I’ve been a casual reader of news the last few days. I’ve skimmed. I’ve been busy. But I think I’m not alone in that. Regardless, the point I’ve gotten about Obama’s energy policy is that he’s backtracked on offshore drilling, and is now willing to support it.

I was a little pissed about this, until I actually read the speech he gave. Anyone who’s concerned about the future of energy consumption, the environment, or gas prices (so, yeah, everyone) ought to read it. It’s an outline of serious proposals, with real targets and financial incentives behind them, the kind of thing that we’ve been running away from in the U.S. for way too many years.

Yeah, he said he’d be “willing to consider” a lmited amount of offshore drilling — something he calls unmeaningful in the long or short term — if that’s what it politically took to pass a comprehensive energy bill. That hurts a little, but it also shows who he is — someone practical who is willing to compromise a little in pursuit of a very important goal. I can accept that, and it is better that he tells us this now than later. Right?

His real proposals (or targets) are serious, and good grist for genuine discussion:

• work to get 1 million 150 mpg hybrids on the road in 6 years
• $7000 tax credit to consumers for buying these
• $4 billion in tax credits and loans to help U.S. factories retool to make these
• by end of 1st term, require that 10 percent of energy in US comes from renewable sources. (This can be a tricky figure, depending on whether he’s talking total energy demand, or total national electricity generation. Renewables accounted for 7 percent of total demand in 2006, but already 9.5 percent of electricity generation. It’s not an easy figure to grow, either– three-quarters of the renewables-generated electricity was hydroelectric, and it’s unlikely we’ll be building any significant new dams soon)
• national goal to reduce electricity use by 15 percent by end of next decade.

There’s meat here, even if it’s possible for us to do more. More than just a flip-flop on offshore drilling. As a package, it’s so much more serious than what McCain is proposing (drilling and a tax holiday on gas) that it makes the GOP sound a little like, I don’t know, maybe Paris Hilton…

I know, I haven’t been blogging lately. I’ve been traveling, in the States for the first time since moving to Berlin (more on that later, but it was only in going back that I finally felt like an expat). Also reading, evolutionary theory and sociobiology.

Which leads to this point. Reading this article on the growing branch of “neuroeconomics” (economists that actually look inside the brain, with MRIs and such, to see what’s happening in the course of an economic decision). It strikes me that a pretty simple evolutionary argument exposes a serious flaw in much of classical liberal (or conservative, in modern parlance) economics.

There’s an exercise called the “ultimatum game,” which behavioral economists use to study people’s preferences. Two people. A set sum of money, say $100, to be split between the two. Person A is given the right to set the distribution split, without any limits. She can say 50-50, for example, or 90-10. The only limit is that B has to agree. If B in fact agrees, they both get whatever cash A has doled out. If B disagrees, both get nothing.

A perfectly rational B, (classical economics’ rational actor) should in theory accept even a radically uneven (90-10) split, because he is getting a free $10. The fact that A is getting $90 shouldn’t matter, all other things being even (another big assumption, but skip that for a little while). In fact, studies show that B rejects a very large proportion of uneven splits, apparently because they seem unfair.

Irrational by “rational actor” standards, sure. But it strikes me that an evolutionary analysis shows why this is perfectly rational, even inevitable, from a genetic perspective. As Richard Dawkins (”The Selfish Gene“) describe, genes themselves clearly don’t have conscious preferences. However, behavior can evolve, as in the case of genetic-driven behavior which successfully allows an individual to accumulate more resources, which translates into greater ability to reproduce (more nuts gathered, for example, means that a larger number of offspring can be supported), and thus a wider propagation of that particular gene or genetic pattern.

Clearly, in a world of limited resources, there is competition for resources. Every individual would be best served by being in the position of the game’s A, getting more resources than her rival. In a strictly economic perspective, B’s getting a free $10 is a good thing, and should be accepted regardless of the unfair split. But in an evolutionary perspective, a gene (or gene-driven behavior) which happily accepted the 10 percent split while a rival took 90 percent, wouldn’t last. The A group, with more resources, would propagate at a much higher rate, and ultimately drive the B’s out.

