Nobility

If there is one person that I would say represents everything typical of dynastic politics in America, it would be Ted Kennedy. His path to power began in 1960, when his father, one of the most powerful men in America, asked the governor of Massachusetts to name a Kennedy family friend to the senate seat recently vacated by Ted’s older and much more capable brother John, as Ted was too young to be a senator. Other than being a lawyer and his political experience serving on his brother’s election campaign, he had few qualifications, and already a troubling past, having been expelled from Harvard College for cheating in 1951 (after serving in the Army for two years, he was re-instated and later graduated from Harvard).

His personal life was characterized by partying and drinking, and most famously the 1969 Chappaquiddick incident, where the most reasonable interpretation is that Kennedy’s drinking killed a 28 year old woman. Once he became the democratic senator from Massachusetts, he was virtually unbeatable, having had no serious primary challenges and few challeges from the opposing party.

If there is one person who would represent the idea of citizen rule, or democracy in action or whatever you want to call it, it would be Sarah Palin. A graduate of the University of Idaho, she first ran for political office in 1992, winning a seat on the city council with a grand total of 510 votes. Her career moved her up to mayor, eventually leading to Governor of Alaska and famously the Vice Presidential ticket of the republican party in 2008.

If there’s any reason to be in favor of nobility, it is the above two statements. One the one hand, we had a hard partying loosely ethical man who got to where he was purely on his father’s connections and his family name, on the other, an all American girl who through sheer pluck was able to rise to the top and become one of the most famous, if not powerful, politicians in the country, and most neutral observers agree that the first case was better, that it’d be better to be ruled by Ted Kennedy than Sarah Palin. (ok, time out, neutral is a tough claim here, as its very hard to get truely neutral opinions, and I’m comparing two of the most polarizing politicians of my lifetime, and there are tons of people who would say that Palin is much better than Kennedy was, so if nothing else, this is just my semi-biased opinion).

Kennedy has had very big legisaltive accomplishments: the ADA, Children’s Health Insurance (CHIP), the immigration bill of 1965, etc. Basically, if you are a liberal judging him on the basis purely of his legislative conduct (as opposed to personal character), you’d like him. If you’re a conservative, yeah, you wouldn’t, but thats borderline tautological. (perhaps, a more reasonable question is this: is Sarah Palin held in higher esteem by conservatives than Ted Kennedy is by liberals? I think the answer is no).

Sarah Palin is, in my opinion, one of the most intersting persons in contemporary American politics. She splashed onto the scene in 2008 when John McCain named her his running mate, and at that point basically nobody outside of Alaska had much of an opinion about her, in many ways she was the clearest example of a political blank slate, which people could project their ideas or wishes onto. To Republicans, she became the embodiment of Tea Party Republicans (before the Tea Party actually became a thing, mind you), cutting pork, and opposing the “bridge to nowhere,” although in many cases that wasn’t the case (Alaska still received the half billion dollars alloted for the bridge, it was just never built). However, she almost instantly became that, morphing into what others expected to be in a very seemless transition, becoming (at least for a while) the figurehead of the Republican anti-establishment; never squandering an opportunity to criticize the “lamestream media.” What’s most interesting to me isn’t that Palin was able to play chameleon and appear to be whatever the voters wanted, politicians do that all the time. Whats interesting to me is the sincerity of it all, Palin seemed to go beyond adapting or even embodying the nation’s perception of her, she became that perception.

The advantages of nobility are simple, they’re similar to the reasons we have tenure for professors and why judges have lifetime appointments; it mutes the temptation to go with whatever is popular in the moment, to act above the whims of the public. Rule by nobility isn’t so much an idea that there is a class of people better than the commoners but that, not facing re-elections, the nobles are free to pursue long term interests.

But that’s not illustrated by our example. Ted Kennedy, due to his name, position and history, was free to choose some positions not entirely based on the will of Massachusetts, but I doubt he really did this much more than any other Senator; he was a liberal senator from a liberal state. The story of Ted Kennedy is one of being given an office which he did not deserve, and sought to be worthy of the office.

None of this is to say that I support going back to rule by a hereditary nobility; I don’t want to change the government structure based off of a single example, there are also hundreds of things which can go wrong with nobility, and you can make the argument that the virtue of democracy isn’t so much that it produces great leaders, but rather that it prevents horrible leaders.

One thing I’d like to see is the ways that functional nobility work; meaning things like life peers in Britain, or senators for life in Italy, to attempt to gauge whether they have “better” records than elected representatives (although how to measure their records is an open question).

Doublefamous

Da vinci, Ben Franklin, Noam Chomsky, Marcus Aurelius, Goethe, Winston Churhill, Bertrand Russell, (insert big gap here), Bo Jackson (also, Deon Sanders, Jim Thorpe, and to a lesser extent Danny Ainge), Arnold Schwarzenegger – not to be confused with Ronald Reagan (or Al Franken, Sonny Bono, Clint Eastwood, etc), Lewis Carroll, Robert Hooke, also Rene Descart (and to a lesser extent Newton, Leibniz, Pascal and Galileo), Marcel Duchampe (although not really, I could perhaps add Garry Kasparov to this list), Bing Crosby (and also Frank Sinatra, Elvis is pushing it); but also Will Smith, Ice Cube and of course, Marky Mark; Marcus Tullius Cicero, (and also Julius Caesar), and last but not least, Thomas Jefferson (perhaps James Garfield as well?)

