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The Problem with Economists

[ 158 ] February 8, 2016 |

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As has bothered some of you, I think the field of Economics is largely intellectually bankrupt, a field specializing in mathematical formulas that tell us almost nothing about human behavior, a field serving as intellectual hacks for free-market global capitalism that provides justification for the exploitation of the world’s workers without actually caring about those workers, a field that intellectually uncurious and that is only comfortable with policymaking from 30,000 feet, yet a field that has an enormously inflated view of its own importance to the world, often looking down on other academic disciplines. This is not true of all economists of course, but it is true of far too many.

The historian Jefferson Cowie explores these these problems with economists in this Chronicle piece. A couple excerpts.

After reading through a policy speech prepared by John Kenneth Galbraith, President Lyndon Johnson addressed the economist. “You know, Ken,” he said, “the trouble with economics is it’s like peeing in your pants. It feels hot to you but leaves everyone else cold.” One only has to go to an economics seminar to know that Johnson was right.

Yet in an era in which markets have become the method of justifying and adjudicating all things, we cannot afford to have economics leaving us feeling cold and wet. Economics has become the benchmark for other intellectual endeavors; its practitioners rule policy debates; and, sadly, its mathematical modeling has become a closet form of anti-intellectualism — mathematically abstracted, as it tends to be, from real-world problems — that is creeping into other disciplines. While fewer people care that much of the lit-crit crowd stopped talking humanities to humans, economics is too central to political life for such shenanigans. It is time for the “queen of the social sciences” to get off her throne and start speaking to some of the lesser subjects in the kingdom of academe.

My “J’accuse” is this: The field of economics practices the very sin it preaches against ­— protectionism. That is to say, economists are protectionists of the intellectual sort at a time when the need for trade in the market of ideas has never been more pressing.

In a recent article, “The Superiority of Economists,” in the Journal of Economic Perspectives, we learn a number of things that are truly impressive about the field: Its graduates have higher standardized-test scores than political scientists and sociologists; they tend to find places higher up in policy and advisory circles; they are the best at math; and they earn more money and tend to have better career prospects than other graduates do. It’s no surprise that economists also seem to have more intellectual self-confidence than those in other fields. Economics, after all, is the only social science to have its own Nobel prize. Grounded in the present, they look toward the future and only rarely to the past.

On the other hand, smug in their security, economists are the least likely to cite other disciplines. Perhaps the most disturbing thing is the remarkable extent to which graduate training in the field is similar across institutions and departments — a stark contrast to other disciplines. And most of that graduate education is driven by textbooks and textbooks alone. To other social scientists and humanists, that is an astonishing proposition, and evidence of the field’s range of ideas.

As that survey of economic training shows, economics demonstrates more internal control over its own labor market, hiring only those who follow the prescribed formulas. The study of economics appears to be an exercise in the affirmation of orthodoxy.

First, that is classic LBJ. God bless him. Second, as Cowie points out, the Nobel in economics is a ridiculous joke that only exists because the Bank of Sweden wanted to promote itself.

The insularity of economics prompts an enormous irony: Rather than a market, economics borders on a command economy. From inside its fenced-in monocultural landscape, students are taught that they have arrived at the land of objectivity, that they have passed beyond the ideological and into the scientific. Not only is this protectionism, but it creates a rub with democratic theory and practice. It is, essentially, an invitation to opt out of the greater intellectual struggles in which the rest of us are engaged. By protecting itself from the contagion of outside ideas, economics offers up a more extreme version of the Balkanization and creeping anti-­intellectualism that are apparent elsewhere in the academy. Its hegemonic role, however, makes all the more important the need for the field to open up and transcend its preoccupation with the blackboard fictions of economic modeling.

As the Keynes scholar Robert Skidelsky has put it, the methodological presumption of economics is that “a good car [called economic modeling] has been built: Students must learn how to drive it.” But economics should not be a course in driver’s ed; it should empower students to think critically and creatively about the whole system of transportation. We should be inculcating curiosity, a sense of adventure, a greater range of ideas, not shutting them down. After all, it’s not as if economists are simply correct. When the queen asked the faculty members of the London School of Economics and Political Science why they did not foresee the 2008 financial crisis, they said they would get back to her. They later admitted in a letter that they had no answer and that their promise to provide one was an example of “wishful thinking combined with hubris.”

