Part of what I seek to do here is to raise things that aren't being heard enough. As Krugman notes, the current bailout plan looks to be throwing money at some US banks without compensating US taxpayers for the risk they're taking.
What's worse is that this fix might not even fix the problem, because it is not only the subprime loans which are the problem -- it is all sorts of loans. Jason Lindt makes this case, and although I can't vouch for his numbers, he makes it convincingly. He says we should go straight to the problem: banks' insolvent balance sheets. While the current bailout plan looks like a sneaky way to throw money at banks, a good plan should specifically offer capital to these banks by purchasing their preferred stock. This gives them some Tier 1 capital as a cushion, and it also makes them pay us dividends in the future.
I still have questions about this. Sometimes the dividends on preferred stock don't get paid, but then they stack up cumulatively. The Tier 1 capital page says these types of preferred stock don't usually apply to Tier 1 capital. We might need a strange kind of which is more geared towards the long-term, and also gives us voting power in these companies. We need to put these banks on long-term payment plans, because it is going to be a while before they'll be able to pay us back for the mess they've caused.
Incidentally, as to the cause of this, Anton Wahlman notes something I haven't heard before: the effect of the Taxpayer Relief Act of 1997, which exempted profits on personal residents from taxation. That law likely contributed more than the Community Reinvestment Act bullshit, which has been refuted.
Tuesday, September 23, 2008
Friday, September 19, 2008
The paths
If you live in a world of your own,
A world of isms and a dusty tome, hook a left.
Search till you die;
the wisdom you seek is a lie.
If you live in the world of matter,
A world of irrational symbols, reactions, and recursion,
try the path to the right,
but know you may be in for a fight.
You live in a world of people,
Some are strong, and some feeble.
Beware the bull; his word can pull.
And consider neither path, young soul.
A world of isms and a dusty tome, hook a left.
Search till you die;
the wisdom you seek is a lie.
If you live in the world of matter,
A world of irrational symbols, reactions, and recursion,
try the path to the right,
but know you may be in for a fight.
You live in a world of people,
Some are strong, and some feeble.
Beware the bull; his word can pull.
And consider neither path, young soul.
Monday, September 15, 2008
Review of Kicking Away the Ladder by Ha-Joon Chang
I was pleasantly surprised by this book, which was first assigned to me in a class. I must not have read it then, and now I'm finally working through the books I've piled up over the years. It destroyed the misconceptions which I'd finally come to accept after years of brainwashing (with no evidence).
The first claim is that mainstream economists have ignored history. The "eminent" Nobel (the fake economics one) laureate economic historian, Douglass North, wrote "the standard history of the United States" economy which mentioned tariffs once "in order to dismiss them as an insignificant factor in explaining US industrial development" (2002:24-25). This can only be regarded as intellectually dishonest. Alexander Hamilton first proposed the infant industry argument for US industry, in opposition to Adam Smith's advice that the US focus on agriculture. The US maintained average weighted tariffs of around 40-50% on manufactured goods until 1950. The illustrative table, from Paul Bairoch's book Economics and World History, is available online.[1]
The second chapter focuses on policies which countries used to get an edge in industry. Espionage, tariffs, subsidies for imported raw materials, government-subsidized plants and researchers, and other methods were used to bolster industry.
The next chapter focuses on institutions. It's much looser and weaker, but makes the tentative case that we might be pushing important institutions such as democracy, central banking, various regulations, limited liability corporations, bankruptcy law, property (including intellectual) rights, the judiciary, child labor, social welfare provisions, and information disclosure too fast on developing nations. I'm not sure I'm convinced, but it is interesting. Some of these are important, others are less so, certainly. The most important, in my mind, are stable law, transparency, information disclosure, and property rights for the masses rather than the few. The succinct and scholarly discussion of economic institutions in historical and developmental context alone makes the book worth it.
After reading the book, I'm inclined to agree that activist policies are often necessary. Friedrich List, the major theorist of the infant industry argument, argued that free trade was really only beneficial among equally industrialized countries, and I'm inclined to agree. A country needs to build up its basic industrial institutions. However, tariffs are probably not the way to go today. Export-oriented policies used by the Asian Tigers are preferable. The issue is complex, however, as all the countries are chasing after a limited supply. Economists seem skeptical of the race to the bottom in international trade (in things like environmental standards), but I don't really understand why.
The first claim is that mainstream economists have ignored history. The "eminent" Nobel (the fake economics one) laureate economic historian, Douglass North, wrote "the standard history of the United States" economy which mentioned tariffs once "in order to dismiss them as an insignificant factor in explaining US industrial development" (2002:24-25). This can only be regarded as intellectually dishonest. Alexander Hamilton first proposed the infant industry argument for US industry, in opposition to Adam Smith's advice that the US focus on agriculture. The US maintained average weighted tariffs of around 40-50% on manufactured goods until 1950. The illustrative table, from Paul Bairoch's book Economics and World History, is available online.[1]
The second chapter focuses on policies which countries used to get an edge in industry. Espionage, tariffs, subsidies for imported raw materials, government-subsidized plants and researchers, and other methods were used to bolster industry.
The next chapter focuses on institutions. It's much looser and weaker, but makes the tentative case that we might be pushing important institutions such as democracy, central banking, various regulations, limited liability corporations, bankruptcy law, property (including intellectual) rights, the judiciary, child labor, social welfare provisions, and information disclosure too fast on developing nations. I'm not sure I'm convinced, but it is interesting. Some of these are important, others are less so, certainly. The most important, in my mind, are stable law, transparency, information disclosure, and property rights for the masses rather than the few. The succinct and scholarly discussion of economic institutions in historical and developmental context alone makes the book worth it.