It’s a bit more complicated than that, of course. A rise in the proportion of As probably wouldn’t be stable itself. But what might be stable is the rise of B’s who had evolved a sense of being cheated — who would reject the 90-10 split, leaving both parties with nothing, leaving them both poor but equal. From B’s perspective of evolutionary survival, equal at zero is better than being a little bit better off absolutely, but having less resources than A.

I’m sure evolutionary-minded economists have puzzled this all out before. But it has interesting consequences for thinking about our consumption decisionns, and our preferences for a fair vs. unequal society. The conservative argument that it is OK if the rich get very rich, as long as the poor get a little better off in absolute terms, probably violates a kind of internal fairness system we’ve developed over the years in order to keep ourselves alive. So much for “rational actor.”

Because I am a fervent believer that the unrestrained free market has the best possible answers to all problems, I would like to propose to the Internets at large a solution to the problem of meat, and a way of reigning in the pork and cattle industries that have become nothing less than environmental disasters.

The industrial world has shown us the way. Carbon credits, in which over-polluting companies can buy what are essentially rights to pollute from companies that have cleaned up their act, are obviously turning around the entire global warming problem. Lickety-split, as they say. Thus, we simply need to apply this model to the agribusiness world, and we’re in good shape.

Here’s how it will work. All people on the planet will be given an appropriate level of meat consumption. Say, three-quarters of a pound a week. That’s three quarter pounders at McDonalds, more if you figure that not all that mashed-up stuff is actually meat anyway. Anybody who wants to consume more than that can go onto to MeatOffsetCredits.com and buy credits, and chow down to their heart’s content.

The credits themselves will come from people who can document that they’ve eaten less than the 3/4 lb per week. Veggies, tofu- and bean-lovers. The less meat you eat, the more money you’ve got in the bank.
Think of the advantages. It’s a perfect way to funnel developed-world funds to poverty-stricken, or even voluntarily vegetarian nations. Give every citizen in the world a MeatOffsetCredits.com account, and we can even skip some of those pesky foreign aid issues where development funds get diverted by (dare I say steak-loving) dictators and generals.

And for those of us bean-lovers who are living in say, Berlin, skimping on meat budgets so we can enjoy our palatial two-room apartments, well, let’s just say we won’t have to worry about the falling dollar anymore. We’ll be subsidized by the international brotherhood of the Fleisch.

Who’s with me? Anybody have Ban Ki-Moon’s email address?

(Thanks to Kean for the link to this NYT story, which is a good luck at the genuinely terrible state of industrial meat production and consumption in America)

I’m thrilled about Obama’s win in Iowa. I’m not as surprised as maybe I should be, reading the headlines, but maybe this is one of the advantages of being overseas, and not steeped in the daily horse-race reporting. From here, the story emerging after Obama’s win — that Democrats are more focused on the prospect of a complete and cleansing change than on the promise of competence — seems a bit obvious. Yet that’s simplistic, too. What Obama seems to have done is convince people in Iowa that in addition to being a genuinely new and healing force, he can still be a competent leader. More power to him, that’s what the country needs.

The coverage here is fascinating. I was a little shocked to read this in Der Spiegel, a magazine I ordinarily respect deeply.

But the Iowa snow king has scant hope of reaching the White House. He’s too young, too inexperienced, too vague, and for many Americans, too black. His magic words about the era of change, of hope, of an America he will unite — all that will evaporate like morning mist. …

Yesterday morning in my hotel, at the breakfast table next to mine, two sisters, perhaps six and eight years old, greeted each other with the following exchange. “Are you fired up?” said one. “Are you ready to go?” replied the other. That’s the battle cry of Obama’s supporters. Children love fairy tales.

Compare this to Arianna Huffington’s take:

Obama’s win might not have legs. Hope could give way to fear once again. But, for tonight at least, it holds a mirror up to the face of America, and we can look at ourselves with pride. This is the kind of country America was meant to be, even if you are for Clinton or Edwards — or even Huckabee or Giuliani.

