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August 21, 2014 3:47 PM Promises, Promises in Foreign Policy

By Jonathan Bernstein

Dan Drezner stuck a fascinating hypothesis about presidential politics down at the end of a post about foreign policy, and I want to highlight it because as far as I know no one has ever addressed this question.

Here’s Drezner:

This brings me to the final reason that I’m a bit more sanguine than Beinart about recent foreign policy rhetoric: it doesn’t matter all that much. Statements about how one would do things better on the foreign policy front are among the best examples of cheap talk you’ll find in Washington. Why? Because the world will look different in January 2017 than it does today. So of course these proto-candidates can say they’d do things differently. No one will hold them to these claims if they’re elected, because the problems will have evolved.

We know that politicians tend to keep their promises, or at least try to. Is foreign policy different than other issues? I don’t know.

One problem with Drezner’s hypothesis is that it’s possible that specific promises don’t matter much, but general approach does. Politicians do more than make promises about specific issues (“I will go to Korea” or “I will end the war in Iraq”). They also make implicit or explicit promises about all sorts of future behavior; John McCain may not quite have promised to be a foreign policy hawk or specifically committed himself to any particular intervention in 2008, but anyone watching him believed that they knew his general foreign-policy orientation.

Of course, politicians don’t always keep their general promises (remember George W. Bush’s interest in foreign-policy modesty?). But they usually try to, unless there’s an awfully strong reason that they shouldn’t. Perhaps, however, the connection between general approach and specific actions leaves enough wiggle room that it doesn’t really constrain presidents. A President McCain may have promised to be a hawk, but he still might have chosen not to intervene in Syria or Ukraine or any other specific crisis without breaking his overall promise.

Even so, out-of-date specific promises can also constrain presidents when they are close enough analogues for new situations. Campaign comments about a conflict between Russia and Georgia might be irrelevant by 2009, but dragged out during a new conflict in Ukraine. No two situations are identical, but they’re often close enough (that’s true for domestic policy too).

Presidents are also constrained by party ties. That’s actually a two-fold bind: Candidates are forced to make promises along party lines, and then modern, party-centered presidents staff their administrations with partisan governing professionals (secretaries of defense for Democratic presidents notwithstanding). So at the elite level, the dominance of party almost certainly reduces the president’s choices. Partisanship, however, cuts both ways: A president can generally count on strong partisans to stick with him even if he embraces an unfamiliar position. Thus, in some cases Democrats approved of Barack Obama’s foreign-policy choices, even though they had hated similar policies from George W. Bush.1

My guess is that the real reason foreign-policy talk is cheap is that it’s even more likely than other campaign rhetoric to be cliche-ridden mush. Politicians want to be tough with whichever enemy is in the news this week. They all want peace in the Middle East (but fully support Israel). They all want to everything resolved peacefully without surrendering anything to anyone.

Sure, an actual foreign policy conflict can break out on the campaign trail, but it just isn’t all that common. So my guess is that the true reason that we can ignore a lot of foreign-policy rhetoric from campaigns is that there’s not enough real content about which to worry.

1 It’s possible to overstate the size of those effects in polling, but some of it definitely happens. Nor is it entirely irrational. Rank-and-file voters have little way of knowing, for example, how serious a foreign-policy threat is to national security; if they trust the president on other issues, it’s not unreasonable for them to trust him on these issues as well.

[Cross-posted at Bloomberg View]

August 20, 2014 3:38 PM Mitch McConnell Doesn’t Want a Shutdown

By Jonathan Bernstein

Oh, c’mon. I know we’re well into the campaign silly season, and I suppose that Republicans have earned what they’re getting today with their ill-considered government shutdown strategy last fall and other brinkmanship since taking the House majority in the 2010 elections, but reactions to Mitch McConnell’s latest comments are totally ridiculous.

Here’s what the Republican Senate minority leader said to Politico: “We’re going to pass spending bills, and they’re going to have a lot of restrictions on the activities of the bureaucracy.”

That was then transformed in the story into “Accept bills reining in the administration’s policies or veto them and risk a government shutdown.” The headline became “McConnell’s plan to shut down Obama.” First Read’s summary ran with “Mitch McConnell’s suggestion that Republicans, if they win control of the Senate, would possibly threaten to shutdown the government to force policy changes from President Barack Obama.” And there are more examples.

