Steve Rogers Reinvents The World- National Deficit Soars

Now we've all heard about the "Heroic Age." Norman Osborn was smacked down, the Sentry was killed, Steve Rogers is back, the Avengers are reinstated and everything is fantasti-awesome in the Marvel Universe.

Steve Rogers art by Mike Deodato and others, Image obtained from http://marvel.com/universe/

Yup, H.A.M.M.E.R. (Norman Osborn's perversion of S.H.I.E.L.D.) has been disbanded and the good guys are back in charge. Everything has been fixed. Only one thing hasn't been accounted for... the goddamn cost of it all.

Lets examine whats been happening in the last few years of the Marvel Universe, shall we? First there was a superhero Civil War, during which S.H.I.E.L.D. was restructured with super powered battle suits (called "cape-killers") to hunt down heroes.

In addition, Tony Stark became the head of S.H.I.E.L.D. and started building new devices and heli-carriers left and right (including a red and gold heli-carrier ala his Iron Man armor). I'm sure these changes (both substantive and cosmetic) came with a fairly hefty price. But that was just the beginning.

Then when Norman Osborn took over national security, he dismantled everything Stark had created and replaced it with his own version of hardware and manpower. This includes new soldiers and new weapons (granted they were created using stolen technology). He also reinvented the Avengers and revamped the super hero initiative by training and paying villains as personal hit squad. The massive amount of government funds appropriated for Osborn's "Dark Reign" should have shown up to even the most oblivious of congressional oversight commitees. But somehow, Osborn was allowed to continue employing supervillains and redirecting funds.

Norman Osborn, art by Mike Deodato and others, obtained from http://marvel.com/universe/

But that's all over right? Osborn got his butt kicked. He was removed from his position as head of the nation's defense and has been replaced with Steve Rogers (the man who was formerly Captain America). And with the new heroic morality that Steve Rogers brings to the position, surely fiscal responsibility will follow. Right?

Noooooooooope.

The first thing Steve Rogers does upon taking control of America's superheroic defenses is to dismantle H.A.M.M.E.R. He immediately, arrests the vicious H.A.M.M.E.R. soldiers and disable the institution itself. Rogers then reorganized S.H.I.E.L.D. and reformed 4 teams of Avengers. That's right 4 Avengers. The regular Avengers, the New Avengers, the Secret Avengers, and created an Academy for young Avengers who desperately need training. Rogers also re-did the Thunderbolts program under the guidance of Luke Cage.

Now, a revamp of national security obviously needed to be performed. Norman Osborn had spent a year perverting the nation's defenses into something awful. Steve Rogers had to make some changes. But it's the sheer volume of his changes I can't help but object to. One group of Avengers was enough for most of the history of the Marvel Universe. Then two were around, and they dealt with problems just fine. But here Steve Rogers has created multiple government-funded Avengers teams to protect the world. This on top of disbanding the superhero initiative (and thereby dismantling the very expensive infrastructure underlying the initiative) while trying to replace the gap in protection that initiative teams provided surely could tax the national budget.

Now, being a resident of New York State (where the schools are in desperate need of funding and services are constantly being cut), I've taken issue with Steve Rogers' willy nilly spending party. I think he needs to scale back his changes and take things slowly in light of the massive spending that the two previous men in his position indulged in.

No wonder the economy is tanking. We're all subsidizing a Secret Avengers trip to Mars.

Cover to Secret Avengers#1, art by Marko Djurdjevic, obtained from http://marvel.com/universe/

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Captain America, War, and the Great Depression

Captain America #603 by Ed Brubaker and Luke Ross, Marvel Comics (2010)

It's been a wild ride in the Captain America series. Steve Rogers died via magic bullet, traveled through time, faced off against the Red Skull, then finally came back to life with the help of Bucky. Now that all that's over with, the series take a turn and focuses on more pressing matters.

I refer, of course, to evil super-soldier clones and their political agendas.

