Author Archives: Brad Warbiany

Government Spending Has Been Flat The Past 5 Years. No, Really!

Revenue and Spending 2000-2019 (estimated)

Back in 2011, I looked at some CBO projections, and said that the country was in dire straits financially. Spending seemed to be on an absolute tear, and revenue–even if it lived up to wildly optimistic projections–wasn’t going to come close to keeping up.

Essentially, the CBO projections pointed to spending occurring at absolutely unprecedented levels, and relied on completely unrealistic projections of economic growth to [not quite even] pay for it. At the time, I said:

Even with those assumptions, where does spending fall historically? Even at these rosy projections, it never falls under 22% of GDP (on par with the highest spending the country has seen since WWII), and those rosy projections came in January 2010. A year later, in January 2011, the CBO outlook got worse. It now shows spending never falling under 23% of GDP during the decade 2011-2020. Historically, spending has not exceeded 23% of GDP for a single year between 1946 and 2008.

Where has revenue been over the last few decades? Well, for the years 1991-2000, during which time we suffered one mild recession followed by the tech bubble, total government revenue averaged 18.75% of GDP. For the years 2001-2010, where we dealt with the tech bubble collapse followed by the subprime bubble and then crash, total government revenue averaged 17.07% of GDP. A sizeable drop, to be sure (the worst spots being 2009 & 2010, where the financial crash slammed revenue below 15% of GDP). But fundamentally not that far out of line with historical precedent.

Now, I hadn’t gone back to look at the numbers since then. So I was very surprised to read a Cato post suggesting that spending was stagnant and was sitting at a mere 20.3% of GDP, not the 23%+ area that the CBO was projecting. As Daniel Mitchell from Cato puts it (emphasis added):

Here are some specific numbers culled from the OMB data and CBO data. In fiscal year 2009, the federal government spent about $3.52 trillion. In fiscal year 2014 (which ended on September 30), the federal government spent about $3.50 trillion.

In other words, there’s been no growth in nominal government spending over the past five years. It hasn’t received nearly as much attention as it deserves, but there’s been a spending freeze in Washington.

I was frankly shocked. So I ended up going straight to the OMB data (note: it’s an .xls file) to confirm.
Revenue and Spending 2000-2019 (estimated)
Looks pretty legit. Spending was pushing well above 23% GDP for a few years due to the economic meltdown, the stimulus, and the continuing effects of global war.

What’s interesting, and I pulled this out of the graphic for clarity (go download the original source data if you want to confirm) is that this is NOMINAL spending. Considering there has been inflation since 2009, it’s actually fair to say that spending has decreased in real dollars over the last 5 years.

Spending is well below the CBO projections from 2010 that I used in my previous post. And frankly, revenue is WELL below their projections as well. But the spending restraint is sufficient to keep both spending as a percentage of GDP and deficits as a percentage of GDP in reasonable territory.

Now, there are always devils in the details. Mitchell points out a few in his post at Cato, and has even more to say on the subject here. But either way you slice it, the fiscal meltdown that many (including me 3 1/2 years ago) were predicting hasn’t come to pass.

Some on the left will credit Obama (even though they’ve never seen spending they didn’t like). Some on the right will credit the Tea Party (even though they spent the 8 years prior to Obama spending like a Kardashian wedding).

As for me, I’m just going to say that I’m glad my predictions–based on CBO projections–didn’t come to pass.

Do Rich High School Dropouts Do “As Well” As Poor College Grads?

Poor Grads & Rich Dropouts

That’s the claim of Matt O’Brien at Washington Post’s Wonkblog, in a post titled (unsurprisingly), “Poor kids who do everything right don’t do better than rich kids who do everything wrong.” His main point:

Even poor kids who do everything right don’t do much better than rich kids who do everything wrong. Advantages and disadvantages, in other words, tend to perpetuate themselves. You can see that in the above chart, based on a new paper from Richard Reeves and Isabel Sawhill, presented at the Federal Reserve Bank of Boston’s annual conference, which is underway.

Specifically, rich high school dropouts remain in the top about as much as poor college grads stay stuck in the bottom — 14 versus 16 percent, respectively. Not only that, but these low-income strivers are just as likely to end up in the bottom as these wealthy ne’er-do-wells. Some meritocracy.

So the anger is that some rich dropouts still succeed and make it to the top, and some poor college grads remain on the bottom. Or, to annotate a graph as O’Brien did:

Poor Grads & Rich Dropouts

This, however, is a terrible analysis.

First and foremost, it doesn’t live up to his title. Poor kids who do everything right do quite a bit better than rich kids who do “everything” wrong. Only 20% of rich kids who don’t graduate high school make it into the top 40% of income earners. 41% of poor college grads make it into those upper quintiles. Almost 70% of poor college grads make it into the top 60% of income earners. Only 49% of rich HS dropouts do so. The other half of rich high school dropouts end up in the bottom two quintiles, as you’d expect from high school dropouts.

