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Sunday, April 30, 2006

"I'm a straight, white, Southern male - and *gasp* I hang out with my gay neighbor all the time."

Brain-Terminal reports on emails received from allegedly "tolerant" progressives, and those from small-town America.

Guess who said the quote referenced in the title to this post? Hint: it wasn't from some liberal in San Francisco heaping scorn upon Middle America.

Perhaps there's hope for America yet?

"You are representing your race when you speak."

I meant to blog about this story, but A Constrained Vision, among others, beat me to it. The story is about a group of black professionals who founded a group which tries to instill in mainly black children the need to speak correctly. The theory behind this radical thinking is that to those people who are well spoken life's rewards accrue. Essentially: barring the occasional celebrity or professional athlete, high incomes correlate highly to eloquence and education. (Sidenote: those professional athletes who are also well-spoken find success in other, non-athletic pursuits. See: Tiger Woods, Michael Jordan, David Robinson, etc. Those professional athletes who fail to get an education seem to have a rather marginal post-career life. See: Pete Rose, etc.)

One question: Would it have been considered racist for a white to say of black children: "you represent your race when you speak, so speak well"? It is refreshing to hear such words from a black person; too bad America is so fraught with political correctness that those simple, and true, words, if spoken by a white person, would be seen as racist.

An Orwellian Libertarian

Tyler Cowen, a self-described libertarian, has the temerity to tell me which culture to consume?

I think he's exaggerating for rhetorical effect, but this is like Nixon going to China.

"Yesterday, I was minding my own business, walking down Newbury Street, and a homeless man hissed "stinking white bitch" at me and got some facts right"

Ann Althouse takes in Boston.

Darwin Comes to China

Chinese bike manufacturers find themselves having to compete with one another, a process which sounds suspiciously Darwinian:

During its heyday in the late 1980s, Flying Pigeon produced about four million bikes a year and employed more than 10,000 workers. When Mr. Sha took over as deputy general manager in 1993, bicycles were still king of the road. In that year, China produced 41 million bikes, and just 223,000 cars. Flying Pigeon and two other state firms -- Phoenix and Forever, both based in Shanghai -- controlled the market.

But Flying Pigeon's ample profits were about to vaporize. First, the domestic market for recreational mountain bikes and racers took off. Consumers wanted them in trendy rainbow hues, and the fashion in frames and accessories changed by the month. But Flying Pigeon resisted change. It kept churning out black roadsters based on a 1930s Japanese design. It failed to modernize its old, inflexible production lines.

At the same time, another huge shift in the Chinese market was taking place, as bike sales in wealthy cities dried up. Until the early 1990s, rush hour in Beijing was dominated by cycles, their spokes whirring gently as they churned the air. But urban sprawl scattered populations and workplaces, stretching commutes to the point where buses and subways are now often the only practical choice for millions of workers.

Bicycles have been banished from Shanghai's major thoroughfares to help relieve chronic traffic congestion. Wang Fenghe, the 65-year-old director of the China Bicycle Association, recently gave up pedaling and switched to a car after a careless Beijing motorist shattered his knee in a collision.

Clearly, as the good folks at the Discovery Institute have told us, evolution doesn't exist; therefore, nothing can properly be considered "Darwinian"*. This news surely must be propaganda by Beijing ahead of the 2008 Olympic games, trying to show the world how they have embraced free markets.

*This is sarcasm. If you have trouble figuring that out may I suggest you have a tin ear for such, and, as a consequence, you should go see an audiologist post haste.

Thursday, April 27, 2006

Gas

There's this thing called "gas", which contrary to popular belief, is not the stuff that comes out of you when you fart, but rather is this thing that people use to power their "cars."

Bieng a city resident I have no need for "cars" and therefore am unaffected by the apparent price hikes of this "gas" in recent weeks. It is with mild amusement and no small amount of hubris that I go about my commute unaware of the pain that this "gas" is causing for people's "cars." But Jane Galt has some good observations about why people are so upset at the price of this precious fluid:

My thoughts:

1) Most Americans buy gas at least once a week

2) They buy a lot of it

3) They buy it by itself--if the price of milk or orange juice rises, it gets lost in the overall grocery bill, which is still falling in real terms.

4) The price is visible and because demand is almost completely inelastic, little effort is made at price discrimination--there are no coupons for cut price gas.

5) There is relatively little variation in gas prices compared to, say, generic food/drugs vs. name brands.

6) Gas is heavily implicated in other consumption. When the price of milk rises, you stop drinking milk and start drinking calcium-fortified OJ (or vice versa). When the price of gas rises, you stop going to the movies and start watching the science channel.

7) There are very few good substitutes for gasoline consumption.

8) It is relatively difficult to cut back on gasoline consumption, because commutes and things like grocery shopping make up so much of the total, and people only purchase new cars once every few years, if that.

In short, people have to buy it; they have to buy large amounts of it frequently; it's very difficult and painful to economize on; and the cost is highly visible. That's what makes it different from groceries or furniture. Or anyway, that's my guess.

Never mind, of course, that people have brought this problem upon themselves by refusing to live in places with adequate public transportation.

More gaseous thoughts at the invaluable Coyote Blog.