It’s the kind of country we’ve always imagined ourselves being — even if in the last seven years we fell horribly short: a young country, an optimistic country, a forward-looking country, a country not afraid to take risks or to dream big.

Huffington’s right, I think, even if it’s a bit starry-eyed. A kind of optimistic political innocence is a defining American characteristic. It can go horribly wrong, as the Bush years have shown. But at least today, Americans still genuinely believe in — even expect, as in a Hollywood movie — healing and redemption after periods of darkness.

The Spiegel article rejects this idea. Obama represents the triumph of this innocence, and Americans are silly to believe in fairy tales, it argues. I think there’s more, too; America has screwed up so badly, so viciously, in ways with such awful consequences for the rest of the world, that it doesn’t deserve a healing process. And maybe there’s something to this. We voted Bush in twice, inflicting his ignorance and violence on the rest of the world; maybe it’s time we stopped believing in fairy tales.

But I think that’s a misreading of America. Voting for Obama is neither a rejection of our own history or a childlike misunderstanding of the difficulties of the future. It’s the expression of a people and place that for more than 200 years has been defined by constant self-reinvention. It’s an ugly spirit at times, when we not only refuse to admit our mistakes, but actually forget them. But genuine hope is not only a fairy tale. Sometimes healing happens.

From this column here, which sorta gets inflation and falling currency valuations mixed up, but it’s funny anyway:

Dubyah has turned us into a third world banana republic. We’re Costa Rica to the rest of the World. With lousier snorkeling.

Who can blame the hordes of Eurotrash from clogging the aisles of our Tiffany franchises like an extended family of hillbillies at a dollar store? Everything here is so incredibly cheap. We’ve turned into a discount playground for the world’s trust fund babies. High-end restaurants, the good hotels, VIP sections of our most exclusive nightclubs, Saturday night movie tickets: pretty much off limits to anybody holding an American passport. We’re the minimum wage security guards of a giant high-end outlet mall known as America just one cut rate Virgin flight away from true civilization.

My own personal favorite was being in fairly rural Romania last summer, a country not really known for powerful economic performance, a country that literally has plastic, washable money, and a friend-of-a-friend says: I love going to America, everything is so cheap!

We are unstoppable. Watch out, Costa Rica! What a good time to be paid in dollars.

Juan Cole and a few other bloggers are reporting chatter from D.C. that the administration will launch a pre-war sales effort after Labor Day, much as before Iraq, softening up the public for an attack on Iran.

Ugh. Could they be so ludicrously, criminally stupid? Please tell me Americans would see this as irresponsible, impeachment-worthy insanity.

I fear the good people in the Republican party are getting desperate. Not only are they bringing up the specter of communism once again,they’re even going all the way back to Marx (minus, of course, anything like fidelity to Marx’s actual ideas):

Mitt Romney’s comments on Hillary Clinton:

“Hillary Clinton just gave a speech the other day about her view on the economy. She said we have been an on-your-own society. She said it’s time to get rid of that and replace that with shared responsibility and we’re-in-it-together society,” Romney told the crowd. “That’s out with Adam Smith and in with Karl Marx.”

It’s rare to see a right-winger so nakedly embrace the ugliest part of radical free-market ideology. Surely markets aren’t entirely incompatible with the idea of a little community, of looking out for one another? I think I fear this man.

Economists these days are buzzing about addressing globalization’s problems, and particularly a growing income inequality in the United States that’s taken us back to 1928 levels — a particularly foreboding statistic, given 1929’s banner economic news.

This has long been an issue on the left, but recent economic data, and the rising power of protectionist or anti-globalization lobbies, has finally brought Republican types into into the conversation. Chief example: In the latest Foreign Affairs, a former Bush economic advisor calls for a “New Deal” that essentially bribes lower-income workers to stop opposing new trade deals.

(T)he time has come for a New Deal for globalization — one that links trade and investment liberalization to a significant income redistribution that serves to share globalization’s gains more widely. … (T)o be politically viable, efforts for further trade and investment liberalization will need to be explicitly linked to fundamental fiscal reform aimed at distributing globalization’s aggregate gains more broadly.

