Wed, 30 Nov 2005

US Citizenshp for sale?

Startupboy points out an interesting idea: Securitize Citizenship. In other words, give every US citizen a blank passport, and let them do whatever they want with it. This is a great idea! It solves several problems. First, it allows people who don't like immigrants to buy up passports and destroy them. Second, because there will certainly be a market for purchasing these passports, it lets all US citizens benefit from their hard work in making the US a nice place to live. Third, because the price will change, it will give citizens a personal reason to increase the quality of their government as seen by the rest of the world.

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Sun, 27 Nov 2005

Sick Days

New scientific evidence shows that 40% of all sick days are taken on Mondays and Fridays! That's nearly half of all sick days!

That would seem to be evidence of employees cheating their employers, wouldn't it? If so, it would make sense to clamp down on employee laxness by restricting the number of Mondays or Fridays that an employee could take off.

The trouble is that the other 60% of sick days are taken on Tuesdays, Wednesdays and Thursdays, thus it makes more sense to restrict mid-week sick days.

And the trouble with both of these conclusions is that 40% is 2/5th and 60% is 3/5ths of the whole, exactly what one would expect of a random sample of events spread over five days. Hat tip: Liberal Order.

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Sat, 26 Nov 2005

Expert Analysis of Risk

You see this all the time. An expert stands up and says "Through my expertise, I see a problem that nobody else sees." If you listen a little more closely, you find out that the reason the expert concludes that nobody else sees the problem is that they're not paying him money to solve it. That may seem excessively cynical. I don't think so. Being experts, they overestimate the importance of their field of study (no blame: this is the human condition).

The general public lives in a sea of risk. You know what they say: "Life is short and then you die." For some people life is shorter than others, if only because humans are fragile. People perceive some risks irrationally, particularly when you get into very small risks of very bad things. I think that that is simply because people cannot make the proper mental trade-off. Which risk is worse: the risk of dying in a coal-related accident or the risk of dying in a nuclear accident? Mathematically, coal is a bigger killer, and yet people are opposed to replacing coal with nuclear power.

Nonetheless, people who mis-estimate risks under their control are likelier to die. In this way do trees serve to eliminate the imprudent from the pool of automobile drivers. It's reasonable to assume that people are correctly evaluating the risks in their life. So when an expert says "I know better than you", they're technically correct in their field of expertise, but their recommendations do not automatically make for good policy.

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It's a feature, not a bug!

In the world of computer programmers, we have a phrase: "It's a feature, not a bug!" We use that phrase when somebody doesn't understand the subtleties of how something should work. They apply a naive analysis to it and conclude that it was a mistake, and needs to be fixed.

Many people do not understand the structure of the US government. Sadly, they are as likely to be Americans as not (the blame for which I lay at the feet of Social Studies as taught in government schools.) Because they fail to understand the subtleties, they call for the government to be fixed. Usually this entails centralization of power.

This morning on our local NPR customer I heard a news report about the dangers of chemical plants. The main thesis of the story was that mere citizens don't understand the risks of chemical plants, because if they knew what the experts knew, they would call for federal laws regulating these plants. There are two problems with this idea. I'll tackle the problem with expert analysis of risk in another post. The other problem is the call for federalization. The NPR reporter whined at the end of her report "Without a federal law, when one state restricts chemical plants, that only transfers the problem to other states."

The structure of the US government is designed to handle error. Part of being human is making mistakes. Part of being a god is being omnipotent. So did The Christ know he was making a mistake as he was doing it? If that never happened, then he was either not human or not a god. But I digress. Complete knowledge is not available to us. What we know, we know because we have experimented.

The US government is one vast, continuous experiment, or so it's supposed to be. Unfortunately, we have greatly reduced the amount of experimentation in space, and turned it into experimentation in time. That's just plain stupid. Everybody knows that "many hands make light work." That just says that work goes faster if you have lots of people doing it. The same effect works in government.

The original structure was designed to be an parallel experiment in space. The federal government was strictly limited in the laws it could pass. All other laws were to be passed by states. Of course, not all states would pass the same laws. Thus, some states would make mistakes that others would not make. That's how science works: you have a control and you have a test. You keep one thing constant and you change the other.

We have destroyed all this experimentation by allowing federalization. We no longer restrict the federal government, and in doing so we have given up science. We no longer have a control. Everyone is a test subject, so we never really know what are the effects of laws. Without having US citizens who are not subject to those laws, we can't tell if they had good results or bad. Also, instead of running multiple experiments, we can only run one experiment across the entire country. If that experiment fails, as some people have said the Telecommunications Act of 1996 has failed, all of that time has been lost. With a more distributed set of laws, other states could have been trying something different.

The other problem with federalization can be seen by flying over the US. The many regions of the US are radically different. We have mountains and streams and lakes and deserts and plains and cities and forests. How can anyone think that one law could fit everywhere? Take, for example, telecommunications. The way you address "tele"communications depends on how far is your "tele". Telephone service in an apartment building is vastly different than telephone service out west where it's not unusual to have miles between customers. Beehive Telephone serves rural Utah and Nevada. They own an airplane to fly between their central offices. I can't imagine any eastern telephone company needing an airplane.