And, for the perspective of a real economist, check out the ElectEcon.

Personally, I just think people are morons, and, as morons are wont to do, they see that they are paying more in absolute terms than they used to pay for the same thing, and, therefore, politicians see an opportunity to curry favor. The consequence is that all coherence and rational thought evaporates like, well, gas. And ignorance persists.

This is all a function, in part, of statistical illiteracy (i.e., understanding the difference between absolute and relative pricing). For some of my comments on the pervasiveness of statistical innumeracy, see my comments at Althouse's blog post about self-selected (non-random) online surveys. Same innumerate principle applies to gaseous matters.

Wednesday, April 26, 2006

Yet More Evidence That I Don't Understand Man's Propensity Toward Faith

Reports the Economist:

THEOLOGIANS used to ponder how many angels might fit onto the head of a pin. Now experts in the Vatican are to consider something more practical, though perhaps just as difficult for non-Catholics to understand. The head of the Vatican’s Pontifical Council for Health and Pastoral Care confirmed in an interview with an Italian newspaper, La Repubblica, that the council had been asked by Pope Benedict XVI to study whether those infected with HIV (and other grave infectious diseases) should use condoms. Although the Catholic church opposes contraception, some liberal cardinals now argue that the fight against sexually transmitted illness—notably AIDS—is so pressing that the use of condoms, in some circumstances, should not be condemned. It might be justified, for example, if the intention were not to prevent conception but to stop the spread of a virus from husband to wife.

That there is even a debate about the propriety of condoms proves only that religion foists upon man an inability to think critically and empirically. How many more people need to die of AIDS before Aquinas' angels on the head of a pin is jettisoned in favor of logic and empiricism?

Tuesday, April 25, 2006

Productivity

It's often said that Ireland and America have stronger economies than France or Italy because their workers are more productive.

Procter & Gamble's experience in Italy should demonstrate that Italians are none too productive:

Italian women keep some of the cleanest homes around.

They spend, on average, 21 hours a week on household chores other than cooking -- compared with just four hours for Americans, according to Procter & Gamble Co. research. Italians wash kitchen and bathroom floors at least four times a week, Americans just once. Italians typically iron nearly all their wash, even socks and sheets. And they buy more cleaning supplies than women elsewhere do.

All that should make them the perfect customers for the manufacturers of cleaning products.

But when Unilever launched an all-purpose spray cleaner about six years ago, the product flopped. And when Procter & Gamble tested its top-selling Swiffer Wet mop, which eliminates the need for a clunky bucket of water, the product bombed so badly in Italy that P&G took it off the market.

What the world's biggest consumer-products companies failed to realize is that what sells products elsewhere -- labor-saving convenience -- is a big turnoff here. Italian women want products that are tough cleaners, not timesavers.

The Italians "are not ready for convenience in the way Americans are," says Elio Leoni Sceti, chief marketing officer at Reckitt Benckiser PLC, maker of Lysol cleaner and Woolite laundry detergent. "It's perceived as a step back."

What sort of cultural idiocy allows people to spend so much time cleaning and not producing wealth?

For those who don't believe that a propensity toward productivity is culturally iingrained, consider Richard Posner's argument about income inequaity and its cultural implications:

Cognitive skills tend to get developed at very early ages, while my colleague, James Heckman, has shown that non-cognitive skills, such as study habits, getting to appointments on time, and attitudes toward work, get fixed at later, although still relatively young, ages. High school dropouts certainly appear to be seriously deficient in the non-cognitive skills that would enable them to take advantage of the higher rates of return to greater investments in education and other human capital.

So instead of lamenting the increased earnings gap by education, attention should focus on how to raise the fraction of American youth who complete high school, and then go on for a college education. These pose tough challenges since the solutions are not cheap or easy. But it would be a disaster if the focus were on the earnings inequality itself. For that would lead to attempts to raise taxes and other penalties on higher earnings due to greater skills, which could greatly reduce the productivity of the world's leading economy by discouraging investments in human capital.

Certainly there is a point at which the returns gained from cleaning one's house or ironing one's socks are significantly less than the cost of time put into doing these chores. Were the Italian household a properly managed business, its old line businesses (excessive cleaning) would be shuttered in favor of more profitable pursuits. Just as productive people reap the benefits in America, so should they in Italy. And yet theirs is a calcified economy. Wrinkled socks is a pretty small price to pay for economic growth.

Monday, April 24, 2006

Bad Times for the New York Times

Any serious observer of the newspaper industry has to see that, at best, it faces enormous challenges in the coming years. Morgan Stanley is trying to compel change at the New York Times:

Tough times for newspaper companies are showing up weaknesses in their managements. In January, Dow Jones & Company, publisher of the Wall Street Journal, replaced its chief executive. Some people reckon that Arthur Sulzberger, chairman of the New York Times Company, and his chief executive, Janet Robinson, are simply not doing a good enough job of steering the firm through a changing market. “They've not been as forward-thinking strategically as you would expect from such a powerful franchise,” says Lauren Rich Fine, a publishing analyst at Merrill Lynch.