After reading the book, I'm inclined to agree that activist policies are often necessary. Friedrich List, the major theorist of the infant industry argument, argued that free trade was really only beneficial among equally industrialized countries, and I'm inclined to agree. A country needs to build up its basic industrial institutions. However, tariffs are probably not the way to go today. Export-oriented policies used by the Asian Tigers are preferable. The issue is complex, however, as all the countries are chasing after a limited supply. Economists seem skeptical of the race to the bottom in international trade (in things like environmental standards), but I don't really understand why.
Tuesday, September 09, 2008
Should we be trying to support advertising?
There's a bit of a problem with "new media". People aren't willing to pay for it. We may have micropayments on the way, but for now the support is largely advertising. But advertising may not be as lucrative as people think. As web-consumers become smarter and internet search (as well as other internet navigation) becomes more effective, click-through rates plummet to nothing.
The bigger problem will come when companies realize that much of advertising is a waste of money. A recent study found by comparing US and Canadian drug use (where drug advertising illegal) that drug advertising was short-lived and "modest".[1] Media producers, particularly independent ones, will find it more difficult to spend time doing what they're doing.
When I find a good blog, I purposefully click on Google ads to show a little support.
The bigger problem will come when companies realize that much of advertising is a waste of money. A recent study found by comparing US and Canadian drug use (where drug advertising illegal) that drug advertising was short-lived and "modest".[1] Media producers, particularly independent ones, will find it more difficult to spend time doing what they're doing.
When I find a good blog, I purposefully click on Google ads to show a little support.
Sunday, September 07, 2008
Capitalism and Freedom Review
After reading Capitalism and Freedom carefully, my opinion of Milton Friedman has been revised upward. I was assigned this book for class, but I never gave it a thoughtful, careful read till now. The book that I had read carefully from Milton, Free To Choose, left me thinking he was not a great thinker. My recollections were that Free To Choose was surprisingly lacking in nuance. That is probably because it was targeted for a mass audience, but its simplicity still seems like a negative mark for Milton Friedman.
Capitalism and Freedom has very few numbers, and no models, but it is well-argued nonetheless. It is full of rhetoric, but it is the kind of rhetoric that makes sense -- the kind which characterizes government controlling the individual as a violation of human rights. Friedman argues against the central control which was prominent at the time, but is no longer taken seriously. He does not so much engage the other type of socialism -- welfare capitalism, except to perhaps endorse it in his last sections on the distribution of income and social welfare measures.
In Friedman's second chapter, he notes the appropriate functions of government (p. 34) -- functions which I completely agree with, but which neocons, and liberals, tend to forget about. These include setting and enforcing the rules of the "economic game", promoting competition, countering monopolies, overcoming neighborhood effects (also called externalities), and even supplementing charity and the family in protecting the irresponsible. He identifies a number of policies as unequivocally wrong. Generally I don't agree that these are always wrong, but it is hard to see why agriculture price supports would be necessary. Others, such as tariffs, parks, and detailed regulation of banking would seem to have a place dependent upon the situation.
Chapter 3, on money, is probably one of the most important chapters. Friedman opposes the current Federal Reserve system, believing it is too liable to human error, and instead proposes (citing his A Program for Monetary Stability) a consistent rate of growth in the money supply of 3 to 5 percent.
Chapter 4, International Financial and Trade Arrangements, is also enormously important, and unfortunately awfully complex -- more so than money. Friedman endorses the floating exchange rate which Soros finds so troubling -- and the floating rate might be the best of bad options. Unfortunately, it leads to a fair amount of uncertainty, speculation, and sudden catastrophes as currencies change. If only there was a perfect system.
In chapter 5, Friedman critiques the Keynesian use of fiscal policy to alleviate unemployment. He argues that it relies upon untenable assumptions, because the money which the government spends must be borrowed from the public, which will drive up interest rates, and thus reduce the amount of spending and investment. He admits that it is ultimately an empirical question, but says that his recent work (The Relative Stability of the Investment Multiplier and Monetary Velocity in the United States, 1896-1958) suggests that there is no rise in expenditures, as his "quantity theory" suggests.
In Chapter 6, Friedman lays out the case for vouchers in education. I won't spend much time here -- I agree that vouchers are a good thing if strict standards are maintained, but Friedman endorses questionable standards, such as allowing segregated schools. Chapter 7 is on discrimination, a complicated political subject I'd rather not get into.
Chapter 8 is on monopoly. Friedman admits that all the ways of dealing with monopoly are bad, but tentatively concludes that leaving monopolies private may be best, mainly because innovation happens so quickly, and the government is so reluctant to let loose of its hold. I'm not sure I agree, but it is a decent point. He also makes the case here that a corporation should not be socially responsible, and that government needs to be the one holding people responsible. This sort of reminds me of how I used to play MUDs -- exploit the code, and argue that I shouldn't have to maintain reasonable behavior if it is not programmed into the game. It was probably a bad attitude, and a corporation should similarly not follow the letter of the law -- if it does, it will hopefully find itself in trouble, as I did. This argument from Friedman might be taken as an implicit argument that the government must be especially vigilant and free to take action.
He notes an interesting unintended consequence of our current system. Dividends are taxed double, which leads corporations to hold dividends and then invest them in their business, whether it is prudent or not. I fully agree with him here, and wish corporations disbursed more dividends. He wants to abolish the corporate income tax and instead force shareholders to record their profits from the company on their taxes -- meaning that they'd have to pay taxes on them, I'm guessing?
In Chapter 9, Friedman makes the case that the American Medical Association is a lobbying group bent on keeping competitors out. It's amusing. He defends "faith healers" by noting that one of thousands of quacks may produce a valuable breakthrough through their unorthodox experimentation. Those of you who know my Wikipedia efforts will know that I am sympathetic to alternative medicine, and I like this defense -- although I truly dislike things like therapeutic touch and homeopathy. Friedman argues that restricting medicine only to the highly-skilled reduces the total "physician-hours", and reduces total amount of care, thereby reducing the quality. Friedman tentatively notes that government certification may be necessary because certification information is nonexcludable -- one person can pass it on to others.