In Captain America #603, "Bad Cap," created in the 1950s while the original Cap was in suspended animation, travels by bus from New York to Idaho and ponders the state of the economy along the way. He notices rows of empty houses and long unemployment lines and begins recalling the days of the Great Depression.

He then wonders why the Depression ended-- as the war brought "a wave of industry to America"--while current conflicts abroad make little to no difference on unemployment.

This is a strange thought. Though he doesn't explicitly state in his internal monologue that World War II caused the end of the Great Depression, he is strongly implying it. In fact, he is implying that the wartime spending and increased factory production helped reduce the unemployment rate domestically. Indeed, unemployment in the U.S. quickly fell below 10% after the war began and eventually all but faded.

This is in line with the major view shared by Keynesian economists and historians alike. That is, that massive military and infrastructure spending during the war increased the labor force, increased production, helped boost aggregate demand, and pulled the economy back from collapse. Paul Krugman referred to the war as a "large public works project." In this sense, many see the war--and fiscal expansion--as having been the primary cause of the end of the Great Depression

Of course, this is a subject of much debate. Many attribute the reduction in unemployment during WWII more to the draft than war spending. There are also arguments citing other factors (aside from fiscal policy) that accelerated GDP growth and economic recovery. These debates about the effects of war spending on the Depression aren't exactly new--and many have been resurfacing given the parallels with the current Great Recession.

For instance, in a piece written for the Wall Street Journal last year, economist Robert Barro argued that the fiscal multiplier during World War II was actually less than we thought. According to him, the multiplier was something closet to 0.8, meaning that gross domestic product (GDP) rose by less than the increase in government expenditures (whereas if the multiplier was a flat 1.0, each unit of government spending would have led to a unit increase in GDP):

The other way to put this is that the war lowered components of GDP aside from military purchases. The main declines were in private investment, nonmilitary parts of government purchases, and net exports -- personal consumer expenditure changed little. Wartime production siphoned off resources from other economic uses -- there was a dampener, rather than a multiplier.

A notable paper written in 1992 by economic historian, Christina Romer, entitled "What Ended the Great Depression?" argued that fiscal stimulus played a relatively minor role and that recovery mainly stemmed from monetary expansion--that is, gold inflows into the United States during the 1930s led to lower interest rates, which encouraged more investment and eventually increased aggregate demand.

Regarding World War II's effect on the economy, Romer wrote:

That monetary developments were very important, whereas fiscal policy was of little consequence even as late as 1942, suggests an interesting twist on the usual view that World War II caused, or at least accelerated, the recovery from the Great Depression. Since the economy was essentially back to its trend level before the fiscal stimulus started in earnest, it would be difficult to argue that the changes in government spending caused by the war were a major factor in the recovery. [...] Thus, World War II may indeed have helped to end the Great Depression in the United States, but its expansionary benefits worked initially through monetary developments rather than through fiscal policy.

Does all this mean proponents of fiscal expansion are wrong today? Well, no. In fact, according to a speech Romer delivered in March 2009, the idea that monetary expansion played such a large role does not necessarily negate fiscal policy as an effective recession-fighting tool:

I wrote a paper in 1992 that said that fiscal policy was not the key engine of recovery in the Depression. From this, some have concluded that I do not believe fiscal policy can work today or could have worked in the 1930s. Nothing could be farther than the truth. My argument paralleled E. Cary Brown’s famous conclusion that in the Great Depression, fiscal policy failed to generate recovery “not because it does not work, but because it was not tried.”

In response to those "small multiplier" arguments, Krugman likes to point out that there was rationing during the war (i.e. governments tried to curb consumer spending to conserve resources).

