Seven billion

NPR reports on global population trends, which will bring us to seven billion strong in October or November. Several nice quotes by the eminently quotable David Bloom of Harvard are included.

I'm refereeing a paper on population momentum right now, which is responsible for a large part of the continuing increases in population levels. Even though fertility rates have fallen in many parts of the globe, age structures favoring the young mean that crude birth rates remain quite high and will continue for some time.

The sex ratio and the real exchange rate

Thanks to EconBrowser for finding this paper on sex ratios and exchange rates and on China in particular. The authors argue that an unbalanced sex ratio favoring men tends to depreciate a country's real exchange rate by raising saving rates and by increasing labor supply, if nontradables are more labor intensive. I think the argument for both those channels hinges on men's needs to accumulate more resources to compete for scarcer women.

Stuck in 1980

The Times Economix blog reports on a study of grade inflation since 1960 by Rojstaczer and Healy, and even shows a nifty graph of grading densities over time. Wow!

My own record at Queens College, a public institution? Since 2006, 25% A's, 40% B's, 24% C's, 5% D's, and 6% F's. According to the graph, I'm pretty much lined up with the "1980 Public" density.

NPR on the Mediterranean diet

NPR's Morning Edition reports on changes in diet and obesity in Mediterranean countries, complete with this zinger:

For the first time in history, today's children are predicted to live shorter lives than their parents. And the Italian Ministry of Health is worried. Health officials say the obesity is reaching epidemic proportions, and the TV campaigns "make it easier to make healthy choices."

I'm not sure I believe the first sentence, but I would agree that the effect of rising obesity on longevity is a point of great interest. The article points out how the price of the Mediterranean diet is higher than it was, but I think what is meant by that is probably (a) the price relative to the alternative, and (b) the price including a source of protein like fish, rather than more vegetables and grains as the diet probably was heavier in.

Dangerous misconceptions about Social Security's assets

This afternoon, in a press conference on the topic of raising the debt ceiling, Rep. Louis Gohmert said that "there is such a thing called the Social Security Trust Fund, and the Social Security Trust Fund will be able to pay seniors their checks for many months to come even if Congress does nothing.”

I'm not sure what is more lamentable here: this misconception itself, which sounds like an honest mistake, or the fact that Gohmert implied that the President would understand it if "he'll do his homework."

Interestingly, the end of the video includes some more remarks of Gohmert's that were not transcribed, in which he refers to a Joint Economic Committee report that he claims supports this view.

The problem is that the Trust Fund holds nothing but U.S. government bonds. In order to pay beneficiaries with those assets, the Social Security Trustees would have to sell them on the open market. And as Fed chair Ben Bernanke and many others have warned, failing to raise the debt limit and defaulting is likely to lower the prices of outstanding debt considerably. Cashing out abruptly like that would probably not be a very efficient way to finance benefit payments.

It's also true that annual Social Security Trust Fund income will exceed costs until 2023, per the latest SSA Trustees report. If income consisted only of taxes, the government could simply earmark payroll taxes for benefits and pay them in full. But it turns out that net interest earned on those government bonds in the Trust Fund is about $100 billion of annual income now, or practically the entire amount of the Social Security surplus. If the government were to completely default on its debt, annual payroll taxes would be barely enough to cover annual benefits now, and they would not be enough very soon, as the Baby Boom continues to retire.

(An additional complication is that the tax relief package passed last December actually lowered the payroll tax rate for 2011 by 2 percentage points, for which the Treasury compensates the Trust Fund via borrowing. Presumably the tax rate will rise for 2012, but I interpret this to mean that if the Trust Fund were indeed to somehow "go it alone" without general revenue, it would come up short this year.)

World Bank data

I gather it's not exactly a new development, contrary to the verb tense in the title of a recent NY Times article, but the World Bank has made much of its data public. Complete with nifty graphics on the front page!