Policy Punchline

Nate Silver, widely considered as the preeminent election forecaster, uses Bayesian methods in his models. What is Bayesian statistics? It just happens that some of our team members have been studying Bayesian concepts, so we hope this explanation could be somewhat helpful in informing you of the foundational methodology that Silver uses to forecast. The questions we discuss include: - Was Nate Silver right in 2016? (He was and wasn’t). - Can we even judge whether a forecaster is right or wrong? - Are elections chaotic systems that we cannot predict or controlled systems that we can? - Should forecasters incorporate the likelihood of a “Black Swan” event like a coup or contested elections in their models? - Do alternative facts (or truths) exist? - Do we have enough data to make predictions for someone like Trump? This is a brief recap to our election night livestream, in which we had a four-hour long discussion on various topics such as the evolving nature of our political discourse, the future of Obama

Tiger Gao and Marc Chaaban react to the election outcome so far and discuss why it’s an indictment on the Democratic Party and a victory for Trump. Does the failed expectations of polling consensus represent an error in election predictions or a cognitive dissonance about the true political feelings of Americans? Have the democrats failed to put forward policy that appeals to Americans, or are they simply losing the messaging war? Will a (highly probable) Biden presidency with a Republican Senate majority devolve into a lame duck presidency and a replay of the Obama-Tea Party drama that resulted in few major legislative accomplishments? Will the Democratic Party face even greater challenges in consolidating voters moving forward, while the Republican Party seems to be more unified and determined behind Trump than ever?

Trey Gowdy is a former federal prosecutor and Congressman from Greenville, South Carolina. Known for his ability to persuade, question, and debate in courtrooms and Congressional hearings, Mr. Gowdy rose to fame within the Repubican Party. He resigned in 2018 when he could no longer tolerate the hyper-partisanship and polarization of political discourse. In this interview, Mr. Gowdy discusses the state of America’s political discourse, how both constituents and politicians should be blamed for fueling polarization, social media’s outsized role in shaping people’s beliefs, and his optimism and pessimism for this election season and beyond. Mr. Gowdy had a stellar career as a prosecutor, achieving the highest performance rating possible for a federal prosecutor two years in a row. His recently published book, "Doesn’t Hurt to Ask: Using the Power of Questions to Communicate, Connect, and Persuade," provides guidance to those who wish to become effective communicators. Mr. Gowdy talks about how politicians m

Dan Kammen is the Class of 1935 Distinguished Professor of Energy at the UC Berkeley. Well-rounded in issues across the entire energy sphere, Prof. Kammen has also served in both the Obama and Trump administrations among other public facing duties, in addition to being a founder of and advisor to several private companies.  In this interview, Prof. Kammen discusses his views on the American energy policy after Covid-19 and the elections season, and stresses that social and environmental justice are playing an ever more important role in the future of clean energy, requiring a leader like Biden to put forth bold plans. He believes that the U.S. missed a great opportunity to push through a green stimulus package after Covid, which showed the necessity for a clean energy-style stimulus. The opportunity was capitalized upon other countries like South Korea and New Zealand, but the U.S. was stymied by partisan politics when it came down to the details. He remains optimistic, however, when comparing his own Co

Katharina Pistor is Edwin B. Parker Professor of Comparative Law and the director of the Center on Global Legal Transformation at Columbia University. Her most recent book, "The Code of Capital: How the Law Creates Wealth and Inequality," examines how assets such as land, private debt, business organizations, or knowledge are transformed into capital through contract law, property rights, collateral law, and trust, corporate, and bankruptcy law. "The Code of Capital" was named one of the best books of 2019 by the Financial Times and Business Insider. She is a leading scholar and writer on corporate governance, money and finance, property rights, comparative law, and legal institutions. There is no shortage of books explaining issues of inequality in 2020, but they fail to address some of the more fundamental questions about the genesis of capital: How is wealth created in the first place? And, relatedly, why does capital often survive economic cycles and shocks that leave so many others adrift, deprived of t

