History Readings

In 2011, Mr. Bernanke, a staunch proponent of transparency as a tenet of monetary policy, gave the first scheduled news conference by a chairman in Fed history. His comments to reporters went beyond mere openness; he expressed remarkable candor and established, albeit tentatively, the basis for a regular rapport with the public.

By the late 1990s a vast majority of the central banks had begun to incorporate elements of inflation targeting. The aim is to shape the expectations around the most fundamental dynamic of market economies: the evolution of prices. The experiments relied on theories going back decades. As far back as the 1930s, the economists Knut Wicksell, Irving Fisher and John Maynard Keynes proposed that price behavior was based in large part on expectations.

A senior official of the European Central Bank, Benoît Coeuré, said in a speech last year that monetary stability was “a cornerstone of the social contract.” Fed officials who remember the high inflation of the 1970s, brought under control by Mr. Greenspan’s predecessor, Paul A. Volcker, pretty much agree.

The most comforting explanation of these facts is that they are mere artifacts of class — rich parents passing on advantages to their children — or of immigrants arriving in this country with high skill and education levels. Important as these factors are, they explain only a small part of the picture.

Take New York City’s selective public high schools like Stuyvesant and Bronx Science, which are major Ivy League feeders. For the 2013 school year, Stuyvesant High School offered admission, based solely on a standardized entrance exam, to nine black students, 24 Hispanics, 177 whites and 620 Asians. Among the Asians of Chinese origin, many are the children of restaurant workers and other working-class immigrants.

Merely stating the fact that certain groups do better than others — as measured by income, test scores and so on — is enough to provoke a firestorm in America today, and even charges of racism.

The irony is that the facts actually debunk racial stereotypes.

Nigerians make up less than 1 percent of the black population in the United States, yet in 2013 nearly one-quarter of the black students at Harvard Business School were of Nigerian ancestry; over a fourth of Nigerian-Americans have a graduate or professional degree, as compared with only about 11 percent of whites.

By 1990, United States-born Cuban children — whose parents had arrived as exiles, many with practically nothing — were twice as likely as non-Hispanic whites to earn over $50,000 a year. All three Hispanic United States senators are Cuban-Americans.

Meanwhile, some Asian-American groups — Cambodian- and Hmong-Americans, for example — are among the poorest in the country, as are some predominantly white communities in central Appalachia.

MOST fundamentally, groups rise and fall over time.

while Asian-American kids overall had SAT scores 143 points above average in 2012 — including a 63-point edge over whites — a 2005 study of over 20,000 adolescents found that third-generation Asian-American students performed no better academically than white students.

The fact that groups rise and fall this way punctures the whole idea of “model minorities” or that groups succeed because of innate, biological differences. Rather, there are cultural forces at work.

the strikingly successful groups in America today share three traits that, together, propel success

The first is a superiority complex — a deep-seated belief in their exceptionality. The second appears to be the opposite — insecurity, a feeling that you or what you’ve done is not good enough. The third is impulse control.

research shows that some groups are instilling them more frequently than others, and that they are enjoying greater success.

Ironically, each element of the Triple Package violates a core tenet of contemporary American thinking.

it’s precisely this unstable combination that generates drive: a chip on the shoulder, a goading need to prove oneself. Add impulse control — the ability to resist temptation — and the result is people who systematically sacrifice present gratification in pursuit of future attainment.

We know that group superiority claims are specious and dangerous, yet every one of America’s most successful groups tells itself that it’s exceptional in a deep sense.

That insecurity should be a lever of success is another anathema in American culture. Feelings of inadequacy are cause for concern or even therapy; parents deliberately instilling insecurity in their children is almost unthinkable. Yet insecurity runs deep in every one of America’s rising groups; and consciously or unconsciously, they tend to instill it in their children.

Numerous studies, including in-depth field work conducted by the Harvard sociologist Vivian S. Louie, reveal Chinese immigrant parents frequently imposing exorbitant academic expectations on their children (“Why only a 99?”), making them feel that “family honor” depends on their success.