To put it bluntly, the discipline of economics has yet to get over its childish passion for mathematics and for purely theoretical and often highly ideological speculation, at the expense of historical research and collaboration with the other social sciences. Economists are all too often preoccupied with petty mathematical problems of interest only to themselves. This obsession with mathematics is an easy way of acquiring the appearance of scientificity without having to answer the far more complex questions posed by the world we live in.

The book is more important, of course, for its argument about how the economy works. Piketty’s basic premise is as heroic as it is succinct: The rate of return on capital outstrips economic growth, making capitalism an engine for inequality unless there are countervailing forces.

As powerful and persuasive as Piketty’s work is, truth be told, he is not much of a historian. As much as I admire his data — and use it myself — the American history in his book, where it exists, is often just wrong in both fact and interpretation. He wields history like a chef with a heavy hand on the salt — it’s there every time you taste the dish but it doesn’t really help things. Balzac keeps popping up in Piketty’s book, but there are no unions, the New Deal is not especially significant, and there is not much labor-market policy at all. Taxation and war seem to be the only levers of change and, by association, the only solution to problems. Social history — the history from below — seems like an unknown land.

Neither Cowie nor myself think the field of Economics is irredeemable. Obviously we need people studying the economic system. But as currently constructed, the field causes more problems than it solves and in doing so, directly contributes to the inequality of the modern world. Economists need to do better. Stopping the fetishization of mathematics is a good place to start. Study real people doing real things. Read the work of people in other disciplines. Come off the mountaintop and understand the people you theorize about. Talk to them. Speak to their concerns.

Cowie by the way is one our leading historians. Capital Moves was foundational in the study of capital mobility as a historical phenomenon and was the book that inspired Out of Sight. Stayin’ Alive may be the most important book written on the decline of working-class America in the 1970s. And his new book on the New Deal anomaly promises to be transformational in how we think about social change and inequality in American history.

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Oil Tax

[ 17 ] February 8, 2016 |

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I know there is no way it will get past Congress, but President Obama is completely correct in calling for a $10 per barrel tax on oil to fund green infrastructure.

The proposal would go toward a $32.4 billion annual push to green the transportation sector by funding public transit, an urban planning initiative and clean vehicle research, the White House said in a fact sheet. Obama will include the plan in the budget request he releases next week.

The plan will likely die in the GOP-controlled Congress, which will vet Obama’s budget request before writing spending bills later this year.

But the proposal represents a new front in Obama’s climate change end-game: After finalizing carbon reduction regulations for the electricity sector last year, he is turning his attention back to the transportation sector, which accounts for 30 percent of American carbon emissions every year.

“The president’s plan does what we need to once again have a transportation system that is a source of American strength while at the same time taking steps to reduce carbon emissions and fight climate change,” Jeff Zients, the director of the National Economic Council, told reporters Thursday.

Charging the fee to oil companies, the White House said, is both a funding mechanism for the transportation initiative and an incentive for the private sector to move toward cleaner fuel.

Mostly, this is the correct policy. Now, it’s not without its downsides, in that were this to pass, it would be passed on to consumers, meaning that it would effectively be a regressive tax that made gas and heating bills a larger percentage of income for the poor than the rich. And I have a problem with that, not that there is an easy alternative solution. Otherwise, this is a correct policy in that it specifically targets climate-change inducing industries, incentivizing them, as well as drivers, to use less oil and move toward green energy, while using the money to build the infrastructure necessary to manage this transition. Of course, Republicans are opposed to hippie energy and infrastructure spending alike, so it will die. But this is along the lines of the policy Democrats need to constantly fight for.

Erik Visits an American Grave, Part 16

[ 14 ] February 8, 2016 |

This is the grave of Henry Ward Beecher.