I’m sure I’m missing tons of people from this list, (especially since it’s very Western-Centric) although you could argue that half shouldn’t even be on it. In fact, you could that the only people who legitmately belong are Da Vinci and Ben Franklin (which is amazing to think of it!) If you’re still wondering what the hell I’m talking about, this is the list of people famous for two different things. Da Vinci was an inventor and an artist, Franklin a scientist/inventor and a statesman and an Author, etc etc. Half the list is almost silly, after all entertainers/politicians, musicians/actors and two sport athletes are all kind of beside the point; they’re all leveraging success in one endeavor to suceed in another. Having famous philosphers who were also mathematicians doesn’t sound silly, but there were so damn many of them that I almost think it is.

The point of all this is that its very rare to become great at two things; probably only a little harder than it is to become famous for one thing. (I realize I’m using two different measures here, “greatness” on the one hand and “fame” on the other, I think fame is, if not the better measure, at least the more objective one).

Does any of this mean anything? First, that it was much easier to be successful long ago; has there been any scientist in the past hundred years who have contributed to two different fields, yet it seems that hundreds of years ago if people contributed to one field of science, it was better than even that they’d contribute to another. Science (and in many ways everything else) has become more specialized; you have to spend years learning something before you’re able to contribute something novel, Newton developed Calculus when he was 24, and then continued to advance most every area where he studied.

Second, it means that success is hard work (and not just hard!). If successfully doing something was only a matter talent, it would stand to reason that, unless the talents were not at all transferable, that we would see many people famous for more than one thing; we typically don’t see that. (There are few scientists who are famous authors, except when writing about things they study). Instead, I think we can reason that success is a result not just of talent, but of hard work as well (not that this is a terribly controversial statement or anything).

Chess as life

“A bad plan is better than no plan at all”
-Emmanuel Lasker

I’ve been playing a lot of chess recently, so I thought I might write about it.

The five general principles of chess:

1: Understand the value of each piece (pawn = 1, knight/bishop = 3, rook = 5, queen = 9), and only trade a piece for an opponents piece of equal or greater value.
2: Control the center
3: In the opening, don’t move the same piece twice
4: Make sure your king is safe
5: Try not to have any unprotected pieces
One of the ways you can divided thinking in chess is between tactics and strategy. Tactics being when you calculate (if I do this, then he can do that, and I’ll have to do this…). Strategy is doing because they’re good in principle (putting a rook on an open file, even if it has no immediate benefit). One of the things I’ve been learning in chess is that good strategy leads to good tactical opportunities. Doing the right things early (developing pieces, for instance), gives more occasions when a complicated piece of calculation will significanly help you out. That is, that doing the right things at the beginning, even if it doesn’t necessarily have an immediate benefit, will give you opprotunities later on.

I won’t go into the cliche details, but I think this is the way that life primarily works. Doing things “right” leads to opportunities, sitting back and complaining that you never get opportunities doesn’t. If you value what you should value, are willing to make the right trade offs (good bishop for bad bishop), then you will slowly gain advantages.

Thee sixth rule is that you have to have a plan. The plan isn’t necessarily something that you will ever accomplish, but for any given circumstance within chess you have to have something to work towards, if not to accomplish it then to preoccupy your opponent. Same as in life, a plan may neven be realized, but in working towards something you may be able to recognize another plan or another opportunity. But again, if you don’t have a plan in the first place, you may not be able to see the new opportunity.

The last rule for chess is this, whenever the time is right, when you have an opportunity and your goal is within reach, ignore all other rules and abandon all principles to achieve checkmate. Save your money, be responsible work hard, but remember that doing those things are a means to an end. What use is it to save money except to one day spend it (whether on yourself or on somebody else)? What use is it to work hard except to accomplish something? When there is something you truly desire, whether that is social change, or a significant other, or something else, don’t let things like career, money or status stand in your way, even if they got you 90% of the way there, don’t let them hold you back when you’re about to checkmate your opponent.

Bad Arguments vs Bad Faith Arguments

There is a bit of an argument between Scott Sumner and Jason Smith, its a couple months old because I saw it and filed it away somewhere to be used later because I think it illustrates a point. The post is an argument about the sequestration and macroeconomics; read it if you want to.

I’m not really going to comment on the post itself, but on a single sentence of it, which reads “Now that Sumner is on his way to Mercatus, I can only assume it will get worse.”

Mercatus, for those of you who don’t know, is “world’s premier university source for market-oriented ideas—bridging the gap between academic ideas and real-world problems.” Its a libertarian/market oriented think tank located at George Mason University, and is funded in part by none other than the Koch brothers.