In Chapter 10, on the distribution of income, Friedman gets again into the tough ethical issues. He admits that the issue is difficult. Somehow he tries to run inequality from personal endowments together with inequality from inherited wealth, because the latter leads to personal endowments. To an extent, this is true, but he emphasizes it too much. He also makes a somewhat bizarre argument that if there were 4 Robinson Crusoes marooned on four islands, and one landed on a fruitful island, that Crusoe would not be required to share his wealth, and the 3 others, who were barely scratching by, would not be morally justified in taking it. He says this is analagous to someone finding $20 on the street, and then 3 people deciding to mug you for not sharing it. Does his analogy make sense? I dunno. I don't get ethical issues, generally, but I think 1) we should encourage a meritocracy, 2) we cannot allow people to starve or live with debilitating illness. Which brings up to the next chapter.
In Chapter 11, Friedman discusses Social Security and other social welfare provisions. He criticizes the idea behind social security -- that people cannot save for themselves -- however, I tend to think that people cannot. He notes this possibility as well, but thinks there are better ways of ensuring that people secure their retirements, so that the government is not left supporting them in their old age. He argues that most people would save for their unemployment, and that social security arose only because many people were unprepared for the Great Depression.
In Chapter 12, Friedman endorses a negative income tax, noting that such a system would target poverty much more specifically than minimum wage laws.
In 13, he sums up his arguments. Nothing too interesting here, and I'm losing steam.
Capitalism and Freedom has very few numbers, and no models, but it is well-argued nonetheless. It is full of rhetoric, but it is the kind of rhetoric that makes sense -- the kind which characterizes government controlling the individual as a violation of human rights. Friedman argues against the central control which was prominent at the time, but is no longer taken seriously. He does not so much engage the other type of socialism -- welfare capitalism, except to perhaps endorse it in his last sections on the distribution of income and social welfare measures.
In Friedman's second chapter, he notes the appropriate functions of government (p. 34) -- functions which I completely agree with, but which neocons, and liberals, tend to forget about. These include setting and enforcing the rules of the "economic game", promoting competition, countering monopolies, overcoming neighborhood effects (also called externalities), and even supplementing charity and the family in protecting the irresponsible. He identifies a number of policies as unequivocally wrong. Generally I don't agree that these are always wrong, but it is hard to see why agriculture price supports would be necessary. Others, such as tariffs, parks, and detailed regulation of banking would seem to have a place dependent upon the situation.
Chapter 3, on money, is probably one of the most important chapters. Friedman opposes the current Federal Reserve system, believing it is too liable to human error, and instead proposes (citing his A Program for Monetary Stability) a consistent rate of growth in the money supply of 3 to 5 percent.
Chapter 4, International Financial and Trade Arrangements, is also enormously important, and unfortunately awfully complex -- more so than money. Friedman endorses the floating exchange rate which Soros finds so troubling -- and the floating rate might be the best of bad options. Unfortunately, it leads to a fair amount of uncertainty, speculation, and sudden catastrophes as currencies change. If only there was a perfect system.
In chapter 5, Friedman critiques the Keynesian use of fiscal policy to alleviate unemployment. He argues that it relies upon untenable assumptions, because the money which the government spends must be borrowed from the public, which will drive up interest rates, and thus reduce the amount of spending and investment. He admits that it is ultimately an empirical question, but says that his recent work (The Relative Stability of the Investment Multiplier and Monetary Velocity in the United States, 1896-1958) suggests that there is no rise in expenditures, as his "quantity theory" suggests.
In Chapter 6, Friedman lays out the case for vouchers in education. I won't spend much time here -- I agree that vouchers are a good thing if strict standards are maintained, but Friedman endorses questionable standards, such as allowing segregated schools. Chapter 7 is on discrimination, a complicated political subject I'd rather not get into.
Chapter 8 is on monopoly. Friedman admits that all the ways of dealing with monopoly are bad, but tentatively concludes that leaving monopolies private may be best, mainly because innovation happens so quickly, and the government is so reluctant to let loose of its hold. I'm not sure I agree, but it is a decent point. He also makes the case here that a corporation should not be socially responsible, and that government needs to be the one holding people responsible. This sort of reminds me of how I used to play MUDs -- exploit the code, and argue that I shouldn't have to maintain reasonable behavior if it is not programmed into the game. It was probably a bad attitude, and a corporation should similarly not follow the letter of the law -- if it does, it will hopefully find itself in trouble, as I did. This argument from Friedman might be taken as an implicit argument that the government must be especially vigilant and free to take action.
He notes an interesting unintended consequence of our current system. Dividends are taxed double, which leads corporations to hold dividends and then invest them in their business, whether it is prudent or not. I fully agree with him here, and wish corporations disbursed more dividends. He wants to abolish the corporate income tax and instead force shareholders to record their profits from the company on their taxes -- meaning that they'd have to pay taxes on them, I'm guessing?
In Chapter 9, Friedman makes the case that the American Medical Association is a lobbying group bent on keeping competitors out. It's amusing. He defends "faith healers" by noting that one of thousands of quacks may produce a valuable breakthrough through their unorthodox experimentation. Those of you who know my Wikipedia efforts will know that I am sympathetic to alternative medicine, and I like this defense -- although I truly dislike things like therapeutic touch and homeopathy. Friedman argues that restricting medicine only to the highly-skilled reduces the total "physician-hours", and reduces total amount of care, thereby reducing the quality. Friedman tentatively notes that government certification may be necessary because certification information is nonexcludable -- one person can pass it on to others.
