05-14-2016, 04:35 AM
Basically it's something that cannot happen in the universe of market fundamentalists..
Nordic Zombie Arguments
Posted by Matt Bruenig on June 9, 2015
There are two amazing things about watching the American Right struggle mightily to contend with the smashing success of the Nordic social democracies. The first is that their arguments about the Nordics seem to shift daily and often in contradictory ways. The second is that they glom on to zombie arguments that really appeal to the straining-to-be-clever crowd long after they've been eviscerated. The current zombie argument that appeals to this crowd is about innovation.
You see, the cynical naysers of the Nordics have a very big problem on their hands. Actual measurable economic indicators show the Nordics, for at least 50+ years now, ripping through the convenient story US right-wingers like to tell about growth. Despite doubling (relative to the US) all the stuff right-wingers constantly tell us is going to kill growth (welfare and taxes), the Nordics defiantly grow as fast as the US, and this is true even for the Nordics that aren't called Norway.
To deal with this uncomfortable fact, the right-wing therefore has to shift arguments. They can't say these policies kill growth even though that's what they've been predicting all along because, well, they don't. So instead, they have changed to saying that, though the Nordic model destroys growth-boosting innovation, they manage to grow despite that by stealing all the innovations of the magnificent United States of America.
Jim Pethokoukis made this move last week despite literally writing a post just a few months ago about how the proof for this argument is garbage. Now it's Megan McArdle who did nothing more than, out of the blue, cite the exact same joke paper and reup the nonsense:
I cannot put this more bluntly: this paper is literally trash. It is the most failed paper written in a long time. To talk about merely "quarreling" with the academics' model is to a disservice to the reader. The authors empirical evidence for this is, as Jim Pethokoukis points out, that the US has way more patent trolls than other countries have. That's it. There is nothing else going on, empirically, in the paper. And while the US certainly has innovated patent trolling like no other, it's not exactly a strong point in favor of the US model.
But the great thing about "innovation" here is that the term is so imprecise and vague that the Right has an endless refuge in it. On the hard economic indicators that they assured us could not go the way they have gone in the Nordics, they have lost. But on mushy underdefined amorphous concepts like "innovation," they can, precisely due to its imprecision, feel comfortable acting like they've made some point here.
And it hardly matters what you do about that point. You can show, as many have, that the Nordics have higher start-up rates than the US. You can show, as many have, that the Nordics have higher business R&D than the US. You can show that they have higher levels of venture capital than the US. You can show that they have higher numbers of international triadic patents (patents that, because they are filed in the EU, US, and Japan, are not skewed by the unique American phenomenon of patent trolling rent-seekers). You can go through global innovation indexes that rank them at the same level as the US (some slightly above, some slightly below).
You can point at innovation indicator after innovation indicator after innovation indicator, and it just doesn't matter because there was once a non-reviewed working paper that relied solely on US patent trolling levels to prove the US is a super-duper innovator.
Cool Innovative Stuff Nordics Are Up To
Given this, I am at a loss about what to do here. If hard aggregate quasi-indicators of innovation don't do it, then are narratives necessary? Do I need to start listing cool innovative stuff Nordics have been up to? I guess it can't hurt. So let's give it a shot.
You know how yesterday Apple had a big conference about how they were starting a music streaming service and people were like "oh man, they are getting ready to compete with Spotify." Yeah that's a Swedish company. You remember when Jay Z wanted to compete with Spotify and launched Tidal? Yeah he bought up a Norwegian company to do that. Also, not to overwhelm you here, but the Swedish music industry is the best and most advanced in the world. Top American artists go to Sweden to record.
You remember Skype, groundbreaking video chat software? Brought to you by a Swede and a Dane (same folks who brought you Kazaa).
You know how people are real excited about self-driving cars? Maybe even Google will deliver one. Well, Swedish Volvo has been on that beat and are actually set to test their self-driving cars in 2017 with a plan for full automation by 2020. Remember how the US got real worked up about that lone Nevada tractor trailer that was going to be sort of self-driving? Well Sweden is doing something like that, except instead of having one truck with one dude who still sits in there (what's the productivity gain of that?), they have already successfully tested and are working on rolling out robo truck trains where 3+ trucks, occupied by no one, closely follows a lead truck operated by a driver, thereby quadrupling or more driver productivity while also cutting down on fuel costs because of reduced drag.