These articles have produced cries from Democrats that McConnell is going to shut down the government.

Look, I have no problem at all with Democrats reminding voters that Republicans shut down the government and suggesting that it might happen again.

But McConnell did not, in fact, say he would shut down the government to get what he wanted, and the “neutral” news media shouldn’t imply that he did. There’s nothing wrong with a congressional majority including veto-bait in bills, including in must-pass spending bills. In the normal course of things, the next step is that Congress either removes the offending provisions after a veto, or perhaps negotiates with the White House over which measures the president can actually accept. The president would have some leverage here, but Congress — especially in a party-unified-Congress scenario McConnell is talking about — hardly needs to automatically roll over for presidents.

McConnell, at least according to his quotes in Politico, doesn’t imply a take-it-or-leave-it shutdown threat. It’s just as likely he intends to push Republican issues as far as he can take them, and then hold Obama and the Democrats responsible for whatever they oppose — and force vetoes to generate publicity over their differences. All McConnell says when pressed about a shutdown is that the president “needs to be challenged, and the best way to do that is through the funding process. … He would have to make a decision on a given bill, whether there’s more in it that he likes than dislikes.”

The real question is whether Republicans would (as they did last year and during the 1995-1996 shutdown) seek a shutdown as a way to gain more leverage. Government shutdowns don’t happen by accident. As long as Republican Senator Ted Cruz and other radicals are involved, that’s a real possibility, and fair game for Democrats to run on. But there’s nothing wrong with what Politico calls “confrontation” as long as it stops short of deliberately going over the brink.

Nor is there anything wrong with using reconciliation as a tactic, despite Politico’s clear and inaccurate suggestion that there’s something unusual or illegitimate about it. For clear-headed budget analysis that assumes that Republicans would use reconciliation — but that also foresees the difficulties that the party will face if it does have House and Senate majorities — see Stan Collender’s solid column today. It’s an excellent antidote for the media hype and the campaign talking points being tossed around.

[Cross-posted at Bloomberg View]

August 20, 2014 12:15 PM Rush to Judgment on the Rick Perry Indictment

By Mark Kleiman

I don’t know whether Gov. Rick Perry is guilty of anything, or - assuming he is - whether the special prosecutor has the goods to prove it, let alone whether the right-leaning Texas Court of Criminal Appeals would sustain such a conviction. (Since Perry isn’t an innocent person on Death Row, the court will tend to give him all the breaks.)

I do know that most of what has been written about the case since the indictment has been nonsense, with Blue and Red pundits competing to see who can say the nastiest things about the prosecutor. See Simon Maloy and Kevin Drum on the Hack Gap.)

Worse, everyone seems to be ignoring the obvious fact that, even if Perry can’t be convicted of a crime, his conduct in this case ought to disqualify him for the Presidency.

Forrest Wilder of the Texas Observer offers some facts and analysis in rebuttal, and Jeffrey Toobin of The New Yorker demolishes the “But Mom, all the kids do it!” defense.

Here are the facts, as currently understood:

1. The Public Integrity Unit of the Travis County (Austin) DA’s office prosecutes public corruption cases involving the Texas state government, since Austin is the capital. Since that unit carries out what is in effect a statewide function, it - unlike the rest of the DA’s office, which is supported by local taxes - is paid for by a special appropriation from the Texas Legislature.

2. One of the cases brought by the PIU involved a grant of $11 million from a scandal-ridden state cancer research fund to a politically-connected company owned by donors to Perry and Greg Abbott, the AG and Republican candidate to succeed Perry. The grant application had not been adequately reviewed, and allegedly that fact was kept from the grant-making committee.

3. Travis County is Democratic, while the state government is solidly Republican. Neither the legislature nor the state Attorney General is going to hold Perry and friends accountable. So if Perry were to gain control of the Public Integrity Unit, he and other Republican office-holders could commit crimes with impunity.

4. The Democratic DA of Travis County got nailed for drunken driving, and the post-arrest videotapes don’t show her in a very good light.

5. If she were to quit, the Governor would appoint her successor.

6. Perry demanded the DA’s resignation. She refused, and the county officials who could have fired her decided not to do so.