In Chapter 10, on the distribution of income, Friedman gets again into the tough ethical issues. He admits that the issue is difficult. Somehow he tries to run inequality from personal endowments together with inequality from inherited wealth, because the latter leads to personal endowments. To an extent, this is true, but he emphasizes it too much. He also makes a somewhat bizarre argument that if there were 4 Robinson Crusoes marooned on four islands, and one landed on a fruitful island, that Crusoe would not be required to share his wealth, and the 3 others, who were barely scratching by, would not be morally justified in taking it. He says this is analagous to someone finding $20 on the street, and then 3 people deciding to mug you for not sharing it. Does his analogy make sense? I dunno. I don't get ethical issues, generally, but I think 1) we should encourage a meritocracy, 2) we cannot allow people to starve or live with debilitating illness. Which brings up to the next chapter.
In Chapter 11, Friedman discusses Social Security and other social welfare provisions. He criticizes the idea behind social security -- that people cannot save for themselves -- however, I tend to think that people cannot. He notes this possibility as well, but thinks there are better ways of ensuring that people secure their retirements, so that the government is not left supporting them in their old age. He argues that most people would save for their unemployment, and that social security arose only because many people were unprepared for the Great Depression.
In Chapter 12, Friedman endorses a negative income tax, noting that such a system would target poverty much more specifically than minimum wage laws.
In 13, he sums up his arguments. Nothing too interesting here, and I'm losing steam.
Sunday, May 18, 2008
What follows?
Everything logical should be able to be stated in understandable and because of that memorable terms. That's not to say the world can be described understandably per se -- the world is not fundamentally logical. But if someone says "you just have to see it, or it just is", rather than "it follows from this principle working like this", it seems likely that they're more confused than you are. (I have already been proven wrong on these, but it's to a degree -- I assume I will discover the intuitive understanding.) There are, I suppose, important foundational principles which just have to be assumed.
How about morality -- is that one of these foundational principles? I think not. But it is clear that there is physical truth -- a fixed sort of truth -- and spiritual truth. And spiritual truth includes not only your wildest imaginations (and then some) but also things outside of your wildest imagination. But then how do we factor in the effect of data, then? All truth is constructed from some limited data of the real world. Its degree of truth, then, is a function of how close it comes to the real world. There is a truth for both physical science and human morality -- or does it? I'm not sure if we can describe what we should define as truly good -- but we can describe what we will define as truly good.
The test of a real philosopher: to learn without being taught?
If the harder disciplines (physics, mathematics) are half as screwed up as philosophy, economics, and medicine (in no particular order), then God help us.
I've forgotten everything else I wanted to say.
How about morality -- is that one of these foundational principles? I think not. But it is clear that there is physical truth -- a fixed sort of truth -- and spiritual truth. And spiritual truth includes not only your wildest imaginations (and then some) but also things outside of your wildest imagination. But then how do we factor in the effect of data, then? All truth is constructed from some limited data of the real world. Its degree of truth, then, is a function of how close it comes to the real world. There is a truth for both physical science and human morality -- or does it? I'm not sure if we can describe what we should define as truly good -- but we can describe what we will define as truly good.
The test of a real philosopher: to learn without being taught?
If the harder disciplines (physics, mathematics) are half as screwed up as philosophy, economics, and medicine (in no particular order), then God help us.
I've forgotten everything else I wanted to say.
Thursday, May 08, 2008
Affirming the Consequent, Denying the Antecedent
Both of these are misnomers. When you "affirm the consequent", you are actually affirming the antecedent upon observing the consequent.
If P, then Q.
Q.
Then P.
This is the fallacy that they call affirming the consequent. The fact that its misnamed makes it more difficult to remember.
Similarly, denying the antecedent:
If P, then Q.
Not P.
Then not Q.
Another fallacy, but again, it is misnamed. The denial of the antecedent is observational. The fallacy lies in denying the consequent based on the observation of not P.
If P, then Q.
Q.
Then P.
This is the fallacy that they call affirming the consequent. The fact that its misnamed makes it more difficult to remember.
Similarly, denying the antecedent:
If P, then Q.
Not P.
Then not Q.
Another fallacy, but again, it is misnamed. The denial of the antecedent is observational. The fallacy lies in denying the consequent based on the observation of not P.
Wednesday, May 07, 2008
Intuition Pumps (Thought Experiments), Free Will, and Nietzsche
In light of the way that modern philosophy works, this post by Adam Rawlings deserves to be spread far and wide. It's not often that you find philosophers rejecting (even to a degree) rather than analytically debating (fallacious) thought experiments (there are good thought experiments -- check out out I made previously by hitting the thought experiments tag).
I haven't studied modal logic, but it seems that what is "logically possible" is rather arbitrary. Logically possible in our physical world is likely not what philosophers think it is; some of these "logically possible" assertions strike me as similar to Descartes' claim that "the more perfect -- that is to say, that which contains in itself more reality -- cannot be a consequence of and dependent upon the less perfect. This truth is not only clear and evident..." (Third Meditation). ADHR criticizes all of the thought experiments on this basis.
There's another criticism for Frankfurt thought experiments. As a compatibilist, Harry Frankfurt accepts determinism. Yet if determinism implies that there is a single future path which rules out metaphysical responsibility, as Dennett, Pereboom, Honderich, Inwagen, Kane, and others believe, then Frankfurt has to explain how the "free will" necessary for moral (metaphysical) responsibility exists. His thought experiments assume "free will" because people make a free choice. He attacks what he calls the Principle of Alternate Possibilities, focusing this attack on actions -- but what really matters is choices. In Frankfurt's imaginary world, people can still make "free" choices for which they are ultimately responsible. (Technically, the agent in Frankfurt's experiment is only responsible for his action when the controller did not have to act.) What I'm saying is that Frankfurt's thought experiments don't get him any closer to the moral responsibility he wants; he still hasn't addressed the regular problems with "free will" moral responsibility. He won't be able to, either, because the metaphysical free will which allows ultimate metaphysical responsibility is incoherent. We are not responsible for our positions, and thus we are not ultimately responsible for our actions. We are only responsible in the sense that we have to be responsible (responsibility keeps people's behaviors in check). This critique is obvious, but somehow it hasn't gained traction in the philosophical literature; I imagine most philosophers would reject it out of hand simply because they don't want to admit that they've studied Frankfurt counterexamples these past 30+ years without noticing.