So, if I parse the argument from Jason Smith correctly, its that Scott Sumner is dishonest in his opinions, but going to the Koch funded Mercatus center will only make it worse; which on a quick read kind of makes sense, but if you examine it closely, it really doesn’t.

A bad argument is one that is wrong. If I believe that the moon is a hologram and argued so because stuff like this happens, then I would be making a bad argument. If I didn’t believe that the moon is a hologram, but argued that it was anyway, I’d be making a bad faith argument. Bad arguments can be harmful, but the problem is that its impossible to tell a bad argument from a good argument until after you’ve examined it. They’re a necessary evil, after all, many “bad” arguments can turn into good ones after years of examination.

A bad faith argument is different, and they can be more harmful. The Koch brothers, for instance, own large interests in logging companies, one can make a case that they would therefore profit from denying global warming, and that the profit motive, not their actual belief, is partially driving the debate.

Now, why might this be a bigger problem than other arguments? Countering a bad faith argument with evidence will never work, as he was is arguing in bad faith will only ever change when the underlying incentives for arguing in bad faith change (in the global warming case above, the profit motive, but there can be other causes). Whereas if people were simply arguing because of what they believe, then as soon as the weight of evidence changes, people will change their mind. (ding ding ding ding! most naive thing I’ve ever written on this blog award goes to… the previous sentence!). The one arguing badly in good faith can still present ideas which may be missed otherwise or prove a testing ground for good theories, while the arguer in bad faith will twist arguments and attempt to confuse rather than illuminate ideas.

Looking at the original statement in this lens, its pretty clear that Jason Smith is arguing that Scott Sumner will be arguing in bad faith (if he isn’t already). That because not only his opinions but also his economic well being depend on agreeing with market based though, he will compromise himself and his scholarship.

But this can’t be right; if it were it’d essentially be saying that studying with people you argee with or taking a job to advocate a position is inherently bad faith. A logical extension would mean that any environmental activist would be arguing in bad faith so long as they worked for a environmental organization, which in effect would by saying that we can’t trust the sierra club when the speak about preserving the environment, because they only care about preserving the environment. The same principle holds true for the Mercatus center, should we not trust them with regards to market based solutions, because they only care about market based solutions?

One could argue that its the Koch influence which is the problem, and that Mercatus is only a mouth-piece for Koch industries. (I doubt that it is, but at least that’s a plausible story). This may hold true for Mercatus issues in general, but not in macroeconomics. The Kochs may lose if people decide to stop cutting down trees, but nobody wins because of a recession. If the Kochs are backing Scott Sumner for their own selfish reasons, well that just means they think NGDP targeting will prevent recessions/cause growth, and if that’s true that everybody should be for it. If its false, everybody, including Koch brothers, should be against it.

Of course there are differences in opinion on controversial issues, (that’s pretty much a tautology if I’ve ever seen one), and maybe the Kochs are right about NGDP targeting (or maybe they just fell that the Mercatus center is doing good work in general and are happy to help fund it), maybe they’re wrong. But regardless, so long as neither they nor Dr. Sumner are arguing because of a hidden incentive then they’re simply part of the debate. We can’t commit to evaluating only good arguments, because we can’t tell if an argument is good or not until after we evaluate it.

Paul vs the World

What then shall we say? That the law is sin? By no means! Yet if it had not been for the law, I would not have known sin. For I would not have known what it is to covet if the law had not said, “You shall not covet.” But sin,seizing an opportunity through the commandment, produced in me all kinds of covetousness. For apart from the law, sin lies dead. I was once alive apart from the law, but when the commandment came, sin came alive and I died.10 The very commandment that promised life proved to be death to me. 11 For sin, seizing an opportunity through the commandment, deceived me and through it killed me.

I’ve heard a few explanations for this passage. The first and most obvious is that the law creates in us rebellion, we want something simply because we are forbidden it. This does relate, but I think that Paul is talking about something different as well.

When we examine the law, certainly the law as Paul the Pharisee would have observed it was horribly hard to follow. Look at how much of first few books of the Bible are laws; laws which are expected to be followed. Yet how much harder is it for us Christians, who commit murder whenever we are angry, and adultery whenever we are lustful.

What was Paul’s sin? Well, for starters he was a murderer; executing those he believed to be heretics and blasphemers. What led him to this? Adherence to the law. He identified worth as following the law, and those he felt broke it (namely Christians) were worthy of death.
We look to the law for morality, look to achieve goodness by following code; and we fail. We then look to justify ourselves, to prove that our failures do not make us worthless. So we look around, and see the sins of others. We see other failing, putting themselves ahead of others, being thoughtless and careless and oh so unholy. And then we try to justify ourselves by comparing ourselves to others, by judging them, and by deciding that their sins are the truly bad ones while ours are merely minor indiscretions. We look to other’s sins, and decide we are holy not just because we don’t commit them, but because we are actively working protesting those sins. This leads us nowhere though, we are still surrounded and convicted by our own sin; the more we become obsessed with sin, the more we become aware of it and the more we need to justify ourselves by comparing ourselves to others.

