One Stupid Debate Question

Here is a question asked of Mitt Romney during the presidential town hall debate last week:

Q: In what new ways do you intend to rectify the inequalities in the workplace, specifically regarding females making only 72 percent of what their male counterparts earn?

I have an idea. Let’s pass a federal law mandating equal distribution of income between men and women. It would be easy enough to sort out. No more complicated than any other of the federal government’s redistributive schemes. At the end of each year a tally could be set based on income tax returns; additional taxes then levied on the men and subsequently disbursed to the women up to the amount of the disparity.

Or, maybe we can get serious for a minute.

The question implies one of two things: either that equality of outcome ought to be the goal (in which case we should follow my recommendation above), or otherwise that something nearing equality would be the natural outcome but for the existence some pernicious force in our society successfully conspiring to keep women down. And either way the government ought to do something about it.

But, is government intervention really the answer? To get the right answer, you need to ask the right question. To find the right question, I turn to Stanford economist Thomas Sowell.

So, Mr. Sowell, what of this inequality in the workplace?

From Sowell, Thomas (2011-03-22). Economic Facts and Fallacies: Second Edition (p. 59). Perseus Books Group. Kindle Edition:

“In most societies, for most of history, women have earned lower incomes than men. That fact is not in dispute. What is open to question—and what has generated many fallacies—have been various attempts to explain this fact.

Plausible possibilities are many: Employers might discriminate against women, parents might raise girls and boys differently, women and men might have different skills or make different choices in education or careers. These and other possibilities are often collapsed into one prevailing conclusion: When and where there are significant differences between women and men in their employment, pay, or promotion, discrimination can be inferred and, where there has been a lessening of such disparities over time, it has been due to a lessening of discrimination under the pressures of government, the feminist movement or a general increase in enlightenment. Such reasoning has been common from the media to the political arena to courts of law. But this explanation cannot withstand a scrutiny of history or of economics. It is one of the central fallacies of our time.”

Activists decrying the income gap between men and women are (to quote Charles Lane) using income equality as a proxy for a non-quantifiable social good; in this case equal opportunity. But, equal outcome is not a good proxy for equal opportunity, because it ignores the very real possibility that even with equal opportunity, different preferences between men and women might still lead to unequal outcomes.

In other words, that question about Romney closing the gender pay gap is based on a false premise.

It was one stupid debate question!

 

Oh, and by the way, Economic Facts and Fallacies is awesome. If it didn’t have such a boring title and such a boring cover, it would’ve been the sort of runaway best-seller that Freaknomics turned out to be, just with a lot more insight than Freakonomics. Get an e-reader, and pick up a copy of Sowell’s book. You won’t regret it.

Weird Reactions to September Jobs Report

Former General Electric CEO Jack Welch is defending his statement about Obama cooking the books on the September Jobs report. But – as Reason Magazine’s Tim Cavanaugh points out – Welch still didn’t provide evidence of any actual cooking. Instead he just reminded everyone of what seemed so self-evident only a month ago: that the economy is performing unimpressively, despite the jobs report.

Recall, after the August jobs report showed a two point drop in unemployment (from 8.3% to 8.1%), pundits on the left and the right generally agreed it wasn’t because of a sudden or trending improvement in the economy. The drop in unemployment was mostly explained by a drop in labor force participation (which would signal a worsening economy).

Now, the September jobs report shows a partial rebound in labor force participation over August AND another – bigger – drop in unemployment (from 8.1% down to 7.8%). This might indicate a booming economy, if it weren’t so obvious that the economy isn’t booming.

Alas, labor force participation is still at its lowest point in thirty years. Jobless claims were up again in September. We continue to shed jobs in the manufacturing sector. And where there has been large job growth – in the healthcare sector – it is more likely thanks to new ObamaCare regulations than any economic improvement. What’s more, with the July and August numbers adjusted upwards, September actually marks a three month low for job growth amid a three year low for GDP growth.

Yet, after the September jobs report, there seems to be a split. No longer do these awkward unemployment numbers belie an economy still sputtering along. Instead, the September report is, alternatively, a huge boost for Obama OR a product of the Obama Administration gaming the numbers to help his re-election bid.

The economic reality hasn’t changed. How did the storyline?

After Weak Debate Performance, Obama Goes Big (and Yellow) (and Feathered)

 

It is good to see Obama rebounding from his mediocre debate performance last week. To get back on track, his campaign launched a new ad attacking Mitt Romney’s priorities for reform. According to the ad – narrated by Pablo Francisco (just kidding) – “Mitt Romney knows it’s not Wall Street we have to worry about, it’s Sesame Street.”

Powerful stuff.

The President has also worked from the stump to put the first debate behind him and set the tone the last four weeks of the campaign.

Here is Obama at a fundraiser in San Francisco:

“Elmo has been seen in a white Suburban.  He’s driving for the border,” he said. “Governor Romney’s plan is to let Wall Street run wild again, but he’s going to bring the hammer down on ‘Sesame Street.’”

In case you’re under thirty and wondering what that Elmo thing is supposed to mean, don’t feel bad, I missed the O.J. Simpson reference on the first pass too. The President was (humorously?) alluding to Simpson’s failed attempt to flee to Mexico after murdering his ex-wife back in 1994. Charming.

FOUR MORE YEARS!