7. Perry threatened to veto the appropriation for the Public Integrity Unit if the DA didn’t resign. She didn’t. He did.

8. That veto had the effect of shutting down the cancer-institute investigation until the Travis County board voted to support the Public Integrity Unit with local tax money.

8. A local NGO demanded and got a judge appointed to look into the matter. He appointed a special prosecutor. Neither is an obvious partisan; the special prosecutor had the backing of both Texas Senators for appointment as United States Attorney.

9. After months of grand jury proceedings, the special prosecutor indicted Perry for abuse of power. The indictment makes two charges - coercion of a public official and abuse of office - and does not specify the underlying facts.

So much for the facts. Now some comments.

1. In contemporary practice, white-collar crime indictments often read like the prosecutor’s opening statement, laying out all of the evidence to be introduced. That’s a good way for the prosecutor to get good press, and perhaps poison the minds of potential jurors who have read press accounts of the indictment. But it’s not legally necessary, and may not be good courtroom tactics, since every fact alleged in the indictment must be proven at trial.

2. The fact that Perry had the lawful power to issue a veto, and therefore to make a veto threat, is not dispositive. Lawful powers can be used for criminal purposes, and doing so is a crime. The Saturday Night Massacre was the exercise of President Nixon’s lawful power order his Attorney General to fire Archibald Cox.

3. If in fact, as Forrest Wilder hints, Perry through an intermediary promised the DA to give her a cushy job if she would resign, that seems to me like straight-up bribery, and obviously criminal. Yes, that sort of thing happens all the time. But as Toobin points out, that’s not a legal defense. No, I don’t know why the indictment doesn’t include a bribery count; maybe that’s covered by the abuse-of-office and coercion charges.

4. Assuming for the sake of argument that Perry is innocent in law, or alternatively that he is guilty of an attempt to obstruct justice but that the prosecutor does not have sufficient evidence to prove that charge (that is, he might have intended to interfere with the criminal probe of cancer funding, but have been careful enough not to leave fingerprints), his attempt to take over the one agency that could hold him and his cronies accountable constitutes an outrageous abuse of power. And doing so in the context of stealing millions of dollars from cancer research to enrich political cronies makes it morally disgusting, to boot.

Look, I’m glad and proud that the Blue team prefers accuracy to partisanship, but would it really be too hard to add that Perry is, at best, a legally innocent scoundrel, grossly unfit for the office he holds, let alone the Presidency?

[Cross-posted at The Reality-Based Community]

August 19, 2014 3:15 PM We Are Spending Way Too Much to Raise Our Kids

By Megan McArdle

The U.S. Department of Agriculture has released its annual report on the cost of raising children, and the upshot is what you probably already know: It’s expensive.

This does not — as every article on the report has emphasized — include the cost of college, just the cost of raising them from birth through age 17. What struck me, however, was not the cost, but what parents are spending their money on:



Source: U.S. Department of Agriculture
SOURCE: U.S. DEPARTMENT OF AGRICULTURE

The last 50 years have seen a massive shift away from the basic expenses of keeping your kid alive and toward competitive expenses. Now, those education expenses are a bit misleading — as the report points out, many families basically have no expenditures in that category. Still, it’s remarkable how the averages have shifted. And that reflects a great difference in how we view the basic task of launching a child into the world. It’s no longer enough to make sure they’re fed and clothed; you also have to make sure they can beat the other kids in the education race.

If you’ve ever watched “19 Kids and Counting” and wondered how the Duggars (and families like them) do it, the answer is: They don’t do much beyond the basics. They spend a huge amount, more than $2,000 a month, on food. But before they became television personalities, the Duggars were living in a three-bedroom house with 14 kids. They buy all their clothes at thrift shops. They vacation in an RV. They home-school, and no one’s on a sports travel team or in dance classes. If they buy toys, it’s at a secondhand store. If average-size families did this, no one would be complaining about how expensive it is to have kids.

The problem is that it’s dreadfully hard to do this unless you’re in a very tight-knit subculture in which all this looks normal. If your kids go to school with other kids who aren’t wearing thrift-school clothing, they’ll be made fun of. They’ll learn to long for all the new toys the other kids have. They’ll want to join expensive activities, and you’ll want to get them tutoring and enrichment programs to increase their shot at getting into a good school. You certainly won’t want to cram them into a three-bedroom house. In other words, raising kids cheaply is only possible if you think there’s something even more important than socializing and getting a good education — or if you’re so poor that you simply lack the cash to help your kids compete in our society’s various status competitions.