I can summarize this in one sentence; Paul made an idol of the law. He didn’t seek to follow the law, he sought to worship it. In worshiping the law instead of the law-giver, he perverted the law. Its not so much that he broke the law as that he broke himself upon the law.

Looking to ourselves to fulfill the law is a losing battle, in best case scenario we give up and live with imperfection. In worse case scenario, we become monstrously evil, picketing funerals with “God Hates Fags” signs.

I wrote a while ago about sin from Heaven’s perspective. Consider this essay sin from Earth’s perspective, attempting to avoid sin leads us to become sinful, hating sin leads us to hate and eventually destroy ourselves.  Our world cannot handle sin, it corrodes in the worst way; both embracing sin and struggling against it lead to the same place, becoming hateful, hurtful and demonic.  As great as the evils committed by those who seek only to enrich themselves, aren’t the evils much worse of those trying to fix the world?   The very nature of socialism is to fix some evil in the world, to provide for the poor and to ensure equality among all.  Yet look at the monstrous ways this can be enacted: decimation of political oppositions, gulags, the Stasi, re-education, the millions dead in the Great Leap Forward.  Look at the evil committed in the name of God: the Crusades, the treatment of homosexuals, even Paul’s aforementioned .  Look at the Crucifixion, it wasn’t the Romans who wanted Jesus dead, it was the Sanhedrin.  I could go on and on about the truly evil people in the world thinking they were good.

This is why we need Jesus; we are sinners.  The more we struggle against sin, the more it ensnares us.  But in embracing Jesus, in looking to Him to fix us, in praying that God should replace our sinful nature with a better nature, we can win against sin, we can become a reflection of God’s perfection.  Not a projection, but a foreshadowing of the Kingdom of Heaven.  When we embrace Jesus, we look to work not just for God, but with God, and we learn to imitate Jesus.

Jesus did, on occasion, get angry and started flipping over tables, for there are times we should be angry.  But for the most part, Jesus was meek.  Surely in dying on the cross he was the master of practicing what he preached, turning the other cheek times 1000.  Paul asks the Church at Corinth, why not rather be wronged?  Surely, nobody has ever been a better follower of that passage than Jesus, wronged not just by Pilate and Herod and Judas but by Peter who denied him and by James and John who were not even able to stay awake for him; yet instead of destroying those who crucified him, he asked that the “Father, forgive them, for they do not know what they are doing.”  This is not just our model, it is our method as well, God will not just forgive our sins, he will help us overcome them as well.

Why I’m not a Keynesian

After world war II, the decline in government spending was enormous. Government spending as a percent of GDP went from over 45% to around 15%, which threw the US into a terrible recession, where GDP fell by over 12% in 8 short months. To put this in perspective, the “Great Recession” which lasted from 2007 to 2009, and which was the second worse recessions in the drop of GDP since WWII, only saw GDP decline by 4.3%.

This recession saw unemployment skyrocket to 5.2%. The average person was hurt by this, in 1946, while the GDP in 1946 fell by 11.6%, personal consumption grew by a paltry 12.4%, to put that in perspective it was the 85th worse year since 1930 (source: http://www.bea.gov//national/nipaweb/DownSS2.asp).

So what actually happened? We see that the decline in government defense spending after World War II caused the measured GDP to fall a lot, but what this meant is that the government stopped building tanks, aircraft carriers, rifles and ammunition. This meant that the US “produced” a lot less in 1946 than it did in 1945 or 1944, but that production was for military purposes only. While this created a recession, it was a recession on paper only. If you haven’t noticed, that 85th worse year for personal consumption growth? Out of a period of 85 years, (ie, the best).

The decline in one sector of GDP (government spending) was great enough to cause GDP to significantly retract (worse year for GDP since the great depression), but it did not make other sectors of GDP fall. In fact, not only did personal consumption have its best year eve (or since 1930 when the BEA statistics start), so did Gross Private Domestic Investment (same source as above). Unemployment did increase, but not to a very high level (we’ve seen a steady fall in unemployment for 6 years, but we’re still above the 5.2% immediate post war peak). Basically, the idea that the end of the war would throw the US back into depression was wrong, the only fall in GDP was only a reduction in anti-Nazi spending. Its a bit like saying that the best measure of a person’s economic well being is his consumption spending. And that in year 2, when he was healthy, he spent significantly less than in year 1, when he was fighting cancer. It was good that he was able to spend money fighting cancer in year 1 no doubt, but it was better that he didn’t have cancer in year 2.

If we’re to tell the story more, the drop in government defense spending allowed resources to be dedicated to other areas, such as business investment, new home construction, and creation of consumer goods. But this this the opposite of what is supposed to happen according to Keynesian economics. The fall in government spending is supposed to depress incomes in general, as all the soldiers return home and the tank builders are laid off, the total demand for goods and services wil fall, causing GDP to fall, not just in terms of fewer tanks and rifles, but everything else as well. This didn’t happen.