You know the top computer game in the history of the world (besides maybe Tetris) is Minecraft, coming out of Sweden right? You know Finland is a dominant player in the mobile games market more generally right? That's where Angry Birds came from. That's where Supercell (makers of Clash of Clans, among others) is located too.
You know that Finland's public research and development institute has been developing 5G mobile network technology, with speeds 10x faster than current 4G, and is already testing it in a city in Finland right now as we speak? You know Linux, the operating system that runs almost every website and app in the world as well as Android phones, comes initially from Finn Linus Torvalds, right?
All this stuff (and countless other stuff omitted) is not just innovation, but also cutting edge innovation of the sort pundits usually get excited about as the new frontier. That is, we are talking about mobile networking technology, self-driving cars, new media innovations in streaming and games and smartphone software. But of course it's not just these last few years. One would need to talk about Nokia, Ikea, Ericsson, and other iconic firms and their innovations and successes over the years as well, though I'll leave that aside here.
How many little stories would I need to dust on top of hard economic indicators to convince people that the Nordics do come out with new innovative stuff that seriously affects the entire world, and in fact probably overall punches well above its weight?
The answer of course is that no amount of anecdotes or even aggregate data will convince the naysayers otherwise. They are first and foremost ideologically opposed to egalitarian economic systems, even when they are constructed in ways that facilitate high-growth and high-innovation. If you asked someone like McArdle whether she would support the Nordic model if, hypothetically, it does actually comport with high growth and innovation, she would, if being honest, tell you no. The same goes for Pethokoukis and all the rest of the right-wing.
Even so, they can't, for seriousness purposes, admit that the Nordics do as well or better than the US on all important growth/innovation fronts though. That would not play well for their jobs as pundits. And thankfully, because "innovation" is just a vague placeholder without any precise meaning, they have found that thing they can say about why our horrifically brutal system truly is better and necessary for the world. Their intellectual dishonesty has a suitable zombie bedmate and they will hold on to it for dear life.
Nordic Zombie Arguments
Posted by Matt Bruenig on June 9, 2015
There are two amazing things about watching the American Right struggle mightily to contend with the smashing success of the Nordic social democracies. The first is that their arguments about the Nordics seem to shift daily and often in contradictory ways. The second is that they glom on to zombie arguments that really appeal to the straining-to-be-clever crowd long after they've been eviscerated. The current zombie argument that appeals to this crowd is about innovation.
You see, the cynical naysers of the Nordics have a very big problem on their hands. Actual measurable economic indicators show the Nordics, for at least 50+ years now, ripping through the convenient story US right-wingers like to tell about growth. Despite doubling (relative to the US) all the stuff right-wingers constantly tell us is going to kill growth (welfare and taxes), the Nordics defiantly grow as fast as the US, and this is true even for the Nordics that aren't called Norway.
To deal with this uncomfortable fact, the right-wing therefore has to shift arguments. They can't say these policies kill growth even though that's what they've been predicting all along because, well, they don't. So instead, they have changed to saying that, though the Nordic model destroys growth-boosting innovation, they manage to grow despite that by stealing all the innovations of the magnificent United States of America.
Jim Pethokoukis made this move last week despite literally writing a post just a few months ago about how the proof for this argument is garbage. Now it's Megan McArdle who did nothing more than, out of the blue, cite the exact same joke paper and reup the nonsense:
Quote:Where does innovation mostly come from? Daron Acemoglu, James Robinson and Thierry Verdier, the academics whom Drezner cites,argue that it disproportionately comes from economies where "incentives for workers and entrepreneurs results in greater inequality and greater poverty" . . . i.e., the United States. Those innovations, however, don't make just us more productive; they filter out to the rest of the world.
Now, you can quarrel with the academics' model, and indeed, many people have. But even if you think they are wrong about needing inequality-producing incentives to drive innovation, there remains a kernel of truth: When it comes to growth, Scandinavia's economic policy simply doesn't matter as much as U.S. economic policy, so it's hard to draw good lessons from it for other, larger countries.
I cannot put this more bluntly: this paper is literally trash. It is the most failed paper written in a long time. To talk about merely "quarreling" with the academics' model is to a disservice to the reader. The authors empirical evidence for this is, as Jim Pethokoukis points out, that the US has way more patent trolls than other countries have. That's it. There is nothing else going on, empirically, in the paper. And while the US certainly has innovated patent trolling like no other, it's not exactly a strong point in favor of the US model.
