goes to war with its growing rival. In the 19th century, power transferred peaceably. Why?”)

The book under review, is:
Schake, Kori. Safe Passage: The Transition from British to American Hegemony. Cambridge, MA: Harvard University Press, 2017.

Record High Temperatures in London

(p. C6) During London’s long summer of 1858, the sweltering temperatures spawned squalor. With a population of more than 2 million, London had outgrown its medieval waste-removal systems, turning Spenser’s “sweet Thames” into an open sewer. Epidemics such as cholera and diphtheria ravaged the poor and rich alike. The stench, as we now know, was a symptom of a bacterial problem. But at the time it was believed to be, in itself, the cause of disease. The dominant medical notion of miasmas held that “noxious and morbific” contagion was carried through the air.
The heat of 1858 made the problem of London’s effluvia unignorable. At the end of May, Rosemary Ashton notes in “One Hot Summer,” the temperature was 84 degrees in the shade; there followed three months of hot days, with record highs in the 90s for the shade and well over 110 degrees in the sun.
. . .
The Great Stink, as the noisome ordeal came to be called, is a terrific subject for Ms. Ashton, the noted scholar of George Eliot, George Henry Lewes and literary London. She excels at unearthing and explaining the daily distractions of the nose-holding populace over the course of the summer: horse races, art shows, murder and divorce trials, even the breezes that, as Darwin noted, wafted thistle seeds across the English Channel from France. Ms. Ashton also convincingly uses the Great Stink as a backdrop to crisis points in the lives of three great figures of the day whose biographies rarely overlap: Darwin, Disraeli and Charles Dickens.

For the full review, see:

Alexandra Mullen. “The Stink That Sank London; As highs climbed toward 100 degrees, raw sewage roasting on the Thames created the ‘Great Stink’.” The Wall Street Journal (Saturday, Aug. 20, 2017): C6.

(Note: ellipsis added.)
(Note: the online version of the review has the date Aug. 11, 2017.)

The book under review, is:
Ashton, Rosemary. One Hot Summer: Dickens, Darwin, Disraeli, and the Great Stink of 1858. New Haven, CT: Yale University Press, 2017.

Socialized Medicine “Mummifies Its Doctors in Spools of Red Tape”

(p. A17) One of the reasons patients find condescension from doctors especially loathsome is that it diminishes them — if you’re gravely ill, the last thing you need is further diminishment. But the desires of patients, Marsh notes, are often paradoxical. They also pine for supreme confidence in their physicians, surgeons especially, because they’ve left their futures — the very possibility of one at all, in some cases — in their doctors’ custody. “So we quickly learn to deceive,” Marsh writes, “to pretend to a greater level of competence and knowledge than we know to be the case, and try to shield our patients a little from the frightening reality they often face.”
Over time, Marsh writes, many doctors start to internalize the stories they tell themselves about their superior judgment and skill. But the best, he adds, unlearn their self-deceptions, and come to accept their fallibility and learn from their mistakes. “We always learn more from failure than from success,” he writes. “Success teaches us nothing.”
This was a prominent theme in Marsh’s last book, and readers may have a sense of déjà vu while reading this one. Like “Do No Harm,” “Admissions” is wandering and ruminative, an overland trek through the doctor’s anxieties and private shames. Once again, he recounts his miscalculations and surgical catastrophes, citing the French doctor René Leriche’s observation that all surgeons carry cemeteries within themselves of the patients whose lives they’ve lost. Once again, he rails against the constraints of an increasingly depersonalized British health care system, which mummifies its doctors in spools of red tape. Once again, he describes his operating theater in all of its Grand Guignol splendor, with brains swelling beyond their skulls and suction devices “slurping obscenely” as tumors evade his reach.

For the full review, see:
JENNIFER SENIOR. “Books of The Times; Surgical Catastrophes, Private Shames.” The New York Times (Sat., Oct. 7, 2017): A17.
(Note: the online version of the review has the date Oct. 5, 2017, and has the title “Books of The Times; A Surgeon Not Afraid to Face His Mistakes, In and Out of the Operating Room.)

The book under review, is:
Marsh, Henry. Admissions: Life as a Brain Surgeon. New York: Thomas Dunne Books/St. Martin’s Press, 2017.