In a study of thousands of high school students, Asian-American students reported the lowest self-esteem of any racial group, even as they racked up the highest grades.

Moreover, being an outsider in a society — and America’s most successful groups are all outsiders in one way or another — is a source of insecurity in itself. Immigrants worry about whether they can survive in a strange land, often communicating a sense of life’s precariousness to their children.

Finally, impulse control runs against the grain of contemporary culture as well. Countless books and feel-good movies extol the virtue of living in the here and now, and people who control their impulses don’t live in the moment.

The dominant culture is fearful of spoiling children’s happiness with excessive restraints or demands. By contrast, every one of America’s most successful groups takes a very different view of childhood, inculcating habits of discipline from a very early age

Needless to say, high-achieving groups don’t instill these qualities in all their members. They don’t have to

At the same time, if members of a group learn not to trust the system, if they don’t think people like them can really make it, they will have little incentive to engage in impulse control.

success comes at a price. Each of the three traits has its own pathologies

Even when it functions relatively benignly as an engine of success, the combination of these three traits can still be imprisoning — precisely because of the kind of success it tends to promote. Individuals striving for material success can easily become too focused on prestige and money, too concerned with external measures of their own worth.

Only in combination do these qualities generate drive and what Tocqueville called the “longing to rise.”

It’s just much harder when you have to do it on your own, when you can’t draw on the cultural resources of a broader community, when you don’t have role models or peer pressure on your side, and instead are bombarded daily with negative images of your group in the media.

But it would be ridiculous to suggest that the lack of an effective group superiority complex was the cause of disproportionate African-American poverty. The true causes barely require repeating

Nor does the lack of a group superiority narrative prevent any given individual African-American from succeeding. It simply creates an additional psychological and cultural hurdle that America’s most successful groups don’t have to overcome.

Culture is never all-determining. Individuals can defy the most dominant culture and write their own scripts

The same factors that cause poverty — discrimination, prejudice, shrinking opportunity — can sap from a group the cultural forces that propel success. Once that happens, poverty becomes more entrenched.

Disappearing blue-collar jobs and greater returns to increasingly competitive higher education give a tremendous edge to groups that disproportionately produce individuals driven, especially at a young age, to excel and to sacrifice present satisfactions for long-term gains.

THE good news is that it’s not some magic gene generating these groups’ disproportionate success. Nor is it some 5,000-year-old “education culture” that only they have access to. Instead their success is significantly propelled by three simple qualities open to anyone.

The way to develop this package of qualities — not that it’s easy, or that everyone would want to — is through grit.

It requires turning the ability to work hard, to persevere and to overcome adversity into a source of personal superiority. This kind of superiority complex isn’t ethnically or religiously exclusive. It’s the pride a person takes in his own strength of will.

research shows that perseverance and motivation can be taught, especially to young children.

The United States itself was born a Triple Package nation, with an outsize belief in its own exceptionality, a goading desire to prove itself to aristocratic Europe (Thomas Jefferson sent a giant moose carcass to Paris to prove that America’s animals were bigger than Europe’s) and a Puritan inheritance of impulse control.

But prosperity and power had their predictable effect, eroding the insecurity and self-restraint that led to them. By 2000, all that remained was our superiority complex, which by itself is mere swagger, fueling a culture of entitlement and instant gratification.

the trials of recent years — the unwon wars, the financial collapse, the rise of China — have, perversely, had a beneficial effect: the return of insecurity.

The economics community just hasn't spent much time over the past couple of decades focusing on the effect that machine intelligence is likely to have on the labor marke

The Digital Revolution is different because computers can perform cognitive tasks too, and that means machines will eventually be able to run themselves. When that happens, they won't just put individuals out of work temporarily. Entire classes of workers will be out of work permanently. In other words, the Luddites weren't wrong. They were just 200 years too early

while it's easy to believe that some jobs can never be done by machines—do the elderly really want to be tended by robots?—that may not be true.

