Cute:

Republican Rep. Joe Read of Ronan aims to pass a law that says global warming is a natural occurrence that “is beneficial to the welfare and business climate of Montana.”

This seems like fruitful territory. Imagine what could be achieved by simply passing laws that say tax cuts raise revenue and defense spending doesn’t count as spending.

As Tyler Cowen suggests my view of the college cost conundrum is that this is likely to be tackled initially at the low end. As Mark Kleiman says, to solve the Baumol effect problem in education you’d basically need to start offering something that doesn’t at all look like our canonical image of a college. Incremental change in what the University of Michigan does won’t cut it, you’d need a qualitatively different kind of institution. But to create something that’s qualitatively different from, but as good as, and also cheaper than the University of Michigan would be a mind-boggling logistical and regulatory challenge.

What you could plausibly hope to see happen is the creation of an institution of higher education that’s (a) much worse than the University of Michigan, (b) better than nothing, (c) radically cheaper than the University of Michigan, and (d) scalable. Then you could imagine a model like that moving incrementally up the quality ladder. CAP put out an interesting paper from Clayton M. Christensen, Michael B. Horn, Louis Soares, and Louis Caldera laying out some of the fundamentals here.

I know a lot of people, especially people working in or around academia, find this kind of talk unpleasant. But people thinking about education really do need to confront the Baumol problem. Around the margin, government subsidies can and should step in to make college affordable to talented students from poor families. But tuition subsidies as a share of GDP can’t just rise every year. Either a college education will turn over time into something that only a narrow elite can afford, or else our idea of what “a college education” looks like has to transform into something with a lower cost structure and more scalability. Even people who do focus on the cost-side like Matthew Kahn here often seem to me to be looking too much at the level rather than the shape of the curve. If tuition leapt 50% then stayed flat as a share of income, that would be fine; 5% a year forever isn’t sustainable.

I’d been hoping to find a map of states’ collective bargaining policies and Josh Marshall found one:

As with a lot of things in American life, it’s all tied up with region, history, and political culture. Plenty of states seem to manage to have budget crises much severe than Wisconsin’s with less union-friendly legal regimes.

My colleagues Michael Ettlinger and Michael Linden have put together a useful interactive tool that lets you try your own hand at cutting $100 billion out of the domestic discretionary budget. It’s, um, hard! Especially if you take the view that the country shouldn’t eat its seed corn by slashing research and infrastructure spending, you basically have no choice but to hammer the poor and pare back all kinds of regulatory agencies and just kind of hope that doesn’t make it too easy for people to get away with malfeasance.

Of course I suspect that to many conservatives making it easier to get away with malfeasance is feature and not a bug.

GS writes:

On ‘grand bargains’ and regressive cuts…

Doubling the gas tax would bring an additional 20-30 billion in revenue… it would also have a significantly positive environmental impact.

Why not trade a 20-30 billion tax increase for a 20-30 billion tax decrease on, for example, FICA?

That’s easy—status quo bias. This is good policy, but like anything that that swaps FICA for anything it’s bad for retired people. And like anything that begins to dismantle America’s sprawl-driven industrial policy it’s bad for people who drive a more than mean amount and auto firms that sell lots of SUVs and pickup trucks. What’s more, some people would be disquieted about the potential destabilization of dedicated funding streams for Social Security and transportation. In a political system that permits thousands of ways to kill a proposal, the change won’t be made.

In America, it’s very difficult for policy to make modest shifts. Instead, the vast majority of the time nothing happens. Then sometimes you get big shifts. I’ve learned recently that in technical terms the policy change curve has a leptokurtic rather than normal distribution.

Via Brad DeLong a striking chart that’s mislabeled “The Death Of The Music Industry”:

This measures something that’s both larger and smaller than the “music” industry. The newspaper industry isn’t the words industry or even the news industry. People still listen to music. People still play music. People who play music even still earn money. But the business of selling recordings of music is shrinking. Which, of course, is exactly what ought to be happening to it. Distributing a digital copy of an album to a person’s computer is much cheaper than manufacturing and distributing a physical CD to a retail store. In a competitive market, the price of a widget ought to approximate the marginal cost of producing an additional widget. That’s one reason why this blog is free to read. Thanks to copyright, a recordings-seller does have some level of market power to allow him to seek monopoly rents. But there’s a pretty high degree of substitutability between different songs, so the competition is still pretty intense and the prices are low.

This is one reason why I would discourage bands from trying to underprice tickets at their own shows as a reward to fans. Since digital copies of recordings are non-rival and basically free to make, any non-zero sale price entails some deadweight loss. And since concert tickets are necessarily scarce, any sub-market price entails some deadweight loss. The optimal strategy for a popular band that wants to do something nice is market pricing for concert tickets, plus free recordings. Or even better, you could release your records into the public domain.