What we have, in other words, is a collective-action problem that is steadily ratcheting up the amount we spend on our kids. Unfortunately, like many collective-action problems, it’s hard to imagine what sort of collective solution we could put in place. As long as it’s possible to spend money to give their kids a leg up, people will do just that — and other parents will do their utmost to spend even more.

[Cross-posted at Bloomberg View]

August 19, 2014 11:58 AM Abandoning the Democratic Script

By Julia Azari

President Obama’s remarks this afternoon dealt with two distinct crises, the situation in Iraq and the situation in Ferguson, Missouri. The two problems differ in many ways, but one characteristic that they share is that both have required Obama to abandon the ways in which he, along with fellow Democrats, have approached the issues at stake.

The foreign policy dilemma has been evident for some time. Like many Democrats from the center left on out, particularly those who wanted to run for president in 2008, Obama sought to differentiate himself from Bush and from Democrats who had gone along with the Iraq War. (Ok, maybe one Democrat in particular - one whose name rhymes with Schminton.) Candidate Obama’s emphasis on repudiating Bush’s foreign policy has repeatedly left him in a tough spot when it comes to the Middle East. Few could have anticipated the Arab Spring in 2011, which created a whole bunch of ongoing questions about how the U.S. should approach the region. But this illustrates the dangers of contemporary mandate politics - that is, relying heavily on the idea of doing what you promised to do - which has a certain intuitive appeal but doesn’t leave leaders much slack to deal with unexpected problems. Obama has also been forced, by virtue of when his presidency has fallen in both the broader arc of history and the cycle of political time, to contend especially with what looks to me like a persistent problem with Democratic foreign policy ideology: it’s pretty easy to criticize opponents for acting unilaterally and being hawkish. It’s harder to develop and execute an alternative set of policies, based on different values - our nation’s own security, respect for human rights, and respect for the international community (not all of whom share our view of human rights).

Where race issues are concerned, Obama’s dilemma cuts even deeper. The president’s own racial background has brought the topic closer to the surface of political discourse in a number of ways. His speech, “A More Perfect Union,” in 2008 received praise as both an honest confrontation of racial mistrust and a reaffirmation of basic national values. But since then, Obama has attracted criticism for engaging in “respectability politics” in his remarks about black fatherhood, and more recently in his response to the tragic events in Ferguson. Obama is in a difficult position. In the past five years, when Obama’s rhetoric has turned to race, the tone of the response has been especially antagonistic. Furthermore, Obama’s usual approach - which emphasizes colorblind ideals and economic inequality - reflects the way his party handles those issues. The 2012 Democratic platform has a section on civil rights, but it focuses heavily on employment and poverty (as well as other important civil rights issues, including LGBT rights and equal pay). The document acknowledges the “disproportionate effects of crime, violence, and incarceration on communities of color” and mentions fairness in drug sentencing as an issue. But these are presented as anomalies in a just and colorblind system, and as impediments to equality of opportunity that would otherwise lift all citizens. The 2000 platform is similar - its civil rights section refers to the 1964 Civil Rights Act, affirms equality and suggests commitment to affirmative action. In other words, you could read these platforms and come away with the idea that racial disparities could largely be explained away in economic terms, and that racism persists only as part of a few discrete issues, .

But racism isn’t just about economics; anyone who actually read Ta-Nehisi Coates’ provocatively titled piece this summer has seen that the relationship between wealth and race is far more complex and even less rosy than the colorblind opportunity narrative would suggest. I’m hesitant to look for a lesson in the death of a teenager. But it seems to me that after this, Obama and other Democrats, including whoever tries to succeed him, will need to change their narrative about race and racism.

[Cross-posted at the Mischiefs of Faction]

August 18, 2014 6:21 PM “Bad Cess”

By Henry Farrell

Patrick Nielsen Hayden on Twitter today wished bad cess on a Hugo nominee apparently belonging to the richly-deserving-of-the-worst-cess-possible class. ‘Bad cess’ is an Irish expression; I suspect Patrick got it from Flann O’Brien, but I wouldn’t put it past him to have come across it somewhere else. This reminded me that I’ve been meaning for years to record a couple of Irish country expressions, mostly from my father and through him, from Gid, a Westmeath woman who worked at the farm he was born on, and who died when I was ten or so.