Robotic pets are growing so popular that Sherry Turkle, an MIT professor who studies the way we interact with technology, is uneasy about it: "The idea of some kind of artificial companionship," she says, "is already becoming the new normal."

robots will take over more and more jobs. And guess who will own all these robots? People with money, of course. As this happens, capital will become ever more powerful and labor will become ever more worthless. Those without money—most of us—will live on whatever crumbs the owners of capital allow us.

Economist Paul Krugman recently remarked that our long-standing belief in skills and education as the keys to financial success may well be outdated. In a blog post titled "Rise of the Robots," he reviewed some recent economic data and predicted that we're entering an era where the prime cause of income inequality will be something else entirely: capital vs. labor.

We're already seeing them, and not just because of the crash of 2008. They started showing up in the statistics more than a decade ago. For a while, though, they were masked by the dot-com and housing bubbles, so when the financial crisis hit, years' worth of decline was compressed into 24 months. The trend lines dropped off the cliff.

In the economics literature, the increase in the share of income going to capital owners is known as capital-biased technological change

The question we want to answer is simple: If CBTC is already happening—not a lot, but just a little bit—what trends would we expect to see? What are the signs of a computer-driven economy?

if automation were displacing labor, we'd expect to see a steady decline in the share of the population that's employed.

Second, we'd expect to see fewer job openings than in the past.

Third, as more people compete for fewer jobs, we'd expect to see middle-class incomes flatten in a race to the bottom.

Fourth, with consumption stagnant, we'd expect to see corporations stockpile more cash and, fearing weaker sales, invest less in new products and new factories

Fifth, as a result of all this, we'd expect to see labor's share of national income decline and capital's share rise.

There will be no place to go but the unemployment line.

The modern economy is complex, and most of these trends have multiple causes.

in another sense, we should be very alarmed. It's one thing to suggest that robots are going to cause mass unemployment starting in 2030 or so. We'd have some time to come to grips with that. But the evidence suggests that—slowly, haltingly—it's happening already, and we're simply not prepared for it.

the first jobs to go will be middle-skill jobs. Despite impressive advances, robots still don't have the dexterity to perform many common kinds of manual labor that are simple for humans—digging ditches, changing bedpans. Nor are they any good at jobs that require a lot of cognitive skill—teaching classes, writing magazine articles

in the middle you have jobs that are both fairly routine and require no manual dexterity. So that may be where the hollowing out starts: with desk jobs in places like accounting or customer support.

In fact, there's even a digital sports writer. It's true that a human being wrote this story—ask my mother if you're not sure—but in a decade or two I might be out of a job too

Doctors should probably be worried as well. Remember Watson, the Jeopardy!-playing computer? It's now being fed millions of pages of medical information so that it can help physicians do a better job of diagnosing diseases. In another decade, there's a good chance that Watson will be able to do this without any human help at all.

Take driverless cars.

Most likely, owners of capital would strongly resist higher taxes, as they always have, while workers would be unhappy with their enforced idleness. Still, the ancient Romans managed to get used to it—with slave labor playing the role of robots—and we might have to, as well.

There will be no place to go but the unemployment lin

we'll need to let go of some familiar convictions. Left-leaning observers may continue to think that stagnating incomes can be improved with better education and equality of opportunity. Conservatives will continue to insist that people without jobs are lazy bums who shouldn't be coddled. They'll both be wrong.

Corporate executives should worry too. For a while, everything will seem great for them: Falling labor costs will produce heftier profits and bigger bonuses. But then it will all come crashing down. After all, robots might be able to produce goods and services, but they can't consume them

we'll probably have only a few options open to us. The simplest, because it's relatively familiar, is to tax capital at high rates and use the money to support displaced workers. In other words, as The Economist's Ryan Avent puts it, "redistribution, and a lot of it."

would we be happy in a society that offers real work to a dwindling few and bread and circuses for the rest?

The next step might be passenger vehicles on fixed routes, like airport shuttles. Then long-haul trucks. Then buses and taxis. There are 2.5 million workers who drive trucks, buses, and taxis for a living, and there's a good chance that, one by one, all of them will be displaced

 economist Noah Smith suggests that we might have to fundamentally change the way we think about how we share economic growth. Right now, he points out, everyone is born with an endowment of labor by virtue of having a body and a brain that can be traded for income. But what to do when that endowment is worth a fraction of what it is today? Smith's suggestion: "Why not also an endowment of capital? What if, when each citizen turns 18, the government bought him or her a diversified portfolio of equity?"

