Category Archives: Media

updates from Chicago Booth

Why it’s so hard to simplify the tax code
By Dee Gill – Simplifying the tax code ostensibly has bipartisan backing. Both the Bush and Obama administrations advocated for simplification, in reports, as have House Speaker Paul Ryan (Republican of Wisconsin) and Senator Elizabeth Warren (Democrat of Massachusetts). But when the Senate passed a tax bill this past December, there was no postcard.

What happened? The same thing that always does, suggest researchers. While simplicity is a stated goal, complexity wins the day. Hence companies and individuals will hire accountants to wade through the latest bill, interpret the new rules, offer guidance, and help work through the inevitable corrections and amendments.

And this comes at an economic cost. Research by James Mahon and Chicago Booth’s Eric Zwick, and others, collectively indicates that the complexity leads individuals and companies to fail to take advantage of billions of dollars in offered breaks, many of them presumably intended to stimulate the economy. In this way, complexity undermines what tax incentives are purported to accomplish. more>

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Trump’s lies corrode democracy

By James Pfiffner – Previous research has demonstrated that most modern presidents have told lies for a variety of reasons, from legitimate lies concerning national security, to trivial misstatements, to shading the truth, to avoiding embarrassment, to serious lies of policy deception. However, when a president continues to insist that his previous false statements are true, the institutions of government become corroded and democracy is undermined.

Of course, many of Trump’s lies are “conventional” lies similar to those that politicians often tell in order to look good or avoid blame. But the number of these types of lies by Trump vastly exceeds the lies of previous presidents. Glen Kessler of the Washington Post compiled a list of more than 2000 misleading or false statements in Trump’s first 355 days in office.

But aside from volume, Trump’s lies differed significantly from those of previous presidents. Some of his most frequent lies are bragging about his achievements in ways that are demonstrably untrue and contrary to well-known and accepted facts.

Trump’s refusal to admit the truth of widely accepted facts corrodes political discourse and is consistent with the practice of many authoritarian leaders. If there are no agreed upon facts, then it becomes impossible for people to make judgments about their government or hold it accountable. more>

Russia, Iran And Turkey Are Building A New Middle East

By Jonathan Wachtel and Albert Wachtel – Washington’s constructive role in the 20th century began in 1905 when President Theodore Roosevelt coaxed Moscow and Tokyo into signing the Treaty of Portsmouth, ending the Russo-Japanese War. A couple of months after Yalta in mid-century, Franklin Roosevelt died, but the Marshall Plan of Harry S. Truman, Roosevelt’s successor, enabled post-war Europe to rebuild, including the creation of a democratic and friendly West Germany.

20th century America led the effort to build a better world, and nations depended on that.

In the 21st century, that crucial role has often been abdicated. Barack Obama tried to sidestep crises, naively dismissing emerging Islamic State militant group (ISIS) terrorists as a “J.V. team.” He threatened to bomb Syrian President Bashar al-Assad’s installations because he used chemical weapons but didn’t follow through. His red lines were pale, and his attempts to lead from behind were pale policy.

Enemies advanced destruction, chaos, and despair, and by the time Donald Trump took office, Iran was asserting itself across the Middle East, not just in Syria and Lebanon, where Hezbollah dominates the national army, but in Iraq and Yemen as well.

Mr. Trump is perplexingly outsourcing American policy in Syria. more>

Tech Upheaval Means a ‘Massacre of the Dilberts’

By Fergal O’Brien and Maciej Onoszko – The Bank of England Governor Mark Carney said there are a lot of “routine cognitive jobs,” at risk, in what he termed a “massacre of the Dilberts” — a reference to the satirical American comic strip about office workers.

Technology and the fourth industrial revolution are having untold impact, he said, and it’s going to take huge efforts to make sure workers ultimately benefit. The effect of automation is just one part of the change and examples of the seismic shift can be seen in finance, where many “unglamorous” data entry jobs have already been transformed.

“Get a grip on the scale of the problem. Assess and address,” he said.

Carney added that part of the solution could require major social change, with workers having to extend or return to education in later life to prepare themselves for the new world of labor. He acknowledged that wouldn’t be simple, when many people will have mortgages and other financial responsibilities, and added that up to now not everyone is getting training right. more>

The Labor Market Basis For Populism

By Carl Melin and Ann-Therése Enarsson – All over the world, populist parties and movements are growing ever more strongly, and established parties appear to lack effective strategies to combat this.

Changes in the labor market will not have the same impact on all groups. Routine tasks are more vulnerable to automation and we can see that many low-skilled men, often in jobs that have had a relatively high status and income, are more vulnerable than others. But traditional working-class jobs are not the only ones affected, as digitization and the emergence of artificial intelligence (AI) are also affecting many white-collar employees.

The trend of increased populism that we have seen over the last decade mirrors what happened during the Great Depression in the 1930s when such movements seized power in countries such as Germany, Italy and Spain, with the disastrous consequences we all know.

The question is: what can be done to counteract a similar trend.

Even if automation may mean that some people lose out, there is no alternative as the new technology is a precondition for old jobs not simply disappearing, but also being replaced by new ones.

What can be done, however, is to reduce people’s anxieties and the personal cost of these changes. On the-job-training and other forms of education are the most important tools, but security in times of change is also about effective unemployment insurance.

