Oregon bans Native American mascots in schools
Devil's Lake Daily Journal
The Oregon Legislature voted in 2001 to eliminate the word "squaw" from geographic names because many Native Americans consider it offensive. SALEM, Ore. (AP) — Eight Oregon high schools will have to retire their Native American mascots after the ...

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Chrystia Freeland highlights research showing that reduced discrimination over the last 50 years gave the economy a substantial boost -- increased fairness gave us increased efficiency. Unfortunately, however, it appears that new barriers may be emerging:

Equal rights and the U.S. economy, by Chrystia Freeland: Are equal rights good for the economy? ... A draft paper by four U.S. economists makes the strong empirical case... Fairness, they contend, has made the economy more productive. Chang-Tai Hsieh, Erik Hurst, Charles Jones and Peter Klenow argue that as much as 20 percent of the growth in productivity in the United States over the past 50 years can be attributed to expanded opportunities for women and blacks. ... Few women or blacks would describe the United States today as a perfectly color- or gender-neutral economy. But ... female and black workers have felt the change directly in their paychecks. According to the paper, the reduction in frictions since 1960 increased real wages for white women 39 percent; those of black women, who suffered double discrimination and therefore got a double boost, 57 percent; and those of black men 44 percent. But while the economy as a whole benefited, there was one group that lost out. The paper calculates that the “reduced friction” for women and blacks meant that the real wages of white men were 4.3 percent lower than they would have been without the increased competition. That result explains a political reality that we often don’t like to admit: Gains for women and blacks have come at a price for white men, and that is surely why some of them still resist the rights revolution. ... The story in their draft paper on women and blacks is positive... But the four economists suspect that for one category of Americans, the poor, the external barriers to professional success have actually increased. ... Hurst made sure I understood that this final point was just a hypothesis. The economists plan to run it through their model over the next few months and report on their results later this year. But if their theory pans out, their work will tell a story about America over the past 50 years that many of us intuitively will feel to be true – a country that discriminates less and less on the basis of gender, race and now sexual orientation, but where the class divide is becoming so stark as to constitute a new form of discrimination.

Increased inequality and the associated decrease in mobility are usually presented as as issues of fairness, but when barriers prevent people from realizing their potential that has implications for efficiency as well. It hurts both individuals and the economy as a whole when some groups of people face "external barriers."

New Jersey Legislature will Hold First-Ever Hearing on Bill to Decriminalize ...
eNews Park Forest
14 other states (Alaska, California, Colorado, Connecticut, Maine, Massachusetts, Minnesota, Mississippi, Nebraska, Nevada, New York, North Carolina, Ohio and Oregon) have already decriminalized small quantities of marijuana for personal use, ...

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OregonLive.com
Lessons from the Primary: Diverging Parties or Incumbents Behaving Badly?
Oregon Catalyst
So, with two members of the Legislature sent packing on Tuesday, has this polarization come to Oregon? Consider the case of Chris Telfer- Senator from Bend, former candidate for Treasurer, and one of two CPAs in Salem. She was also a bit of an anomaly ...
Oregon state Rep. Mike Schaufler and state Sen. Chris Telfer lose seatsOregonLive.com
As One Campaign Ends, Another BeginsKTVZ
Knopp Beats Incumbent Telfer For District 27OPB News

all 7 news articles »

Can the euro be saved?:

Apocalypse Fairly Soon, by Paul Krugman, Commentary, NY Times: Suddenly, it has become easy to see how the euro — that grand, flawed experiment in monetary union without political union — could come apart at the seams ... with stunning speed, in a matter of months... And the costs — both economic and, arguably even more important, political — could be huge. ... Greece is, for the moment, the focal point. Voters who are understandably angry at policies that have produced 22 percent unemployment — more than 50 percent among the young — turned on the parties enforcing those policies. And ... the result ... has been rising power for extremists. ... Greece won’t, can’t pursue the policies that Germany and the European Central Bank are demanding. So now what? Right now, Greece is experiencing ... a somewhat slow-motion bank run, as more and more depositors pull out their cash in anticipation of a possible Greek exit from the euro. Europe’s central bank is, in effect, financing this bank run by lending Greece the necessary euros; if and (probably) when the central bank decides it can lend no more, Greece will be forced to abandon the euro and issue its own currency again. This demonstration that the euro is, in fact, reversible would lead, in turn, to runs on Spanish and Italian banks. Once again the European Central Bank would have to choose whether to provide open-ended financing; if it were to say no, the euro as a whole would blow up. Yet financing isn’t enough. Italy and, in particular, Spain must be offered hope —... some reasonable prospect of emerging from austerity and depression. Realistically, the only way to provide such an environment would be for the central bank to ... accept and indeed encourage several years of 3 percent or 4 percent inflation... Both the central bankers and the Germans hate this idea, but it’s the only plausible way the euro might be saved. ... So will Europe finally rise to the occasion? Let’s hope so... For the biggest costs of European policy failure would probably be political. Think of it this way: Failure of the euro would amount to a huge defeat for the broader European project, the attempt to bring peace, prosperity and democracy to a continent with a terrible history. It would also have much the same effect that the failure of austerity is having in Greece, discrediting the political mainstream and empowering extremists. All of us, then, have a big stake in European success... The whole world is waiting to see whether they’re up to the task.

Tim Duy:

Closer to Colliding, by Tim Duy: Each passing day brings the runaways trains closer to collision.  

The European strategy to scare the Greek people into voting for pro-austerity parties was always risky. My tendency is to think it will drive voters in the other direction, this is especially the case if voters come to believe they hold the real leverage. And that is exactly the strategy that is emerging. From the Wall Street Journal:

The head of Greece's radical left party says there is little chance Europe will cut off funding to the country and if it does, Greece will repudiate its debts, throwing down a gauntlet that could increase tensions between Greece's recalcitrant politicians and frustrated European creditors...

..."Our first choice is to convince our European partners that, in their own interest, financing must not be stopped," Mr. Tsipras said in an interview with The Wall Street Journal. "If we can't convince them—because we don't have the intention to take unilateral action—but if they proceed with unilateral action on their side, in other words they cut off our funding, then we will be forced to stop paying our creditors, to go to a suspension in payments to our creditors."

Europe and the Greece are locked in a battle of mutually assured financial destruction. Nor can European leaders afford to take Tsipras' threats lightly:

According to recent opinion polls, Mr. Tsipras' party is poised to win the most votes in repeat elections next month, bettering its surprise second-place finish in an inconclusive May 6 vote that left no party or coalition with enough seats in Parliament to form a government. With Mr. Tsipras poised to win pole position in the coming vote, it raises the risk that Greece will soon face a showdown with its European creditors over the contentious austerity program that Athens must implement in order to receive fresh aid.

If Europe caves and gives in to Greek demands, however, a new set of challenges to the austerity agenda will arise. How long would it be before the people of Spain or Italy or Portugal or Ireland realize that they too have much more leverage than they ever imagined. Can the Troika cave to Greece while remaining credible with other troubled economies?  I doubt it - which I think increases the risk that the core of Europe will believe it necessary to create a moral hazard example out of Greece.  

Of course, this worked so well with Lehman Brothers. We will just foget about that little detail for the moment.

• A secret Denmark shares with Canada about mobility - Miles Corak
• Greece Must Exit - Nouriel Roubini
• Spending and Growth - Paul Krugman
• What Makes Countries Rich or Poor? - Jared Diamond
• American Lessons (for Europe) - Acemoglu and Robinson
• The Fruits of European Austerity - mainly macro
• Duy Sums Up - French Politics
• The Eurozone Crisis: An End to Austerity? - Jeff Madrick
• Europe's woes and policy hedging - Macro Matters
• Why Markets Won’t Fix JPMorgan - The Baseline Scenario
• Investigating JPMorgan Chase - Simon Johnson
• "Does Canada have Dutch disease?" - Stephen Gordon
• Divorce rates help explain why Americans work more  - Vox EU
• Ignorance Is Strength: House of Representatives Edition - Econbrowser
• Geithner to Dimon: Resign From The NY Fed Board - Baseline Scenario
• The Problem with the Throw-Greece-from-the-Train Plan - Peter Dorman
• FOMC Minutes - Stephen Williamson
• Not a Greek Problem - Paul Krugman

Oregon bans Native American mascots in schools
Fox News
The NCAA limits the use of imagery and names considered hostile and abusive, and a debate still rages over the University of North Dakota's "Fighting Sioux" nickname and a logo with the profile of an American Indian warrior. The Oregon Legislature ...