Gid was fond of two maledictions. One is a little opaque to me; “May the curse of Scotland be on you.” If I were to guess, it was a reference to the fact that multitudes Irish farm labourers had to go to Scotland to find seasonal work; many of them stayed and ended up, sooner or later, in the slums of Glasgow or other cities. The other is more transparent; “May the curse of the seven snotty orphans be on you.” ‘Snotty’ here means ‘badly behaved and presumptuous,’ rather than with noses in need of a good wiping. It wasn’t unusual for relatives to have to take orphans in unexpectedly- my own father’s father was brought up by two bachelor uncles after his parents died when he was an infant. And of course, he was very lucky - the history of orphanages in Ireland is a wretched one indeed.

Gid would also say that someone was “that hungry, he’d eat a chap’s arse through a chair,” a chap being country argot for a small child. Stephen King uses the word “chap” in a similar way in one of his novels, suggesting that the slang made its way to Maine (and of course, ‘chappie’ is a somewhat dated English diminutive for a very young boy). And of someone knocking on death’s door for a long while, but never quite managing to expire, “it’s the creaking door that hangs the longest.” This last seems from an Internet search to have had some circulation in nineteenth century England, where likely it originated.

I like these sayings; there’s some flavor to them. Feel encouraged in comments to provide your own, if you have any.

[Cross-posted at Crooked Timber]

August 18, 2014 6:14 PM Hillary’s Wealth Won’t Matter

By Jonathan Bernstein

Yesterday, Annie Lowrey considered Hillary Clinton’s recent (and continuing) stumbles over her wealth. She concluded that none of this “Mitt Romney problem” will matter because Democrats have a proven rhetorical flourish on the subject — Lowrey suggested, “Yes, we’re really lucky. And I know first-hand that we don’t need a tax break for our millions in earnings or our private jet.” It’s certainly, as she pointed out, language that Bill Clinton has used repeatedly since leaving the White House, and that Barack Obama also uses.

Whatever. The real reason wealth-related blunders won’t hurt Clinton is that she apparently isn’t going to be seriously challenged in the primaries and caucuses, where this sort of thing could matter. Personal characteristics, gaffes and clever rejoinders just aren’t all that important for the general election, when partisanship and partisan trends kick in and swamp almost everything else.

Those things can matter a lot in the nomination fight because voters and party actors alike are trying to differentiate among candidates who, in many cases, have virtually identical positions on policy.

But when it gets to November, most people vote based on party. Most of those who really don’t have party ties will usually be swayed by their assessments of the current president and of the nation’s well-being. Everything else isn’t completely irrelevant — for example, perceived ideological extremism can hurt a candidate — but it’s unlikely to make a significant difference.

Moreover, to the extent that gaffes could possibly matter at the margins, it’s almost impossible for summer 2014 flaps to have any effect in fall 2016. Unless Republicans decide to campaign on it (and the odds are that they will also have a wealthy candidate as well, so that’s not probable), whatever Clinton says this summer will be long forgotten by the election. Well, it will be forgotten by most political junkies. Ordinary voters are barely paying enough attention now to the faraway presidential election to know about this in the first place.

And even if Republicans do decide to run on it, the function of that kind of campaigning isn’t to win votes; it’s to activate the partisanship of those who are predisposed to vote for the party all along. To educate, that is, regular partisan voters about what it is they should be disliking about the other party’s candidate. And there’s never any shortage of reasons available to dislike the opposing party’s candidate — so if it’s not this, it will certainly be something else.

[Cross-posted at Bloomberg View]

August 18, 2014 6:03 PM Off-Cycle Elections and the Parties

By Seth Masket

In a recent Monkey Cage post, Brian Schaffner, Wouter Van Erve, and Ray LaRaja seek to explain why towns like Ferguson, Missouri have such a disparity between the percent of the population that is African American and the percent of the city council that is African American. (For more on this, please see my response at Pacific Standard). Part of the story, they say, is turnout. Ferguson has off-cycle city elections; they’re held in April of odd-numbered years, instead of coinciding with presidential elections. As a result, turnout is far lower for municipal elections, and also seems more biased in favor of white residents. (Between the 2012 presidential elections and the 2013 city council elections, white turnout in Ferguson dropped from 55% to 17%; black turnout dropped from 54% to 6%.)