In simple terms, if owners of capital are capturing an increasing fraction of national income, then that capital needs to be shared more widely if we want to maintain a middle-class society.

it's time to start thinking about our automated future in earnest. The history of mass economic displacement isn't encouraging—fascists in the '20s, Nazis in the '30s—and recent high levels of unemployment in Greece and Italy have already produced rioting in the streets and larger followings for right-wing populist parties. And that's after only a few years of misery.

When the robot revolution finally starts to happen, it's going to happen fast, and it's going to turn our world upside down. It's easy to joke about our future robot overlords—R2-D2 or the Terminator?—but the challenge that machine intelligence presents really isn't science fiction anymore. Like Lake Michigan with an inch of water in it, it's happening around us right now even if it's hard to see

A robotic paradise of leisure and contemplation eventually awaits us, but we have a long and dimly lit tunnel to navigate before we get there.

in the past 30 years, software and robots have thrived at replacing a particular kind of occupation: the average-wage, middle-skill, routine-heavy worker, especially in manufacturing and office admin. 

the next wave of computer progress will continue to shred human work where it already has: manufacturing, administrative support, retail, and transportation. Most remaining factory jobs are "likely to diminish over the next decades," they write. Cashiers, counter clerks, and telemarketers are similarly endangered

here's a chart of the ten jobs with a 99-percent likelihood of being replaced by machines and software. They are mostly routine-based jobs (telemarketing, sewing) and work that can be solved by smart algorithms (tax preparation, data entry keyers, and insurance underwriters)

I've also listed the dozen jobs they consider least likely to be automated. Health care workers, people entrusted with our safety, and management positions dominate the list.

Although the past 30 years have hollowed out the middle, high- and low-skill jobs have actually increased, as if protected from the invading armies of robots by their own moats

If you wanted to use this graph as a guide to the future of automation, your upshot would be: Machines are better at rules and routines; people are better at directing and diagnosing. But it doesn't have to stay that way.

Higher-skill workers have been protected by a kind of social-intelligence moat. Computers are historically good at executing routines, but they're bad at finding patterns, communicating with people, and making decisions, which is what managers are paid to do

lower-skill workers have been protected by the Moravec moat. Hans Moravec was a futurist who pointed out that machine technology mimicked a savant infant: Machines could do long math equations instantly and beat anybody in chess, but they can't answer a simple question or walk up a flight of stairs. As a result, menial work done by people without much education (like home health care workers, or fast-food attendants) have been spared, too.

robots are finally crossing these moats by moving and thinking like people. Amazon has bought robots to work its warehouses. Narrative Science can write earnings summaries that are indistinguishable from wire reports. We can say to our phones I'm lost, help and our phones can tell us how to get home. 

In a decade, the idea of computers driving cars went from impossible to boring.

The first wave showed that machines are better at assembling things. The second showed that machines are better at organization things. Now data analytics and self-driving cars suggest they might be better at pattern-recognition and driving. So what are we better at?

One conclusion to draw from this is that humans are, and will always be, superior at working with, and caring for, other humans. In this light, automation doesn't make the world worse. Far from it: It creates new opportunities for human ingenuity.  

But robots are already creeping into diagnostics and surgeries. Schools are already experimenting with software that replaces teaching hours. The fact that some industries have been safe from automation for the last three decades doesn't guarantee that they'll be safe for the next one.

It would be anxious enough if we knew exactly which jobs are next in line for automation. The truth is scarier. We don't really have a clue.

As the Internet goes about its work making the economy more efficient, it is reducing the need for travel agents, post office employees, and dozens of other jobs in corporate America. The increased interconnectivity created by the Internet forces many middle and lower class workers to compete for jobs with low-paid workers in developing countries. Even skilled technical workers are finding that their jobs can be outsourced to trained engineers and technicians in India and Eastern Europe.

