— Why are so many electronics companies so bad at naming their products?

— Florence + The Machine, “What The Water Gave Me”.

— Mario Monti officially in as Italian Prime Minister.

— U.S. and Australia reach accord to permanently station Marines Down Under, presumably to counter China.

— Syrian military defectors attack a military base.

— Via Scott Lemieux, you can’t get a McRib in Europe because it contains Azodicarbonamide which is “most commonly used in the manufacturing of foam gym mats and the soles of shoes.”

— CBO says Democrats jobs plans would create more jobs than the GOP alternatives.

— Newt Gingrich wants to get rid of the CBO.

The increasingly troubled United States Postal Service today announced an annual loss of $5.1 billion in the face of declining mail volume.

Discussions of postal reform tend to get bogged down in rather technical details about the specifics of the union contracts and the unusual accounting rules around USPS pensions. But if the Postal Service were a private firm, you’d say that its problem is pretty simple — thanks to technological innovation, people don’t want to send as much mail as they used to and there’s no reason to believe that trend will ever turn around. The fundamental issue the country needs to think about is whether subsidizing regular mail delivery to rural areas is actually an important policy priority in the modern day. Back in the late-18th and early-19th centuries, the fact that the United States had an efficient postal service meant we were in possession of cutting edge communications infrastructure. It was the equivalent of having South Korea’s broadband. Today, that doesn’t seem very plausible to me. Some people of course would prefer not to pay market rates for mail and parcel delivery, which is nice for them, but I don’t think it serves any compelling policy purpose beyond tradition.

The team is “Majority-owned by the Ontario Teachers’ Pension Plan, through a portfolio company that also owns the Toronto Maple Leafs and Air Canada Center.”

Specifically they’re a wholly owned subsidiary of Maple Leaf Sports & Entertainment which owns the arena, the Maple Leafs, the Raptors, and the Toronto FC soccer team.

The fact that the union-owned Raptors are currently involved in a labor dispute with the NBA Player’s Union is a reminder of Peter Drucker’s (mistaken) theory that the United States in the early 1970s was heading toward “pension fund socialism.”

Chicago Federal Reserve President Charles Evans continued his crusade to rescue the American economy in a CNBC interview today. He makes the key point that rather than worrying that more action will open the Fed up to more unfair criticism, Fed officials ought to worry that more failure will drive more popular discontent:

“I think we should be more aggressive, and that quite frankly makes a lot of people nervous,” Evans also said.

It’s natural for the Fed to face criticism “when things aren’t going very well,” said Evans. However, he lets such criticism “roll off my back” and focusing on his job.

Monetary policy stimulus has come under attack by members of Congress. Republican Congressional members sent a letter listing their complaints on the eve of the Fed’s most-recent policy meeting in early November.

It’s absurd to think that most members of the public have meaningful opinions about the conduct of monetary policy. What they have opinions about are high unemployment, short hours, falling asset prices, and falling incomes. The Fed’s problem is that while it’s done “a lot of stuff” it hasn’t set meaningful targets and then hit them. As a result, “a lot of stuff” has coincided with widespread economic misery and discontent. If they start doing things that work, then people will cheer.

Liberals are generally well-aware that growing up in poverty gives children significant disadvantages in life that make blithe talk of “equality of opportunity” pretty hollow. Jon Cohn has a fascinating article in the New Republic that looks at some of the relatively recent evidence on the neurological development science underlying some of these problems. It’s interesting on its own terms, but an interesting suggestion from Cohn is more political than scientific. He quotes Jack Shonkoff as arguing that “The concept of disrupting brain circuitry is much more compelling than the concept that poverty is bad for your health.”

In other words, maybe giving a sciency gloss can give a new sheen to some social justice concerns. And maybe so. But the reality is that high-quality interventions are bound to cost a fair amount of money, and that winds up running headlong into the currently toxic politics of taxes in the United States. Cohn, enlisting James Heckman as a source, argues forcefully and persuasively that investing funds in early childhood interventions would pay off economically. I completely agree. But right now the debate inside the Democratic Party is over whether or not it’s acceptable to raise taxes on people earning between $250,000 and $1,000,000 per year. The idea that broad-based taxes to finance broad-based social programs is sometimes a good idea is completely off the table in American politics right now.