I won't say where I personally fall in the debate, though I will say that I'm surprised Bad Cap seems to take the Keynesian position so strongly. You might recall that he has recently grown angry with what he views as a significant departure from America's fundamental values. He refers to current politicians and policy-makers as "hippies" and "commies," presumably for pushing legislation predicated on government spending and taxation. The same sort of spending that he seems to think worked before! Well, at least for unemployment. He even joins the radical right-wing militia group, the Watchdogs, in an attempt to "reclaim" America and uphold the values of "real Americans."

Bad Cap repeats the claim that America's integrity has fallen since the time of his childhood, but he doesn't seem to be sure how. Perhaps he is a strong believer in wartime Keynesianism, but is skeptical of spending government money on social welfare. I wonder what he thinks of the 1960s and Medicare. Had America already lost its values by then?

Either way, he's been through a lot, what with the super-soldiering, being an evil clone, and the mental instability thing. Maybe he just, you know, changed his mind?

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Madison Avenue VILLAINY!

Cover to the Captain America: Secret Empire Trade Paperback, art by Sal Buscema

While paging through the Captain America: Secret Empire trade paperback, I noticed an interesting plot point.

The main focus of the story involves an underground organization called the Secret Empire trying to discredit Captain America as America's #1 hero and replace him with their candidate, Moonstone.

So how does the Secret Empire go about discrediting Cap? They use a Madison Avenue advertising firm. And they choose correctly. The fictional ad firm belonging to Quentin Harderman frames Cap for murder and theft and makes Moonstone a hero for beating the tar out of Cap. And throughout the book, the Madison Avenue suits are only too happy to assist the Secret Empire in taking over America (and eventually, THE WORLD)! In fact, when the frame is revealed to different characters in the story (namely The Falcon, Professor Xavier, and Nick Fury) no one is surprised that Madison Avenue Ad Executives would stoop so low.

So this has me thinking: what evils does advertising have in store for us in the future? Is the marketing of the iPhone and the Snuggee some sort of harbinger for the doom to come?

Is Madison Avenue working against us right now?

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Externalities: Watchdogs Edition

Superheroes fight crime and save lives. But by doing so they impose certain costs on people not directly involved. These are superhero externalities.

Captain America #603 by Ed Brubaker and Luke Ross

Here's a riddle: what do you get when you mix an extreme right-wing, armored terrorist group with Captain America and Falcon? The answer: destroyed public property.

In their never-ending quest to restore order to a society that they believe has abandoned traditional American values, the Watchdogs, now led by the evil clone of Captain America, "Bad Cap," are now on a mission to capture Bucky and Falcon.

The only problem with this foolproof plan is that to actually kidnap one of these heroes, it seems the Watchdogs have to fire their sophisticated weapons indiscriminately across the city. The result is that windows get broken, roads surfaces get cracked, and of course, traffic lights get destroyed.

Remember: all of this is to bring us to an era of fiscal responsibility and minimized public costs. In the process, all they have to do is...well, impose more public costs.

Of course, maybe this is all part of the plan.

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Why Can't There Be Two Captain Americas?

Captain America: Who Will Wield the Shield by Ed Brubaker, Butch Guice & Luke Ross
Click to See More

Natalia, aka The Black Widow, asks a very good question to Bucky in the one-shot Captain America: Who Will Wield the Shield? Namely, why can't there be two Captain Americas?

The quick back-story to those unfamiliar is that Steve Rogers, the original Captain America, had been presumed dead for years from Marvel's Civil War. During his absence, his former sidekick, Bucky Barnes, took the mantle of Captain America. Now that Rogers is back, there is the dilemma of who gets to be the hero.

Steve Rogers wants Bucky to continue as Captain America, citing some vague premonition about the dangers of Bucky relinquishing the shield. Bucky feels a sense of guilt over keeping the identity, as it was Steve's to begin with. In fact, he's actually pretty self-deprecating about the whole thing, claiming that Steve was better at the whole superhero thing than he ever was.

First of all, Bucky should know better than to doubt his self-worth. He has proven himself throughout the past few years to not only be a qualified candidate for the position, but for also adopting a style and technique that differs considerably from Steve Rogers'.