The new news is that Internet-based companies may well be the businesses of the future, but they create opportunities for only a select few. Google has a little over 54,000 employees and generated revenues of around $50 billion in sales or about $1.0 million per employee.

in order to justify hiring an employee, a highly productive Internet company must create five to ten times the dollars in sales as the average domestic company.

will the Internet also create the greatest economic inequality the global economy has ever known?

One reason we are failing to create a vibrant middle class is that the Internet affects the economy differently than the new businesses of the past did., forcing businesses and their workers to face increased global competition. It reduces the barriers for moving jobs overseas. It has a smaller economic trickle-down effect.

Doing some of the obvious things like raising the minimum wage to fight the effects of the Internet will probably worsen the problem. For example, it will make it more difficult for bricks-and-mortar retailers to compete with online retailers.

Surprisingly, the much-vilified Walmart probably does more to help middle class families raise their median income than the more productive Amazon. Walmart hires about one employee for every $200,000 in sales, which translates to roughly three times more jobs per dollar of sales than Amazon

two things are certain: the Internet is creating many of those in the ultra-wealthy 1%; and it forces businesses to compete with capable international competitors while providing the tools so that businessmen can squeeze inefficiency out of the system in order to remain competitive.

If the government is going to be in the business of redistributing wealth, a better approach would be to raise the earned income tax credit and increase taxes to pay for it. Not only would this raise the income of low paid workers, but also it would subsidize businesses so they would be more competitive in world markets and encourage them to create jobs

For 30 wonderful years, we had been unusually flush, and we got used to it, re-designing our institutions to assume unending increases in subsidized demand. This did not happen. The year it started not happening was 1975. Every year since, we tweaked our finances, hiking tuition a bit, taking in a few more students, making large lectures a little larger, hiring a few more adjuncts.

Over the decades, though, we’ve behaved like an embezzler who starts by taking only what he means to replace, but ends up extracting so much that embezzlement becomes the system. There is no longer enough income to support a full-time faculty and provide students a reasonably priced education of acceptable quality at most colleges or universities in this country.

Of the twenty million or so students in the US, only about one in ten lives on a campus. The remaining eighteen million—the ones who don’t have the grades for Swarthmore, or tens of thousands of dollars in free cash flow, or four years free of adult responsibility—are relying on education after high school not as a voyage of self-discovery but as a way to acquire training and a certificate of hireability.

Though the landscape of higher education in the U.S., spread across forty-six hundred institutions, hosts considerable variation, a few commonalities emerge: the bulk of students today are in their mid-20s or older, enrolled at a community or commuter school, and working towards a degree they will take too long to complete. One in three won’t complete, ever. Of the rest, two in three will leave in debt. The median member of this new student majority is just keeping her head above water financially. The bottom quintile is drowning.

One obvious way to improve life for the new student majority is to raise the quality of the education without raising the price. This is clearly the ideal, whose principal obstacle is not conceptual but practical: no one knows how. The value of our core product—the Bachelor’s degree—has fallen in every year since 2000, while tuition continues to increase faster than inflation.

The metaphor my colleagues often use invokes religion. In Wannabe U, the author describes the process of trying to turn UConn into a nationally competitive school as the faculty being ‘dechurched’. In this metaphor, we are a separate estate of society that has putative access to its resources, as well as the right to reject democratic oversight, managerial imperatives, and market discipline. We answer to no one but ourselves.

When the economic support from the Golden Age began to crack, we tenured faculty couldn’t be forced to share much of the pain. Our jobs were secure, so rather than forgo raises or return to our old teaching loads, we either allowed or encouraged those short-term fixes—rising tuition, larger student bodies, huge introductory lectures.

All that was minor, though, compared to our willingness to rely on contingent hires, including our own graduate students, ideal cheap labor. The proportion of part-time and non-tenure track teachers went from less than half of total faculty, before 1975, to over two-thirds now

In the same period, the proportion of jobs that might someday lead to tenure collapsed, from one in five to one in ten. The result is the bifurcation we have today: People who have tenure can’t lose it. People who don’t mostly can’t get it.