That leaves you with the option of turning a serious national early childhood policy into yet another thing that we’ll pay for through higher taxes on the rich. Politically, this is perfectly clever. Democrats propose higher taxes on the rich as part of deficit reduction, Republicans block it, and Democrats get to complain about it. Then Democrats propose higher taxes on the rich as part of a jobs program, Republicans block it, and Democrats get to complain about it. I’m sure higher taxes on the rich to pay for early childhood eduction would also poll well. From everything I’ve seen, the voters are eager to tax the rich. But none of this shows any signs of actually working as a way of changing public policy.

Wonks are usually more comfortable talking about economics than culture, but in my experience, an awful lot of grassroots concern about immigration focuses more on the soft cultural factors. In particular, a lot of people express anxiety about the fact that many immigrants don’t speak English and they’re concerned that ethnic media and ethnic enclaves mean they and their descendants won’t learn English. If you’re familiar with the extensive effort that foreigners who haven’t moved to the United States are putting into learning English, this can seem a bit funny. But it’s worth emphasizing, as Dowell Myers and John Pitkin do in a new report, that immigrants to the United States are indeed interested in learning the language of global commerce:

People’s sense that many immigrants speak English poorly is absolutely correct. Learning a foreign language is difficult, especially for adults, and most immigrants don’t manage to really pull it off all that well. But people’s fear about the trends are mistaken. People do try, and they do improve over time. The authors can use this data on historical trends to project into future. They find, for example, that by 2030 “the percentage speaking English well—or very well, or only English—advances to 70.3 percent, and among Hispanic immigrants this reaches 57.1 percent, a majority.”

Reuters has a very interesting interactive tool where you can play around with different Italian debt scenarios. Here, for example, I cooked one up where a 7.5 percent interest rate on the debt and a 3.7 percent primary budget surplus are totally fine:

All you need to get there is a 4.5 percent Nominal Gross Domestic Product growth. What’s super-nice about this is that it the 7.5 percent interest rate is really on the high side. If markets were confident that Italy would enjoy 4.5 percent NGDP growth, there’s no reason to think they’d demand such a high interest rate. If rates fell to 6 percent, then 4.5 percent NGDP growth would be manageable even if the primary surplus fell to as little as 1.8 percent of GDP. But if Italy only gets a 2 percent NGDP growth rate, then even a 6 percent interest rate is only payable with a primary surplus of almost 5 percent of GDP.

This is a long-winded way of saying that while there’s more to Italy’s budget situation than the ECB’s tight money policies, the ECB’s tight money policies are also very relevant. It’s extremely strange for a country forecast to run a primary surplus to be facing a sovereign debt crisis.

The European Union (which includes the U.K., Sweden, Denmark, and some Eastern European countries along with the Eurozone) is a huge wale in the global economy, but in terms of American exports, it plays second fiddle to Canada:

This is a nice illustration of the fact that even the era of globalization, geography, and distance matter a lot. Americans have a level of entwinement with Canada and Mexico that’s way out of proportion to those countries’ weight in the world economy as a whole.

This can’t be said often enough, so I’ll link to Don Taylor saying it today. The long-term deficit is all about health care:

Paying for the health care for the elderly, the disabled, and the poor is expensive and predicted to become increasingly expensive. It’s much cheaper in foreign countries, because those countries use price controls. One possible alternative to price controls is Paul Ryan’s plan to shift the costs onto households so as to bankrupt them rather than the government.

Defense cuts kinda are and kinda aren’t on the table in Capitol Hill’s endless budget negotiations. But a new analysis from Cindy Williams, now at MIT but formerly the lead national security analyst at the Congressional Budget Office, says that over the long term, we need really big cuts. The paper is “The Future Affordability of
U.S. National Security” PDF) and the bottom line is:

Using CBO’s analyses of the overall federal budget as a starting point, I find that an affordable long-term level for national defense spending is between 1.6 percent and 2.6 percent of GDP. Within that band, the affordable level will depend upon whether taxes are permitted to rise and on how the cuts in federal spending are distributed among three broad categories: mandatory programs, nondefense discretionary accounts, and national defense. Assuming that the wars in Iraq and Afghanistan wind down a few years from now and are not replaced by new, expensive wars, that translates into cutting the non-war defense budget in real terms by four percent to 40 percent, relative to its 2011 level, within the coming decade.