Talk of the Tower, Spring 2012

8/2/2019 Talk of the Tower, Spring 2012

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1ideas defning a ree society

Hoovers Russell Roberts may look and sound like his ellow scholars, but there arent

many economists whose rap music videos have exceeded fve million YouTube views.

His twoFear the Boom and BustandFight of the Century, created with collaborator John

Papola in 2010 and 2011depict economist John Maynard Keynes squaring o with ree-

market proponent F. A. Hayek. Both videos portray the Keynesian versus Austrian schools o

economics in an entertaining and approachable way. A third rap video is in the works.

Whats amazing to me is the two (rap videos) combined still get about 5,000 views every day,

months ater their release, Roberts said, adding that many middle and high school teachers

use them in the classroom.

continued on page 8

insidFrom h dirors dsk

Page 2

Formr d hair Alan Grnspan

joins blu-ribbon onomiss

a Hoovr onrn

Page 3

Rading and riing abou Iran

Page 4

On h road again

Page 5

Rboo dral rol in K12

duaion, ask or says

Page 6

Hoovr llo Mihal MFau

onfrmd US ambassado

o Russia

Page 10

Hoovr rivs uniqu porrai

ollion rom Brnard L

Sharz Foundaion

Page 10

Rird Admiral Gary Roughad

namd Annnbrg

Disinguishd Visiing Fllo

Page 10

In mmoriam

Page 11

alko f t h e

ora q u a r t e r l y p u b l i c at i o n o f t h e h o o v e r i n s t i t u t i o n , s t a n f o r d u n i v e r s i t y

sg 2012

ReSeARcH FeLLOw RUSSeLL ROBeRtS

Using new media to teacheconomics

In a lineup of Hoover scholars, could you identify the rapper? the novelist?

the Internet talk show host? Heres a hint: Theyre all the same fellow.

Photos

courtesyRuss

ellRoberts


2/12

2 Hoover Institution

FROM tHe

As a policy-oriented enterprise on the campus o a majorresearch university, the Hoover Institution seeks to deploy its unique

intellectual resources toward practical, t imely application or the betterment o our nation and our world.

In recent years, our novel approach has incentivized extraordinary scholars to combine eorts within academic

teamsor virtual acultieswith specifc objectives defned by the Institution and each teams members. This

model, deploying Hoover ellows and other scholars to work together on commonly defned, ully integrated

topics and projects, has been a resounding success. I am elated that our culture at Hoover has moved ormallyto include these scholarly orums as part o the working environment o the Institution.

Initially, these groups were unded through one-time grants and contributions. Now, because o their enormous

success and the act that we wish to continue wholeheartedly with these research initiatives, we are moving to

build them into our permanent planning going orward.

We plan to create an entity that will be known as Ideas and the Public Interest, providing our generous

underwriters the opportunity to invest in a specifc academic team or to supportIdeas and the Public Interest

generally. Funds contributed to generally supportIdeas and the Public Interestwill serve as a source o desired

incremental unds as needed or some individual teams, and as seed unding or the launch o new initiatives

as restricted unding is raised rom early perormance success.

By using academic and administrative structures already in place, our academic teams leverage precious

resources to create disproportionate value in the orm o ocused, scholarly work on prevailing policy issues.

ThroughIdeas and the Public Interest, Hoover and its unsurpassed community o scholars ormally integrate

this collective approach to applied scholarship or the greater good.

John Raisian

Tad and Dianne Taube Director

directors desk


3/12

Former Fed

chairman Alan

Greenspan joins

blue-ribbon

economists

at Hooverconerence


Former Federal Reserve chairman Alan Greenspan visited the Hoover Institution in December

to meet with a blue-ribbon group o economists concerning the stagnant economy.

Organized by Hoover ellows John Taylor and Lee Ohanian, the conerence, entitled Restoring

Robust Economic Growth in America, brought together economists with extensive research and

policy experience to address issues such as unemployment, policy uncertainty, long-term reorms,

and monetary and fscal problems.