If we can’t keep raising costs for students (we can’t) and if no one is coming to save us (they aren’t), then the only remaining way to help these students is to make a cheaper version of higher education for the new student majority.

The number of high-school graduates underserved or unserved by higher education today dwarfs the number of people for whom that system works well. The reason to bet on the spread of large-scale low-cost education isn’t the increased supply of new technologies. It’s the massive demand for education, which our existing institutions are increasingly unable to handle. That demand will go somewhere.

why is not part of the answer a secondary education certification scheme that is serious and ideally nation-wide. The British GCSE/A-levels is something that seems to work. Herding the cats that would be necessary to implement something like that is, I grant, a monstrous task, but perhaps no more difficult than revising the university system. As things stand now, the lack of standards in most high schools means wasted opportunities of academic development for a very large part of our reasonably gifted teenage population. A revised university system would still leave in place the distinctly inadequate high school system we have now.

The other way to help these students would be to dramatically reduce the price or time required to get an education of acceptable quality (and for acceptable read “enabling the student to get a better job”, their commonest goal.) This is a worse option in every respect except one, which is that it may be possible.

The metaphor I have come to prefer (influenced especially by Richard Rorty) is that we in the academy are workers, and our work is to make people smarter — ourselves, our peers, our students, which is a goal that has to be constantly negotiated among various constituencies.

When the military rationale for both the GI Bill and the Soviet struggle ended, so did overall American interest in the kind of funding that drove the Golden Age. There is not now and has never been a broad commitment to higher education as a social good in this country

ow you can say — and many of my colleagues do — that this is all just a matter of getting state governments to take on different concerns or convictions, or getting a more nationalized educational system. That was the song my parents, both educators, sang, and the song I grew up singing. But the period when the states really drove funding up lasted just 15 years — 1960 to 1975 — and has been in decline for 40 years since.

I can — barely — imagine some states increasing some subsidies to some campuses at a rate faster than inflation. Some of the schools in California, Virginia, Massachusetts, and Michigan are candidates for this. I cannot, however, imagine my tenured colleagues tolerating the situation that makes higher education broadly affordable in social democracies, which would require us earning less while teaching more.

I am done, in other words, thinking of myself and my peers on faculty as blameless, and I am done imagining that 40 years of evidence from the behavior of democratically elected legislatures is some sort of readily reversible blip. I do not believe that the caste system that has established itself at elite institutions can be funded at the rate which we insist we need, and I do not believe that we will willingly see any of our own benefits reduced to help our junior colleagues or our students.

Students feel compelled to acquire credentialing as a means of improving their economic positions. Unfortunately, along the way, “professional” training has taken precedence over education. The two have become conflated in the public mind.

Today it is not only that the PhD:s are abundant but also that in many areas peak knowledge is short lived. You might be competent when you graduate but five years later that competence is of yesteryear and the ones with the newest knowledge kick you out just like you kicked someone else out five years ago. We need a base to stand on but then we need to go in and out of education during our whole lives to keep up with development. This puts a strain on each end everyone of us as individuals but it also calls for a whole new role for academia

Change the game and lower the transaction costs: Instead of treating students as backseat passengers in a higher educational vehicle that’s geared towards the transmission of self-contained content, i.e., content produced by professors for the self-serving purpose of publication–put steering wheels in the hands of students, take them out on road trips, negotiate real problems–and they will become self-educating

Note that having a college degree only retains value right now because there isn’t a better (more predictive, and trusted) credential to be had for people who are seeking jobs.

the online versions of education have reduced the college experience down to what’s easy to implement and easy to measure: receiving lectures, and activities of the quiz-and-test variety. It’s not clear that the value of the traditional old-school college experience (and it’s accompanying degree) were the result of those particular aspects of the experience. Granting degrees based only on coursework runs the risk of diluting the perceived value of the degree.