Now, nobody will argue that poor kids don’t have an uphill battle from day 1. And nobody will argue that rich kids have a multitude of advantages in front of them. Their path to success is easier. There are many reasons for this, and I’m not going to go into them here, but suffice to say that I agree with the simple premise that it’s harder to succeed when you start out poor.

But what the graph that O’Brien uses to prove his point is actually proving that putting your nose to the grindstone, pushing yourself to enter and complete college, is important whether you’re rich or you’re poor. If rich HS dropouts were successful at a higher rate than poor college grads, I might agree with this analysis. But they’re not. Poor college grads do measurably better than rich HS dropouts.

Yes, some poor college grads still end up on the bottom, and some rich HS dropouts still succeed. But how many, and why? Compare the above chart with the below (also from the Reeves/Sawhill paper):

Overall mobility

Social Mobility Matrix, US Overall

In this chart, you can see that the bottom quintile–60% of them, in fact–stayed in the bottom two quintiles. Only 23% made it to the top two quintiles. And the top quintile–56% of them–remained in the top two quintiles. Only 25% fell to the bottom two quintiles. So overall, completely outside of any educational data whatsoever, the bottom remained on the bottom and the top remained on the top.

But if you’re poor, and you graduate college, you flip the script. Your odds are very good to go from the bottom quintile to middle class or better. And if you’re rich but don’t graduate college, your odds are better that you’re going to end up in lower middle class or worse. It won’t hold true for everyone, as there are strong cultural factors in play. But those cultural factors are not overwhelming. Demography DOES NOT equal destiny.

That’s meritocracy.

Brad’s Beer Review: Red Brick Brewing’s Matcha Super Green Yuzu IPA

First, my apologies for missing the review last week. With the site migration not completing until Sunday, I didn’t get a chance to put something together.
Matcha Super Green Yuzu IPA
This week I’ve tried to do something a little different. Here in Southern California, I could easily spend years doing a weekly review just of beer from San Diego County. Many of these, such as Alpine, are difficult to get even here in Orange County, much less for the rest of the world.

Luckily, I recently had a beer trade with a coworker who lives in Georgia. I sent him a box of Russian River beer, and he sent the best of the best of GA beer. I might as well review something that our readers back east have better access to than we do out here. In this case, it’s Red Brick Brewing’s Matcha Super Green Yuzu IPA. Because when I think Georgia–bearing in mind that I lived there for two years–my first thought is “green tea IPA”!

That said, it’s my first tea-infused beer, so it should be an interesting experience!

  • Stats: 7.8% ABV, 62 IBU. 4.5 SRM.
  • Aroma: Well, for an IPA, it certainly doesn’t lead with hops. Bit of a shame there. Maybe a bit of the tea, but not overwhelming. I definitely pick up a bit of graininess and a bit of phenol.
  • Appearance: Pale gold, very hazy. Not much head. I typically pour rather gently, but as it was going I tried to get much more aggressive and still didn’t get much. I think the tea definitely causes the haze, but not sure on the head.
  • Flavor: For an IPA, and a 62 IBU IPA at that, I don’t find it overwhelmingly bitter. There’s a maltiness in there. Granted, this is not all that uncommon for East Coast IPAs. The tea is not overdone. A concern with any spiced beer is that the spice will absolutely overwhelm everything else. In this case it melded very well. I would have liked some more hops, though.
  • Mouthfeel: Light to medium body, but with a bit of sweetness that makes it seem a little bigger than it is. I think here is where the tea is most detectable, though. It’s different on the tongue than a typical beer. I get this tiny back-of-the-tongue astringency that I don’t get often.
  • Overall Impression: This one was just “ok” for me. Everything seemed a bit “muddled”. I like nice crisp dry IPAs that are heavy on the hops. I didn’t get them. I do like tea, and I was expecting a bit more noticeable tea character. And the maltiness kind of overshadowed both of those. I wouldn’t really recommend this one.

There you have it. A great big “meh”. I’m sure it’s possible to get green tea to work harmoniously in an IPA, but this isn’t the one.

Book Review: Hearts of Darkness

I recently read* Hearts of Darkness: Why Kids Are Becoming Mass Murderers and How We Can Stop It

This is obviously setting up to be a slightly controversial book from the start. Trying to delve into the psychology of mass killings is fraught with peril.
Hearts of Darkness
This book, however, seems to deliver on its theme.

At its core, the book makes two arguments. Both have merit, but both also lead to questions. At its core, the arguments boil down to this:

  1. Mass killings have become an epidemic, and are a serious issue in their own right that need to be addressed by society.
  2. Mass killings are fundamentally an intersection between the forces of society and severe mental health issues.