Morgan Stanley is unlikely to get its way, since the Sulzberger family is unlikely to cede control. But Mr Sulzberger has already presided over two inglorious episodes at the paper—the Jayson Blair affair in 2003, when a reporter was found to have made up parts of his articles, and the recent departure of Judith Miller after flawed reporting on Iraq. Though its purpose may be chiefly symbolic, Morgan Stanley's campaign is a further blow.

Demographic Presumption

Toyota and Fox are partnering to bring a TV show called "Prison Break" to mobile phones. Allegedly, I am in the "target demo" of the show, being male and 30 years old. Never mind that I never heard of the show until I read about it in the Wall St. Journal:

In a first-of-its-kind agreement, Toyota Motor and News Corp.'s Fox network plan to announce today that they have cut an extensive deal for the auto company to sponsor -- and be featured in -- a spinoff series for mobile phones of the hit drama "Prison Break." Toyota, as part of the cross-platform deal, also will sponsor exclusive content for a Web site dedicated to the program and get ad exclusivity in several episodes in May as the series nears its season finale.

I don't understand the appeal of watching a TV show on a small cell phone screen. Perhaps this will take off, and it will be one more instance in which (most) TV bores me. But if the problem really is that people my age are too busy for advertisers to reach in the conventional way (i.e., through TV) then perhaps that means that TV needs to change its shows, in order to attract more viewers. The only shows that interest me at this point either feature sophisticated plot development, such as The Sopranos and Huff, or else are relatively free of the strictures of George Carlin's "seven dirty words", such as Nip/Tuck and Entourage.

Reading is Fundamental

Readers of a certain vintage will remember the "Reading is Fundamental" PSAs of the late 70s and early 80s.

Well, it seems the issue is not so much how kids learn to read but rather that they simply learn to read. This seemingly simple postulation--that is more important to get kids to read than to adhere to a certain pedagogical methodology--is controversial:

Kolbeck and the other teachers at P.S. 29 are following the dictates of what’s called Balanced Literacy, an equal parts celebrated and maligned teaching technique ordered into the city schools three years ago by Michael Bloomberg and his schools chancellor, Joel Klein. Balanced Literacy is more of a catchall concept than an actual curriculum, interpreted slightly differently in every school system that uses it, but it is invariably rooted in an education philosophy known as whole language. Unlike traditional so-called phonics-based programs, in which kids repeat and memorize basic spelling and pronunciation rules before tackling an actual book, whole language operates on the presumption that breaking down words distracts kids, even discourages them, from growing up to become devoted readers. Instead, students in a Balanced Literacy program get their pick of books almost right away—real books, not Dick and Jane readers, with narratives that are meant to speak to what kids relate to, whether it’s dogs or baseball or friendship or baby sisters. Over time, the theory goes, kids learn the technical aspects of reading—like contractions, or tricky letter combinations painlessly—almost by osmosis. The joy of reading is meant to be the spoonful of sugar that helps the medicine of spelling and grammar go down.

The one thing I remember from learning to read was being embarrassed at not knowing how to pronounce "island" (I thought the "s" was pronounced). I was reading a bunch of stories with the word "island" in them and just pronounced "izland" to myself, until one day I heard another kid read the story aloud: "island," without the "s." And you know what? I learned to read.

I don't remember doing much reading of Dick and Jane books (those seem to have been popular when my parents were kids) but I do remember a teacher speaking contemptuously of them.

Kill The Drug War

Well, I'm now a victim of the Drug War.

See, I have the genetic misfortune to be allergic to cats, and I'm not too bright, so I have cats. Which prompted me to re-stock my Claritin supplies. Upon getting to CVS I was told to show ID, and then informed that they could only sell me one box of the dangerous drugs.

CVS has lost my business, the stupid fuckers.

In Which I Put Pompous Academics in Their Place

TIAA-CREF, the pension giant that insures that thousands of academics don't have to dirty their hands with messy details like money, is trying to reform itself. Retired, and ignorant, academics are none too happy:

But missteps and controversies have hobbled the overhaul. In 2004, two members of the board of trustees caused a scandal when they went into a side business with TIAA-CREF's independent auditors. Criticized for a conflict of interest, they left the board. Then, a bid to upgrade the computer system in a hurry backfired on thousands of clients, some of whom didn't receive pension or other retirement-account payments for a time. Meanwhile, a program of steeply raising mutual-fund fees angered some clients and prompted fund-tracker Morningstar Inc. to accuse TIAA-CREF of "blatant disregard" for shareholders.

Reactions like that could imperil one of TIAA-CREF's great strengths: the nonprofit's longtime reputation as being on the side of the little guy. "It doesn't seem right that they would turn this company into a Merrill Lynch. They're not as interested in the individual clients as they are in making profits," says Dick Benson, a retired math professor in Bellevue, Wash.

Well, here's some news for Professor Benson: (1) Merrill Lynch was founded on the explicit premise Wall St. did not cater to the "little guy"; claiming that TIAA-CREF is turning into Merrill shows only the good Professor's ignorance of financial services history; (2) money management firms need to make money, as do all firms; (3) though the law treats corporations as a kind of person, companies nonetheless are not corporeal beings and therefore do not have a "soul."