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Beecher was the most prominent minister in mid-19th century America. The son of Lyman Beecher, one of the most important ministers of his generation, Beecher started his ministerial career in 1837 in Indiana. He rejected his father’s neo-Puritan teachings for a doctrine that emphasized joy, pleasure, and reform, fitting for the Second Great Awakening. He became a major social activist, an abolitionist, an temperance advocate, and a supporter of women’s suffrage. He attacked the Fugitive Slave Act and became a leading national voice against it. He also raised funds to send arms to anti-slavery forces in Kansas during the Bleeding Kansas period. During the Civil War, Abraham Lincoln sent Beecher to Europe to speak against the Confederates, helping turn the tide of European public opinion to supporting the United States.

After the Civil War, he was one of the abolitionists who quickly turned to attacking workers and their unions and to feeling that the government should stay out of the South. He supported Andrew Johnson’s Reconstruction plans, was close to the capitalists building their monopolies, and vociferously anti-union. During the Great Railroad Strike, Beecher stated, “Man cannot live by bread alone but the man who cannot live on bread and water is not fit to live.” He became hated by unionists around the country. To his credit, he did embrace Darwin’s theory of evolution and opposed the Chinese Exclusion Act.

He may have thinketh no evil, but he definitely thinketh lust, as Victoria Woodhull notoriously exposed. Beecher was a notorious womanizer, with rumors about his affairs extending to well before the Civil War. So when he spoke out against Woodhull’s ideas about free love, she decided to write an exposé of Beecher’s hypocrisy, detailing his latest affair in her newspaper. Beecher then had her tried for obscenity, launching a series of trials that dominated national headlines for two years, including Beecher himself going on trial for adultery. He was exonerated in 1875 and died in 1887.

Henry Ward Beecher is buried in Greenwood Cemetery, Brooklyn, New York.

The Coen Brothers Films, Ranked

[ 237 ] February 8, 2016 |

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I haven’t seen Hail, Caesar! yet, but I look forward to it. So naturally it is time to rethink the Coen Brothers work. Bilge Ebiri ranks their films. I love his writing, but I can’t agree with this ranking. So I’m trying my own.

1. The Big Lebowski–I know it’s not their most sophisticated film, but it might be the funniest movie of my lifetime. It’s basically a perfect film.

2. Fargo. Also a near perfect film.

3. No County for Old Men. Really the only decent adaptation of anything Cormac McCarthy has written. Partly that’s because it was a cinematic book to begin with, but partly it’s certainly the excellent scrip, casting, and direction.

4. Miller’s Crossing. I really love this film. I love the language, the ethnic politics, and Albert Finney blowing away his assassins to “Danny Boy.”

5. Raising Arizona. I never loved this as much as other people, but obviously it’s a good film.

6. Blood Simple. Not my very favorite, but obviously a very fine first film.

7. A Serious Man. This is a pretty underrated film. It feels minor at first, but it’s a pretty profound meditation. Great ending too.

8 True Grit. Just a very solid film. The original made a better choice in not including the ending of the book, but that’s a minor mistake by the Coens. Plus who can dislike Jeff Bridges as Rooster Cogburn?

9. O Brother Where Art Thou. It’s not truly great but I like almost everything about it, including of course the great soundtrack.

10. Intolerable Cruelty. This is also an underrated film. It’s slapstick and silly, but in a very good way.

11. Barton Fink. I know some people love this film. I do not. It is a completely decent work. But I do not love it.

12. Inside Llewyn Davis. A fairly disappointing film, outside of the cat.

13. The Hudsucker Proxy. Meh. I like the Coen Brothers silly side, but I just didn’t feel this worked that well.

14. Burn After Reading. God, this was disappointing. So much potential. Utterly forgettable.

15. The Man Who Wasn’t There. Sometimes people really defend this film, including Ebiri. I don’t get it. I thought it was just nothingness. I was bored throughout.

16. The Ladykillers. Ugh.

The Pull of Pollo

[ 7 ] February 8, 2016 |

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I don’t listen to a lot of podcasts, but one that I do like is Gravy, the podcast of the Southern Foodways Alliance. This podcast on how the chicken industry has utterly transformed Springdale, Arkansas, turning it from one of the state’s whitest towns into the state’s most diverse town. This is because the poultry industry is worked almost entirely by Latino immigrants, as well as some people from the Marshall Islands and south and southeast Asia. Lots of emphasis on the terrible working conditions in the plants, how this is a permanent transition since many of the immigrants really love northwest Arkansas and won’t leave, and the racism that pervades the community.