I have my issues with both arguments.

First, essentially all statistics on violent crime show that it’s in the decline. So while I’m not going to argue whether or not mass shootings in the dramatic and newsworthy sense are increasing or decreasing [as I haven’t looked at the stats], I’m concerned that the authors didn’t even address the fact that violent crime is decreasing in the aggregate. If you want to make the case that this particular problem is worth addressing, you’d think that including overall crime stats and explaining why this trend increasing in the face of declining crime is worth of a societal response is really necessary.

Second, the argument of the book is quite clear. Essentially all of the killers profiled showed evidence of paranoid schizophrenia. We’re not talking about normal people who went over the edge. We’re talking about crazy people who decided to manifest their version of crazy in a way that causes extreme casualties. But if you assume that these events are increasing, that means we either are seeing an increase in the number of crazy people or we’re seeing something in society that is making crazy people more prone to these events. Unfortunately, the authors don’t seem to justify either argument.

That said, I like the book for its deep investigation into the history of several of these high-profile killers. What they show, with intense research, is that every one of the profiled killers were showing evidence of severe mental schisms. And we’re not talking about depression, or anxiety. We’re talking about hardcore paranoid schizophrenia. Depressed people take their own lives. People who hear voices, or have other similar breaks with reality, are the ones who try to take a bunch of people with them.

The Good:

First and foremost, the book extensively focuses on mental health issues. It essentially states that not all paranoid schizophrenics will become mass shooters. In fact, only a small number will. But it looks into the history of several of these killers and severe mental instability is a pretty darn clear thread woven through their history.

Second, I do like the fact that they don’t fall on the trope of “the kid was autistic, therefore he’s an unfeeling monster” garbage. Yes, autistic people tend to have difficulty relating to others in a “normal” way. No, they don’t lack empathy or concern for others. Autistic people tend to be much less violent than in general. But every time you get into one of these mass killings, the speculation is that the killer is autistic. And in the case of Adam Lanza, it pretty well seems to line up. But the key is that while autistic people tend not to be violent, people who are both autistic and paranoid schizophrenics or have borderline personality disorder just might be violent. Clearly this is an important distinction to me.

Third, this is most certainly NOT an anti-gun book. Despite the fact that the authors are pretty well in favor of gun control, they’re cognizant of the fact that this is not central to the thesis of the book. They do indulge for about 2 pages in the waning portions of the text to suggest that maybe if getting a gun is harder than it is now, that you might see a decrease in these killings. Given the restraint they show throughout the rest of the book, I’ll indulge them 2 pages towards the end.

The Bad:

The “epidemic” claim is not well supported. They throw out a statistic on multiple-death shootings having gone up over the years, but I think to call these “mass” killings in the same vein as a Sandy Hook or Columbine is a stretch. As mentioned before, overall violent crime is in decline over the last several decades, so it’s hard to square this with an epidemic of mass murder. I think if you’re trying to prove an epidemic, the best answer is that with modern communication, we not only know more about these events, and sooner, than we did before, and that in some of the cases the perpetrators were–if not “copycats”–inspired by previous killers. This is made clear in the book, but still I find “epidemic” to be a stretch.

They do a good job of profiling certain killers. But there are many mass killers that are NOT covered here. A skeptical reader is left wondering why not. Now, it could be simple. The authors may simply not have had access to enough medical records or personal history of these other killers to draw a conclusion. It may have been that family and friends or family of the killers were just non-cooperative with the authors. Or, of course, it could be that the authors cherry-picked the ones who supported their premise and left those who did not out. It wasn’t addressed either way, and I think it should have been.

But where the book really fails is to draw a significant conclusion. They clearly have identified a problem and a diagnosis, but when it comes to serious mental disorders, it’s very easy to overreach between acting in the interests of public safety, and trampling the rights of the disabled. After all, a very small proportion even of the mentally ill are likely to go on shooting sprees. How far are we really willing to go to stop this? At best, raising awareness of the issue to identify potential “cries for help” might be the best option, as in a number of these cases, the killers really did need, and express their want of, help to get better.

In their close, the authors point to a number of possible factors leading to this rise. He’re we’re exposed to a litany of the usual suspects. Easy access to guns (and high capacity magazines) is one. Violent video games is another. Leaning left, as they do, they throw out a few more, such as economic issues, globalization, and free speech on the internet. All of these seem to be a bit of a stretch. Hell, they might even want to throw “overpopulation” in there, because more people equals more targets, right? The problem with each of these is that under the right conditions, one can find a study suggesting that these are contributory factors, but it’s never clear just how much of this issue will go away by “solving” any given one of these issues. Nor can we typically agree on the solutions.