One reason I cannot take the professoriate seriously is that so many of its kind are self-righteous, bloviating anti-capitalists who think that theirs is a rarefied world, unsullied by the wheels of commerce. Never mind that universities, as they currently exist in the United States, are anachronistic. Never mind that corproate America's biggest lament is that graduates don't know how to write, compute, or communicate.

Never mind that academics have too much education and too little practical experience to make sense of the world.

Sunday, April 23, 2006

When Capitalism Sucks

Budweiser, which is to beer as McDonald's is to cuisine, which is to say, Budweiser is not so much beer as it is a pale imitation, is one of the worst examples of the mediocre quality to which mass-produced items sink.

Budweiser also has rights to sell its beer at soccer's World Cup, which is in Germany this year.

Germans, being perceptive about such things, realize that Budweiser is not beer, and are none too happy:

Being the official beer sponsor of the world's most-watched sporting event should give the company an ideal chance to promote its brand and to associate itself with the one thing Germans love almost as much as beer, soccer.

But the King of Beers has a king-size problem: Germans hate the beer and Anheuser-Busch can't even use the Budweiser name in Germany. In a country where brews are hand-crafted and richly flavored, many drinkers dismiss Bud as light, mass-produced and weak.

"We don't want Bud at our World Cup," says Johannes Schnitter, a 25-year-old student at the Freie Universität in Berlin, who has set up an anti-Bud Web site, BudOut.de. "I'm not anti-American. This is just the worst beer you could imagine."

A long-running legal dispute with a Czech brewer prevents Anheuser from using the name Budweiser in Germany. Anheuser-Busch introduced Budweiser in 1876. In 1895 a group of Czech brewers in the town of Ceske Budejovice (Budweis in German) launched a beer called Budweiser too. The Czech company says it was upholding the tradition of beer brewed in the town since the 13th century. The two companies have been fighting over use of the name almost ever since.

Middle America doesn't know good beer, just as it does not know good cars. Budweiser, and its food equivelent, McDonald's, is perhaps the worst manifestation of Middle American flavorlessness and ennui.

Condoleezza Throws a Watermelon?

What's racist about this story? Is there some connection between blacks and watermelons that I'm unaware of?

Saturday, April 22, 2006

Google in China

The New York Times Magazine has a long article about Google's investment in China. The message of the article seems to be that the Chinese are docile when it comes to government-inspired censorship, either because they are intimidated or merely don't know any other way of living:

It was difficult for me to know exactly how Lee felt about the company's arrangement with China's authoritarian leadership. As a condition of our meeting, Google had demanded that I not raise the issue of government relations; only the executives in Google's California head office were allowed to discuss those matters. But as Lee and I talked about how the Internet was transforming China, he offered one opinion that seemed telling: the Chinese students he meets and employs, Lee said, do not hunger for democracy. "People are actually quite free to talk about the subject," he added, meaning democracy and human rights in China. "I don't think they care that much. I think people would say: 'Hey, U.S. democracy, that's a good form of government. Chinese government, good and stable, that's a good form of government. Whatever, as long as I get to go to my favorite Web site, see my friends, live happily.' " Certainly, he said, the idea of personal expression, of speaking out publicly, had become vastly more popular among young Chinese as the Internet had grown and as blogging and online chat had become widespread. "But I don't think of this as a political statement at all," Lee said. "I think it's more people finding that they can express themselves and be heard, and they love to keep doing that."

Of course, anyone can say people don't "hunger" for democracy if those people either do not know what democracy is or are intimidated into not "hungering" for such.

Natan Sharansky's memoir, The Case For Democracy: The Power of Freedom to Overcome Tyranny and Terror, is a good place for Mr. Lee to start reading about the human mind. As the author of the article implies, it's hard to know where Lee's real feelings end and his public persona (both as a Chinese citizen and Google's public face in China) begin. Surely those who have fomented democratic revolutions in, say, America, or Poland, or Turkey*, or Indoesia, would argue that their hunger for democracy outstripped their desire to be oppressed.

Were it not the case that man did not yearn to be free, there would be no Rouseeau, no Boston Tea Party, and, obviously, no Tiananmen Square. Surely we are not to believe the canard that Chinese man is somehow inherently different to those American, Polish, Turkish, and Indonesian agitators for freedom.

*Before you say "But wait! Turkey is an Islamic country and therefore is not democratic", consider (1) the relative freedom of Turks as compared to their Saudi or Egyptian neighbors and (2) the secular precepts upon which Ataturk founded modern Turkey.

Americans and Cars, Part II

It occurs to me that, in my haste, I did not really make the point I wanted to make in this post.

As emailed to a reader, this is the point I'm trying to make:

The point I was trying to make, and which I don't think I made very well, is that all we hear of people and their cars is how much traffic there is and how high the price of gas is.

These are all manifestations of the uniquely American assumption that each person has a god-given right to acreage. Now, in a country that has billions of acres and only three hundred million people, this is not an unreasonable assumption to make, however, concomitant with the idea that every American should have their own house on their own (large) plot of land is the fact that cars will be an integral part of society.

Cars create traffic, which creates inefficiencies, exacerbates costs (both in time and cash terms), and forces people to endure ever-longer commutes.

I don't really care if people want to live in the suburbs, but you get, as they say, what you pay for: lots of traffic, impossible commutes, etc.