Now, this may not be the best case. You can argue that the proper Keynesian government level was still much lower in the war than actual government spending, or that the special circumstances dominate in immediate aftermath of the war.

More recently, we saw two major changes in government spending in the past 8 years. The first was the stimulus bill of 2009, which was supposed to jolt us to recovery and keep unemployment below 8%. The second was the sequestration, which, due to the Republican preference for lower government spending and political fighting about the debt limit, caused government spending to be reduced (and taxes to raise, both of which are considered anti-stimulative effects by Keynesians). Let’s look at how this effected the economy:

GDP Growth 2009 to present

Unemployment 2009 to present

It looks to me like government spending had little to no effect on GDP growth, and unemployment looks totally unaffected. It went up during the recession and a little bit afterwards, and has fallen consistently since, regardless of what the government tries to do.

This is my biggest complaint against Keynesian economics, or I guess fiscal stimulus to be specific. We had an $831 billion government program, and nothing to show for it. The Keynesian economist can make the case that things would have been worse without the stimulus or better without the sequester, that’s certainly a possibility and I don’t want to dismiss it. But I do think that the burden of proof should be on the people proposing trillion dollar expenditures. And I don’t think that the burden of proof was at all met. This is the strongest case I have against fiscal stimuli, they have enormous costs and very unclear benefits.

None of this is a counter to the idea that we shouldn’t have government spending.  There are many great things that government has provided, including roads, schools, police.  To return to the World War II example, we basically prevented a madman from conquering the world, which is a worthy a goal as there can be.  But what I am arguing against is the idea that government spending by itself typically stimulates the economy; the idea that we’re better off having the government hire people to do useless things.

There may be instances when this is true, that simply borrowing and spending money by the government can counteract a bad economic environment.  But as of right now, I’m convinced that it’s probably not true generally (ie, that any bad economic environment can be improved by the government spending more money), and that we can’t distinguish the instances where government spending helps from when it hurts or has minimal effect.

Insider Trading is Stealing

Over at econlib, Charles Hooper argues that insider trading doesn’t really hurt anyone. Insider trading instead is a victimless crime, and is in fact beneficial.

His argument goes like the following:

In the market for any given stock, there are “uninformed buyers” and “uniformed sellers.” That is, people who buy and sell stock but without inside information. In his example he uses the case of something very good happening to a company soon. The number of uninformed buyers (or technically the shares which uniformed buyers buy) will equal the number of uniformed sellers (with the same technicality).

The uniformed seller is hurt because he does not reap the rewards of the good news, but remember this is before any insider trading occurs, so it can’t be said he is hurt by insider trading.

Then, and insider comes along, buys a number of shares, and profits from the good news, making a large sum of money after the news is made public. Mr. Hooper asks who is hurt from this? Certainly not the uniformed seller, because he was going to sell anyway. The person most hurt is the uniformed buyer, who loses on the opportunity. Yet the uniformed buyer has no real claim to the potential benefits, after all, the buyers can’t complain that the “Insider snatched Uninformed Buyer’s dumb-luck windfall”.

There is one fatal flaw in the argument: Mr. Hooper seems to believe that any increase in the number of buyers will be offset by an equal decrease in buyers. But there are two ways that an increase in buys can effect the market, it can “crowd out” other buyers, or it can cause more people to sell, most likely some mix of the two. For various reasons, I think that the effect would be more sellers rather than fewer other buyers, but all we need to establish is that some of the effect of buying shares is encouraging others to sell them.

Now, we see the problem. The insider, an employee and agent of the shareholder, is transacting with the shareholder, using the knowledge that they gained only through being an employee against the shareholder. That is simply wrong.

Let’s clarify with an example: lets say that three friends pool their money to form an oil exploration company, hoping to find the next big well. One of them runs the company (being an engineer and all), and gets paid a salary, but the three friends split all profits evenly. They go a long time without finding any oil, and all three are discouraged. Then, one day, it becomes very evident that they are about to strike oil; but only to the one running the company. Instead of telling his co-investors about it, he instead offers to buy up their shares.

We can argue about ethics and why this is or isn’t ethical; but those discussions go nowhere. Instead, lets talk about economics. Each outside investor knows that, whenever they transact with insider, they can expect to lose. If they sell their shares to the insider, well they can bet that they’re on the verge of hitting oil. And if the insider offers to sell his shares, then they can be certain that the wells are dry (or that the expected find won’t pan out). Basically, the outsiders have one rule if they don’t want to get screwed: never transact with the insider. This of course hurts the insider, why shouldn’t he be allowed to sell to his co-investors if he needs the money, or buy if he has a windfall he wants to invest? In fact, we can see that the insider is worse off in this example than the outsiders (assuming they have jobs which pay the same), they can transact with each other (buying to invest, selling shares in order to consume), assuming their counterpart wants to do the opposite. But the insider can never transact, nobody will every buy from him or sell to him.