Well worth your time.

And if you like that, here’s one telling the story of Shirley Sherrod, who must be the most famous midlevel appointment in the Department of Agriculture in U.S. history, thanks of course to Republican mendacity and racism.

Your Daily Reminder of America’s Real Terrorist Threat

[ 28 ] February 7, 2016 |

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Surprise! It’s crazy right-wing white people!

They and untold thousands like them are the extremists who hide among us, the right-wing militants who, since 2002, have killed more people in the United States than jihadis have. In that time, according to New America, a Washington think tank, Islamists launched nine attacks that murdered 45, while the right-wing extremists struck 18 times, leaving 48 dead. These Americans thrive on hate and conspiracy theories, many fed to them by politicians and commentators who blithely blather about government concentration camps and impending martial law and plans to seize guns and other dystopian gibberish, apparently unaware there are people listening who don’t know it’s all lies. These extremists turn to violence—against minorities, non-Christians, abortion providers, government officials—in what they believe is a fight to save America. And that potential for violence is escalating every day.

“Law enforcement agencies in the United States consider anti-government violent extremists, not radicalized Muslims, to be the most severe threat of political violence that they face,” the Triangle Center on Terrorism and Homeland Security reported this past June, based on surveys of 382 law enforcement groups.

The problem is getting worse, although few outside of law enforcement know it. Multiple confidential sources notified the FBI last year that militia members have been conducting surveillance on Muslim schools, community centers and mosques in nine states for what one informant described as “operational purposes.” Informants also notified federal law enforcement that Mississippi militia extremists discussed kidnapping and beheading a Muslim, then posting a video of the decapitation on the Internet. The FBI also learned that right-wing extremists have created bogus law enforcement and diplomatic identifications, not because these radicals want to pretend to be police and ambassadors, but because they believe they hold those positions in a government they have created within the United States.

This has received more attention in the last year because of Dylann Roof and because of the occupation of the Malheur National Wildlife Refuge. Internal terrorism is by far the top security threat of Americans, outside of their own guns of course. But we do nothing serious about it because the Republican Party has room for these people and their ideas and thus protects them. I mean, when you have hatemongers like Alex Jones saying the government is going to invade Texas and the governor of that state acts on this “threat” for political gain, that says way too much about how much Republicans coddle these people and their dangerous actions.

Statistics show that the violence of right-wing extremists goes up when Republicans control at least one house of Congress. The reason, according to an analytical report conducted for West Point, might be “relative deprivation, which occurs when the high expectations of far-right activists during a conservative Legislature are not fulfilled.” In other words, these radicals expect to be ignored when Democrats are in charge, but when Republicans in power fail to champion the extremist cause, attacking the government strikes them as the only remaining option.

If true, the deprivation must be monstrous now. Think back: How many times have Republican politicians told their followers Obama could be impeached? How many times did they suggest he was a Muslim or wasn’t born in this country? How many times did they say he lied to cover something up in Benghazi? How many times did they say his health care policy included death panels? How many times did they say he was committing crimes or shoving through policies that would kill people?

Then, in 2009, the Republicans directly—and almost certainly inadvertently—identified themselves as aligned with the dangerous radicals. The Department of Homeland Security produced an analysis saying that violent right-wing extremists posed the greatest terrorist threat to the country—a report since proved true. But Republicans used this to feed into another conspiracy theory, proclaiming that the Obama administration had just deemed conservatives as a terrorist threat. To those unaware of what the report actually said, it was more evidence of a coming ideological war. To those radicals who knew, it meant establishment Republicans agreed that conservatives and violent right-wing extremists meant the same thing. Congressional hearings ensued, and terrified bureaucrats shut down the Homeland Security division that conducted the analysis of right-wing extremism, just when their knowledge was most needed.

