NY Times - Arg!

And I quote, "Consider the unfortunate story of Rob Paladino." Ahhh yes the unfortunate story of a man who can afford to rent an apartment that costs 3,800 a month. At that price there is little chance he even moved his own stuff in. Why in the worst crisis in housing in 80-odd years, with tent cities across the country, are we using the term "unfortunate" on this guy? It makes me understand why some people hate the "liberal elite" (doesn't exist).

Oh yeah the 37 cent coin thing

I was just abstracting in my post below about some negative aspects of new experimental economics, and it reminded me of this piece I read a while ago:

Do We Need a 37-Cent Coin?

I mean, what? Are we really asking ourselves that? The answer is a definite no but for entertainment purposes let's:

First, a note : The probability of a transaction of value v is not uniform from [0, 99].

From a purely human perspective (as we are not very good adding machines), it helps that our current four coins have a common factor of 5. 5 is nice for many reasons, but they can all be alluded to by merely saying “5 is nice because it is more-or-less half way between 0 and 9 and it relates indirectly to our preference for base 10.”

I mean, seriously, a coin whose value is a prime number? Prime numbers are messy (there-in lies their joy…)!

If you’re measure of efficiency is number of coins per transaction, your root worry is probably weight of coins or size-in-pocket. Solution: smaller, lighter coins (This is why the silver dollar is impractical - trying carrying twenty dollars in silver “ones” around with you).

I think a MUCH better measure of efficiency would be speed of transaction. In this case, I doubt the efficient solution would involve 37 cent coins.

Unless I completely missed something…

Regards,
Nate

So this is primarily an example of optimization with the wrong constraints. The proper constraint is not coins-per-transaction. Like I said, obviously not because it gives us the absolutely ludicrous answer of "37". The proper constraint is speed-of-transaction.

I worry that if people in new experimental economics continue with these sort-of nonsensical approaches, economics is going to lose what little popularity it's managed to gain since "Freakenomics" was published and the populace is going to go back to treating us as boring but vaguely threatening. And communist. Or socialist, or whatever.

Decreasing Marginal Returns

A very interesting post just went up over at RortyBomb, all around awesome blog. I appreciated the chance to think about the topic presented, that some goods appear to have increasing marginal returns.

Anyways, interesting as it is I think it deserves rather harsh criticism for perpetuating some rather bad habits existant in what I guess I'd call new experimental economics (Unless, of course I'm totally wrong on all counts).

Without further ado, my reply to RortyBomb's post:

Interesting, but the greater the "wow" factor of a thought experiment, the more I'm suspicious.

Lets start with a more formal definition of decreasing marginal return. Decreasing marginal return says as x increases by a constant increment, y increases by a diminishing increment (y = f(x)). In other words, second derivate of f(x) is negative.

With your cake argument, it's all good. Each piece of cake is a constant increment - 1/10 of the whole. With the screaming argument I'm less sure. As you say the percieved incremental decrease in volume from one less screaming person is negligable at first and the whole cake at the end, to turn a phrase. To properly determine the curvature of this screamer data, you'd need to impute and determine a constant increment (denominator, x value) over which to measure your change in y (utility).

It's relatively confusing to try and work out how the above analysis effects our comparison of the cake and screamer model, and I think this is further evidence of the simpler point I'm trying to make: the cake and screamer examples are apples and oranges. The experiment is set up incorrectly. If you were to try a constant incremental decrease in decibel volume, I'm quite sure we'd start to see classic marginal decreasing return.

Anyways, I say perceived and that is strictly true, but for the basis of argument percieved means "real". Psychologically speaking, that is certainly true, and I'm bored by metaphysics. The theory of utililty functions seems to capture and subdue the difference between reality and perception, anyway.

Other thoughts:
A fundamentally confusing factor that gives this experiment extra sparkle is the increasing good in the cake example, and the decreasing bad in the screamer example. Graph these two and your blown away by the result - they are nearly opposite!. Well, of course they are - the cake example is the conceptual inverse reflection of the screamer example over x (increments) and y (utility). Graph the cake example against the screamer example reflected over the line x = y and you will see what I mean.

An economics way to accomplish this reflection might involve the use of Hicksian compensation for how much somebody would accept (dollars) to have an increasing number of people start screaming.

