Did Megan McArdle Really Graduate from a Business School? - Grasping Reality with Both Hands
Ouch, Brad De Long calls Megan stupid with more words then necessary.
Did this person really graduate from a business school?
Either she needs her tuition back because they did not teach her what present value is for, or the business school needs to revoke her degree to get its reputation back because its graduates do not know what present value is for, or both.
rBad DeLong has some fun with Megan McArdle acting as if using present values to compare costs at different dates were some weird leftist idea. But it actually gets funnier: she asserts that
the only reason the two numbers look even remotely similar is that they’re using a present value calculation and a very long time frame
which is right, but not in the way she thinks: if you use a shorter time frame, say 25 years, there isn’t any Social Security shortfall at all!There’s also the bit about how
the government doesn’t really have any mechanism to save
except for, you know, running smaller deficits so that it doesn’t run up as much debt.