There’s certainly some logic to this. If elections are held far from presidential ones, they’ll tend to receive a lot less media attention, which usually means that poorer and less educated voters will be less likely to participate. And those trends disproportionately affect Democrats and African Americans.

So we should probably expect to see Democratic leaders opposing off-cycle elections and Republicans supporting them, right? After all, it’s Democrats who tend to support efforts to increase voter turnout, while Republican leaders are willing to accept lower turnout in the name of fighting voter fraud (even if that pretty much never happens). Are Democrats trying to end off-cycle elections?

Far from it. Sarah Anzia recently wrote a dissertation on election timing (I haven’t read the book version yet), and the findings are pretty fascinating. In short, interest groups have an easier time dominating the low turnout, low media exposure environment of off-cycle elections. In cities that have off-cycle elections for city councils and school boards, we tend to see police officers, firefighters, and teachers receiving higher pay and better benefits. After all, it’s these local public employees (and their immediate friends and families) who often have the most at stake in municipal elections; they’ll vote no matter what. Most of the rest of the population simply sees no need to participate. That drop in voter turnout makes a huge difference in terms of policy.

And this has an important relationship to the parties. The unions and public employee groups that tend to benefit from these off-cycle elections also tend to lean Democratic. As a result, it is Republican state legislators across the country who tend to push to synchronize local elections with presidential ones, while Democratic legislators protect the off-cycle elections where they exist. That is, Republicans are pushing for higher turnout while Democrats want to keep it lower for municipal elections.

You could label this hypocritical, but basically, it’s just parties advocating for their constituent interests, which is as old as democracy. Voter turnout, after all, is simply a means to producing certain policy ends, and the parties will tend to push whatever rules help reach those ends.

[Cross-posted at Mischiefs of Faction]

August 18, 2014 9:31 AM Should We Compensate Organ Donors?

By Keith Humphreys

Over 100,000 Americans are currently on a waiting list for an organ donation, but the number of living and dead donors this year will not remotely approach that number. As a result, 18 people die every day while on a waiting list. Sally Satel, a physician and organ donation recipient, has argued that we will only solve this problem if we begin compensating organ donors. Bioethicist David Magnus in contrast believes that incentivization would risk creating a morally suspect seller’s market in organs. These two scholars were joined by Tom Mone, a national leader in organ transplantation, at a fascinating health policy forum that I had the privilege to facilitate recently at Stanford Medical School. We’ve been doing these health policy fora for five years now, and this was one of the most engaging discussions:

[Cross-posted at The Reality-Based Community]

August 17, 2014 7:11 PM Can Millennials Reverse America’s Declining Rates of Entrepreneurship?

By Dane Stangler and Jordan Bell-Masterson

There has been considerable hand wringing in recent months about research (pdf) showing a decline in American entrepreneurship, a fall in “economic dynamism” (the turnover of companies and jobs), and an overall aging of U.S. businesses. In the face of pessimistic long-term growth forecasts from the World Bank, International Monetary Fund, and Federal Reserve, these findings are worrying.

The founding and growth of new businesses has always been key to innovation, and young companies have been shown to be more prolific sources of job creation than their older counterparts. The velocity with which these firms move in or out and up or down is what economists call economic dynamism. It is critical to rising living standards.

But, according to research by the Brookings Institution and economic research published in leading journals, the United States has been on the wrong trajectory when it comes to these things. The rate of business creation has been falling for several years, even predating the 2008-09 recession, and the average age (pdf) of U.S. companies has been rising. The share of the overall population of firms accounted for by older businesses—those 16 years and older—rose by more than 50 percent from the early 1990s to 2011. Partly as a result, economic dynamism has diminished.

These trends are not necessarily new and have been covered before in the Washington Monthly, but recent discussions have brought new urgency to the issues. Why is this happening, and can we expect it to continue?