How do we fix this? Simple, make it a law that says that the insider can’t transact based on knowledge that he has that the outsiders don’t; the outsiders will now be willing to sell, knowing that they are protected if the insider has material nonpublic information. Thus, the insider now has the same privileges as the outsiders, and (in our simplified example), everybody is better off (they all have more potential trading partners) and nobody is worse off – clearly a pareto improvement.

But lets imagine a twist to the scenario. Instead of buying the shares directly from the outsiders, the insider sets up a shell company to purchase the shares from the outsiders, the outsiders have no way of knowing that the company is really owned by the insider. Is this ethical? I certainly don’t think so, all the shareholders put their trust in the insider that he would act in their best interests; keeping all potential upside is certainly not within their interests.

Lets use a third example. Same company, same three friends. They strike oil in a well which is expected to produce 100 barrels a day. Instead, it produces 120 barrels a day. The insider decides to take the extra 20 barrels and sell them himself (whether he does this buy selling them through the company and then embezzling the money or physically diverting the 20 barrels a day is unimportant). Is this action ethical? No – it is stealing. But it’s really the same action as above – using insider information (in this case the number of barrels being produced) in a manner against the best interests of the shareholder. How is this any different from insider trading – finding the extra 20 barrels a day, and then offering a price to the other shareholders based off of 100 barrels a day. In fact, it can be shown that the economic impact is exactly the same- the outsiders get the net present value of the sale of 100 bpd split evenly while the insider gets the net present value of the 20 bpd entirely to himself.

Now, you may argue that this doesn’t apply to the situation of the market as a whole; after all transactions on the stock market are much more anonymous. But this doesn’t make it better, it makes it worse. There is (typically) no way of knowing who you are buying shares from; so the insider who buys shares using material nonpublic information would be as if the insider in our above example set up a shell company to buy shares from the other investors. They would sell without ever even knowing that they were selling to the business partner. I can’t see how any of this is ethical, it is currently illegal and should remain so.

Keeping up With the Carcosians

Things used to be so much better, right? Whether its movies, or music, or books, all the good pieces of art have already been created, and we’re left with the bottom of the barrel.

Is this really true though? Movies are a non-starter, they have declined in quality in all levels except the number of explosions or some such nonsense. Music is an interesting question, which I may tackle at some point; I would say yes music has declined, but a: it’s arguable, and b: I’m not versed enough to really comment. Books and visual arts I’ll ignore. Video games are so new that its not really an interesting question – do we really want to compare video games of today to video games of 1990?

That leaves TV. Has TV declined in quality? I think the answer is absolutely, probably more than even movies. So called “reality” programs have taken over every channel, what started as an interesting idea (MTVs the real world), has moved into competitions which could be interesting (Survivor), now it is only talent shows (the cream of the crop, btw), way past their prime contest shows (I had to check, but apparently Big Brother is still on!), staged TV shows featuring some obscure occupation (Storage Wars, Pawn Stars), a whole genre of television which seems to do nothing but exploit rednecks (albeit with their enthusiastic consent), (Duck Dynasty, Swamp Loggers, Axe Men), and worst of all, celebrity worship of the worst kind of people who I can’t really figure out how they became celebrities in the first place (anything with the word Kardashian in the title). That is the majority of TV, and I think it is borderline frightful. Sitcoms are largely horribly stale, doubly so for network dramas, which seem to consist entirely of crime procedurals (CBS currently has CSI, NCIS, NCIS: Los Angeles, and NCIS: New Orleans, not to mention Criminal Minds (a procedural with a slightly different twist!) and Blue Bloods (although to be fair, I can’t really comment on Blue Bloods because I’ve only seen part of it while doing laundry once).

Of course, you protest now. What about Mad Men? Breaking Bad? True Detective? Other new show?

IMDB ranks tv shows by voting, and while I’m hesitant to give those rankings too much credence, you have to get all the way to number 19 before you get an American TV show that wasn’t made primarily in the 2000s. Just about any list of great tv dramas will be dominated by those TV shows which have come out on cable, within the past 15 years, which are serial in nature (so you are expected to watch all episodes in sequence), and which don’t typically have to conform to censors or worry about network reputations. (Of course, not all lists agree. Some lists recognize that perfection in TV was only reached by Season 2 of Murphy Brown)

To answer the question of whether TV has gotten better or worse, we really have to define the question. Has the average TV show gotten better? Have the best TV shows gotten better? Has the average TV show, when adjusted for ratings (ie, the average TV show that people watch), gotten better?

Two things stand out to me in regards to this, the first is that the cause of the greatness is the same cause of the mediocrity. We now have hundreds of choices in entertainment at any given time (during classic TV, the option was 3 to entertain and 1 to educate). Networks had to target the average viewer because specialist programs just wouldn’t work, you couldn’t afford to waste a valuable time slot on something that wasn’t proven, and you couldn’t risk making a show which 10% of everyone thought was great, but 90% of everyone would find offensive.

That changed, now instead of the making tv shows for average viewer, TV shows are nothing but specialist programs. With fifty channels, if you have something that 5% of everyone likes, then you’ve got a chance at winning the time slot; at least in cable anyway. This fragmentation leads to what the cultural critics call “appealing to the lowest common denominator,” although what it really means is that every network is going to be making trash. It means that a cable network can make a show entirely about the Kardashians and it will find an audience, if most people are disgusted by it, who cares?