In his 2019 book "Islam, Authoritarianism, and Underdevelopment: A Global and Historical Comparison," Prof. Ahmet Kuru tackles the question of why Muslim-majority countries have historically exhibited high levels of authoritarianism and low levels of socio-economic development in comparison with the rest of the world. He rejects the two mainstream views of essentialism, which says that Islam is the root of this phenomenon, and anti-imperialism, which says that Western colonization is the reason for historical and modern problems in Muslim-majority countries. In this interview, we discuss a broad range of topics related to Islam and democracy in the Middle East. We focused particularly on Turkey, Dr. Kuru’s home country - discussing what it was like to grow up with a father heavily involved in politics, to Erdogan’s response to the coronavirus, to Dr. Kuru’s hopes and predictions for the future of Turkey’s democracy. We also discussed in great depth the ulema in Muslim-majority democracies, the

"Seeking Virtue in Finance: Contributing to Society in a Conflicted Industry" is the newest book by JC de Swaan, a lecturer in the economics department at Princeton University, where he is affiliated with the Bendheim Center for Finance, and a partner at Cornwall Capital, a New York-based investment fund that the movie "The Big Short" portrayed. At Princeton, Prof. de Swaan teaches classes in Financial Ethics as well as Asian capital markets. Since the 2008 Financial Crisis, a surge of interest in the use of finance as a tool to address social and economic problems suggests the potential for a generational shift in how the finance industry operates and is perceived. Prof. de Swaan seeks to channel the forces of well-intentioned finance professionals to improve finance from within and help restore its focus on serving society. Drawing from inspiring individuals in the field, Prof. de Swaan proposes a framework for pursuing a viable career in finance while benefiting society and upholding humanistic values. In

David Pakman hosts The David Pakman Show, an internationally syndicated television, radio, and Internet political program. In 2005, at the age of 21, Pakman began hosting a local radio station as a "hobby", and by 2011 the show aired on 100 stations and outlets. He was for some time the youngest nationally syndicated political host. In this interview, David and Tiger talk about the state of political consciousness in America, how independent media like podcasting shape socio-political discourse, some of the hot issues that both the Left and Right are concerned about, and what could go wrong in November's elections with mail-in voting. How has the political discourse evolved given all the social turmoil and events in the past few months (Covid-19 and BLM most notably)? By discourse, we mean the general norm that dictates how people interact with each other or the way political and social issues are being talked about in public and private. Amongst all the famous podcasts hosts, for example, some say we’re i

Arvind Panagariya is Jagdish N. Bhagwati Professor of Indian Political Economy at Columbia University and the former and first Vice Chairman of the National Institution for Transforming India (NITI Aayog). Previously, he was the Chief Economist of the Asian Development Bank. In this interview recorded in the spring of 2019, Prof. Panagariya discusses India’s economic reforms and future outlook. As he explains, India and China’s per-capita income really diverged starting in the 1980s as China embarked on more ambitious economic liberation plans ahead of India. The quasi-autarky regime in India scuttled foreign trade and was anti-growth by construction. Growth was important in India's economic policy agenda because one can do little without it. Redistribution wouldn’t have worked because if the state redistributed, everyone would’ve been below the poverty line. There was nothing to redistribute, and nothing to "trickle down" either. Growth was the priority. In 1991, the economic reforms that India needed f

Zena Hitz is a Tutor in the great books program at St. John’s College in Annapolis, Maryland. She has a PhD in ancient philosophy from Princeton University and studies and teaches across the liberal arts. In her book most recent book "Lost in Thought: The Hidden Pleasures of an Intellectual Life," Zena quite artfully explains the ideals of a commitment to intellectual life, and the book inspires fundamental rethinking of our socio-political discourse and academic teaching today. What does it mean to pursue an intellectual life? What are the preconditions for intellectual pursuit, and is it available to everyone? In this long interview, Zena and Tiger go through some of the most contentious debates in academia and beyond – from whether solitude and suffering are required to live out an intellectual life, to whether liberal arts educations are worthy or effective in educating young people. Zena writes in her book that “if intellectual life is not left to rest in its splendid uselessness, it will never bear it