In a lunchtime panel with distinguished ellow George P. Shultz and University o Chicago

proessor John Cochrane, Greenspan argued that the H1B immigration quota is limiting American

productivity and contributing to our economic problems. Calling it one o the worst policies in

America, Greenspan said that the immigration quota limits the number o skilled workers entering

the United States, limits competition, and contributes to making the United States a country o

haves and have-nots.

Those who would compete with Americans with high skills are not permitted to stay in this

country, Greenspan said. Thus, incomes o Americans with those skills are higher than they

would otherwise be, which is one o the reasons why weve got such a tremendously skewed

distribution o income in this country.

Greenspan served as chairman o the Federal Reserve rom 1987 to 2006: the second-longest

tenure in the position. Only William McChesney Martin Jr. served longer, rom April 2, 1951, to

January 31, 1970.

continued on page 7

HOOVeR cOnFeRence

From left: Former Federal Reserve chairman Alan Greenspan, distinguished fellow George Shultz,

and professor John Cochrane discuss ways to reinvigorate an anemic American economy.


4/12


AbrAhAm D. SofAer

Gg P. Sulz Sni fllw in fign Plicy

and Nainal Scuiy Aais

m, task fc n engy Plicy

Not surprisingly, my heavy reading is related to what I am writing.

Both concern Iran.

I am writing a paper (perhaps ultimately a book) entitled Strength,

Diplomacy and the Iranian Threat examining why the United States has been so unsuccessul in dealing with the threat that Iran

will develop nuclear weapons. The US fxation on the nuclear dimension o Irans recent misconduct is a mistakenot because

the nuclear issue is anything less than the single, greatest security threat in the world today but because it is one o the least

manageable. It would be impossible legally to justiy an attack on Irans potential development o a weapon, and any eective

attack would be difcult, costly, dangerous, unpopular with the Iranian people, and might well ail.

Other approaches to the problem are also likely to ail. Ignoring, pleading, and making unilateral concessions have led only to

acute embarrassment or the administrations involved. Containment is a good idea, but international pressure through sanctions

alone seems unlikely to prevent Iran rom developing nuclear weapons.

So, what should the United States do? Essentially, three things. First, the United States should ocus much more emphatically on

Irans current misconduct. Iran has been helping terrorists and others kill Americans ever since the bombing o the US Marine

barracks in Lebanon in 1983. It is responsible or supplying Iraqis with weapons used to kill and wound hundreds o US GIs. It is

helping our enemies in Aghanistan and has been the principal state supporter o terrorism around the world or many years.

Second, the United States must do what needs to be done to deter Iran rom such acts o aggression. This means attacking Iran but

on a legal basis that is clearly justifable. Lets not make the same mistake that we made with Al Qaeda: treating terrorist attacks

exclusively as crimes. They are national security threats. Using the law as a orm o deense is likely to result in huge dividends:

deterring attacks not only on US soldiers but also on our allies in Iraq, Aghanistan, Lebanon, and Israel.

Third, the United States should be prepared or a meaningul negotiation with Iran. As Secretary o State George P. Shultz has said,

strength and diplomacy go hand in hand. As we show Iran we mean business, Iran will come to the table to try to work out a better

uture or itsel. My paper will detail the disciplined principles o these negotiations.

I have ound two books o particular value helping me put my ideas into context. The frst is Kenneth M. Pollacks The Persian

Puzzle. This clear and balanced history o modern Iran is rich in detail about the very complex society Iran has always been. It is,

unortunately, riddled with the authors explanations and speculation about events that are maddeningly intrusive on the historical

account. But that is a small price or the reward o being well inormed. The second book I recommend is by my brilliant Hoover

colleague Abbas Milani: The Shah. Milani has a depth o understanding about Iran that his personal experience has not distorted.

These books complement those o Robin Wright as required reading or those who would try to understand the Islamic revolution.