Mathew Slaughter and his co-author Kenneth Schleve call for what they deem a “radical” move: essentially eliminating the regressive payroll tax for people making less than $33,000, and raising the cap on where this part of the tax stops growing for high-income types.

From the outside, this doesn’t sound like a bad idea; but it’s hardly radical. The payroll tax is among the most regressive forms of taxation we have, hitting low-income relatively harder, and ceasing to be a factor for every marginal dollar made over $90,000. Changing this, despite the arguments of righties like the Heritage Foundation, would not bankrupt small businesses or ruin social security. But it’s hardly revolutionary.

Economist Dani Rodrik, a left-leaning critic of what he calls “globalization’s cheerleaders” has a far more radical idea: change the rules of trade deals so that governments can go back to creating a basic social safety net for their citizens.

Rodrik argues persuasively that the problem with globalization is not limited simply to rising income inequality (which is just one symptom, in any case), but to the fundamental problem that it removes important economic powers from a government’s hands. Welfare systems are harder to operate, income redistribution programs become difficult, even dealing with currency and capital flows are tricky. That’s not always a bad thing, but without government social programs or income redistribution policies, you tend to get… well, exactly what even those Republicans like Slaughter are beginning to worry about.

From a paper of Rodrik’s here:

The greatest risk to globalization …. lies in the prospect that national governments’ room for maneuver will shrink to such levels that they will be unable to deliver the policies that their electorates want and need in order to buy in to the global economy.

The soft underbelly of globalization is the imbalance between the national scope of governments and the global nature of markets. A healthy global economic system necessitates a necessarily delicate compromise between these two. Go too much in one direction, and you have protectionism and autarky. Go too much in the other direction, and you have an unstable world economy with little social and political support from those it is supposed to help.

Rodrik’s policy prescription would bring trade deals far beyond simple market-opening swaps:

When rich and poor nations come together to negotiate the rules of the game, they should stop thinking in terms of exchanging market access: “I will open my markets in x, if you open yours in y.” They should consider instead exchanging policy space: “I will allow you to protect your national social compact, if you allow me to engage in development strategies that conflict with WTO and IMF rules of good behavior.” The challenge is to design procedures that enable the use of policy space for socially desirable purposes, while limiting it for beggar-thy-neighbor purposes.

He concedes that this might be mistaken for protectionism in places, and might easily be abused. But it’s a suggestion worth taking seriously, as the world begins looking at effects of globalization that go beyond simple aggregate, often unequally distributed income growth.

The Economist writes about the new Creation Museum in Petersburg, KY, where bible-believing parents can give their tots a look at dinosaurs set into the context of creation; because everyone knows (or should) that the Tyrannosaurs were created in 4004 BC along with Adam and Eve, and that there were a few, probably young adults for practicality, carried along on Noah’s Ark.

The museum has helpful messages for kids growing up in a world tainted by secular belief:

The debate about the origins of everything is presented even-handedly. Some people trust God, accept that the universe is 6,000 years old and will go to heaven. Others trust human reason, think the Big Bang happened 14 billion years ago, and having abandoned God, are quite likely to start browsing the internet for pornography or commit genocide. Visitors are spared graphic examples of porn, but there are some nasty pictures of lynched black Americans and of Nazi concentration camps.

For anyone with a little soft spot for economics arguments, whether of the strictly WSJ type or the bearded (post-)Marxist variety, the discussion going on here is worth reading.

Long story short: Nation writer Chris Hayes published an article a week or so ago (also worth reading, here) arguing that the current orthodox trend in mainstream economics, that of neo-classical, market-is-God thinking, is essentially or explicitly a mafia that shuts out dissenting thought from journals, marginalizing even the most brilliant thinkers who simply are drawing from a different toolset.

However, even Hayes noted that many of the most promising “heterodox” insights and techniques — people making irrational decisions, transactions taking place with imbalanced information, empirical psychological studies showing up in behavioral economics — are now finding their way into mainstream analyses.

Fast forward a bit to this TPMCafe discussion, where a gang of top economics professors are debating whether or not this exclusion is actually happening, with fascinating forays into what’s acceptable and why in today’s economics.