For this, blame America's insistence that its people deserve not to be in dense urban cores, and, of course, Eisenhower, he of the interstate highway system. Indeed, he an Detroit have the blood of three thousand US solidiers on their hands; the only reason we have any military presence in the Middle East is because we are so reliant on oil to power our millions of cars.

If you think I'm exaggerating here, I suggest you take a trip to Los Angeles and try to engage the locals in a conversation about anything other than the traffic on the 405. Then come back to me and tell me that Americans and their cars are not a prime example of irrationality.

Friday, April 21, 2006

Contradiction

Says the New York Times about the Roosevelet Island Tramway:

[Tramway officials] said the electric backup system had always been something of an extra, since the tramway also has a diesel-powered hydraulic backup system that they consider more than adequate. The diesel system is normally meant to bring stalled tram cars back to the platform, but it also failed on Tuesday night.

So let's get this straight: a backup system, which failed to work, is "more than adequate"?

Some avaricious lawyer is licking his chops right now at the prospect of wasting my tax money on a lawsauit.

I say: kill public education and fix all the public transportation problems this city seems to have. Certainly, public transportation is a better use of my tax dollars than is educating poor kids.

The Great American Idiocy That is the Love Affair With Cars

One of the more idiotic phenomenons of American culture is Americans' love affairs with their cars. Never in history has there been a more inefficient way to get around town than via car. Now, Chicagoans, who have one of the most extensive public transportation systems in the country, are bitching about having to ditch their cars and, well, using the public transportation system for which they paid:

Ann Schue used to cherish the time she spent alone in her 2003 Ford Expedition during her 90-minute morning commute to her job at the University of Chicago. Nestled in heated leather seats, she planned her day while listening to the news.

Not anymore. Massive construction work on one of Chicago's main highways has forced her to trade the peace of her sport-utility vehicle for the clatter and crowds of a double-decker commuter train.

"This was a very, very big step for me," says Ms. Schue, 42 years old, who had never been on a train in her life before she recently started taking the Metra rail service. "I'm still very...," she says, choking up, then pausing to compose herself. "I miss my car."

Chicago is the rare Midwestern city with pervasive mass transit, including buses, elevated trains and regional commuter rail. But it's also typically Midwestern in that many residents so love their vehicles that they'd rather sit in traffic burning up $2.99-a-gallon gasoline than go near a bus stop or train platform.

Look: people who live in suburbs, and who rely on cars to get them from point A to point B are idiots and lead unnecessarily inefficient lives. (I don't care much about the alleged environmental effects of driving; the world is a far cleaner place than it was even twenty years ago.)

Quit your bitching, move out of the suburbs and embrace efficiency.

For those inclined to argue that the suburbs are more environmentally friendly than cities, interesting article here. Explanation of the economics of urban and suburban housing prices here.

That people continue to live in suburbs despite all of the evidence of their drawbacks shows only the inability of man to think rationally about his circumstance. Kill your television and kill your car, and emancipate yourself.

Thursday, April 20, 2006

In Which I try to Explain How I Have More Traffic Than 99.99% of Blogs

Perhaps someone more conversant in descriptive statistics than I can imake sense of this, but my traffic stats over the past few days--in the absence of active blogging by me--have soared:

Wheres_the_traffic_from

Thoughts?

Friday, April 14, 2006

Publishing

Apparently, book publishers' sales are declining and so they are publishing more memoirs, which, the logic goes, should juice sales:

Several trends are driving the popularity of the memoir today. One is the public's continuing fascination with reality TV. The programming genre's obsessive interest in the lives of ordinary people and B-List celebrities has migrated to the printed word. Another trend is the ascent of narrative nonfiction with such books as the "The Perfect Storm" and "Shadow Divers," an account of the discovery of a shipwrecked German submarine from WWII.

Brad Parsons, senior editor for books at Amazon.com, argues that there's a "safety valve" factor that a memoir provides in an uncertain world. "We like to read about the crazy lives of others and how they got through them," he says.

There's an additional reason why publishers like memoirs: Most, except those written by flash-in-the-pan celebrities, have a long shelf life. "Memoirs continue to sell year after year," unlike typical nonfiction books, says Bob Wietrak, chief merchant at Barnes & Noble, the nation's largest bookseller. Indeed, he says that recently 75% of the chain's biography sales have come from memoirs.

One thing publishers should do well if they want to boost overall sales is to ditch hardover versions of books, or, at least, publish hard and softcover versions of books immediately. I never buy hard cover versions of books when they come out; hard cover books are too bulky and heavy for me to be anything but useless. Publishers therefore lose out on sales until such time that they see fit to publish books in portable (softcover) format.

Publishers need to get over the sentimental idea that most of their customers buy books because they have the time to curl up on a couch with a big, hardover tome. Publishers should understand their customers' lives, and design products, and business models, around that, and not around the idea that what the world needs are more memoirists.

Journalism School

What can journalism school teach you that you can't learn by, well, doing journalism?

Just pound the streets and write.