For example, Steve Rogers is stronger, faster, better coordinated, more confident, and has better tactical ability for non-lethal means. Bucky is stealthy, subtle, a better shot, and has better tactical ability for lethal and covert means. Clearly, each of them has an absolute advantage over the other in these terms. That is to say, if each devoted all their resources to non-lethal, non-covert operations, Steve would be able to perform better than Bucky. On the other hand, if each devoted all of his resources to a covert operation, Bucky would outperform Steve.

Now, let's assume that Bucky's concerns are true. Namely, lets say that Steve Rogers is better than Bucky at every element of the job. Steve has an absolute advantage over Bucky in being Captain America. Does this mean that Bucky should pack up his gear, assume a new persona, and move to Bludhaven to find a completely different set of criminals to fight?

Not necessarily. You see, Bucky should realize that although Steve can perform better in all of these feats, Bucky nonetheless has a comparative advantage over him.

The gentlemen from Overthinkingit posted before about superheroes and comparative advantage to show why Superman needs the rest of the Justice League at all. We rehash a bit of that next.

Suppose that there are two kinds of criminals that any Captain America would have to face. One type is the class of strong criminals that require pure old, fashioned fist fights to capture. The other is a more cunning and elusive type that requires more stealth/sneakiness to capture. Possessing both of these skills are necessary to being Captain America. Now suppose that if Steve devotes all his energy to fighting, he could stop 24 criminals in a week (of the first type), whereas Bucky could only stop 8. Now suppose that if Steve devoted all his energy to stealth maneuvering, he could stop 12 criminals (of the second type), whereas Bucky could still only stop 8.

Clearly Steve is better at catching both types of criminals than Bucky. However, for Bucky the opportunity cost of fighting 1 criminal is capturing 1 by using stealth techniques. The opportunity cost of fighting 1 criminal for Steve is capturing 1/2 a criminal by sneaking around (lets just say this means getting halfway there). Similarly the opportunity cost for Bucky of capturing 1 criminal through covert means is capturing 1 criminal by fighting. For Steve, however, the opportunity cost of capturing 1 criminal through covert means is capturing 2 criminals by fighting.

What we see here is that Steve has a lower opportunity cost of catching strong criminals by fighting, whereas Bucky has a lower opportunity cost of catching elusive criminals by covert means.

Now let's just say that in a given week, Bucky and Cap split their time evenly between both types. So, the number of criminals they capture in a week looks like this:

	Fighting	Stealth
Bucky	4	4
Rogers	12	6
Total	16	10

Now suppose Bucky decides to "specialize." He spends all his time working on covert tactics, thus sacrificing the criminals he would have had to catch through fighting (4 criminals) to catch those he could by stealth. Rogers then decides to take 4 criminals he would have caught through stealth and devote that same amount of time to fighting. However, we know that Rogers can fight 2 strong criminals in the time that he can catch 1 elusive perp. through stealth. After they specialize, the new chart looks like this:

	Fighting	Stealth
Bucky	0	8
Rogers	20	2
Total	20	10

Lo and behold, we are now better off than we were before. Despite the fact that Steve might be better at catching strong criminals and catching elusive ones, Bucky's concern that he is not needed is simply false.

Natalia obviously realizes this and as such asks a reasonable question: Why can't both continue to be Captain America to fight the different types of Captain America villains?

Well, for one thing there's only one shield. But more importantly, Bucky could simply specialize under a new superhero persona (which it looks like is what he intended to do). He could call himself "Captain Shadow" or something. He and Captain America could team up, each of them specializing in a certain type of criminal, which would increase the overall number of criminals caught.

On the other hand, creating a new identity does have its disadvantages:

1) New costume, new gadgets, new hideout, etc. all have significant start-up costs.
2) Pooling both skills into one identity could have the benefit of making Captain America appear to be invulnerable. This might deter more crime, as opposed to creating a new superhero that no one has ever heard of and that might take a considerable amount of time to develop the same reputation.
3) More superheroes might lead to more supervillains.