Republicans continued their drumbeat of conspiracy theories to bring out the base, capturing the House in 2010 and the Senate in 2012. And imagine what these right-wing extremists thought. Where were the impeachment proceedings? Why wasn’t Obama under arrest? The man was a murderer, a tyrant spitting on the Constitution, a fraud holding the presidency unlawfully. There were only two possible answers for the extremists: accepting that the Republicans had been lying to them, or deciding that these politicians had sold out the minute they won control.

Who knows what the future holds here? Probably a lot of dead Americans.

Classic Krusty In Real Life

[ 10 ] February 7, 2016 |

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You’ve seen Classic Krusty interview George Meany. But have you seen the real thing? You have now. From September 1952.

Once Again, Thank You Eliot Cutler

[ 29 ] February 7, 2016 |

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The sociopath in the Maine governor’s chair continues his war on the poor:

Maine Republican Gov. Paul LePage, an outspoken opponent of public assistance, managed to remove thousands of residents from the state’s food stamp rolls over the past 15 months by way of his new work requirements.

The number of healthy, childless adults receiving food stamps fell from 13,589 to 1,206 between November 2014 and November 2015 due to LePage’s new policies.

The scenario in Maine could be mirrored nationally, as more than one million residents in 21 states will face losing food stamps if they don’t meet federal work requirements that began this month.

“Food has implications in every area. It affects your ability to work, it affects your ability to stay housed, it affects your ability to keep your children in school,” Christine Hastedt, public policy director for Maine Equal Justice Partners, told the Associated Press. “This took us in the other direction.”

Though many advocates for the poor believe these requirements have had a disastrous result on Maine’s low-income and food-insecure population, the governor’s office points to the state’s declining unemployment rate as a sign that LePage’s program is working.

“Requiring able-bodied people to work to receive their benefits just makes common sense and sends the message to Maine’s hard-working taxpayers that their money is truly being use as a hand up, not a hand out,” Peter Steele, a spokesman for the governor, told the Associated Press.

LePage has claimed that 47 percent “of able-bodied people in the state of Maine don’t work.” The state’s labor force participation rate stood at 64.1 percent in 2014, higher than the national average of 62.8 percent.

Lying about the poor is of course a core LePage tactic. As is humiliating and belitting them:

Increased work requirements aren’t the only obstacle LePage has put in place for those receiving public assistance. Roadblocks from his administration include mandatory drug testing for welfare recipients with felony convictions and ineligibility to receive Supplemental Nutrition Assistance Program (SNAP) benefits for childless households with assets worth more than $5,000.

Late last year, the U.S. Department of Agriculture (USDA) sent a letter to the Maine Department of Health and Human Services (DHHS) that said the state was breaking the law because its application response times for SNAP benefits were too low and its data were insufficient.

Maine ranks last in response time out of 53 SNAP programs in the nation. In 2014, it ranked 36th, marking a drastic drop in efficiency for a state with one of the highest rates of food insecurity in the nation.

At least LePage has a good plan to get those slacking leeches in 7th grade to become productive members of society.

LePage has also pushed to roll back child labor laws that have been in place since the mid-1800s, as first reported by the Bangor Daily News. The Republican governor has long backed a proposal that would lower the legal working age to 12. Those children would work for $5.25 an hour under LePage’s 2013 proposal.

Why is LePage letting 4th graders off the hook? Surely we can find jobs for them working underneath buzzing sawblades in Maine timber mills? Think of all the places they can crawl that big people can’t. So many opportunities here for employers.

HGH Parm, You Taste So Good

[ 87 ] February 7, 2016 |

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I really don’t care whether Peyton Manning is shooting himself up with HGH or not. Hiring goons to intimidate the family members of the person making the accusations is however very not OK. And hiring Ari Fleischer to be your public relations guy, well, I think that means we have assume mendacity with every action. I love that Fleischer is described as a “crisis management consultant.” I guess he does have some experience in selling a war that destroyed Iraq and has spun off to destroy Syria to the American public. Nice that he’s able to take some time away from defending the name of what I now call the Washington Genocides to support poor old Peyton Manning.

Between this and Cam Newton making racists’ heads explode, I think you can guess who I am rooting for this evening. May the game be like the Super Bowl two years ago, my favorite sporting moment of all time.

