Sunday, February 9, 2020

Highly Linkable

It has been too long since I shared things worth reading...

Scott Sumner explains just how rigged it all is in America, and how despite this the American free market still keeps making it better.

The difference between science and Science! begins with some simple yet important facts--take chemistry for example.

How long until smart phone phobia is behind us? Someday it will be fodder for the Pessimists Archive.

Better post this take down of Elizabeth Warren by Tyler Cowen before her candidacy (thankfully) fully flames out.

Dialing It Down a Bit

Partial list of things we need less of: 
  • generational labeling and other generalizations masquerading as arguments
  • homework--kids get enough busywork at school; time at home should be devoted to learning
  • tribalism
  • protectionism--in occupations at home and in trade abroad
  • nostalgia for the way things are or were [especially the way things are imagined to have been]
  • access to other people's money
  • superhero movies
  • outrage at past sins
  • factory farming

Psst... I Have a Secret

Every day I burn a dollar bill. You see I’m really worried about inflation and I want to do my part. If everyone would act like me, we could stop inflation for good.

I admit this is a bit of snarky argument by analogy for the purpose of exposing what I see as the absolute ridiculousness of trying to address macro problems with extremely micro actions. I say "actions" so as to avoid dignifying them with the term "solutions".

Put into this category activities like:

  • The bulk of ESG investing. (I don't invest in company XYZ, who does the bad things, or company ABC, who doesn't notice that what they are doing can't last forever, because I want to deny them capital.)
  • The vast majority of consumer-level environmental activism. (Please use my reusable cloth bag when you sack my groceries full of paper drinking straws, boxed water, and non-GMO foods. And please pack it tight so it fits in my backpack--I biked here, obviously.)
  • Voting as a means of changing the course of public policy. (This is the most important election of our lifetimes--once our candidate wins, disaster will be avoided.)
  • Shaming others for not being part of the cause. (You should have rescued a dog from a shelter rather than buying one from a breeder.)
  • Ad hoc donating to random strangers. (Gives $5 to the man with a sign asking for money on the street corner.)

These activities may be virtuous. They may bring you personal joy or satisfaction. But if you think you will change the world through these activities, you are gravely mistaken. Each of these as a solution to their supposed underlying problem suffers from a kind of reverse Kantianism fallacy whereby an individual action is presumed to be sufficient to bring about a desired outcome because if everyone took this action, the outcome would be achieved. 

Wednesday, February 5, 2020

City Intelligence - Knowing What I Don't Know

There are many aspects to this (things to do, how to get around, what to look for, what to avoid, etc.). In this case I am trying to solve the problem I have when visiting a new city and I want a place to eat. 

There are obviously different dining experiences I am looking for at various times. Many times this problem is solved by the benefit of branding (e.g., McDonald's and Panera Bread are the same everywhere--don't give me no Royale with Cheese counter examples). Still other times a binding constraint "solves" the problem (e.g., I am hungry NOW and this place is good enough and very close). 

But what about those times when I am going for a nice weekend date with my wife out of town or travelling with friends to a football game and need a good meal the night before or on a business trip with a colleague and/or client? Perhaps a matching process I will call "Goldilocks" could be the solution. 

Basically what I am envisioning is a big-data solution that will take my prior experiences and my general preferences and combine them with similar cohorts to develop a suggestion algorithm. I know others have and are trying this, but I have yet to come across anything close to being as robust and easy to use as I desire. Perhaps simplifying the input dimensions and ranking options is the key to being accurate in prediction, reliably useful, and fast. 

The process would start with a few questions and then followup after with the same questions to build and refine calibration:
  • What type of dinning experience are you wanting: more formal than average or more casual than average?
    • Overall for what you desired was this restaurant too formal, too casual, or just right?
  • Are you looking for: a lively more festive place or a quiet more intimate place?
    • Was the restaurant too loud, too quiet, or just right?
Some additional questions would be asked after the experience to further enhance the database:
  • How did the food's taste and presentation meet your expectations: better, worse, or just right?
  • How did the service meet your expectations: better, worse, or just right?
  • How did the value for the price paid meet your expectations: better, worse, or just right?
  • How would you rate this restaurant overall: excellent, just right, or poor?
The goal would be to suggest restaurants that were just right. Why not always hope to exceed expectations? Because expectations should change such that just right is, well, just right.

Sunday, February 2, 2020

What Are You Afraid Of?

Partial list of public policy based significantly on fear. Read into it what you will about how well or poorly fear fits as a justification for the policies. I am simply contending that fear is a significant driver. 
  • Trade Protectionism (tariffs, et al.) – fear of losing economic competitiveness
  • Gun Control – fear of violence
  • Drug Prohibition – fear of self-destructive behavior
  • Immigration Restrictions – fear of others
  • Age-Based Welfare Programs such as Social Security and Medicare (that’s right, everyone collecting SS and using Medicare is on welfare) – fear of insufficient future preparedness
  • Need-Based Welfare Programs such as SNAP (food stamps), Medicaid, et al. – fear of a poverty trap
  • Zoning – fear of change to the familiar
  • Criminal Justice Punishments – fear of bad actors repeating and fear of bad actors not suffering 
  • Campaign Finance Limitations – fear of wealtharchy
  • Military Growth and Expansion – fear of succumbing to the might of others

Friday, January 24, 2020

Take This Job And Make Me Love It

A few short thoughts on work.