Dan Berkovitz is one of the five Commissioners at the U.S. Commodity Futures Trading Commission (CFTC). This interview touches on a wide range of matters in financial regulation. We first discuss the functions of the CTFC – how it regulates commodities, futures, and swaps which all play an important role in our markets despite sounding like abstract financial terms that are so distant to people’s lives. In 1974 when CFTC was first established, the commodities traded in the U.S. were mainly agricultural products, and the CFTC has since evolved dramatically in the past few decades, playing an ever more important role as hedge funds and institutional investors more frequently use commodities and futures contracts to speculate. One important duty of the CFTC is to help enforce the Dodd-Frank Act. We walk through the history of the Dodd-Frank Act – how it was a law established after the 2008 financial crisis to address some of its causes – and whether there's much validity in the criticism against the legislatio

What are the SEC enforcement stories behind major cases of fraud such as the Fyre Festival and Elizabeth Holmes’s Theranos, or famous settlements such as with Elon Musk and Wells Fargo? Stephanie Avakian is the Co-Director of the SEC’s Division of Enforcement. She has worked on some of the most complex and intriguing investigations, settlements, and financial regulations in recent years. 
In this interview, we discuss how the SEC and the greater financial regulatory community handle complex fraud cases while putting forth policy innovations for the fintech space. We first touch on the technical aspects for judging when a virtual currency is a security and when it’s not. It has been a poignant point of debate whether the SEC should treat cryptocurrencies like Bitcoin as financial securities and thus directly regulate them. It has also become more and more difficult to regulate the cyber space at large, such as when celebrities from DJ Khalid to Floyd Mayweather touted cryptocurrencies on social media. It

Kruskaia Sierra-Escalante is a Senior Manager of Blended Finance at the International Finance Corporation (IFC), which is the private arm of the World Bank. The blended finance unit manages more than $1 billion in donor-contributions for climate-smart co-investments in IFC projects. In this interview, we talk about what blended finance is, and how it generally supports high-impact projects in fragile and conflict-affected states that cannot attract financing on strictly commercial terms. By balancing the risky investments with concessional co-financing from donors or third parties, the IFC can tailor lending packages to address the needs of private sector firms in fragile areas. What makes these loans more attractive to borrowers include pricing (i.e. below-market interest rates or a longer grace period), volume, and a local currency structure. On the creditor side, IFC’s role as a co-lender also mitigates some of the risk that private investors face. Blended finance, Kruskaia noted, is key to delivering o

Rachel Glennerster is the Chief Economist for the UK Department for International Development (DFID), which is the UK's ministry for international development cooperation. Previously, she was the Executive Director of J-PAL (the Jameel Poverty Action Lab) at MIT. This March, Prof. Glennerster gave the closing keynote remarks at the 2020 annual conference at Julis-Rabinowitz Center for Public Policy and Finance, where she touched on challenges of working in fragile states and the linkages between the macro- and micro-levels. The economic policy tools used in advanced economies either do not exist or are ineffective in poor, conflict-afflicted areas. Shifts in macro-level policies can have devastating effects at the household level, leading to hyperinflation, parallel exchange rates, or major debt crises. In this interview, we discuss some of the innovative policy and research tools in fragile states, especially RCT (randomized controlled trials). And we touch on various debates on foreign aid, non-profits,

Scott Morris is a Senior fellow at the Center for Global Development, where he directs the US Development Policy Program and co-directs the Sustainable Development Finance Program. He previously served as deputy assistant secretary for development finance and debt at the Treasury Department under the Obama Administration. In that capacity, he led US engagement with the multilateral development banks, as well as US participation in the Paris Club of official creditors. In this interview, Mr. Morris explains how development finance institutions like the World Bank interact with the U.S. Congress and adapt to the ever more complex situations in international economics. As the World Bank’s largest shareholder, the U.S. maintains a unique influence in shaping its agenda, and Congress has an important role both in funding U.S. contributions to the World Bank and in overseeing U.S. participation in the institution. Has the U.S. involvement been beneficial to the growth and credibility of the organization? Why no