RecOMMenDeD ReADInG

Reading and writing about Iran


5/12

Top row (left to right) Director John Raisian, Overseer Mary Myers Kauppila, and Overseer George Siguler at Hoovers regional event in New York; Overseer and New York host Jerry

Milbank greets Senior Fellow Victor Davis Hanson; Chairman Herbert Dwight, Overseer Don Tykeson, and Overseer Gail Jaquish greet Wisconsin Governor Scott Walker at Hoovers

Washington meeting of the Board of Overseers. Center row (left to right) Overseer Heather Higgins greets US Representative Kevin McCarthy of California; Senior Fellow Tom Henriksen

greets Marion Oster and Mona Mapel; Research Fellow Kiron Skinner, Overseer Pitch Johnson and his wife, Cathie, and Senior Fellow Victor Davis Hanson. Bottom row (left to right)

Anne and Dana Smith with Senior Fellow Peter Berkowitz; Research Fellow Bill Whalen addresses a next generation Hoover meeting in Santa Barbara; Overseers Walter Blessey and

Shirley Matteson with Attorney General Ken Cuccinelli of Virginia.

On the road again

5

Regional gatherings in Santa Barbara and New York, and our annual Board of Overseers

meeting in Washington, DC, bring Hoover scholarship to a neighborhood near you!

For future dates and locations, e-mail [email protected].


6/12

Choice and Federalism: Defning the Federal Role in

Education (www.choiceandederalism.org) recommends

that Washington limit its education role to what it can

do best: encourage states to create level playing elds

that expand school options and competition. This would

entail providing access to accurate inormation on school

perormance so that students and their amilies can make

well-inormed decisions about where to enroll.

In our view, the ederal governments proper mandate,

along with providing some o the money, is to enhance

educational opportunity and a principal way o doing so

is to encourage states to give as many parents as possiblewhat is now usually available only to the afuentthe

right to choose where to send their child to school, said

task orce member Grover Russ Whitehurst, lead author

o the report. Schools need to be held accountable or

student achievement, but the marketplace discipline o

robust competition and choice, combined with ample

inormation about school perormance, promises to be

more eective than top-down accountability and program

requirements imposed rom Washington.

Specifcally, the task orce report recommends thatthe ederal government

strengthen its responsibility or three activities that

cannot be eectively devolved: creating and

disseminating inormation on school perormance,

enorcing civil rights, and providing nancial support to

high-need students via backpack unding attached to

individual pupils;

support inormed parental choice with the help o user-

riendly Internet choice portals that describe available

school options and provide clear and relevant inormation

about school perormance; use incentives to promote competitive markets or

education services at the local level.

Schools should be required to participate in data

collection or perormance reporting as a condition or

receiving ederal unds, Whitehurst said. The eds have

a critical role in competitively unding designers and

tASK FORce UPDAte

With the No Child Left Behind (NCLB)

Act overdue for reauthorization, the

Koret Task Force on K12 Education

is recommending a new and powerful

strategy for fundamental education

reformand a major makeover of the

customary federal role: allow states

receiving federal funding to opt out

of traditional federal constraints if

they create vibrant marketplaces for

informed school choice.


Reboot federalrole in K12

education, taskforce says

Photocourtesyhttp://www.K

12.com/


7/12

implementers o school choice portals. Choice wont

work unless parents are supported with good inormation,

delivered in a usable orm.

The task orce also recommends expanding the charter

school sector and encouraging other competitors, such as

cyber schools, interdistrict schools, and private schools.

Along with this broader array o options, school districts

should stop assigning students to schools. Instead, every

parent should be required to engage in school choice,

thereby easing todays socioeconomic dierences among

parents in shopping or schools.

Today, Washington is stuck in an education policy rut,

said task orce chairman Chester E. Finn Jr. On one side

we nd those who would simply let states do whatever they

like with the ederal dollars. On the other side are those

who want the ederal government to tighten the centrally

prescribed accountability screws even harder. This debate

is going nowhere, as is evident rom Congresss multiyear

ailure to reauthorize what just about everyone agrees is a

badly fawed law.

Its time to rethink the whole enterprise, Finn said. By

remaking its core policies or K12 education to align with

those it has long since adopted or higher education, Uncle

Sam can provide parents with something nearly all want:

the opportunity to choose where their child is schooled.

ideas defning a ree society 7

former ed cairman Greenspan joins blue-ribbo

economists at hoover conerence

(continued from page 3)

Mr. Shultz echoed Greenspans concern over the

disproportionate distribution o income.