Really then, being Captain America all comes down to labels. Whether Bucky becomes Captain Shadow or remains Captain America, the important thing is that he realizes that he has an important role to play by fighting a specific subset of criminals. Once he figures that out, he should be happier.

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No Government in My Medicare!

Captain America #602 by Ed Brubaker and Luke Ross

Public opinion on economic policy seems to be the theme of this week's posts. Yesterday, we talked about the idea of offering more bailouts in New York City. In the latest issue of Captain America, we travel all the way out to Idaho only to find more riots and discontent.

The people have spoken! "No government in my Medicare!" None! Divorce all federal interference from our federal programs.

I wonder if there's any way some nasty supervillain came take advantage of this sentiment. Someone like...an evil 1950s Captain America clone-person.

Click on image to see more!

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Externalities: Captain America Edition

Superheroes fight crime and save lives. But by doing so they impose certain costs on people not directly involved. These are superhero externalities.

Captain America Reborn #5 by Ed Brubaker, Bryan Hitch and Butch Guice (2009)
Click to See What Happens Next

You can't make an omelet without breaking some eggs. Similarly, The Avengers can't rescue Captain America without breaking some...Lincoln Memorial reflecting pools.

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What's Worse than the Depression?

Captain America says that he would rather be living through The Great Depression again than be frozen in a giant block of ice as Inuits worshiped his body as some sort of ice god. And you thought you had it bad.

Captain America: Reborn #3 by Ed Brubaker and Bryan Hitch (2009)

I think there are some noncomparability issues here, but Cap manages to pull it off as he always does. The obvious economic lesson is no matter how badly you're affected by dips in the financial climate, no matter how high the unemployment rate climbs, and no matter how poor the housing market gets, never ever ever under any circumstances get shot by a magic bullet that sends you spinning through some temporal loop for eternity. There are better ways to manage stress. I hear Yoga works.

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Which is more Economically Feasible: Time Manipulation or Cloning?

*Spoilers Herein*

We've all heard of the death of Captain America. In Captain America #25 it seemed like the original Cap, Steve Rogers, was shot by a sniper and then finished off by his brainwashed girlfriend Sharon Carter. This was all portrayed as part of the Skull's devious plan to manipulate the American political landscape and get a candidate loyal to the Skull to win a presidential election.

In the current Captain America: Reborn mini-series it seems that the Red Skull's plot to kill Captain America was actually much more sinister. After the Skull was murdered by Aleksander Lukin, the ruthless head of the Krona corporation, the Skull's mind was trapped in Lukin's body via the use of a Cosmic Cube (only in comics folks). Once in this position, the Red Skull began scheming to get his mind out of an unacceptable vessel (old Russian man) and into an acceptable one (hunky Steve Rogers). That's all derailed by the intervention of Bucky, Falcon, Black Widow, and Sharon Carter.

Now the Skull is trapped in a cybernetic body and is enlisting the help of Norman Osborn to capture Steve Rogers' time-traveling body and fill it up with his Naziness. But doesn't this seem overly convoluted? Even for a man who was trapped in suspended animation for forty years and wears a red skull mask on his head? Who was once aged to an elderly man and died of a heart attack but got better. And who was also reduced to becoming a shadow creature who ate the bones of people who went to the beach. Hmmmm, maybe this is right up the Red Skull's alley.

But still, the infrastructure and planning required to carry out this particular devious scheme seems needlessly difficult. To enact his plan the Skull needed to first brainwash Sharon Carter to shoot Steve Rogers with a wacky time gun. Then the Skull needed to develop machinery to rip Steve out of time and place the Skull's mind in his body. All elements of this plan need to be enacted in a perfectly organized manner and new technology must be developed to complete the goals set forth by the Skull's scheme. This plot requires its own infrastructure of lackeys and scientists to work out all the elements that the Red Skull can't himself. So this plot requires large amounts of money to be expended for materials and labor.

