I'm not sure what conclusion I'm supposed to draw that is different, PT. I tend not to choose my colleagues, my employees, or my professional associates based on their political opinions either. I choose them based on productivity, ease of getting high quality (I hope) work done and out, and the pleasure of dealing with them even when stress levels are high. I do not want to live in a world where having a job or colleagues depends on a litmus test of political views any more than I want to live in a world where my suppliers are chosen based on their political views. But I agree that there are some (extreme) transgressions of ideas or actions that should not be tolerated in anyone (if that is your point). It was certainly mine when I wrote the blog. :-) Thanks for the thought provoking comments, PT (and everyone else, too).

Thanks for the link, Raven. I made a suggestion. :-)

Sad, but strangely beautiful.

"We intuit, correctly I think, that life at the bottom of the working class is pretty damn tough, while life at the tippy top is more exciting, but perhaps not fundamentally different from life in the upper middle class..." As long as you and your loved ones have health insurance or stay healthy.

Thank you, Noni. It's why proofreaders are so valuable. :-) Ecrive, I worry about that, too, and for the same reasons you mention. I still think there should be a formal statement of expectations for professional and ethical behavior with regard to COI. Requiring it only for journal articles isn't enough (IMHO).

rj, you are most definitely anyone. :-) Thanks, Raven. You've reminded me of another blog I have in mind that is waiting to be written. It's about how somewhat uncritical preferences for unbiased, but highly imprecise, estimators (i.e., instrumental variables) without some thought given to just how much bias one might actually have to correct for, could play havoc with social policies that are formulated based on those estimates.

DBonar, PS is (in theory) the return to capital (aka profit). It is what is left over after the wage bill has been paid. If it has been artificially enlarged by monopoly or some other market failure that allows price to be set higher than marginal cost or wage rates to be set lower than labor's marginal revenue product, that "enlargement" comes from CS or from workers (I didn't talk about the latter). That (along with wanting to reduce word count) is why restricting the essay to CS is adequate for this brief overview. It can actually get quite complicated because general equilibrium results tend to ripple out through goods and labor markets and affect (usually consumers/workers) in other negative ways. Bruce, some profit is good for a variety of reasons. If you can figure out how to sell the inframarginal units at a price that reflects each unit's (lower) marginal cost, you go. But then why would it not be wrong to price discriminate on the consumer side and extract all consumer surplus? Both sides need to "win" a little. I disagree with you about the perfect competition model. It's useful for establishing a standard or ideal, for understanding how deviations from it are likely to affect CS and PS, and for understanding the (unrealistic) conditions that would have to hold to obtain an ideal result. Far better to understand these things than to simply crash ahead tinkering in ways that may ultimately harm millions. (This is not to deny the harm done to millions by blind faith in an ideal that is seldom realized, but that would be another essay.) BB, my job is to make people think and to provide an alternative moral narrative that supports sound micro and macro policy in an economy I would like to see remain based on commercial exchange and the productive allocation of capital. If I provide the answers, then people aren't thinking. (And, sometimes, I don't know the right answer, I only know the right question.) :-) Good sources on this topic are Joe Stiglitz's textbook "Economics of the Public Sector" Parts 5 and 6 (Norton); and Atkinson/Stiglitz, Lectures on Public Economics (McGraw-Hill), which I think is out of print, but available in most university libraries. Thank you all (including Kaleberg and Mel) for your thoughtful comments.

I want to thank all of you for the very kind comments and encouragement. rl is right. Barefoot Bum's news was the best holiday gift an educator can ever receive. Thank you, BB. M. Gauthier, I hope your daughter learns and benefits from anything I write. Thank you for the recommendation. Jim, nice to hear from a kindred spirit. And thanks to the rest of you (and those readers who don't comment) for reading and for taking the time to provide thoughtful comments. I don't always have time to respond, but I assure you that I think about everything that is said. It often shapes future blogs or gives me new perspectives. Many, many thanks and Happy New Year to you all.

If the unobtainium you want to buy is less risk in a market with an oversupply of it and no reliable insurance against it, then you must self-insure, even if you can still sell your labor for money. As you say, people will buy less in order to hold more money. They almost certainly won't borrow if they can avoid it. It's not clear what one would do with less illiquid assets (most likely hold if they can manage it.) My point being that it won't be enough simply to increase employment in order to reduce the excess demand for money (although it will help). Excess risk (financial shocks, credit freezes, foreclosures (including wrongful foreclosures) and uninsured health losses (in the US)) must also be credibly reduced for those not in the top 5% of the income distribution in order to lower the excess demand for money (or less risk).

And it doesn't differentiate well between serial correlation and addictive processes. See http://papers.ssrn.com/sol3/papers.cfm?abstract_id=356480