Matt Arnold is the Global Head of ESG at J.P. Morgan Chase and has been a pivotal figurehead in integrating sustainable energy practices into large corporations. One important topic in light of the Covid-19 crisis and the recent Black Lives Matter protests is ESG – environmental, social, and corporate governance. ESG has been a discussion topic in the corporate world for a long time, but the topic has suddenly risen to an ever more important status in the past few months. On the environmental side, there is the call for corporations to move away from fossil fuel and be carbon neutral; on the social side, you have the call for diversity, equity, and inclusion (DEI), which is about promoting a more diverse workforce. Two additional noteworthy aspects related to ESG in light of the recent social turmoil are: one, the demand for more inclusive stakeholding calls to an end to the former principle of “shareholder value maximization.” And two, in terms of economic policy, the “misvaluing” of essential workers duri

Brad Setser is the Steven A. Tanenbaum Senior Fellow for International Economics at the Council on Foreign Relations. He previously served as the deputy assistant secretary for international economic analysis in the U.S. Treasury from 2011 to 2015. In this interview, Dr. Setser discusses how tax avoidance schemes by corporations could distort conventional understanding of cross-national capital flows, and how such capital flows through shell companies are driving international balance of payments. He argues we should pay more attention to external debt, particularly on exports and debt in foreign currency, rather than solely focusing on the government debt alone. He highlights the puzzling debt histories of two countries in particular: Japan, which should be in trouble but is not; and Argentina, which gets into trouble no matter what. We also touch on the important topics of progressive tax policies and how it’s entirely realistic to close down international tax loopholes. It’s noteworthy that Dr. Setser

Quantum computing is the latest “buzz-word” in the tech industry – with over $450 million of private funding investments made between 2017 and 2018 – but what are quantum computers and how will they spark the quantum revolution? Do they truly live up to the “hype” or are the challenges facing them not resolvable in the near future? In this episode, Tiger and aspiring physicist Harsh Babla interview Prof. Steven Girvin to learn about his cutting-edge research in the field, his perspective on Google’s recent quantum supremacy claim, venture capital investments in the field, national security concerns raised by quantum computers, the philosophical implications behind quantum computing, and more. This might not be your one-stop shop for understanding quantum physics, but it should provide you with the appropriate technical and theoretical background to understand many of the current debates. Steven Girvin is the Eugene Higgins Professor of Physics at Yale University. He’s a theoretical physicist known for his

Robert Frank is the H. J. Louis Professor of Management and Economics at Cornell University. His newest book “Under the Influence, Putting Peer Pressure to Work” discusses how social environments profoundly shape our behaviors and how we can unlock the power of social influence – through fascinating ideas from behavioral contagion to consumption taxation. 

 In this interview, Prof. Frank explains the core ideas of his book in detail: how individuals are constantly “under the influence” of others’ behaviors and thus do not always make the most rational decisions; how Adam Smith’s concept of “Invisible Hand” has been greatly misconstrued and overblown by free marketers; why we have a powerful and legitimate public policy interest in encouraging socially beneficial memes and discouraging socially harmful ones… We also discuss Prof. Frank’s progressive consumption tax proposal. It may sound surprising to many, but imposing higher tax rates for the rich might not hurt their purchase power because the prices fo

IBM Chief Economist Martin Fleming discusses Covid-19’s immediate impacts on labor markets and the long-term trends for the future of work – from automation to artificial intelligence. Given how millions of people have to work from home today, there have been countless research reports springing up talking about “the end of work as we know it.” Some of us at Policy Punchline have always been skeptical about those futuristic claims that portray an utopian image filled with tech innovations but do not seek to present any concrete path on how to get there. If you have the same skepticism, hopefully some of that can be answered by Dr. Fleming. IBM has long been known for spearheading corporate research and offering forefront business solutions in technology and beyond. Dr. Fleming tells us about the creation of IBM’s Watson, its unique partnership with MIT to jointly research artificial intelligence, as well as other recent innovations in cognitive systems and machine learning meant to aid human decision-making