Thursday, April 13, 2006

Underutilized Resources

Women are an underutilized resource:

Governments, too, should embrace the potential of women. Women complain (rightly) of centuries of exploitation. Yet, to an economist, women are not exploited enough: they are the world's most under-utilised resource; getting more of them into work is part of the solution to many economic woes, including shrinking populations and poverty.

Some people fret that if more women work rather than mind their children, this will boost GDP but create negative social externalities, such as a lower birth rate. Yet developed countries where more women work, such as Sweden and America, actually have higher birth rates than Japan and Italy, where women stay at home. Others fear that women's move into the paid labour force can come at the expense of children. Yet the evidence for this is mixed. For instance, a study by Suzanne Bianchi at Maryland University finds that mothers spent the same time, on average, on childcare in 2003 as in 1965. The increase in work outside the home was offset by less housework—and less spare time and less sleep.

What is clear is that in countries such as Japan, Germany and Italy, which are all troubled by the demographics of shrinking populations, far fewer women work than in America, let alone Sweden. If female labour-force participation in these countries rose to American levels, it would give a helpful boost to these countries' growth rates. Likewise, in developing countries where girls are less likely to go to school than boys, investing in education would deliver huge economic and social returns. Not only will educated women be more productive, but they will also bring up better educated and healthier children. More women in government could also boost economic growth: studies show that women are more likely to spend money on improving health, education, infrastructure and poverty and less likely to waste it on tanks and bombs.

Conceiving of people as resources is a somewhat bizarre, and unsentimental, way of thinking of one's fellow man*, but doing so is certainly better than the cult of victimology around which feminism has found its intellectual roots. Resources, after all, exist to be exploited. The exploitation of man's labor, at least in free societies, has benefits that redound to the man himself: a higher standard of living for him and his family, and all the ancillary benefits that come from earning more money.

*The use of "man" in its universal sense is intentional.

Wednesday, April 12, 2006

In Which I Expatiate on the Depths to Which Religion Has Sunk Man...

A Pakistani Air Force squadron leader finds himself embroiled in controversy because the Air Force, properly, insists that he not have a beard, and he, improperly, says his beard is required by his religion.

The solution here is simple: don't be an air force pilot--or any kind of pilot--if your religious beliefs require that you have a beard. For the same reason that bearded people can't SCUBA dive--beards don't allow you to complete a seal on your face--pilots should not have beards.

Such requirements have nothing to do with secularism, as is alleged by this idiot's Islamist sympathizers.

Religion has, indeed, eroded man's critical faculties; it is a cancer on empiricism.

Via Althouse.

Saturday, April 08, 2006

What I'm Reading

The Closing of the Western Mind, by Charles Feeman.

An obvious play on the title of Allan Bloom's The Closing of the American Mind, Freeman's book explores the efforts by the early Christian Church to squelch empirical observance. Concomitant with this concerted effort, he argues, Europe descended into the Dark Ages, while math and science flourished in Arab lands. But for the Enlightenment, Europe would have been consigned to permanent ignorance.

Some will see the book as inherently anti-religious, or at the least, anti-Christian; however, I don't think Freeman is arguing that religion, or Christianity, specifically, is inherently bad. Rather, early Christianity was used by its officials to keep the masses ignorant, and therefore hold on to its political, legal, and military power and authority.

Abortion

The headline on the New York Times Magazine*:

"Ever imagine what it might be like to live in a place that voted to thoroughly criminalize abortion? A place that sent abortion providers to jail? That policed hospitals? That investigated a woman's uterus? Welcome to 21st century San Salvador, the state of anti-abortion."

Clearly, the article will be biaed in favor of fewer restrictions on abortion, at least based on the headline. (I have not yet read the article.)

*No link provided because I can't find one.

Exponentiation

If you say "x grew exponentially" generally you are saying that the quantity, x, increased by a single digit power greater than one.*

With very large numbers, therefore, be suspicious when one claims that one very large number "grew exponentially."

Case in point, this item from National Journal:

Mollohan's household assets exponentially grew (from $565K in '00 to at least $6.3M in' 04).

(Quote, and link, via InstaPundit, who should know better.)

$565,000^2 = $325 billion, give or take, which, as memory serves, is greater than the revenues of either Wal-Mart or Exxon, and is at least $275 billion greater than Bill Gates net worth. No person who has a net worth of half a million dollars has ever "exponentially" grown his wealth, for that implies that someone, somewhere, is wealthier than Bill Gates. But Bill Gates is the wealthiest person alive; therefore, to assert that someone has exponentially increased his wealth from half a million to close to half a trillion dollars is to assert that which is logically impossible.

Have I proven my point yet that most people don't understand math?

*Most people conceive of "exponential growth" as raising a value to a whole power. While I am aware that in financial math, values are often raised to powers less than one, I do not think such was the intent conveyed in the article; the article's claim of newfound wealth on the part of this politician has a breathless quality to it, which, to my mind, at least, suggests that "exponential growth" was being used in its commonly understood way, not in its finance-specific way.

"“We do not really know what causes economic growth"

Imagine you went to the doctor, and he told you, "you have an infection in your throat but we don't really know what causes it, or how you got the infection. Here's some medicine, but we don't know if it will cure what ails you. Good luck!"