Through the poor quality o K12 education among low-

income areas, we are building maldistribution o income

into the system, Mr. Shultz said. I think it is a crisis that we

are allowing to continue. Theres nothing wrong with these

(lower-income) kids. Theres a crisis in the environment in

which they are entrapped.

Dubbing the current stagnation nancial crisis 3.0,

Cochrane pointed to the three contributing culprits: the

currency crisis, the scal crisis, and the banking crisis.

Giving a banker a deposit guarantee is like giving a teenager

the keys to the car and a bottle o whiskey, he said.

The question, all three agreed, is what system will we

reconstruct rom the ashes?

Mr. Shultz called the solutions simple:

Reorm the personal and corporate tax systems using the

1986 fat tax proposal as a template

Focus on the present; the present president and

current Congress have no control over what will be spent

ten years rom now

Change Social Security indexing rom wage to price

indexing

Let people buy health insurance across state lines to

generate competition

Reorm the monetary policy o the Federal Reserve

I think they should get back to the kind o monetary policy

that (Paul) Volcker and (Alan) Greenspan had, Mr. Shultz

said. It was predictable, consistent with prosperity without

infation. Try the Taylor Rule or example, just to be

parochial about it.

The Taylor Rule, proposed by Hoovers John Taylor in 1993,

stipulates that or each 1 percent increase in infation, the

central bank should raise the nominal interest rate by

more than 1 percentage point. It is intended to oster price

stability and ull employment by systematically reducing

uncertainty and increasing the credibility o uture actions

by the central bank. It may also avoid the ineciencies o

time inconsistency rom the exercise o discretionary policy

Photo

courtesy

VectorResources,

Inc.


8/12


Were trying to reach people who are interested in how the

world works, he said. Thats everybody rom a high school

student who is curious about economics to a person who is

just trying to make a living and get along and is worried about

whats going on in Washington or in the country. We tried to

make these lyrics accessible, a little bit amusing.

With a goal o reaching a broad base o people, Roberts is not

content to communicate through just one medium.

I love to teach and Ive always enjoyed explaining things, but

people want to learn through other media besides the printed

word. It turns out that there is a strong interest in learning and

that people have time in their lives when they can listenwhen

they are on the exercise machine, when they are driving.

So Roberts podcasts (EconTalk www.econtalk.org/).

He blogs (Ca Hayek caehayek.com/).

He raps (www.YouTube.com/watch?v=d0nERTFo-Sk, www.

YouTube.com/watch?v=GTQnarzmTOc).

And he writes novels (The Price of Everything: A Parable of

Possibility and Prosperity; The Choice: A Fable of Free Trade and

Protectionism; and The Invisible Heart: An Economic Romance).

He knows he is making an impact; his ans reach out to tell

him so. Some o his avorites?

Im pretty proud o the act that a dad writes to say, My son

and I listen to the podcast every week on the way to school,

and its been a wonderul way to bond, Roberts said.

I had a guy tell me his th grader has mastered all o the (rap)

lyrics and was showing the video to his riend, and he said,

Dude, dont you know anything about Austrian economics?

But my avorite is the guy who told me he never went to

college, that he works or a maintenance company and he

waxes foors in buildings late at night, and at three in the

morning while hes bung the foor he listens to my podcast.

It was actually the podcast that led to the creation o the rap

videos. Roberts explained that Papola, a lm producer who

had become a an o the podcasts, called him and suggestedthe two collaborate.

The rest, as they say, is history. The rap videos have been

subtitled in eleven languages and viewed hundreds o

thousands o times in those subtitled versions.

I devote an increasing amount o time to what I call public

education, said Roberts. Its so gratiying to know that

people around the world are learning a little something rom

what I do.

Using new media to teach economics

(continued from page 1)

Research fellow Russell Roberts devotes an increasing amount of time to what he calls public education,

making use of new media to teach economic policy.


9/12


KeYNeS

Hr ar. Pa ou, Gra Rssion.thanks o mas you sr no in a dprssion.

Rovry. Dsiny. If you follo my lsson.