If we can get past this focus on ultimate responsibility, however, we can start to think about taking control of our lives and acting with at least some personal responsibility -- you aren't responsible for the position you're in, but goddamnit, you're gonna have to make the best of it. At the same time, this position recognizes (as we do legally) mitigating and aggravating factors in actions, and advocates that we study the causal factors behind behavior to maximize our ability to exert rational control over our bodies. Dennett struggles with this idea in Freedom Evolves, but this is Nietzsche's entire goal, actually, although he pushes people to do it without science (while recognizing that ultimately it may come only through science):
Nietzsche makes the distinction between the causa sui -- the self-creating "free will" which we continually debate, and the self's "will to power", the causa prima which we really need to focus on. We can't be create ourselves, but ideally we can act with our rational self rather than our animal instincts, and avoid being jerked around by 'stimuli'.
UPDATE: Thinking more about the Frankfurt example -- in the linguistic sense, yes, Frankfurt's agent is responsible when he chooses to act as the controller wants him to act despite the fact that he cannot do otherwise. But this is a counterexample, and an outlandish one at that. It's really restricted to just this case -- when the agent acts differently than the controller wanted and must be controlled, the agent is no longer responsible. How is it supposed to apply in the real world?
I haven't studied modal logic, but it seems that what is "logically possible" is rather arbitrary. Logically possible in our physical world is likely not what philosophers think it is; some of these "logically possible" assertions strike me as similar to Descartes' claim that "the more perfect -- that is to say, that which contains in itself more reality -- cannot be a consequence of and dependent upon the less perfect. This truth is not only clear and evident..." (Third Meditation). ADHR criticizes all of the thought experiments on this basis.
There's another criticism for Frankfurt thought experiments. As a compatibilist, Harry Frankfurt accepts determinism. Yet if determinism implies that there is a single future path which rules out metaphysical responsibility, as Dennett, Pereboom, Honderich, Inwagen, Kane, and others believe, then Frankfurt has to explain how the "free will" necessary for moral (metaphysical) responsibility exists. His thought experiments assume "free will" because people make a free choice. He attacks what he calls the Principle of Alternate Possibilities, focusing this attack on actions -- but what really matters is choices. In Frankfurt's imaginary world, people can still make "free" choices for which they are ultimately responsible. (Technically, the agent in Frankfurt's experiment is only responsible for his action when the controller did not have to act.) What I'm saying is that Frankfurt's thought experiments don't get him any closer to the moral responsibility he wants; he still hasn't addressed the regular problems with "free will" moral responsibility. He won't be able to, either, because the metaphysical free will which allows ultimate metaphysical responsibility is incoherent. We are not responsible for our positions, and thus we are not ultimately responsible for our actions. We are only responsible in the sense that we have to be responsible (responsibility keeps people's behaviors in check). This critique is obvious, but somehow it hasn't gained traction in the philosophical literature; I imagine most philosophers would reject it out of hand simply because they don't want to admit that they've studied Frankfurt counterexamples these past 30+ years without noticing.
If we can get past this focus on ultimate responsibility, however, we can start to think about taking control of our lives and acting with at least some personal responsibility -- you aren't responsible for the position you're in, but goddamnit, you're gonna have to make the best of it. At the same time, this position recognizes (as we do legally) mitigating and aggravating factors in actions, and advocates that we study the causal factors behind behavior to maximize our ability to exert rational control over our bodies. Dennett struggles with this idea in Freedom Evolves, but this is Nietzsche's entire goal, actually, although he pushes people to do it without science (while recognizing that ultimately it may come only through science):
"learning to see -- habituating the eye to repose, to patience, to letting things come to it; learning to defer judgement (italics mine), to investigate and comprehend the individual case in all its aspects. This is the first preliminary schooling in spirituality: not to react immediately to a stimulus, but to have the restraining, stock-staking instincts in one's control. Learning to see, as I understand it, is almost what is called unphilosophical language 'strong will-power'. (Twilight of Idols, What the Germans Lack Section 6.)
Nietzsche makes the distinction between the causa sui -- the self-creating "free will" which we continually debate, and the self's "will to power", the causa prima which we really need to focus on. We can't be create ourselves, but ideally we can act with our rational self rather than our animal instincts, and avoid being jerked around by 'stimuli'.
UPDATE: Thinking more about the Frankfurt example -- in the linguistic sense, yes, Frankfurt's agent is responsible when he chooses to act as the controller wants him to act despite the fact that he cannot do otherwise. But this is a counterexample, and an outlandish one at that. It's really restricted to just this case -- when the agent acts differently than the controller wanted and must be controlled, the agent is no longer responsible. How is it supposed to apply in the real world?
Tuesday, May 06, 2008
Econometrics: Worse Than Useless?
Econometric Modeling as Junk Science.
The other one is in the May issue of The Pluralist Economics Review. Unfortunately not updated at the moment.
I really need start studying something really useful, like computer science.
The other one is in the May issue of The Pluralist Economics Review. Unfortunately not updated at the moment.
I really need start studying something really useful, like computer science.
Some feedback for the FBI
Since the FBI's Contact Us page doesn't allow you to email them, here's what my feedback states. Not that they'll listen to it.
First off, you can stop using these terrible feedback forms. There should be hardly any boxes, and more textual input. There's basically two things that people need to refer to: content and design. That's it.
Your main page seems somewhat overloaded.
Your Most Wanted terrorists page goes to a stange place where I can't go back -- it should be incorporated into your other page.
You shouldn't use tables for design. Update to more CSS.