Time On The Clock:

While it is commonly discussed that employees today in many occupations get lots of time to take care of personal business as well as engage in leisure activities while “on the clock”, it is much less discussed how much time “off the clock” they spend engaged in work. The Animal Spirits Podcast (Everybody's Busy (EP.119)) brought this up recently. For many of us after hours and even being on vacation isn’t anywhere close to as disconnected as it used to be—the mobile phone and email has changed all of that. Of course being at work isn’t as dedicated as it used to be either, and the mobile phone has helped change that too. But perhaps the more things change the more they don’t. I assume this was not the norm. What about work golf--in bygone eras was leisure time more consumed by work functions? Or is that an example of leisure time on the job?

What Would You Do For A 10% Pay Cut?

Would you do it for a Klondike Bar? Seriously, while we commonly dream of wonderful jobs with super pay, perhaps we should think about a more realistic trade off. What new job would you trade in your current job for even though it paid in total compensation 10% less? It has to be a real type of job, not Reading-Comic-Books-in-Your-Pajamas Engineer, but it doesn’t have to be actually on offer. The idea is still to fantasize about pay out of proportion to the work. Think about it both with and without a cost-of-loving adjustment. Something in NYC or SAN Francisco might be on my list with the COLA, but there is almost no way something would be without it. Remember that a COLA is not entirely a housing cost adjustment—so maybe those places are still out. Teaching comes to mind for me. Writing does too. Running if not owning a small business might fit the bill. I would just have to forfeit the ownership upside so maybe no. 

Should We All Have Agents?

Thinking about pay, almost nobody likes asking for a pay raise. Jeffrey Tucker has some great advice along these lines. Let’s think about another solution: agents to do it for us. An astute thinker will immediately consider how unions were suppressed to play this role and how inconsistent it is for me to advocate such. Rest assured I am not. This is not about collective action. I am thinking that for business professionals what if all pay negotiations on the employee side were done by agents? 

One big obstacle would be the convoluted employment law structure we have created. Set that aside for the moment. Also, just consider this for certain high-skilled professionals. 

The advantages include less stress for both employees and supervisors, better relations (potentially) between employee and employer as now the agent bears some responsibility for the pay/work arrangement, and more efficient pay arrangements as an agent might be able to better negotiate for pay to match actual value added and an agent might be able to more openly explore options without the risk of burning bridges. 

Wednesday, January 22, 2020

A Radical Idea

I'm going to propose something that is completely crazy. . . Hear me out on this.

I think we should get the government completely out of the manufacturing and distribution of automobiles. We should fully and completely privatize autos.

I know, I know, this sounds crazy. But I truly think that the free market can best provide automobiles for people.

Oh, I hear your complaint, "But Steve, you're crazy. Many people cannot afford cars." As hard as might be to conceive, I believe the free market could do a much, much better job. I also think that we should give people the trust and respect and dignity by expecting that they can actually make the best choices for themselves and their families. 

It is my firm conviction that if we completely got the government out of the business of making and allocating cars, say over a five-year period, that we would get cars at a third the price if not better. After accounting for quality improvements and specialization of needs met, we might see prices effectively a tenth of what they are today.

Imagine a world where cars are not one size fits all. Imagine that we have various sized trucks and sport utility vehicles. Imagine we have sports cars and family cars; we have cars that are small and highly fuel-efficient. All this would be possible if we would let the free market help people figure out what is best for them. 

And yes I hear the objection: some people simply would not be able or be willing to get themselves an automobile. I hear the concern that some people won't make great choices in this regard. For those people we can come up with other solutions. But there is no reason to totally sacrifice all of our well-being just to try to address the very nuanced and isolated problems of particular cases.

For those people that simply can't or won't provide for their own automobile needs, we can provide a bus service; we can provide funds for taxi and ridesharing; we can help organize carpools.  We see the free market work so splendidly in so many other regards. We don't question its ability to provide for our needs in so many countless ways.

Just imagine if you will some alternate universe where we had a public school system. Imagine in this crazy world we decided that because some people won't make the best choices for their children and some people very truly cannot on their own come up with the resources to get their children's educational needs met, that we force everyone to pay for a government-run, public school system. Imagine how inefficient that would be. Imagine how large the cracks would be in that one-size-fits-all world.

Even if we allowed private school alternatives, we would still be mightily restraining the free market by forcing resources into this public school system. It would also be subject to powerful political influences that would shape the school in ways that were at best suboptimal and at worst abject failure. It is easy for us to see how having the government run education would not in any way address the needs of the most needy. It is easy to conceive of how there would be very large disparities in education between the Haves and the Have Nots that couldn't be rectified and corrected because the market process would be thwarted.

All I ask is that you think about this clearly and realize the same is true of automobiles.

P.S., Thanks to Don Boudreaux and Bryan Caplan for the inspiration.