The results are not just suburban sprawl, which Atlanta is hardly the only city to suffer from; another result is widening income inequality—which Atlanta leads the nation in, by the way—since sprawl creates a dearth of close-in affordable housing and forces poor people spend a larger portion of their income on transportation

crowding, especially in bigger cities, is one of the downsides of a government-run health care system. On the upside, had I managed to book a bed in one of the public wards, my birth would have been completely free, paid for entirely by the government’s Assurance Maladie. Everyone pays into Assurance Maladie through charges that are taken directly from their paycheck

From the sixth month of pregnancy to 11 days after a child’s birth, the government covers a woman’s medical expenses in full.

transparency in the price of medical care is a legal requirement in France. The government sets what they consider fair prices for all appointments and procedures, and then reimburses these for everyone at 70 percent. This is not unlike Medicare and Medicaid in the U.S., but because the French government system covers the entire population, it has more bargaining power to keep prices low

t’s not uncommon in the bigger cities, particularly in Paris, for a doctor to charge more than the government’s recommended price. But these overages, called dépassements, don’t come anywhere near what an American specialist might charge. In fact, under French law, a doctor must issue a receipt explaining any dépassement above 70 euros before beginning the test or appointment.

In the U.S., meanwhile, it’s often impossible to get a price for a delivery out of a hospital. Estimates vary by orders of magnitude: This California study of 100,000 complication-free deliveries showed that new mothers were charged anywhere from $3,296 to $37,227, with no clear medical reason for the massive discrepancy.

By contrast, for my complication-free delivery and five-day stay in a private clinic, my total out-of-pocket cost was 400 euros, or about $542.

I don’t think we should count Obamacare’s average monthly premium of $328 as a success. That’s still a lot of money for a middle-class family—and that’s before co-pays, in-network deductibles, and all manner of hidden costs. From my French-ified perspective, a single-payer system—with strong government oversight to keep the price of medical care low—seems like the only way to go.

So equal opportunities might mean a meritocracy. A society in which the best people succeed. Sort of like what we see in the world of distance running.

It turns out that the genetic predispositions for successful long-distance running are much more prevalent in Kenya than in Kansas or Korea. And as far as that goes, it’s fine. Distance running isn’t that big a deal. But would we want all of society to look like that?

The concept necessarily veers between opportunity-as-randomness and opportunity-as-hereditary-aristocracy, and neither comes across as particularly appealing.

, an opportunity to climb is no real answer for people at the bottom. A perfectly fair race is, in at least one important way, the same as a rigged race: Both have a first-place finisher and a last-place finisher

The question of what happens to the person at the bottom genuinely matters. Whether you want to phrase that in terms of the gap between the bottom and the top—inequality, as such—or simply look at the absolute condition of the people at the bottom, you can’t escape the conclusion that outcomes matter, and not just in terms of procedural fairness

Today, even poor people are able to take advantage of things like electricity and antibiotics that were rare or nonexistent 100 years ago. That’s the kind of opportunity that matters—the opportunity for everyone to enjoy a better life. But over the past generation, progress has been slow for the nonrich. And over the past 10 years, it’s been essentially absent.

The effect is dramatic in some countries. Modern Sweden has some of the most rapid social mobility rates estimated in the world. Yet surnames in modern Sweden show status persistence exactly in this 0.7-0.8 range. This result was completely unexpected. Understanding why that is the case is a key puzzle the book tackles.

The book mainly concentrates on measures such as education, occupational status, wealth and longevity as indicators of status. Another surprising puzzle that emerged is that with surnames, the persistence of status was the same for all these measures. We might expect wealth to persist in a different way, since it can be transmitted across generations in a different way than education. You do not need any talent to inherit wealth. This is another regularity the book tries to account for.

Another remarkable feature of the surname data is how seemingly impervious social mobility rates are to government interventions. In all societies, what seems to matter is just who your parents are. At the extreme, we see in modern Sweden an extensive system of public education and social support. Yet underlying mobility rates are no higher in modern Sweden than in pre-industrial Sweden or medieval England.