Your History page should include links to laws that have affected you.
It's shameful that you have no email address on your website. I wanted to send this to you personally.
Usually I'm more harsh in my criticism, but again, it's not gonna matter anyway. The feedback goes into the void.
Tuesday, April 29, 2008
Decent Review of the Skeptical Environmental
I've been looking for a nice, concise little review of the notorious book for a while. It's by Frank Ackerman; type hit ctrl-f and then type "Tree-Huggers" and you'll find it.
Thursday, April 10, 2008
The damage of cell phone radiation
Recently the press has been all over this article; a doctor's interpretation of current research into cell phones and conclusion that they are harmful. This claim has been made by experts previously; similarly, a scientific study found that cell phone masts [pdf] did seem to increase cancer rates.
Now there's a study that has found a direct relationship between cellphone radiation and tissue changes. I found out about it through Mercola, but the science comes from BioMedCentral, the premier open-access biology journal. While I still use my mobile phone, I'll likely be using a landline more when I settle down for a reasonably long time. The cost of using a landline for most of my calls is not that high.
Now there's a study that has found a direct relationship between cellphone radiation and tissue changes. I found out about it through Mercola, but the science comes from BioMedCentral, the premier open-access biology journal. While I still use my mobile phone, I'll likely be using a landline more when I settle down for a reasonably long time. The cost of using a landline for most of my calls is not that high.
Monday, April 07, 2008
Hume Didn't Discover the Problem of Induction
I noticed that Hume's insight into the problem of induction was not so original as philosophers like to claim when I took Ancient Philosophy. Good to see that the philosophical literature has raised the point as well. The same applies to just about all philosophical literature, I imagine -- which makes me wonder whether philosophy has been just a distraction from real knowledge all along. The Greeks set not only the foundation -- they may have built a good sturdy building, as well, and instead of letting it lie and giving it its due recognition, we tear it out down out of a need to publish. Adding more words to a world which is already drowning in them seems like a problem to me.
Thursday, March 27, 2008
Listen To a Ph.D Economist Confuse The Discount and Fed Funds Rate
Somewhat shocking, but typical of an academic: listen to Russ Roberts interview Tyler Cowen.
Some other interesting comments: How much of the current credit crunch is due to lack of transparency? And why have mortgage-backed securities stopped trading, rather than trading at a value with the expected number of defaults worked in? These two seemed to assume that mortgage-backed securities aren't trading at that expected value!
Roberts: "I'm not so sure how much of this trouble is due to a lack of transparency. It seems unlikely..."
Wow.
Some other interesting comments: How much of the current credit crunch is due to lack of transparency? And why have mortgage-backed securities stopped trading, rather than trading at a value with the expected number of defaults worked in? These two seemed to assume that mortgage-backed securities aren't trading at that expected value!
Roberts: "I'm not so sure how much of this trouble is due to a lack of transparency. It seems unlikely..."
Wow.
Friday, March 21, 2008
Quantifying justice
While I've often said that morality is a function of individual preferences and cultural influences (which it is), there are certainly some things associated with ethics which are fairly objective. One of these is justice. Justice is just about universally considered to be "right". Justice can be quantifying: when a being receives a reward (penalty) proportional to the benefits (harms) they've created, the result is just. In our society, many people are not handled justly, and that's something to be concerned about.
Thursday, March 20, 2008
Economics Might Be Changing
My previous post reflects a perspective based on a set of information. My information set is rather limited. While economists would like to gloss over the information limitations because they are mathematically annoying, these information problems are the greatest problems which people face when making economic decisions.
Economics is changing. Some of the George Mason economics, at least, are skeptical of the claims that your average mainstream economist will try to make. This probably reflects a growing awareness among the all economists that, say, applying the Coase theorem willy-nilly doesn't really make any sense. While I don't respect the politics of the GMU economists or the way that these political biases manifest themselves in their work, I will admit that they're probably on a better track than many of the prestigious mainstream economists, and some of their offhand blog posts are probably much more insightful and informative than many of the journal articles written today.
Check out "Evolutionary and Institutional Economics as the New Mainstream" by Hodgson, which I found on the Pluralist Economics Review. So far it's an excellent journal. The article is well-worth reading.
Mainstream economics:
As I continually try to point out, the real world is a world of "reasonably bright individuals [maybe that's a little far] in information-poor environments" [with a surplus of distracting noise] rather than "infinitely bright agents in information rich environments" (Hodgson 2007:11).
Economics is changing. Some of the George Mason economics, at least, are skeptical of the claims that your average mainstream economist will try to make. This probably reflects a growing awareness among the all economists that, say, applying the Coase theorem willy-nilly doesn't really make any sense. While I don't respect the politics of the GMU economists or the way that these political biases manifest themselves in their work, I will admit that they're probably on a better track than many of the prestigious mainstream economists, and some of their offhand blog posts are probably much more insightful and informative than many of the journal articles written today.
Check out "Evolutionary and Institutional Economics as the New Mainstream" by Hodgson, which I found on the Pluralist Economics Review. So far it's an excellent journal. The article is well-worth reading.
Mainstream economics:
- Assumes a can-opener. This is not just a cliched joke.
- Looks at the individuals as homogenous rational agents rather instutionally-influenced.
- Has "a preoccupation with technique over substance" (p.18, Blaug).
- Basically ignores the other social sciences.
- Must change in order to make progress.
As I continually try to point out, the real world is a world of "reasonably bright individuals [maybe that's a little far] in information-poor environments" [with a surplus of distracting noise] rather than "infinitely bright agents in information rich environments" (Hodgson 2007:11).
Sunday, March 16, 2008
Do corporations oppose free trade?
Apparently Dr. Don Bourdreaux of Cafe Hayek noticed my comment that he, along with his colleagues, seems like a "shill for industry". His reply is that, if he was a shill for industry, he would fit a large number of conditions. The fallacy here seems to be that all shills for industry must fit all, or least some of these conditions -- it's a form of straw man argument, or perhaps a red herring. If all shills had to fit all those conditions, the word would be useless.