First, let’s dispense with two potential explanations. One possibility is that the sectoral composition of the US economy has changed, with more economic activity in sectors that inherently have lower rates of entrepreneurship. For example, if the health care sector has historically had less business creation than other sectors, its rising economic share could explain macro trends. University of Maryland economists Ryan Decker and John Haltiwanger, experts in this area, have disproved (pdf) this explanation.

A second potential culprit, as noted by Robert Samuelson recently, is public policy: either an increasing number of unfriendly policies, or the absence of policies that would boost entrepreneurship. Research is not abundant on this, but we think it is an unlikely explanation. The overall trends of falling entrepreneurship, slowing dynamism, and aging businesses have been relatively uniform across states, metropolitan areas, and different time periods. There aren’t many federal policies that could account for that uniformity.

It is possible that public policy has played an important indirect role in shaping the environment in which new and young companies operate. But changes in public policy wouldn’t appear to be a direct cause of falling entrepreneurship.

So what’s behind these trends?

One possibility that must be considered is that the data are incomplete. For one thing, the data used in these analyses only go through 2011. It is difficult to reconcile the findings on declining business creation with the explosion of efforts to promote and support entrepreneurship in the last few years. So, it is entirely possible that the downward trends are already in reversal (although likely not fully reversed).

This raises another possibility: perhaps we are undercounting entrepreneurship. The Census Bureau data used in recent research cover employer businesses. We know, anecdotally, that entrepreneurial activity takes many forms, and that in recent years the diversity of such forms may have been widening. What one colleague calls “fractional entrepreneurship” appears to be on the rise: ventures nestled inside other organizations, side projects that do not need incorporation, and so on.

Using a wider definition of entrepreneurial activity, other Census data indicate that new business creation actually rose during the Great Recession. Thus, our measurement methods could be lagging behind an increase in different kinds of entrepreneurship.

These issues also highlight the relationship between entrepreneurship and economic health. In a new book, The Innovative Entrepreneur, Northwestern economist Dan Spulber analyzes the lifecycle dimensions of entrepreneurship and finds that the decision to start a new venture depends on the range of opportunities and constraints facing a potential entrepreneur. One such factor, demonstrated by Rob Fairlie at UC-Santa Cruz, is the availability of wage and salary work. The opportunity cost of entrepreneurship depends on the labor market alternatives available to someone and their expected returns from those alternatives.

This explanation would not apply to recent years when the labor market has been sluggish. But since the fall in business creation identified by the Brookings research goes back 20 years, it could reflect better wage and salary opportunities available to many who, in different circumstances, might have started companies. Entrepreneurship trends need to be properly situated.

A third explanation could be demographics. The volume of business creation in the United States was actually rather steady (pdf) from the early 1980s up to the Great Recession, with an average of 500,000 new businesses created each year. Because the overall population of businesses was increasing—firms don’t exit at the same rate as they enter—the rate of business creation steadily fell.

We must be careful with casual empiricism, but one other factor that was steady during this same period was the American working age population. The labor market entry of baby boomers and women meant that the working-age share of the population held remarkably steady from the early 1980s to the late 2000s. Correlation is not causation, but the relationship between demographics and entrepreneurship cannot be ignored.

So what can we expect in the future? Will the purported decline in entrepreneurship continue? In a forthcoming paper, the Kauffman Foundation analyzes different trends and scenarios for why entrepreneurship may rise or fall. We can briefly canvass some reasons for optimism here.

Returning to demographics (pdf), over the next 20 years we will have more thirty-somethings than ever before. This matters because the “peak age” for entrepreneurship is the late thirties and early forties. While we might not expect an outright entrepreneurial boom, as Vox’s Matt Yglesias suggests, we are more optimistic than 538’s Ben Casselman, since the decline of the prime-age entrepreneurial population has coincided with the decline of high-tech entrepreneurship (as opposed to the big-box retailer driven decline in the decades prior).

Likewise, we might expect that the proliferation of entrepreneurship education and training programs across the country could translate into more new businesses over the next several years. And, the expansion of crowdfunding sites should encourage a higher level of entrepreneurial activity.

The present state of entrepreneurship, at least according to recent research, may not seem particularly healthy. But there are reasons to think that picture may be incomplete, and plenty of reasons for expecting an entrepreneurship boom in coming years.

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