But the great thing about "innovation" here is that the term is so imprecise and vague that the Right has an endless refuge in it. On the hard economic indicators that they assured us could not go the way they have gone in the Nordics, they have lost. But on mushy underdefined amorphous concepts like "innovation," they can, precisely due to its imprecision, feel comfortable acting like they've made some point here.
And it hardly matters what you do about that point. You can show, as many have, that the Nordics have higher start-up rates than the US. You can show, as many have, that the Nordics have higher business R&D than the US. You can show that they have higher levels of venture capital than the US. You can show that they have higher numbers of international triadic patents (patents that, because they are filed in the EU, US, and Japan, are not skewed by the unique American phenomenon of patent trolling rent-seekers). You can go through global innovation indexes that rank them at the same level as the US (some slightly above, some slightly below).
You can point at innovation indicator after innovation indicator after innovation indicator, and it just doesn't matter because there was once a non-reviewed working paper that relied solely on US patent trolling levels to prove the US is a super-duper innovator.
Cool Innovative Stuff Nordics Are Up To
Given this, I am at a loss about what to do here. If hard aggregate quasi-indicators of innovation don't do it, then are narratives necessary? Do I need to start listing cool innovative stuff Nordics have been up to? I guess it can't hurt. So let's give it a shot.
You know how yesterday Apple had a big conference about how they were starting a music streaming service and people were like "oh man, they are getting ready to compete with Spotify." Yeah that's a Swedish company. You remember when Jay Z wanted to compete with Spotify and launched Tidal? Yeah he bought up a Norwegian company to do that. Also, not to overwhelm you here, but the Swedish music industry is the best and most advanced in the world. Top American artists go to Sweden to record.
You remember Skype, groundbreaking video chat software? Brought to you by a Swede and a Dane (same folks who brought you Kazaa).
You know how people are real excited about self-driving cars? Maybe even Google will deliver one. Well, Swedish Volvo has been on that beat and are actually set to test their self-driving cars in 2017 with a plan for full automation by 2020. Remember how the US got real worked up about that lone Nevada tractor trailer that was going to be sort of self-driving? Well Sweden is doing something like that, except instead of having one truck with one dude who still sits in there (what's the productivity gain of that?), they have already successfully tested and are working on rolling out robo truck trains where 3+ trucks, occupied by no one, closely follows a lead truck operated by a driver, thereby quadrupling or more driver productivity while also cutting down on fuel costs because of reduced drag.
You know the top computer game in the history of the world (besides maybe Tetris) is Minecraft, coming out of Sweden right? You know Finland is a dominant player in the mobile games market more generally right? That's where Angry Birds came from. That's where Supercell (makers of Clash of Clans, among others) is located too.
You know that Finland's public research and development institute has been developing 5G mobile network technology, with speeds 10x faster than current 4G, and is already testing it in a city in Finland right now as we speak? You know Linux, the operating system that runs almost every website and app in the world as well as Android phones, comes initially from Finn Linus Torvalds, right?
All this stuff (and countless other stuff omitted) is not just innovation, but also cutting edge innovation of the sort pundits usually get excited about as the new frontier. That is, we are talking about mobile networking technology, self-driving cars, new media innovations in streaming and games and smartphone software. But of course it's not just these last few years. One would need to talk about Nokia, Ikea, Ericsson, and other iconic firms and their innovations and successes over the years as well, though I'll leave that aside here.
How many little stories would I need to dust on top of hard economic indicators to convince people that the Nordics do come out with new innovative stuff that seriously affects the entire world, and in fact probably overall punches well above its weight?
The answer of course is that no amount of anecdotes or even aggregate data will convince the naysayers otherwise. They are first and foremost ideologically opposed to egalitarian economic systems, even when they are constructed in ways that facilitate high-growth and high-innovation. If you asked someone like McArdle whether she would support the Nordic model if, hypothetically, it does actually comport with high growth and innovation, she would, if being honest, tell you no. The same goes for Pethokoukis and all the rest of the right-wing.
Even so, they can't, for seriousness purposes, admit that the Nordics do as well or better than the US on all important growth/innovation fronts though. That would not play well for their jobs as pundits. And thankfully, because "innovation" is just a vague placeholder without any precise meaning, they have found that thing they can say about why our horrifically brutal system truly is better and necessary for the world. Their intellectual dishonesty has a suitable zombie bedmate and they will hold on to it for dear life.