Interestingly, in China, the extreme social intervention represented by the Communist Revolution of 1949, which included executing large numbers of members of the old upper class, has not resulted in much of an increase in social mobility. Surnames of high status in the Imperial and Republican era continue to be overrepresented among modern elites, including Communist Party officials.

families that have high social competence, whatever the social system is, typically find their way to the top of the social ladder.

 It is clear that families are very powerful determinants of children’s outcomes. But what do parents transmit to their children? Is it mainly some type of culture? Or is it mainly genetics?

The data does not exist to provide any conclusive answer to this question. But even if this is cultural transmission, it looks in all respects just the same as biological inheritance. The book performs a series of tests to see if biological transmission can be ruled out as the important link, and the empirical patterns never rule this out.

A recent book, "The Triple Package"  [by Amy Chua and Jed Rubenfeld], argues the extreme opposite of biology in explaining social status, with the claim that successful cultural groups in the U.S. have three key features leading to success, one being impulse control. But what is remarkable is how disparate the culturally successful groups they identify are – Jews, Chinese, Indians, Mormons, Iranians, Lebanese, Nigerians, Cubans. And it is demonstrable that most of the successful groups identified here were elites selected from the parent populations as a combined result of politics at home and immigration policy in the U.S.

All this information on social mobility within societies unfortunately does not offer much insight into why societies as a whole succeed or fail in economic terms.

The surname data suggests that you will not be able to do much to increase social mobility through social policies of any type.  We already live in societies of massive social intervention in terms of the provision of education and health care. Yet we have not been able to raise social mobility rates above those of the pre-industrial era.

But if we're learning that we can predict the majority of people's outcomes at conception, that should lead us to reexamine our assumption that whatever income distribution comes out in society is fine. Because if it's the case that a lot of this is determined before someone enters the game, it weakens the case for letting the market determine the distribution. You'd be much more likely to favor a society with much less inequality.

And that's where Sweden's system does provide advantages over the U.S.'s. They haven't changed mobility rates, but they've changed the consequences, strongly, of ending up at various points in the distribution. It's a much better place for people who end up at the bottom of the distribution.

One piece of news that most people will find encouraging in these various studies is that eventually all elites become average in their characteristics, even if that takes 300 years

Accounts that emphasize cultural transmission all have a hard time explaining why successful groups, and successful families in general, all experience regression to the mean. There is nothing to stop a cultural trait being inherited unchanged

Only biological inheritance has an inbuilt mechanism to explain observed regression to the mean. It also has predictions about when this regression to the mean will not be observed (complete endogamy). It further implies that the rate of regression to the mean will be the same at the top of the status distribution as at the bottom. So the biological pathway has two advantages over the cultural. It produces a mechanism to explain the regression of all elites and underclasses that we observe, and it has testable implications about the speed and character of that mobility.

The final surprise in conducting this study was to find a seeming simple physics that underlies social mobility.

When we observe an elite group in 1800 in England, we can predict to seven generations in the future what their relative social position will be, despite the arrival of the Industrial Revolution and the rise of the modern welfare state in the interval.

Two very simple equations are sufficient to describe a major feature of the social world, and a feature that you would think impossible to model in any such manner.

But heroin, officials say, is a dangerous substitute. Its dosage, they say, is not controlled by the pill, and its purity can vary wildly.“If you go to heroin, you don’t know who you’re getting it from, what it’s cut with, what quantity can I handle,

Under pressure from European Union officials in Brussels, Malta this week agreed to require foreigners seeking to buy Maltese passports to be residents for at least one year. It has also vowed to carefully vet applicants. Yet initial plans to limit to 1,800 the number of passports granted have been scrapped.

Cyprus recently slashed the amount of investment required to be eligible for citizenship, to $4.06 million from $13.5 million. It is also offering citizenship to foreigners who lost at least €3 million during the recent bailout crisis.

The Caribbean island federation of St. Kitts and Nevis offers citizenship for those who can invest $250,000

Portugal and Belgium offer residency permits leading to citizenship in exchange for big investments.

Crisis-hit Spain offers residency permits to foreigners who buy homes worth more than $260,000, with the aim of drawing Chinese and Russian investment.