I'm not opposed to the use of governmental power. Many problems are easier to solve by forcing everyone to solve a problem the same way (e.g. water and sewer systems). I'm opposed to the use of governmental power in inappropriate situations. But how do we, as fallible humans, to discover which solutions are inappropriate without experimentation? If you agree with me that federalization is a philosophical mistake, please contact your state representatives and tell them to take back the power that is rightfully theirs.

UPDATE 11/16: Roy asks "How exactly are they supposed to do that?" Roy, you're trying to solve problem #2 before you solve problem #1. Problem #1 is to get the state legislators to realize that the federales have stolen their power. Each individual citizen is relatively powerless. In order to magnify their power, they need to convince the powerful to do their bidding. Since power seeks more power, the most effective path is to get the slightly less powerful to attack the more powerful. Right now, the most powerful single entity on the planet sits on Capitol Hill. Collectively, the state legislatures approach them in power, but first they must be convinced to exercise their power. Exactly how they do that is problem #2. First things first.

UPDATE 11/16: Scott contributes two examples:

Flush toilets - Al Gore (and many others) thought it was great idea to limit flush toilets to 1.6 gallons per flush. The unintended consequence is that many people flush *twice*!. However, while the dry western states might very well have thought such a law was a good idea and passed it on their own, does someplace like New Orleans, literally drowning in water even when not flooded, really need to suffer through such a restriction? I was in New Orleans back in 1991, and I saw city employees clean the streets with firehoses!

911 service - I live in Israel and got a Packet8 VOIP service earlier this year. One reason I chose this service was the cost, which didn't include the overhead of 911 service. Packet8 was going to eventually offer 911 as an option. But no, that wasn't good enough for the Feds. They completely overreact to a few people who obviously didn't read the not-so-fine print that their VOIP service 911wasn't the same as standard 911, and instead of merely requiring more visible notice or disclaimer, they required all VOIP services to provide 911, whether the user wanted it or not. I live in Israel. I want an American phone line for various reasons. I don't want or need 911 service and I don't want to pay for it. I had a choice before. Now I don't.

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Sun, 20 Nov 2005

Workers "vs" Capitalists

I've been corresponding with someone who has a Master's degree in Economics (he doesn't say where from; I'm sure it's because they won't admit that they gave it to him), and calls himself "The Real Economist". He says this about workers and capitalists:

There has been and there still remains a simple fundamental fact in any capitalist economy; the capitalist who has to hire at least one worker, by definition, needs that worker to help operate the business; but, the worker, if and when organized and united with other workers, don't need the capitalist employer. The workers collectively can, if they want, form and operate their own government and economy. In other words, in the macro sense, the capitalists need the workers in order to operate and grow their businesses in any major way (workers aka 80% of consumers), but the workers don't need the capitalists in order to grow and exercise their power in any major way.

That's an admirable sentiment. "Bah! Who needs capitalists anyway?" Strictly speaking, it's true. Workers don't need capitalists. They can fore-go spending, accumulate their own capital, and form a worker-owned business. It's done all the time.

But there's something invisible going on here. He's trying to claim that "Capitalists" describes a set of individuals who have it in for workers. He's further claiming that once workers have capital, they'll remain workers and won't become capitalists. The problem with these ideas is that "Capitalists" describes many people. They didn't come into that role with a predisposition to screw workers. People who have capital behave a certain way. They have to, in order to remain capitalists. If they don't behave that way, they become "Philanthropists", who have an entirely different set of goals.

Workers who have capital are no longer just Workers. They are now Worker-Capitalists, who have the interests of both classes, at the same time. If they want to keep their job and their capital at the same time, they will cheerfully cut costs by firing workers (who lose their jobs but keep their capital). The alternative is for all of the workers to lose their jobs and their capital (aka life savings).

Real Economists are trained to see the invisible.

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Sat, 19 Nov 2005

I'm an X economist

From time to time you'll hear people say "I'm an X economist", where X might be labor, historical, Marxist, behavioral, Hayekian, Chicagoan, or Austrian. It is generally a mistake to say that. I don't mean that all schools of economics have produced equally valid results. I mean that the quality of economics is independent of the school that produced it.

There are no X economics. There are only good economics, and bad economics. Limiting yourself to only one school of economics is adopting an ideology. I have found much of value in Austrian economics, but I don't think of myself as an Austrian economist. I want to be open to useful economic results no matter the source. Perhaps someday a Marxist economist might produce something of value?

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Tue, 08 Nov 2005

"I want to pay higher taxes"

I was conversing with someone recently, and they said that they wanted to pay higher taxes.

No, they didn't.

The proper response to that statement is to ask them "So what's stopping you?" Nothing is stopping them from paying higher taxes. All you have to do is send in the check. Every taxing department is perfectly happy to have you pay higher taxes.

No, what they really want is the political power to force other people to pay higher taxes. If you can get them to admit that, then you should ask them whether they think other people's money would be spent more wisely by a government employee or by the person who traded his life energy for the money.

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