Far too many politicians have chosen to respond to populist parties by adopting their world view. Instead of trying to deal with the concerns that are driving people to these kinds of movements, many politicians have often chosen to confirm and reinforce them. more>

Updates from Adobe

WALL TOGETHER NOW
By Jordan Kushins – Las Vegas is known for its garish signage: flashy, flamboyant, all-neon-all-the-time. But now an entirely different kind of marquee has stolen the spotlight. It’s more than 16 feet long, just under ten feet high, and almost five feet deep. It weighs a whopping 770 pounds and is composed of nearly 50 modular MDF forms.

It was meticulously designed in Adobe Illustrator CC, built by hand in England, shipped in pieces across the ocean, then reconstructed in Nevada. And it’s greeting participants at the Adobe Summit.

For the past five years, Adobe has worked with artists on the conference identity, which corresponds to an annual theme. This year’s theme is “experience,” and creative director Angela Fisher was inspired to go beyond 2D constraints to bring the theme to life. “I started thinking, ‘What if the identity was a physical structure?’ A camera panning around, and in and out, could reveal a kind of experience within the branding itself.”

She began making paper models at home on the weekends to explore two facets of the idea. These geometric forms and patterns became building blocks—like DIY Legos—that took on the feel of an abstract cityscape in one, and the shape of an “X” in the other. They were promising, but the concept wasn’t quite there yet. more>

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Rethinking the Social Network

By Susan Milligan – Is Facebook losing its base? The social media giant is already facing a credibility crisis.

Facebook began in the early 2000s at Harvard, where then-student Mark Zuckerberg started “Facemash” (often described as a Harvard “hot-or-not” site) and turned it into a multibillion-dollar site where “friends” could share news and photos, as well as personal profile information.

The site came to play an important role in campaigns and elections. Barack Obama’s campaign, for example, found that getting endorsed and mentioned in Facebook messages was often more effective than paying for TV campaign ads, since voters were more likely to trust information from someone they knew than from a professionally produced campaign commercial.

Other institutions fared poorly with young people as well, though trust was higher as the entities became more local. Just 22 percent trust the president to do the right thing all or most of the time, with the federal government, at 21 percent, and Congress, at 18 percent, coming in even lower. However, 34 percent say they have faith in their state governments all or most of the time, and 38 percent say the same about their local governments. more>

The Work Ahead

By Edward Alden and Laura Taylor-Kale – The world is in the midst of a profound transformation in the nature of work, as smart machines and other new technologies remake how people do their jobs and pursue their careers. The pace of change will almost certainly accelerate, and the disruptions will grow larger. In the United States, where work is the basis for most of the income and benefits that make a secure life possible for Americans and their families, the transformation has been especially wrenching.

The most important challenge facing the United States— given the seismic forces of innovation, automation, and globalization that are changing the nature of work—is to create better pathways for all Americans to adapt and thrive. The country’s future as a stable, strong nation willing and able to devote the necessary resources and attention to meeting international challenges depends on rebuilding the links among work, opportunity, and economic security.

Failure to do so will increase the pressures for retrenchment that are already causing the United States to back away from global leadership. A United States that cannot provide better job and career options and greater economic security for its citizens will be less competitive and less of an example to the world.

It will have fewer resources available for national security. Domestic struggles over the sharing of economic gains will further distract and divide the country, and make it less willing and less able to act effectively in the world.

As technology disrupts industry after industry, the United States needs better ways to help Americans access the many new opportunities technology is also creating, in particular by strengthening the link between education and employment prospects. The country needs stronger support for job creation, especially for better-paying jobs.

It needs to make the skill demands of jobs much more transparent, so job seekers know the credentials required to move ahead on their own career paths. It needs to ensure that all Americans can gain the skills and knowledge that they—and the economy—depend on for success. And the United States needs to improve the benefits and returns from work for all Americans. more (pdf)>

We Need More Social Investment But No More PPPs

By Richard Pond – Europe needs to spend €1.5 trillion on social infrastructure between now and 2030 to redress the massive under-spend over recent years and to address the increasing demands on social services. This is one of the main arguments of the report, Boosting Investment in Social Infrastructure in Europe.

While the report is very good in identifying the scale of the problem, it fails to address some of the key reasons why spending on social infrastructure has been too low for too long and so puts too much emphasis on an increased role for private finance.

There is an alternative view that puts public investment at the center of the solution and this requires an analysis of why the cuts in public investment have been so deep for so long.

It identified three key problems:

  1. The relatively low political cost of downsizing/delaying government investment programs compared to current expenditure programs and subsidies;
  2. An undervaluation of the role of government investment for growth, including its crowding-in effect in times of low growth; and
  3. A set of European and national fiscal sustainability regulations that do not incentivize the prioritization and ring-fencing of capital spending, especially at the sub-national level.

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How to Serve a President You Don’t Like

By Dannielle Blumenthal – It is no secret that the vast majority of Washingtonians dislike our current president.

But you do not have to like the president to serve well, to make your agency more functional, and to deliver great service to the American public. Because whatever program I was working on, it had little or nothing to do with the president and everything to do with the citizen. The more effectively and efficiently I contributed, and helped others to contribute, the better we served the taxpayers, who too often are forgotten in all the discord.

Many conflicts in government really are about ideological differences and beliefs that are fervently held. Others are about personality differences. Still others have to do with money, status, and power. Many are a mixture of all of these.

But most federal employees aren’t having these power struggles.

Most civil servants, at least, can serve a president they don’t like. But if doing you job under this president means violating your personal beliefs and principles, then I would argue it’s incumbent upon you to find another place to work outside of government. more>