What does shill actually mean? Merriam-Webster defines shill as "a: one who acts as a decoy (as for a pitchman or gambler) b: one who makes a sales pitch or serves as a promoter". Wiktionary defines shill as "a person paid to endorse a product favourably, while pretending to be impartial".
Does Bourdreaux "serve as a promoter" of industry? Certainly. Do I think he's been paid egregiously to do it, as some other scholars of the Cato Institute have? Not really. Can he still be a shill? As I elaborated in my comments, shill may not be the exact word. Rather, they are apologists for the status quo. They don't think there's something wrong with the way we are treating our environment, and believe that the free market (composed of industry) will fix all problems if only it was completely unshackled.
The GMU economists seem to ignore the significant incentives that corporations have to look for short-term profit rather than the long-term, ,and the worrying concentration of power in a few firms, who exert that power both in the market and in politics. Similarly, they don't seem to mind the increasing concentration of wealth. They've expressed doubts on global warming, an area which they are not experts in. Scientists are as certain on global warming as economists are on free trade (which means that it depends on who you talk to) (do any believe in global warming? I'd like to know). They seem bothered that people ignore economists when it comes to free trade, but don't recognize the irony in their global warming skepticism. Further, and most damning in my mind, they never seem to say a peep about the information asymmetries which dominate economic decisions.
Does your typical corporation oppose free trade? Doubtful. If industry didn't benefit from free trade, it's unlikely that it would happen. Economists don't have that much power. Efficient multinational corporations benefit enormously from free trade -- it's the inefficient corporations which oppose free trade, such as the old steel industry (which is quickly being supplanted by mini-mills). Especially in today's globalized world, businesses benefit from free trade -- they can hire cheap labor and export to new emerging markets. It's likely that most businesses realize that it's the 21st century, and there's no going back from globalization (or at least, that's how it appears). Tariffs mean paying more for inputs and closed foreign markets. A glance at The Economist's CEO Briefing 2007 shows that CEOs are (or at least were) extremely bullshit about the global economy and trade, and, while worried about international competition, your average business is not really exerting a lot of political pressure to stop it. This Fortune 500 survey of 1987 found that a third of CEOs declared, without prompting, that they were free traders, and that CEOs want government to promote free trade -- and by that, they mean bipartisan free trade. I wonder what the number would be now.
Ironically, I like quite a few of the posts at Cafe Hayek -- for example, this one (though I think we can get some idea on the effect of NAFTA). But attributing most of our problems to regulation is just ridiculous. Yes, there is far too much government going on, but most of that government is spurred by industry -- the military-industrial complex which elected George W. Bush will continue to funnel most of our tax dollars to corporations. The recent financial crisis is not caused by government. Can we blame the government for our environmental crisis?
What has government done right in the past hundred years? Hmm: Internet, national road network, Clean Air Act, and the SEC., to name a few I'd agree that the government has done quite a few things wrong, but these were more a function of bad leaders than some intrinsic nature of government. It's not so simple as "industry good, government bad".
What does shill actually mean? Merriam-Webster defines shill as "a: one who acts as a decoy (as for a pitchman or gambler) b: one who makes a sales pitch or serves as a promoter". Wiktionary defines shill as "a person paid to endorse a product favourably, while pretending to be impartial".
Does Bourdreaux "serve as a promoter" of industry? Certainly. Do I think he's been paid egregiously to do it, as some other scholars of the Cato Institute have? Not really. Can he still be a shill? As I elaborated in my comments, shill may not be the exact word. Rather, they are apologists for the status quo. They don't think there's something wrong with the way we are treating our environment, and believe that the free market (composed of industry) will fix all problems if only it was completely unshackled.
The GMU economists seem to ignore the significant incentives that corporations have to look for short-term profit rather than the long-term, ,and the worrying concentration of power in a few firms, who exert that power both in the market and in politics. Similarly, they don't seem to mind the increasing concentration of wealth. They've expressed doubts on global warming, an area which they are not experts in. Scientists are as certain on global warming as economists are on free trade (which means that it depends on who you talk to) (do any believe in global warming? I'd like to know). They seem bothered that people ignore economists when it comes to free trade, but don't recognize the irony in their global warming skepticism. Further, and most damning in my mind, they never seem to say a peep about the information asymmetries which dominate economic decisions.
Does your typical corporation oppose free trade? Doubtful. If industry didn't benefit from free trade, it's unlikely that it would happen. Economists don't have that much power. Efficient multinational corporations benefit enormously from free trade -- it's the inefficient corporations which oppose free trade, such as the old steel industry (which is quickly being supplanted by mini-mills). Especially in today's globalized world, businesses benefit from free trade -- they can hire cheap labor and export to new emerging markets. It's likely that most businesses realize that it's the 21st century, and there's no going back from globalization (or at least, that's how it appears). Tariffs mean paying more for inputs and closed foreign markets. A glance at The Economist's CEO Briefing 2007 shows that CEOs are (or at least were) extremely bullshit about the global economy and trade, and, while worried about international competition, your average business is not really exerting a lot of political pressure to stop it. This Fortune 500 survey of 1987 found that a third of CEOs declared, without prompting, that they were free traders, and that CEOs want government to promote free trade -- and by that, they mean bipartisan free trade. I wonder what the number would be now.
Ironically, I like quite a few of the posts at Cafe Hayek -- for example, this one (though I think we can get some idea on the effect of NAFTA). But attributing most of our problems to regulation is just ridiculous. Yes, there is far too much government going on, but most of that government is spurred by industry -- the military-industrial complex which elected George W. Bush will continue to funnel most of our tax dollars to corporations. The recent financial crisis is not caused by government. Can we blame the government for our environmental crisis?