Conclusion:

I’m sure this is not an easy book to write. It’s a deeply troubling issue, and one where it’s almost bound to be politicized. Every time one of these events happens, the left and right tend to immediately look for any signs that the killer numbers among the other party. And every time we libertarians see something like Jared Loughner, we immediately worry that someone will assume that all libertarians are going to “go postal” on the Post Office.

This book does a great job to highlight that crazy doesn’t choose a party. And that for the most part, while violent people may kill people, it’s the crazies who are responsible for mass murder. It really is a useful book purely on that point alone. We do have a mental health issue in this country (and other countries do as well), and this is something that should be addressed so that we can help the people at risk of perpetrating these acts.

But the byline of the book includes “and How We Can Stop It.” I think the book fails to deliver on that claim. Now, that isn’t necessarily the authors’ fault. I’m not sure there is an easily-packaged solution that they could put together for us. And much like terrorism, you can win 99 battles out of 100, but that 100th is going to dominate the news cycle. In a country of 300M people, and a world of 7B, the law of large numbers states that perhaps this is simply a problem the world must endure.

At best, they say that these battles are won on the margins, and that with some small changes, like reduced capacity magazines or better control over the sale of violent video games, we might save “some” lives, and that’s better than none. However, I think their politics cause them to minimize the cost to liberty of infringing on our rights to make these improvements at the margins.

In short, the book was a worthwhile read, especially since I see it at Amazon in hardcover for $2.43 right now. At the original print price, though, probably not worth it.
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Brad’s Beer Review: Stone Coffee Milk Stout

This is a beer I’ve wanted to try ever since I heard it was to be released. Milk Stout (sometimes known as sweet stout or cream stout) is one of my favorite beer styles. I first found Left Hand Brewing Company’s Milk Stout when I lived in Georgia back in ‘05-07. When I moved back to California, I couldn’t get Left Hand beers (nor could I easily find any commercial milk stouts), so I used the info from their web site and my own palate and created a homebrewed milk stout that has been roundly adored by friends and family, and kicked major tail in competitions.
Stone Coffee Milk Stout

Thus, the news that Stone Brewing, a company whose beer I generally find faultless, was going to brew a milk stout got me excited. The fact that they were going to add coffee—another thing I love—to the mix made me even more so. I saw it at the grocery store this afternoon, and immediately knew it was coming home.

Milk Stout is so named because it is typically sweetened with lactose (milk sugar). Take note, lactose-intolerant folks, this style is not for you. Lactose is unfermentable by saccharomyces cerevisiae, so the sugar adds sweetness without adding additional alcohol. The Milk Stout style, in comparison to the Dry Stout, will have a sweeter finish. Even for a beer that may have a reasonable amount of roast flavor and aroma (and the bitterness that comes with roasted malts), the sweetness should cleanse the palate for the next sip.

Now, on to my thoughts for the Stone Coffee Milk Stout:

  • Stats: 4.2% ABV, 40 IBU. Color not listed.
  • Aroma: I definitely pick up roast here. To me, the roast is definitely more prominent than the coffee in the aroma. I don’t pick up any hops in the aroma, which is appropriate for the style.
  • Appearance: Black and completely opaque. Light brown / dark tan head with great lacing. Really, though, describing the appearance of a stout is rather boring. They do pretty much all look black!*
  • Flavor: Up front, there’s a hit of roast, but it quickly subsides into coffee. While you—or at least I—cannot smell much coffee in the nose, it’s definitely strong on the tongue. I will say that the beer doesn’t finish as sweet as other milk stouts I’ve tasted. One of my criticisms of many commercial milk stouts is that they take a dry stout with relatively weak roast character and just add lactose. My own recipes tend to be big on the roast and correspondingly big on the lactose. This beer seems a bit big on the roast and coffee, with JUST enough sweetness to cover the bitterness of the roasted malt, the coffee, and the hops, but not a dominant perception of sweetness.

    Of course, all of this is in character for Stone. They tend towards big flavor, and most of their beers don’t shy away from bitterness, and finish fairly dry. This seems to me to fit into their general palate profile. And this beer clocks in at 40 IBU [International Bitterness Unit], which is the top of the scale for a beer that falls into the bottom of the scale for ABV.

  • Mouthfeel: Again, I expect most milk stouts to be pretty full-bodied. This is much closer to medium body, with a slightly more dry finish than I would typically expect from the style.
  • Overall Impression: Honestly, this is a delicious beer. I’m really enjoying it. It’s not entirely what I was expecting, though. In fact, if you didn’t tell me there was lactose in this beer, I’d have a difficult time picking it out. The bias towards bitterness, the medium body and the dry finish, all just say “coffee stout” to me. But the simple fact is that I like bitterness, I like dry finishes, and I generally enjoy light to medium body beers. So while it is delicious, it’s not necessarily something I’d recommend as a pure example of the style.

All that said, I highly recommend you buy this beer. It truly is delicious.
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