That is a simple accounting identity, a way to avoid double counting. Income (output, GDP, whichever term you choose) is just the flow of value, and it would be stupid not to include how much value went toward consumption. An economy produces x amount of value in a given year, and those are simply how the value is divvyed up. Some production goes to satisfying consumer demand, and some is held back to build more productive capacity. You're just off base not conflating your own personal semantics for what "production" should mean with a simple technical accounting identity.

Reinhart and Rogoff have certainly been warning of high debt levels, but it's wrong to give this study too much credit for what "austerity" there has been across Europe. Most cuts in places like Greece and Spain were fait accompli, once it was clear that the ECB was not going to budge on its inflation target to neither try and boost nominal growth nor to crudely relieve nominal debt levels.

I will grant that the 90% debt/gdp trigger is most likely non-existent, but the rest of their book does yeoman's work in cataloging financial crises. It's a useful antidote to the mass psychological amnesia that is perpetually recurring. "Our new investments our safe and returns will never fall" inevitably leads to "what perfidy caused this?" The cycle has been repeated in remarkably similar ways for nearly a millenium now. We should appreciate the detailed financial history they have created, and chide them for the dubious massaging of the data. Just don't overstate its political implications.

Immigration is good for everyone, though especially for immigrants. Immigrants experience massive wage gains just by stepping over an imaginary line. Nations that receive immigrants receive solid overall growth benefits.

H1-B visas never fail to bring out the nationalist grief on /.. There is a fallacy that there is a set amount of technology work to do, and if you increase the labor supply, that makes everyone worse off. The labor supply is actually endogenous to the demand for labor. More skilled labor allows people to be able to rely more on skilled labor. It's counterintuitive I know, but it absolutely is.

Population growth is also endogenous to technological advancement. Increasing the amount of people integrated in a society, increases the chance that we advance.

Endogenous growth theory, Paul Romer is going to win a Nobel prize for it one day. Learn it. Free movement of labor has been crucial to the advancement of humanity.

So, since they've been required to actually pay what they promised their employees, unlike a lot of other pensions these days, they now can't make money. Huh. That doesn't strike me as the model of success we should be pushing for.

It might be a good investment to allow/encourage the post office to create a network of state issued email addresses, or whatever other scheme of modernization we might come up with. That's the kind of risky change that large bureaucratic organizations with massive legacy labor costs typically aren't good at. I'm all for letting them experiment. I'm not for throwing money at or trying to force a revival an archaic model of 6-day-a-week service for fewer and fewer first class mail and more and more direct marketing.

Making money on junk mail! That's hardly the romantic vision of an efficient, broad reaching government agency that binds us all together that people weep over now that the Post Office is in trouble. Sure, the post office could radically remake itself, as a poster downthread suggested. The old way of doing things 6 days a week, universal letter service, while employing hundreds of thousands of low skill workers is dead. We can save the brand, but not the old system.

It's true that the Post Office is required to pre-fund its pensions in a burdensome way. That doesn't change the fact that their current setup is not economic. First class mail is declining in usage, but direct marketing through the mail has consistently, and for a long time, increased as a source of revenue. Face it, letters have diminished in importance. People are weeping over a shell of a former institution. The Post Office is just chasing the advertising dollars like everyone else seems to be.

Yeah, probably not, at least not in any predictable way. There are a million things that popular opinion and unrest within China make more likely to be reformed: the Hukou system, land distribution, criminal justice, etc. Single party rule and stringent censorship just don't motivate the Chinese like westerners constantly tell them that it should. I'm of the opinion all of this is a tremendous waste, but I don't expect any majority of the Chinese public to agree with me any time soon.

Ratcheting up Internet restrictions is the norm during times like this. Expect VPN's in-country to also be strangely slower.

What's interesting to me are the new unconventional methods of restraint China always seems to be a pioneer in. It seems protesters throwing leaflets out of taxi cabs is a growing fear, so taxis are restricted in being able to travel around Tiananmen and will their windows locked, with some having control handles removed altogether.

I was present in China during the Arab Spring, when it was feared protest would spread. Any mention of a meetup place for protesters would all of a sudden shoot up the priority list for construction repairs. Many areas were cordoned off with armadas of street sweet sweepers.

Paranoia is an extremely inefficient use of ingenuity.

The interesting thing about this whole episode is that, despite no obvious interventions by the state, the market itself failed to raise prices to clear the market.

In shortages like this, the logistics of gasoline make it difficult to really up capacity even by significant price raises. The gasoline market is highly segmented. It's not very easy to divert supplies from elsewhere and ship gasoline in the quantities needed, unlike with things like food and water.

What "price gouging" can do, however, is eliminate hoarding and frivolous use. $8.00 a gallon really makes you think twice whether you need that generator running 24 hours a day. That can help to calm down the shortage.

The puzzling thing is that gas stations seem to be much to afraid of being seen reaping a windfall profit by raising prices. So instead, we get lines miles long, essentially a gasoline lottery.

I'm not sure that's exactly knowable. Sure, the numbers are way better than contradictory pundit guts, but for instance, we had no way of knowing if a "Bradley Effect" would have been in play. Response rates for polling firms consistently came in below 10%. Polling is getting harder and harder in an age where fewer people have landlines and polling cell phones is restricted. As of now, state polls are good guides. They will be right up until they aren't, and then the science will change.

I'm not saying that the probability of systematic error is large, just unknowable. It was a perfectly reasonable and scientific position for a Republican to say "Romney's chances are equal to the probability of error in the polls, and I hope that probability is large."

Romney's own internal numbers had Obama up by 5 in Ohio the weekend before the election even.

Exactly. Neither Nate nor any of the many other poll aggregators (Sam Wang, Drew Linzer, etc.) have found any way to conquer the inherit unpredictability of political events far into the future. Read Daniel Kahnemann. Experts, no matter how "scientific" their methods are consistently wrong and worse at predicting politics far into the future than the proverbial dart throwing monkey.

We care about Nate Silver and people that do what he does for two reasons: 1) They definitively point out that most pundits are full of crap and unwilling to realize that polling, not their guts, describe what's happening in the short run in the most accurate way currently possible. 2) For partisan reasons. Democrats love Silver because his numbers provided a security blanket to liberals afraid for Obama. To be fair, had the election turned out different and Nate's numbers called it for Romney, Republicans would be lionizing him as well, and we'd all be mocking whatever the Democratic version of "Unskewed Polls" had been. That popular media figures skew left really helps Silver's celebrity this time around.

I'm no geologist, but I have learned a bit of stats.

A twenty-five-fold increase, that excludes the largest outlying event, in the number of earthquakes would seem to be statistically significant of something.