Anyways, the important part is the improperly constructed experiment. The new experimental econonomics is great because it involves a lot of interesting questions and though experiments. Again, though, you can "show" all sorts of really crazy things with improper conditions and mangled comparisons.

Once again on hoping I'm not massively horribly wrong. On the internet. God Forbid.

A Conversation in my Head

So I'm having this conversion in my head and it goes like this:

Other person: blah blah blah alternative lifestyles blah blah blah
Me: You mean by alternative lifestyles someone who chooses an unconventional lifestyle?
The other person: Yeah
Me: I'm just curious about whether you think that would be ok to say in front of someone who is homosexual, or likes kink.
The other person: Why not? It's just a word, a term
Me: People say that but it's not a good argument; words have consequences too.
The other person: Yeah whatever sticks and stones may break my bones but words will never hurt me.
Me: Could you pass me that bottle of scotch?
Me: Words have consequences like actions do in the sense that they have a place in the cause and effect paradigm. This means classic judgements can be made against words, the same as actions. I say to you, you should not use a word unless you are certain you know it's not going to be a negative experience to someone within earshot of you. Since you can't prove to me that nobody would be hurt by a particular word, and even more specifically that nobody in earshot would be hurt by a word you say, I say be very careful about what words you use.

You are going to say that the taxonomic imperatives of language outweigh the moral imperative of avoiding personal injury. I say to you that that is just rephrasing the maxim that we should all be utilitarians about words. I also say that what we say is one of the few things we may actually be able to exercise on the basis of pure will. There are no unavoidable impact calculi when we are discussing the taxonomic imperatives of language.

Ah, but then you say that if you know your audience you can safely make a utilitarian calculus of word choice against personal injury that results in a positive outcome. After all, you say, the beauty of operating on a case-by-case basis is that you have adaptability over stodgy moral imperatives. But I say to you, wouldn't behaving differently in different situations violate your true identity at least some of the time? I'm not sure what you would say then.

But, I would say that the notion of a true identity is a shaky one at best, and that if we were about to get all existentialist I would divert to metaphysics. The key change goes something like this: the entire notion of identity is presumed by the fact that we are entirely complex chemical reactions. What is so special about us is that we don't know the entirety of the reaction. In fact it's quite probable the reactions in each of us are so unique and complex we'll never know. It's the x-factor. It's certainly not God, but it's certainly a reason people go looking for God.

This leaves us at one possible resolution: we just don't know whether we are a single identity or many. I would say you can see how it relates back to what we were talking about originally.

The Brookings Institute Should Hire the Entire Cast...

...of Armageddon, so that we can have more stunning analysis in the same vein as this:

http://www.brookings.edu/articles/2008/06_nasa_easterbrook.aspx

So this letter (more or less, the internets ate my other copy) was sent to my Good Friends Who Make Money from This Sort of Thing:

Having just read Gregg Easterbrook's commentary on a few subjects (including the inane article about planet-killing asteroids), I can say with certainty that my opinion of the Brookings Institute has declined sharply. This man is so unqualified, it makes me wonder about all the other "Experts", and how they could NOT deserve that title.

This may not have been a good idea considering the ratio: number of jobs offered by Brookings institute / number of jobs I'm willing to take. ESPECIALLY considering the ratio: number of jobs / total number of people looking for jobs.

I get on CNN's case, a little

I dropped an email to CNN about this article: http://www.cnn.com/2008/POLITICS/09/09/biden.special.needs/index.html

The email:

I'm left wondering why the article "Biden's comments on special needs called 'new low'" had a quote from the republican spokesperson in the title but none from the democratic one. I'm not trying to accuse cnn of systemic media bias, I just think non-partisan headlines might be a better idea.

I mean, honestly people, you put the thing about the lady with the lawsuit against Alaska for failing to provide for special needs children in the last paragraph? When the case was filed on a behalf of an autistic child, and Palin's nephew is autistic?
Huh?
What?
Right...
Uhhh...

And this article couldn't have been called "Biden slams McCain-Palin on lack of support for stem cell research"?