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USA TODAY
Oregon bans Native American mascots in schools
USA TODAY
Oregon Department of Education officials say Wisconsin is the only other state to enact restrictions on Native American mascots. Wisconsin's law, approved by the Legislature in 2010, requires school boards to prove that their Indian mascots don't ...

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KEPR 19
Oregon bans Native American mascots in schools
CBS News
The NCAA limits the use of imagery and names considered hostile and abusive, and a debate still rages over the University of North Dakota's "Fighting Sioux" nickname and a logo with the profile of an American Indian warrior. The Oregon Legislature ...
Oregon education board OKs some of nation's toughest restrictions on Native ...Minneapolis Star Tribune

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KATU
Oregon education board OKs some of nation's toughest restrictions on Native ...
Washington Post
Oregon Department of Education officials say Wisconsin is the only other state to enact restrictions on Native American mascots. Wisconsin's law, approved by the Legislature in 2010, requires school boards to prove that their Indian mascots don't ...
Oregon bans Native American mascots in schoolsSI.com

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Oregon bans Native American school mascots
The Spokesman Review
The NCAA limits the use of imagery and names considered hostile and abusive, and a debate still rages over the University of North Dakota's “Fighting Sioux” nickname and a logo with the profile of an American Indian warrior. The Oregon Legislature ...

OregonLive.com
In Oregon, justice delayed
OregonLive.com
This is why lawmakers should make the courts a high priority when the legislative Emergency Board meets next week -- and when the Legislature reconvenes next year. Oregon lawmakers have made several smart investments in the state court system in recent ...

Oregon bans Native American mascots in schools
WOKV
The Oregon Board of Education is scheduled to vote on a resolution that would require Oregon schools to retire their Native American mascots within five years or risk losing state funding. The vote Thursday, May 17, 2012 could give Oregon some of the ...

MyFoxOrlando.com
Oregon Bans Native American Mascots
MyFoxOrlando.com
... nickname and a logo with the profile of an American Indian warrior. The Oregon Legislature voted in 2001 to eliminate the word "squaw" from geographic names because many Native Americans consider it offensive. education_news_2009030310540036_JPG.

KATU
Oregon education board OKs some of nation's toughest restrictions on Native ...
Washington Post
Eight Oregon high schools will have to retire their Native American mascots after the Board of Education voted Thursday to prohibit them, giving the state some of the nation's toughest restrictions on Native American mascots, nicknames and logos.
Oregon bans Native American mascots in schoolsThe Associated Press

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Oregon bans Native American mascots in schools
The Associated Press
The NCAA limits the use of imagery and names considered hostile and abusive, and a debate still rages over the University of North Dakota's "Fighting Sioux" nickname and a logo with the profile of an American Indian warrior. The Oregon Legislature ...

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Oregon bans Native American mascots in schools
WHIO Dayton
Oregon Department of Education officials say Wisconsin is the only other state to enact restrictions on Native American mascots. Wisconsin's law, approved by the Legislature in 2010, requires school boards to prove that their Indian mascots don't ...

David Altig argues that flexible inflation targeting "is far from dead":

Is inflation targeting really dead?, by David Altig: Harvard's Jeffrey Frankel (hat tip, Mark Thoma) is the latest econ-blogger to cast an admiring gaze in the direction of nominal gross domestic product (GDP) targeting. Frankel's post is titled "The Death of Inflation Targeting," and the demise apparently includes the notion of "flexible targeting." The obituary is somewhat ironic in that at least some of us believe that the U.S. central bank has recently taken a big step in the direction of institutionalizing flexible inflation targeting. Frankel, nonetheless, makes a case for nominal GDP targeting:

"One candidate to succeed IT [inflation targeting] as the preferred nominal monetary-policy anchor has lately received some enthusiastic support in the economic blogosphere: nominal GDP targeting. The idea is not new. It had been a candidate to succeed money-supply targeting in the 1980's, since it did not share the latter's vulnerability to so-called velocity shocks.