But it also means that the same system which can afford to produce TV shows that you don’t need a brain to enjoy can also make TV shows which are challenging, complex and engrossing. They can make the TV show which gets weird or maybe just violent. The release from the control of the big three networks has made TV more diverse, dumber on average but more intelligent at its peak.

One other thing to note is that there is a similarity between all the great shows which have come out of cable in the past 15 years, and that is they are almost entirely dramas. While there have been some comedies which people love recently, (30 Rock, Parks and Rec, Arrested Development, The Office), I think the pale when compared to the number and quality of dramas. If you ask people what the best TV drama of all time is, my guess is you’ll get a lot of Sopranos, Breaking Bad, The Wire, and Mad Men (not coincidentally, I wrote up that list, then decided to Google it to at least get somebody else’s opinion on it. The first link I clicked, here:  (and the first hit on Google), had those as the top four). You won’t get too many people saying that Hill Street Blues or ER.

If you go the other way, and ask what the best TV comedy of all time was, my gut feeling is that you’ll get a lot of people saying I Love Lucy, All in the Family, M*A*S*H, Cheers, The Cosby Show, Seinfeld, and Friends. First, we should questions whether my statement is true, you can argue that the office, Curb Your Enthusiasm, Arrested Development, 30 Rock etc are funnier than anything that has come before them. Comedy is more subjective than drama though, what one person finds hilarious is what another finds merely amusing and while these may be the funniest shows on now (or recently), they’re not the most popular. Two and a Half Men and the Big Bang Theory are the most popular sitcoms, and as far as I know they’re not terribly well liked by the critics. Seinfeld was not only the funniest show of its time, but the most popular comedy as well. Same with Cheers and I Love Lucy.

I think a big reason we don’t have the funny, popular sitcom is that humor is, much more than drama, a social reaction. We not only like to watch comedies, but we like to watch them with other people. Drama takes us to a place we’d never experience; a whether it’s a meth lab in New Mexico or Carcosa, comedy takes us to a place we’re totally familiar with – a parking garage or a Chinese restaurant. To be dramatic, you must be unusual, to be funny, universal. Becoming more splintered as a society we don’t have that common connection anymore, or at the very least the artists of today can’t exploit the fragmenting of cable TV to create a comedy which reaches everyone. That is why we seem to be getting more and better dramas while comedies seem to be moving along at a much slower pace.

Snowflakes

You are one in a million. A precious snowflake, and you’re totally unique.

What was your reaction to those statements? My guess is that you may think it is hackneyed, untrue and ridiculous. You aren’t unique, there are tons and tons of people just like you. Lets find out exactly how many.

First, lets define a few characteristics here.

1: Gender
2: Race
3: Age Group

For gender, there are two possibilities, for race, lets say 3 (White, Black, Asian) (you could argue a lot about the appropriate number), for age group, lets say six groups (preteen, teen, young adult, adult, middle age, elderly). We could expand further downward (infant, toddler, etc), but you aren’t one of those because you can read.

So as of right now, there are 36 different possible readers taking only 3 characteristics (which of course aren’t the full dimension).

Lets keep adding some values:

4: Political affiliation (3 possibilities liberal, conservative, libertarian)
5: Religion (we’ll go with 6 common possibilities, Christian, Muslim, Jewish, Hindu, Buddhist, Atheist)
6: Nationality (google say 196, but we can differ)
7: Occupational sector (I could argue a lot about these and it depends on how you define these, but lets say 20 different employment sectors)

So now, based on these 4 new characteristics, we have 3*6*196*20, or 70,560, times 36 (from our first three), which gives up 2,540,160.

But we’re not anywhere near done. For fun, lets add the Myers Brigs Categories

8-11 Myers Brigs (Extroverted/Introverted, thinking/feeling, judging/perceiving, sensing/intuiting, or 16 total)

Lets add some more random items:

12: Are you a traditionalist or a trailblazer? (2)
13: Are you high strung or chilled out. (2)
14: Are you career oriented, family oriented, friend oriented, or community oriented (4)
15: Do you get your way or get along? (2)

Ok, lets go back to some more traditional measures:

16: Sexual Orientation (2)
17: Education Level (we’ll say 5, did not finish high school, high school only, some college, college degree, graduate degree)

Ok, now we’ve got 16x2x2x4x2x2x5 which is 5,120. Multiply this by our number above and we get 13,005,619,200. With only 17 criteria, we now define more types of people than there are people in the whole world. So if you’re a young adult white male conservative Christian American financial services professional who is an INTJ, a traditionalist, a high strung community oriented get-along straight college graduate, you can say that you are unique. Actually you can’t, because that’s who I am.

Now, there’s two major complaints I anticipate. The first is that my categories above weren’t fair because your religion/race/whatever wasn’t on there. Well, that just means you are even more unique than above, you truly are special.