Zika and Latin America’s War on Women

[ 36 ] February 6, 2016 |

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As we discussed the other day, we don’t really know what the heck is going with the Zika virus. We do know that it is causing a variety of health problems in different places that are very bad. The most prominent is microcephaly, where babies are born with exceptionally small heads. If this is as real as it seems it might be, this could be a generational-defining virus. Several Latin American nations are advising women not to get pregnant. Oh, OK. Among the other problems here, such as placing the entire burden for this on women, is that abortion is illegal in almost all Latin American countries, often with harsh punishments involved. This includes Brazil and El Salvador, both of whom have made this recommendation to women. In Brazil, it seems that there is a push to use this as a way to weaken the nation’s harsh anti-abortion laws, with at least one judge saying he’d make exceptions in this case. But in El Salvador, no.

And some countries, like El Salvador, forbid abortion in all cases, even when the mother has been raped or her life is at stake. Despite the public health recommendations to avoid pregnancy, deputy health minister Eduardo Espinoza told Buzzfeed News that the government will have to uphold the anti-abortion laws, “whether we like it or not,” but noted the public health crisis may trigger a debate that could revise the law. But experts seem skeptical that the anti-abortion laws, which have been repeatedly passed by mostly-male governments in Catholic countries, will be changed any time soon.

Human rights organizations condemned the government recommendations to avoid getting pregnant, saying that it’s unfair for poor women to have to assume such an enormous public health responsibility in the face of laws that make it impossible for them to do so. “You’re asking women to make a choice that sounds logical from a health perspective, but it’s not a real choice,” says Tarah Demant, senior director of the Identity and Discrimination Unit at Amnesty International. “It’s putting women in an impossible place, by asking them to put the sole responsibility of public health on their shoulders by not getting pregnant, when over half don’t have that choice.”

Of course since these laws are about punishing women for sex, contraception is hard to come by as well. So I guess those sluts will just have to care for their shrunken head babies for the rest of their lives. Serves them right for opening their legs. This, sadly, is an accurate summary of how many in Latin America will feel about the situation.

Who Pollutes and Where Do They Pollute?

[ 5 ] February 6, 2016 |

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Important new research here on the connections between major toxic polluters and where they site their factories:

We ask the following questions:
(I) Are producer disproportionalities present and consistent across the study area?
(II) Are particular communities (low income and/or those of color) disproportionately impacted by producers who generate a disproportionate amount of pollution?

Our findings suggest affirmative answers to both these questions. Using public data and open-source software, we assess industrially based exposure estimates and proximate socio-demographic characteristics on a polluter-by-polluter basis across the continental United States. We find a highly skewed distribution of polluter-based harm generation with fewer than 10% of the nearly 16 000 study area facilities generating greater than 90% of estimated exposure (question (I)). When describing the socio-demographic exposure profiles, we show that although polluters are likely to disproportionately impact poor and nonwhite communities, these disproportionalities become even more pronounced when considering the smaller group of facilities who generate the majority of exposure risk (question (II)). We refer to this small group of disproportionate generators as toxic outliers.

An implication from our study is that these two sides of disproportionality are connected in a ‘double disproportionality’ framework. This type of connection has both applied and scholarly significance. First, double disproportionality would predict that industrial impacts overall, and in EJ communities specifically, would decrease if toxic outliers could be compelled to reduce their emissions. Second, double disproportionality adds to our understanding of how society’s polluter-industrial complex works by explicitly incorporating measurable power dynamics. Future studies should consider disaggregating polluters rather than looking at polluters in the aggregate.

In other words, to fight against environmental injustice might actually be more about targeting individual companies who are especially horrible than fighting the aggregate of all polluters. Very interesting policy implications here.

Via.

Historicizing Flint

[ 6 ] February 6, 2016 |

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If you are looking for some good long reads this Saturday, check out this forum on placing the Flint water crisis in historical context, featuring some of our leading environmental historians, as well as economists and an engineer. There are essays on the history of environmental injustice in Flint, the history of lead pipes, and the toxicity of American infrastructure. Really good stuff.

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