What has government done right in the past hundred years? Hmm: Internet, national road network, Clean Air Act, and the SEC., to name a few I'd agree that the government has done quite a few things wrong, but these were more a function of bad leaders than some intrinsic nature of government. It's not so simple as "industry good, government bad".
National Databases to Increase Government Efficiency
- The Consumer Product Safety Commission database of products. The Senate just passed a bill requiring this, but the House doesn't like the idea. Similarly, other relevant information on each product should be added to this database.
- A database on corporations. Contractor Misconduct is sort of a good start to this, but not quite. These databases should have all relevant information on a corporation, and should, of course, be linked to the CPSC's database, along with the usaspending.gov contractor database. To reduce overhaul, companies should be required to input this information themselves, after registering on the website. If the corporation is lax on updating its page, it should be fined.
- A national database of all local police stations, recording all complaints on officer behavior and their official resolution. If you read Reddit or Digg, you've likely heard about ratemycop.com. The trouble is that none of these comments are official; they have to be taken with a major grain of salt. And, if you browse through it, you'll find that there's a lot of stupid shit on there already.
- All complaints to federal agencies, including complaints on the federal agency's effectiveness, should be made public. All complaints which an agency collects as part of its duty need to be made public along with their resolution. There needs to be an appeal process. Note this story on on a study the GAO on the FCC's handling of complaints on business practices.
- Obama recently revealed his earmarks. All Congress members need a profile connected to a database, and all earmarks need to be made public. This shouldn't be a choice.
- A federal database on hospitals: misconduct of doctors, any possible performance ratings, a place to register to complaints. All prices for all procedures should be made public. Again, these profiles would be updated by the individual hospital rather than government bureaucrats.
- Every government website should make all the complaints regarding its website functionality public as well. Thus, problems on the website (which I frequently find, but are rarely addressed) will be resolved quickly and efficiently if the agency wants to retain face. Comments should be votable by registered users.
- A government account for all US citizens, detailing all information the government has collected on you. Access to this data would require a search warrant, and if any agency requested your information, you should be immediately notified. Libertarians will hate me for this, but I believe that the government should allow citizens to verify their identities cleanly and easily. Ultimately this will allow people to surf their web with their identities, comments, and so on verified if they so chooose.
- All complaints/comments on government policy should be "votable" by those with verified identities a la Reddit/Digg. Thus, the complaints which gather the most interest will go to the top. Of course, all these things could also be sorted differently (by date, by most votes, by most viewed, by resolved, ect.) Plus, all complaints could be also be rated 1-5 stars by any web surfer. You could see what people with verified identities thought was the most important vrs. your average web surfer.
In fact, there's many more databases that could and should be compiled and made public, esp. in reference to government projects and their costs. These could be linked to each other to expose fishy connections and trends. Citizens could then see for themselves what business and government is doing.
While things like Wikipedia have made a good stride in linking together relevant information and greatly decreasing information asymmetries, Wikipedia can't link to information which is not publicly available. Plenty of the most juicy, important information for citizens is still hidden by the government.
As I've said often before, the first and most important function of government is to act as a bridge for information.
Friday, March 14, 2008
Obama, Transparency, Earmarks
I have mixed feelings about Obama. While I loved him when I heard that he passed the Transparency Act of 2006, I was disappointed to find later that they'd basically taken usaspending.org and tossed a .gov at the end of it. They spruced it up a bit and made it more user-friendly, but I'm not sure that there was as much value-added as there could be. There was plenty of glory, however.
Yesterday Obama revealed his earmarks. I'm not real government-savvy (I've been exploring the government websites for about a year now, but they're still a maze to me), and I wonder why he even had to reveal them. Aren't they publicly-available? Apparently not -- or apparently it would be a major hassle to compile the data, as it's probably in text files. So it's $740 million, including a fishy $1 million for his wife's hospital. I'll give him credit for revealing it. Clinton has not revealed hers. I don't think he's completely pure, but he certainly has a better record for integrity than McCain (who was involved in the Keating case) or Clinton, who is just plain slimy.
I'd trust Obama and McCain more than Clinton when it comes to making smart economic policy, as well. While Obama has made a fuss about NAFTA, his book comes down more in favor of free trade:
EDIT: Where is the press release of these revealed earmarks from Obama? The fact that it was revealed last Thursday (March 13), but there is no press release from Obama's website is disturbing, to say the least. It suggests that he's trying to downplay his earmark requests. However, the earmarks question is fairly prominently displayed (#2) in his AnswerCenter.
Yesterday Obama revealed his earmarks. I'm not real government-savvy (I've been exploring the government websites for about a year now, but they're still a maze to me), and I wonder why he even had to reveal them. Aren't they publicly-available? Apparently not -- or apparently it would be a major hassle to compile the data, as it's probably in text files. So it's $740 million, including a fishy $1 million for his wife's hospital. I'll give him credit for revealing it. Clinton has not revealed hers. I don't think he's completely pure, but he certainly has a better record for integrity than McCain (who was involved in the Keating case) or Clinton, who is just plain slimy.
I'd trust Obama and McCain more than Clinton when it comes to making smart economic policy, as well. While Obama has made a fuss about NAFTA, his book comes down more in favor of free trade:
A tariff on imported steel may give temporary relief to U.S. steel producers, but it will make every U.S. manufacturer who uses steel in its products less competitive on the world market.... U.S. Border Patrol agents can't interdict the services of a call center in India, or stop an electrical engineer in Prague from sending his work via email to a company in Dubuque. When it comes to trade, there are few borders left.
EDIT: Where is the press release of these revealed earmarks from Obama? The fact that it was revealed last Thursday (March 13), but there is no press release from Obama's website is disturbing, to say the least. It suggests that he's trying to downplay his earmark requests. However, the earmarks question is fairly prominently displayed (#2) in his AnswerCenter.
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