In completely unrelated news, I googled this ridiculous string of words "stem cell research percentage americans support" and got:
http://www.christianpost.com/article/20070616/poll-american-republican-support-for-embryonic-stem-cell-research-increasing.htm

Poll results show that 22 percent of Americans say the government should place no restrictions on funding embryonic stem cell, while another 38 percent thought the government should ease current restrictions to allow more research. In total, 60 percent of Americans support less restrictions on the research.

Support for expanding stem cell research has grown compared to in 2004 when 55 percent of Americans said the government should place no restrictions or ease current restrictions, and in 2005 when 53 percent supported this.

Remind me way were arguing about this again, except as another way for the McCain monkey machine to fling poop at everything:

Republicans

Barack Obama's running mate sunk to a new low today, launching an offensive debate over who cares more about special needs children," McCain-Palin spokesman Ben Porritt said. "Playing politics with this issue is disturbing and indicative of a desperate campaign."

Democrats

This is a clash of policies, not a clash of personalities.

"A Brave New World" Was Too Goddamn Patronizing

In between your seat and the snack car on the Train of Stupidity that is politics in general is the boxcar full of shit that is McCain's Health Care Plan, as developed by Pfizer (Motto: Singhandedly keeping McCain's love life alive since '98)

Initially I can tell you without really reading the plans, that I trust Barack Obama's much more than McCain's. Look how much shorter in description each plank of McCain's plan is compared to Obamas. How about all that absurd rhetoric on McCain's page, militarizing/romanticizing about health care, with his "Call to Action", his "Vision", his "Plan of Action". You can't win by leading the charge on Health Insurance Hill - its going to take a lot of nerds working late nights in broom closets with calculators to figure this one out. Which leads me to my next quick thing: mentions of cold hard numbers. I counted 4 numbers in McCain's plan. There are 26 in Obama's. Instead of numbers? McCain uses the word "should" eleven times in his plan; Obama twice.

It's comparable statements about the same ideas which really demonstrate my point:

McCain:
INFORMATION TECHNOLOGY: Greater Use Of Information Technology To Reduce Costs. We should promote the rapid deployment of 21st century information systems and technology that allows doctors to practice across state lines.

Obama:
Lowering Costs Through Investment in Electronic Health Information Technology Systems: Most medical records are still stored on paper, which makes it hard to coordinate care, measure quality or reduce medical errors and which costs twice as much as electronic claims. Obama will invest $10 billion a year over the next five years to move the U.S. health care system to broad adoption of standards-based
electronic health information systems, including electronic health records, and will phase in requirements for full implementation of health IT. Obama will ensure that patients' privacy is protected.

Here's another one:

McCain:
TRANSPARENCY: Bringing Transparency To Health Care Costs. We must make public more information on treatment options and doctor records, and require transparency regarding medical outcomes, quality of care, costs and prices. We must also facilitate the development of national standards for measuring and recording treatments and outcomes.

Obama:
Require full transparency about quality and costs. Obama will require hospitals and providers to collect and publicly report measures of health care costs and quality, including data on preventable medical errors, nurse staffing ratios, hospital-acquired infections, and disparities in care. Health plans will also be required to disclose the percentage of premiums that go to patient care as opposed to administrative costs.

And here's something which just flat out demonstrates how Obama's take on the world trumps McCain's:

McCain (this is under "Lowering Health Care Costs"):
TORT REFORM: Passing Medical Liability Reform. We must pass medical liability reform that eliminates lawsuits directed at doctors who follow clinical guidelines and adhere to safety protocols. Every patient should have access to legal remedies in cases of bad medical practice but that should not be an invitation to endless, frivolous lawsuits.

Obama (this is under "Lower Costs"):
Insurance reform. Obama will strengthen antitrust laws to prevent insurers from overcharging physicians for their malpractice insurance and will promote new models for addressing errors that improve patient safety, strengthen the doctor-patient relationship and reduce the need for malpractice suits.

Obama comes at this problem from two directions: The direct cost of the lawsuits themselves, and the indirect cost of covering the possibilities of the lawsuits (insurance). McCain only comes the problem in the former (and not the latter) way. Most importantly: Obama's plan is concerned with the prevention of malpractice; McCain's plan is concerned with the prevention of malpractice lawsuits.