That is essentially the state of economics today:


“We do not really know what causes economic growth,” admits François Bourguignon, the chief economist at the World Bank. “We do have a good sense of what are the main obstacles to growth and what are the conditions without which an economy can’t grow. But we are far less sure about what are the other ingredients needed to create and sustain growth.”

More:

This bewilderment doesn’t just appear when economists confront the devilish problems of the developing world. Plenty of what goes on in the rich world also baffles them. I recently asked a well-regarded economist on Wall Street what puzzled her these days. “Interest rates,” she said. “They should be higher.” Sure enough, economic theory predicts that today’s long-term interest rates—the rates for mortgages or bonds that will be paid years from now—should be higher and heading upward because of an expanding U.S. economy and exploding fiscal and trade deficits. But the financial markets just won’t cooperate: Long-term interest rates have remained low and are actually heading down. Before retiring in January, U.S. Federal Reserve Chairman Alan Greenspan described these trends as “a conundrum.” Robert Samuelson, a Washington Post columnist, surveyed the explanations that economists offer to explain this anomaly and found that they are all flawed. In his view, the experts’ inability to explain something so fundamental “attests to our economic ignorance.”

Nor do economists have a convincing explanation for the value of the U.S. dollar. For more than a decade, economists have maintained that the dollar was too expensive and its devaluation was unavoidable. As predicted, the dollar plummeted 39 percent between 2002 and 2004. An inescapable effect of the economic equivalent of the law of gravity, explained the experts. In a country with a huge and growing trade deficit, out-of-control government budgets, a war expected to cost $1 trillion, and high energy prices, the currency’s value will inevitably tumble. Except that it didn’t tumble for long: The dollar’s decline was so fleeting that economics textbooks didn’t have time to register the change. The dollar recovered quickly, climbing 14 percent in 2005.

No doubt economics is important, and no doubt most people are woefully ignorant of economic principles. But is economics really a science? Do we have the empiricial knowledge required of an inquiry for it to be called scienec? Does it have hypotheses that can be tested or rejected? Is its epistemological framework scientific?

I don't have any answers to these questions, but the epistemology of economics seems a fascinating avenue of inquiry for someone sufficiently knowledgeable.

Should Women Be Able To Vote?

I'm of the opinion that rights should only be exercised if one is not ignorant of what those rights entail. You should have no right to free speech if you do not understand that such does not allow you to yell "Fire!" in a crowded theater, or that being fired from your job for sending sexual emails via your employer's computer system is not a abrogation of your speech rights.

So, it is with glee that I hear about the story of a group of Catholic school girls duped into signing an "End Women's Suffrage Now" petition foisted upon them by smarter boys.

Here's a hint: if you have no innate skepticism, all your education is for naught. If you don't know the meaning of the document you're signing, Google the fucking words you don't understand.

Else, quit your bitching and don't expect to be able to vote or exercise any other "rights." Intelligence is a requisite in my book.

By the way, your glabrous epidermis is showing. I suggest you see a doctor post haste. Not only that, but your face is gibbous. Aren't you concerned about your health?!

Hookers and the IRS

Hookers want to pay their taxes. At least, hookers who want society to view their work as legitimate want to pay taxes.

Like many sex workers, Ms. Patterson said she no longer wants to be considered a tax evader. She wants to be a legitimate taxpayer and to begin paying into Social Security and build a good credit history.

But how to list her various revenue streams? Ms. Patterson is self-employed — getting her own private clients through word of mouth — but also receives regular payment when booking a foot massage session through her booking agency, the Foot Worship Palace, a Manhattan company that employs fetish models. On top of that, she is an English tutor for immigrants.

A screener told her that she could get free help from one of several tax preparation centers in the city and introduced her to representatives from Citizens for N.Y.C., which, using a grant from the Robin Hood Foundation, finances 40 local advocacy groups, including Prostitutes of New York, to offer tax help to marginalized workers who might not otherwise file, including street vendors, dishwashers and illegal immigrants who work at hotel, restaurant and cleaning jobs.

Two questions: (1) what does paying one's taxes have to do with establishing one's credit history, and (2) is this sex worker so ignorant as to assume that money she pays into Social Security will be available for her to live on when her body no longer can satiate man's desire for sexual release?

Seems to me that rather than spending time complying with tax laws, this sex worker should take a couple of personal finance and economics courses.

Doormen

Interesting article in the New York Times about doormen and whether they are useful. Some people would rather live in hell than live without a doorman; other would rather live in the suburbs than have a doorman.

Here's a sentiment with which I agree wholeheartedly:

Holiday tipping is an exacerbated exercise in misery for those already ambivalent about their doorman. And for others, the need to make conversation is so annoying that it alone is enough to drive them into nondoormen buildings.

"I had one young guy who moved from a fancy condo doorman building in California where he had a very cheery doorman," said Hy Rosen, a senior vice president at Bellmarc Realty. "He wanted a building without a doorman, and his biggest reason seemed to be he didn't want to have to say hello to someone twice a day."

Michele Golden, another broker for Bellmarc, lived in two luxury buildings before buying a Chelsea loft that came with just a full-time superintendent. She doesn't miss the constant socializing, which she found cloying. "It's like a really good restaurant — the lower key the service, the more I like it," she said. "When they're fawning all over me, I'm not enjoying that. I don't want service to be intrusive in my life."