I'm sure it would be simpler just to clone Captain America. Or put your mind into his body without shooting him through time. Granted the story of Captain America: Reborn is still unfolding and we don't know exactly what will happen or what the full depths of Skull's plan may be. But Captain America has been cloned before and the Skull has previously used Cap's DNA to give him the same super strength and endurance as his foe. Granted, by putting his mind into Steve Roger's body, the Skull is able to effectively kill his arch enemy and then use his foe's form to create all kinds of nasty havoc. Still his choice of plan, while undoubtedly villainous, seems somewhat unnecessary.

Had Skull simply followed established procedure rather than going a new route (which undoubtedly requires a huge R&D investment to work out the new technology required for Skull's body swap in time) he would have been able to get a new body quickly and economically. And he wouldn't be trapped in an Arnim Zola robot and be forced to talk out of his chest.

Thoughts?

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Ecocomic Recession Watch: Captain America Edition

"The Other Steve Rogers" explains how it felt living during the Great Depression vs. living in the modern recession. Note the attention to detail in the artwork, particularly all the "foreclosure" and "for sale" signs as he walks down the street.

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Supernatural Disaster Insurance

Suppose you own the car that's being blown up in this image. You park, run into the convenience store across the street for some batteries, and then some right-wing armored militia blasts everything in its way as it frantically tries to kill Captain America with rocket launchers. No more car. Now what?

In an earlier post, Mark mentioned that the construction industry in the comic book world must account for a large portion of the economy. I bet there is also a lucrative superhero / supernatural disaster insurance industry to deal with these externalities.

How would this insurance industry be set up and organized in the comic book world? Certainly no one is chasing after Superman asking him to pay each time the Daily Planet globe is decapitated from the building. So who is paying? I think there are several options for how a system of insurance in the comic book world could work:

1) A comprehensive, public system. If this government pays for all the damages, then this would effectively be equivalent to having no insurance at all. Instead, the government would levy extremely high taxes from the general public ($18 billion per person per year by Mark's count) and use them to cover all the costs of supernatural disasters.

2) A mixed public/private system. Such a system could be organized any number of ways, but I think two in particular make the most sense. One could be a system similar to obtaining catastrophic insurance (or high-deductible health insurance plans), but in this case it would be paid for by the government. So the government would only pay for certain services, such as for damage caused by superheroes of supervillains to your home, and would only pay "catastrophic" expenses--those that exceed a certain predetermined amount in costs. Everything else would be paid for out-of-pocket by the homeowner. The other way is to establish a base government benefit for certain services (i.e. superhero destruction, supervillain destruction, destruction to your home, destruction to your car, etc.) up to a certain amount. Beyond this base benefit, individuals can elect to purchase supplementary insurance to cover services not included in the package.

3) Market-Based System. This would work exactly like insurance markets work on real Earth. Multiple insurance companies would compete, offer coverage for different services related to superhumans, and charge premiums for that coverage. Likely there would be some significant administrative costs, since most coverage would probably be purchased at the individual level. Furthermore, premiums would be rated by region. That is, if an individual lives in a particularly active area of Metropolis or Keystone City, superhero insurance premiums would be much higher than they would for someone living in Kansas, where there is no action unless Darkseid takes over the entire world (but seriously, how rare is that?)

I will post my views on which system is the best later, but for now I'd love to get reader opinions: Which system makes the most sense in the comic book world? Is insurance necessary at all? A few things to keep in mind:

1) If a public/private system were put into place, should insurance be mandated? If not, then how would they prevent the richer individuals from opting out of the system, thereby increasing average premiums and shrinking the market?
2) Are there any measures that can be taken to minimize the amount of superhero destruction?
3) Should premiums be rated any other way than just by region?
4) What should be included in the base benefit?

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