Lord Kyns. Hr I om. Lin up for h prossion.

hAYeK

w brough ou h shovls and r sill in a dih.

And sill digging. Don you hink is im for a sih

from ha hair of h dog? Frind, h pary is ovr,

h long run is hr, is im o g sobr.

KeYNeS

w ould hav don br had only spn mor.

too bad ha only happns hn hrs a orld ar.

You an arp all you an abou sas and rgrssions.

Do you dny ha orld ar u shor h Dprssion?

hAYeK

wo. On daa poin and your jumping for joy.

th las im I hkd ars only dsroy.

thr as no muliplir. consumpion jus shrankas usd sar rsours for vry n ank.

Pry prvrs o all ha prospriy.

Raion ma. Raion bur. A lif of ausriy.

whn ha ar spnding ndd, your frinds rid disasr.

Y h onomy hrivd and gr fasr.

KeYNeS

So ha ould you do o hlp hos unmployd?

this is h qusion you sm o avoid.

whn r in a mss, ould you hav us jus ai,

doing nohing unil marks quilibra?

hAYeK

I don anna do nohing, hrs plny o do.

th qusion I pondr is ho plans for hom.

Do I plan for myslf or lav i o you?

I an plans by h many, no by h f.

Ls no rpa ha rad our roubls.

I an ral groh, no a sris of bubbls.

Sop bailing ou losrs, l pris ork.

If don ry o sr hm, hy on go brsrk.

KeYNeS

Youv go on your high hors and you ar off o h ras.

I look a h orld on a as-by-as basis.

whn popl ar suffring I roll up my slvs

and do ha I an o ur our disas.

th fuurs unrain, our oulooks ar frail.

thas hy fr marks ar so pron o fail.

In a volail orld nd mor disrion

so sa inrvnion an ounr dprssion.

hAYeK

Popl arn hssmn you mov on a board

a your him, hir drams and dsirs ignord.

wih poliial innivs, disrions a jok.

thos dials ar ising, jus mirrors and smok.

w nd sabl ruls and ral mark pris

so prospriy mrgs and us shor h risis.

Giv us a han so an disovr

h mos valuabl ays o srv on anohr.

Photo

courtesyRussellRobertsand

John

Papola

exrps from Fight of the Century

Russell Robertss YouTube videoFigh of h cnury, created with collaborator John Papola in 2011 and pictured

here, depicts economist John Maynard Keynes squaring off with free-market proponent F.A. Hayek.


10/12


The US Congress has confrmed Peter and

Helen Bing Senior Fellow Michael McFaul as US

ambassador to Russia.

An expert on US oreign policy, US-Russian

relations, political and economic reorm in the

postcommunist world, and the promotion o

democracy, McFaul joined Hoover in 1995. He has

written and edited more than twenty books, and

penned numerous articles and opinion pieces,

as well as serving as an expert commentator on

national television and radio.

During his tenure in the Obama administration,

McFaul has been an integral part o the new

orward momentum in relations with Russia.

His voice and expertise are valued assets in the

current landscape o critical events not only

regarding Russia but also transitions to democracy

in the Arab world.

Beore leaving Stanord University to serve as

special assistant to the president or national

security aairs and senior director or Russian and

Eurasian aairs at the National Security Council,

McFaul was a proessor o political science, a

senior ellow and ormer deputy director o

the Freeman Spogli Institute or International

Studies, and director o the Center on Democracy,

Development, and the Rule o Law.

Hoover ellow Michael McFaul

confrmed US ambassador to Russia

Retired Admiral Gary

Roughead named

Annenberg Distinguished

Visiting Fellow

the Bernard Lee Shwarz

Foundaion has onribued hiry-

four saesmens porrais o he

Hoover Insiuion Library and

Arhives, inluding phoographs

of suh luminaries as Prime

Miniser Margare thaher of Grea

Briain, US sereary of sae Henry

Kissinger, and Prime Minisers

Moshe Dayan and Golda Meir of he

sae of Israel.

the porrais, donaed by Shwarz

Foundaion presiden and Hoover

counil member Mihael Shwarz,

Hoover receives

unique portrait

collection rom

Bernard Lee Schwartz

Foundation

AP

phoo

PhoobytifiJoesVaderwys,

US

navy

Phoo

byBerard

LeeSchwarzcouresy

HooverIsiuioLibraryad

Archives


11/12


Retired Admiral Gary Roughead, appointed in September

2007 as Chief of Naval Operations (CNO) by President

George W. Bush, is in residence at Hoover this year as the

Annenberg Distinguished Visiting Fellow.