"Nominal GDP targeting was not adopted then, but now it is back. Its fans point out that, unlike IT, it would not cause excessive tightening in response to adverse supply shocks. Nominal GDP targeting stabilizes demand—the most that can be asked of monetary policy. An adverse supply shock is automatically divided equally between inflation and real GDP, which is pretty much what a central bank with discretion would do anyway."

That's certainly true, but a nominal GDP target is consistent with a stable inflation or price-level objective only if potential GDP growth is itself stable. Perhaps the argument is that plausible variations in potential GDP are not large enough or persistent enough to be of much concern. But that notion just begs the core question of whether the current output gap is big or small. At least for me, uncertainty about where GDP is relative to its potential remains the key to whether policy should be more or less aggressive.

In another recent blog item (also with a pointer from Mark Thoma), Simon Wren-Lewis offers the opinion that acknowledging uncertainty about size of the output gap actually argues in favor of being "less cautious" about taking an aggressive policy course. The basic idea is familiar. It is a simple matter to raise rates should the Fed overestimate the magnitude of the output gap. But with the short-term policy rates already at zero, it is not so easy to go in the opposite direction should we underestimate the gap.

No argument there. As I pointed out in a May 3 macroblog item, Atlanta Fed President Dennis Lockhart has said the same thing. But, as I argued in that post, this point of view is only half the story. Though I agree that the costs are asymmetric with respect to the downside with respect to the FOMC's employment and growth mandate, they look to me to be asymmetric to the upside with respect to the price stability mandate. And I view with some suspicion the claim that we know how to easily manage policy that turns out to be too aggressive after the fact.

My issues are not merely academic. In an important paper published a decade ago, Anasthsios Orphanides made this assertion:

"Despite the best of intentions, the activist management of the economy during the 1960s and 1970s did not deliver the desired macroeconomic outcomes. Following a brief period of success in achieving reasonable price stability with full employment, starting with the end of 1965 and continuing through the 1970s, the small upward drift in prices that so concerned Burns several years earlier gave way to the Great Inflation. Amazingly, during much of this period, specifically from February 1970 to January 1977, Arthur Burns, who so opposed policies fostering inflation, served as Chairman of the Federal Reserve. How then is this macroeconomic policy failure to be explained? And how can such failures be avoided in the future?...

"The likely policy lapse leading to the Great Inflation …can be simply identified. It was due to the overconfidence with which policymakers believed they could ascertain in real-time the current state of the economy relative to its potential. The willingness to recognize the limitations of our knowledge and lower our stabilization objectives accordingly would be essential if we are to avert such policy disasters in the future."

With this historical observation in hand, it seems a short leap to turn Wren-Lewis's thought experiment on its head. Arguably, the last several years have demonstrated that nonconventional policy actions have been quite successful at short-circuiting the disinflationary spirals that pose the central downside risk when interest rates are near zero. (If you can tolerate a little math, a good exposition of both theory and evidence is provided by Roger Farmer.)

On the opposite side of the ledger, we know little about the conditions that would cause the Fed to lose credibility with respect to its commitment to its inflation goals, and very little about the triggers that would cause inflation expectations to become unanchored. Thus, I think it not difficult to construct a plausible argument about the risks of being wrong about the output gap that is exact opposite of the Wren-Lewis conclusion.

I end up about where I did in my previous post. Flexible inflation targeting, implemented in such a way that the 2 percent long-run inflation target rate exerts an observable gravitational pull over the medium term, feels about right to me. Despite what Frankel seems to believe, I think that idea is far from dead.

Greek party most extreme of Europe's far right
KTVL
Twenty-one members of Golden Dawn were sworn into Greece's Parliament on Thursday, making it arguably the most far-right party to enter a European national legislature since Nazi-era Germany. Europe's financial crisis is changing the tone across the ...

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