I've never understood the principle that one should be tipped for doing his job, even if it is a poorly paid job such as being a doorman. No doorman I have ever dealt with has received a holiday tip from me. Was my service compromised? Not that I can really tell. But then, I'm rather independent, and don't have a need for doormen to rush to hail me a cab, walk a dog (who the hell has a dog in NYC?!), etc., etc. So there was no incentive for me to get the doormen in my good graces.

The beauty of free markets, of course, is that those people who want to pay for the privilege of having a doorman have every right to do so, and those who don't care for one, have other options.

Friday, April 07, 2006

Light Blogging

Due to new responsibilities at work, my blogging rate during the week will be significantly diminished. I will (try) to make up the difference on the weekend.

Wednesday, April 05, 2006

Taxachussetts: Hell On Earth

Health insurance has been made mandatory in Massachusetts. Coyote Blog has an appropriate take on this measure; meanwhile A VC has a stunningly ignorant--and liberal--take on the same.

A VC, it should be noted, is a venture capitalist-blogger. One would expect a VC to understand how ignorant an application of economics such legislation is. Do you want this guy investing in your company?

Related: Stuart Buck relates the story of a pharmacist friend of his:

His gut instinct was that Americans use too many prescription drugs, and that their usage would go down if insurance didn't cover so many prescription drugs. He said, for example, that he'll see people come in who are on 15 or 20 meds, half of which are unnecessary for their conditions. But then as soon as he tells them that a particular med isn't covered by their insurance, they always say, "Well, put that one back; I may come back for it later." Then they never come back for it.

Another example of over-expenditures: He filled a prescription for a new and expensive antibiotic that costs upwards of $75, but then the customer's insurance didn't cover it. When he told the customer the cost, the customer demanded that he call the doctor, at which point the doctor said that amoxycillin (a cheap generic) would do as well. This made him wonder why the doctor didn't prescribe the cheaper drug in the first place.

A third point he made was that if insurance didn't cover so many drugs, the drug companies would find a way to lower their prices, simply because they would realize that a particular drug would never sell if people had to pay $100+ out of pocket.

Sunday, April 02, 2006

Alcatel, Lucent To Destroy Shareholder Value

Megamergers, which rarely work as planned, have a history of destroying, not enhancing, shareholder value.

Alcatel & Lucent have entered into an agreement to merge. If this merger is consummated, look for shareholders to be the ultimate losers.

July 27th, 2007

The Simpsons comes to the big screen.

Illegal Immigration

The controversy now raging over illegal immigration too often focuses on the problem itself, and not the reasons behind the problem. Simly put, people see the United States as offering more opportunity than Mexico or Latin America, and, therefore, are willing to risk life, limb, and deportation to come here.

I have long thought that it would be in the United States' interest to invest in Mexico and help modernize its economy. Remove the incentive for poor Mexicans to risk injury or death in attempting to come to the United States, and a lot of the problems associated with illegal immigration would disappear. To some extent, this would be an exercise in nation building, but it would be rather different than the current quagmire in Iraq. Mexico, for one thing, is a relatively stable country, largely free of the internecine tribal and religious battles that have so riven Iraq.

In any event, the Economist argues much the same thing:

Many senior figures in both parties, ranging from John McCain on the right to Ted Kennedy on the left, favour the kind of compromise espoused by Mr Bush. In the Senate Judiciary Committee on March 27th, they prevailed. By 12 votes to six, they approved a bill that would combine tougher border enforcement with a scheme under which existing illegals could obtain a visa and, eventually, citizenship. A further 400,000 visas would be issued each year for new arrivals. This is probably about the best compromise that could be reached, although its passage by the full Senate, let alone a conference of both houses, is far from certain.

To make such a scheme work, Mexico's co-operation would be important. Hitherto, Mexican governments have been unwilling as much as unable to prevent the flow of their own people across their northern border, or of Central and South Americans across their southern frontier. The visa scheme gives Mexico more of an incentive to do so.

So Mr Bush had something to show when he flew to Cancún for a meeting on March 30th and 31st with Mexico's Vicente Fox and Stephen Harper, the new Canadian prime minister. But the leaders should recognise that faster economic growth in Mexico would do more than any legislative fix to take the heat out of America's immigration argument.

When the North American Free Trade Agreement (NAFTA) came into force in 1994, it was hoped that Mexico's economy would quickly converge with the United States. That hasn't happened. In the late 1990s, Mexico's GDP grew half as fast again as America's. No longer. China has partly displaced Mexico as a supplier of low-wage manufacturing. Nowadays, Mexico creates decent jobs for only around a quarter of the 800,000 who join its workforce each year.

The main way to change that is for Mexico's next president, who will be elected in July, to push through long-delayed reforms of taxes, energy, labour and competition laws. But there is one way the United States could help. Lack of roads and railways mean that the benefits of NAFTA have been largely confined to northern Mexico, rather than the poorer centre and south where most migrants come from. A North American infrastructure fund—in which the United States matched Mexican investment—makes much more sense than spending money on a border wall. In the long run, a richer Mexico means a richer and more secure United States.