Admiral Roughead, who as CNO ocused on military modernization

until his retirement rom active duty in September 2011, plans toexamine the critical role o the military as part o the American

way o lie. Working in collaboration with ormer cabinet members

Distinguished Fellow George P. Shultz and Senior Fellow William

Perry, who are also in residenceAdmiral Rougheads research will

contribute substantially to the Institutions ocus on the role o military

history on current public policy ormation.

To ocus on policy research and to collaborate with esteemed

colleagues is an extraordinary opportunity to remain engaged in public

policy, Admiral Roughead said. I am pleased to accept the prestigious

oer o the Hoover Institution to serve as the Annenberg Fellow.

Admiral Roughead is a visionary when it comes to the role o the

military in national security, Director John Raisian said. Too much

policy dialogue has an absence o history, implicitly suggesting that

all new policy issues are suciently dierent that one does not benet

rom refection on past idea ormation and practice; we think dierently

at Hoover, and anticipate that Admiral Rougheads active presence

will help us look at how to balance current policy dialogue with more

historical perspective.

Hoovr ovrsr Billi Pirni o Mongomry,

Alabama, passd aay on Oobr 22, 2011, a h

ag o ighy-nin.

As prsidn, ceO, and o-onr o Ropir

Indusris, as ll as hairoman o hr

Ropir Indusris subsidiaris, sh as dply

ommid o businss and ommuniy srvi.

Sh bgan hr Hoovr board srvi in 2001.

In addiion, sh srvd on h board o h

tlommuniaions Assoiaion o h Souhas,

h board o advisrs o h Hriag Foundaion,

and h Mongomry hapr o h Daughrs o

h Amrian Rvoluion.

My li has alays bn on o srvi o my llo

man: frs as a rgisrd nurs, hn as a i and

mohr, and fnally as a providr o ommuniaion

o h publi, Pirni said in a rn inrvi.

Born July 6, 1922, in Huron, Kansas, Pirni m

hr husband, Bob, hn boh r sudns

a wspor High Shool in Kansas ciy. Sh

arnd a nursing dgr in 1943 and lar a

dgr in advand managmn sudis rom

h Univrsiy o Kansas, topka. In h mid-

1950s, Bob Pirni purhasd h Union Springs

tlphon company, and oghr h oupl gr

i ino Ropir Indusrisonsising o h original

phon ompany, com Link cabl tV, and Ropir

communiaionshih Pirni ran or mor han

ny yars, sin 1991.

My life has

always been one of serv

to my fellow man.

Billie Pirnie

In memoriam

ar h raions o his ahr, h

la Brnard Sharz, ho ook

up phoography a h ag o

sixy ar a sussul arr in

businss. In his shor phoographi

arr, Brnard Sharz apurd

som o hundrd disinguishd

prsonaliis on flm, inluding six

prim minisrs, a prin, o kings,

and a pop. Mrs. thahr hos

Sharzs porrai or hr ampaign

posr. A 1982 ommmoraiv frs-

day-ovr o a philali issu in

england aurs his lassi porrai

o Lord Mounban.

Ar ory yars as a sussul

businssman, Sharz

(191478) urnd his im

and onsidrabl alns

oard a n arr in porrai

phoography, hih had bn

his hobby sin h as a boy.

In h spa o hr yars, h

as abl o apur dozns o

porrais o unsurpassd qualiy.

His phoographi nounrs

on ripnd ino nduring

rindships ih som o h

orlds lading fgurs.


12/12

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ur latest Hoover publication,

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as indicators o our impact in the

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theBook of Lists includes recent

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Talk of the Tower, Spring 2012

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