People are bound to debate at the margin what services should be publicly subsidized and to what extent. But voters like services and dislike taxes, so there’s always a robust market for trying to fudge the idea that less subsidization means lower levels of service. One frequent dodge here is federalism, whereby you sort of wave around the idea of state government as a way to evade the issue at hand. To wit, via Kevin Carey comes the thinking of Rep Virginia Foxx of North Carolina:

Q. More generally, you have said you don’t believe there’s an appropriate role for the federal government in higher education. How far do you think the current, fairly significant role can — or should — be rolled back?

A. The federal government’s involvement in higher education can and should be scaled back gradually in the coming years. Ideally we’d be able to reduce the burdensome federal bureaucracy and delegate much of the funding and policy decision making to state governments. This would help to foster better solutions to the specific issues confronting higher education and provide improved accountability for taxpayer dollars.

This is doubly nonsense. For one thing, as Carey argues if you devolved responsibility for research spending decisions to state governments then instead of “improved accountability” what you’d find is that each state government wants to fund research at home state universities. For an equal dollar amount of spending, we’d get less value.

More generally, I for one think labor mobility and social mobility are excellent things. If a poor kid from Detroit manages to get into the University of Michigan, graduate, and go get a good job in Chicago or New York or Atlanta or Houston then that’s an American success story. And it’s something officials responsible for education policy in Michigan shouldn’t be afraid of—the long-term decline of automobile industry employment isn’t something they’re responsible for or able to change. But it’s naturally that Michigan public officials will to an extent overweight the interests of Michigan qua Michigan relative to those of Michigan residents. If you tried to entirely devolve responsibility onto the states, then you’d find economically declining areas allocating a larger and larger share of a shrinking pool of resources to a kind of desperate effort to prevent people from leaving the area rather than giving them the skills that will best suit them in life.

Apparently “Homeland Security accounts for roughly 90% of the increase in federal regulatory employment over the past ten years” and Michael Mandel shows that the increase in non-HS regulatory employment seems to have been quite uneven as well:

It’s on the environment and in the banking sector where I think the case for more rigorous regulation was strongest ten years ago, yet those have not been the points of evidence. Admittedly, though, it’s somewhat difficult to fully interpret this data without a better understanding of how the “energy” element relates to the environment.

The last sentences of an article about South Carolina Governor Nikki Haley’s inaugural gala:

Former Gov. Mark Sanford chose to forego a black tie gala for both his first election and re-election in favor of a low-key barbecue at the State Fairgrounds. Haley’s event was paid for through private donations. Top sponsors included BlueCross BlueShield, Boeing, Duke Energy and SCANA.

This sort of arrangement actually looks to me a lot more like bribery than do conventional campaign finance shenanigans. If you assume a race between two perfectly sincere, utterly non-corrupt contenders it’s still natural that private firms would want to spend funds helping the candidate they prefer to win the election. You don’t need to be trying to influence anyone for it to be rational to spend the money. Paying for Haley’s party is different. BlueCross BlueShield, Boeing, Duke Energy, and SCANA are really just providing a private benefit—a fun party—to Haley, her family, and her close political allies.

Krugman: “It says something about the times we’re in that Milton Friedman now looks left-of-center, at least on monetary issues.”

Isn’t part of what it says that it’s a kind of odd and unfortunate coincidence that macroeconomic stabilization debates got tied up with other kinds of more conventional ideological ones? After all, if you assume Milton Friedman’s argument for a negative income tax were being made in good faith the main difference between Friedman and a contemporary American liberal is that Friedman was strongly anti-paternalist. I think he’s wrong about paternalism, but this plainly has nothing to do with monetary policy. It’s like how on the one hand I don’t like coconuts and on the other hand I don’t like missile defense programs. I think a lot of progressives in America disagree amongst ourselves about how paternalistic the welfare state ought to be (and even though I don’t agree with Friedman’s take on this I agree that it should be less paternalistic than it currently is) so there’s no real reason there shouldn’t also be a range of views on monetary policy.

Chase says that unless it goes unregulated, the poor will suffer:

“We don’t want to raise fees on our customers,” a company spokesman said. “But unfortunately, regulation is forcing us to do it. And as a result, some customers may end up unbanked.”

This statement is striking for a number of reasons, and the eye-popping earnings the bank announced on Friday don’t exactly make the company more worthy of sympathy. So I’ve spent the last week trying to figure out why I was so sure I did not believe it the instant I read it.

Read on for why this is false (and see also Felix Salmon) but note as well that if you’re concerned about poor people not having bank accounts there are a number of more straightforward ways to address this than knuckling under to Jamie Dimon.

After all, it’s easy to understand why banks aren’t super-interested in serving poor customers. The idea of getting bank deposits is to get a lot of deposits, and poor people by definition don’t have much money so the rational executive is not super-focused on them. One cut at coping with this is to focus on those firms who do have existing retail relationships with poor people. When Wal-Mart has entered the check cashing business, poor people have benefitted and I think the decision to refuse Wal-Mart’s effort to obtain a bank charter was a mistake.

But of course the most straightforward way to provide banking services to poor people is to just provide the service—create a public option for small-scale depository banking. Since postal services generally already have widespread retail operations, this is often done in collaboration with the post office and is known as “postal banking.” But in an electronic age, you don’t really need physical banks at all. Everyone could just be given an account with a $5,000 maximum on a Treasury Department computer and they could mail you an ATM card with your draft registration card when you turn 18. The accounts could pay 0 interest and wouldn’t need to offer any services beyond basic “money goes in, money goes out” and nobody would have to be “unbanked.” It would cost the government some money to administer such a system, but it would also amount to the government getting interest free loans from Treasury Bank customers so if people actually used it it would be a wash.