Imagine a world under McCain's plan: Your doctor screws up while following procedure (since this seems to be the viable scenario for sueing in McCain's plan). Either the screw up was the doctor's fault, in which case you can't sue her/him because he was following procedure, or god forbid, the procedure was wrong in the first place. If the procedure was wrong either a) better luck next time, b) sue whoever developed the procedure. And voila, the blame shifting game goes on. McCain's plan could be: don't sue the doctor, sue big pharma/the hospitals! Great way to keep costs down...

Yes, Obama's plan is more touchy-feely, but also yes a good doctor patient relationship is crucial. What better way to keep a doctor from screwing up then by giving him an emotional investment in her/his patient. Obviously you people want some kind of "evidence".
Well here you go:
http://www.nytimes.com/2008/07/29/health/29well.html

Obama's plan is also much more adaptable - if the procedure is wrong, there are already people "addressing errors", and a reason to sue (force a change in the system) has been taken out of circulation. Plus I really like the bit about keeping malpractice insurance down - from what I know it's mandatory that doctors have it
most places, so it's probably really increasing overhead costs just about everywhere/is probably a noncompetitive market just about everywhere.
Annnnd here's some evidence:
http://insurance-reform.org/StableLosses2007.pdf
and ahahahahaha some more:
http://www.cbsnews.com/stories/2004/04/02/eveningnews/consumer/main610102.shtml
(this one even goes so far as to refute even the existence of all those "frivolous" lawsuits)

The bottom line with regards to McCain's plan is this: it is like a band-aid on a sucking chest wound. I know I pay about 1500 dollars a year for health insurance, and that my employer coughs up the other 3/4s of the cost, so insuring me costs about 6000 dollars a year. McCain would give me a 2500 dollar tax credit (5000 for families, but god knows how much insuring a family costs, I don't even want to
know).

McCain: is that 2500 dollars in cold cash, or is that a write-down on my income, meaning that instead of getting the money I actually just don't pay the government 2500 dollars times my tax rate. Which in my case, making what I do (which is much more than an actually "poor" person according to the government) would be max about 250 bucks. Two months worth of employer-subsidized health insurance. Great.

Assuming it's actually 2500 dollars, good luck trying to buy insurance with that money if your employer doesn't provide any kind of plan (remember my plan is 6000 dollars). And how many people work for employers who don't offer a plan? 8 in 10 uninsured people (that's from http://www.nchc.org/facts/coverage.shtml). That's 38 out of the 47 million unemployed. Mean McCain has the balls to tell people he's offering them this money "While still having the option of employer-based coverage". 38 million people in the US don't have that option. They can't do a damn thing with that 2500/5000 dollar check. Except that they can't do a damn thing with it anyway because McCain also says:

"...the money would be sent directly to the insurance provider". So I'm not even in the loop for that cash. I, along with the rest of America, would never even see it. So McCain's plan is: every year the U.S. Government would write a 500 billion dollar check (approx. 100 million households in the US times 5000) to the insurance companies.
Shit.

Obama: Mandatory insurance for children. Bam, that's 9 million of the uninsured insured right then and there. No checks to private companies, no "Health Savings Accounts", no mucking about with taxes. Just the Government stepping in and insuring our children. One step program: uninsured --> insured. Obama would also directly provide an option for insurance through the U.S. Government for the remaining uninsured. Instead of just mailing the insurance industry a gigantic check each year, he would create a competitive atmosphere across the public/private divide. Obama's plan would give us (we, the people) leverage over big pharma and the insurance industry, badly needed leverage. Pharmaceutical and insurance companies are profit-oriented, not people oriented. These industries need to remember - they provide a critical service; they do not exist merely to enrich themselves. Pharma and insurance should probably be non-profit - Obama gets us closer, McCain just momentarily satiates their lust for cash.

Sources:
http://www.johnmccain.com/Informing/Issues/19ba2f1c-c03f-4ac2-8cd5-5cf2edb527cf.htm
href="http://www.barackobama.com/issues/healthcare/

By the way, finding the sources of evidence for the things I write about is so blindingly easy I feel almost useless typing this stuff up. It took me four google searches to find everything I needed. I don't understand how people can quibble about facts so often, but never look shit up for themselves (not directed at you CH). It's the internet people! It's simpler than a dick in a box.