The second, and much more relevant piece, is that many of the above are correlated with one another. Take me, for instance, a straight white christian male. All of those are somewhat to heavily correlated with being conservative, which, no surprise, I am (kind of). Which means that, although there are in fact more categories than there are people to fill them, people aren’t randomly assigned, and its very likely that there a bunch of categories with more than one person in them, some of them probably numerous (perhaps mine has a quite a few). But it isn’t many; lets go by my example again.

First, lets start off with Americans, which we’ll say there are 300 million of.
Half are men, which gets down to 150 million.
My age group has 20.3% of the population (I’m defining young adult as 20 – 34), that’s 30.45 million people.
We’ll save 78.5% are christian, of which half are conservative (total of 39.25%). Brings us to 11.95 million.

4% of people work in financial services, and we’ll say that all of them have at least an associates degree. According to wikipedia, 41.89 % of the population had a associates or bachelors degree and 11.77% had advanced degrees. We’ll assume that the ratio of advanced to non advanced degree holders is the same in the financial services industry as it is outside of it, which means that 2.88% of people in the US are financial services professionals without an advanced degree. This now brings us to 344,160 people are like me, in the first 6 categories.

According to google, INTJs are 2% of the population, but more common in men, (of which I am), and we’ll say that in other various ways I’m more correlated with the value, so to pick a number we’ll say 8% of people with the above characteristics are INTJs.

Of these, lets say 80% are traditionalist, 70% are high strung, 40% are community oriented, 75% get along and they’re all straight.

Which means that, in my bucket, there are perhaps 4,625 people. Which may be a lot, but its not too many. I’m sure there are bigger buckets, something with Indian Hindu working in agriculture probably has many more, but again, we’re only talking about 17 different characteristics. I haven’t mentioned whether you like history, whether you are a poet, if you play an instrument, if you prefer the country to the city, the mountains to the beach, the summer to the winter, whether you run, bike, play a team sport. If you like science fiction, if you watch reality TV, if you are in to fashion, or follow sports. If you do drugs, drink alcohol. If you’re in a weird subculture.

All of these are important things, things which matter, which help describe who a person is. And I haven’t even mentioned whether you’re married or have kids yet.

Combine all of these, and while I suppose its still possible there are “Buckets” which might have more than one person in them, I imagine that, just within these characteristics, the vast majority of humanity has a bucket entirely to themselves. And I can go on regarding these characteristics, I’m sure I can name another 20 or 30 categories easily, and there are numerous subcategories within these groupings.

So what is the point? First of all, yes, you truly are unique, there is only one you, and we’ve just proved it, with math.

Sometimes, we compare things to other things. Just the other day, I contrasted the US political climate to the number of original movies coming out. That was a comparison I made, because of my outlook and experience. There are comparisons, accomplishments and insights that only you can make. You are special, and I mean that in the best possible way.

Are ghosts real?

We all have guilty pleasures, mine is paranormal activity. Not the movie series (I’ve never seen any but have heard they are horrible), but just the concept that bigfoot or ghosts or aliens are real.

Three reasons bigfoot isn’t real:

1: If he were real we would have hard evidence: remains, a captured creature, or unmistakable photographic evidence. We have little “good” photographic evidence.

2: Sightings correlate with interest over time. We’ve had few sightings before 1958, suddenly he appears not only in the Pacific Northwest but across the country, as far east as Maine and as far south as Florida. Basically, we’re to believe that he hasn’t appeared in the US at all, until he becomes culturally important, then he is suddenly ubiquitous.

3: The more likely one is to believe in Bigfoot, the more likely one is to find evidence of him. The most famous piece of evidence is the Patterson Gilmlin film (you almost certainly know what it is, but if you need a refresher, click here). Why were the people in the area? They were filming a fictional movie about bigfoot. There have been who knows how many movies filmed in California, thousands of people in the Californian mountains and woods, and the single best piece of evidence happens to be created from people already connected to bigfoot? It seems like a very unlikely coincidence.

There is one reason, however, to put some stock in the bigfoot legend. Take a look at this map:

Bigfoot_Sightings_in_USA

(map by wikipedia User:Fiziker)

Bigfoot sightings seem to follow a general rule: the more people in a state, the more people who see Bigfoot. (New York doesn’t follow this rule, but this makes sense, most people in New York are in a single very urban metropolitan area). Almost everything on this map can be explained by a simple rule: when people are in rural areas, they see a bigfoot with some constant probability. That probability should depend greatly on not just the number of people in an area, but in the number of bigfoot as well, and it doesn’t seem to. There are few to no patterns with regard to geography within this map.

Except one. Washington has more than any other state, and Oregon has a disproportional number of sightings. Why is this? Is it some cultural reason, are people expected to see bigfoot more in those states? Are people more likely to perpetuate hoaxes in Washington and Oregon?

I think that either of those explanations is a better one than that Bigfoot actually exists, but I must admit that it does influence my belief somewhat (perhaps from a 0.2% to a 0.3% chance that bigfoot exists), there does seem to be some geographic pattern that bigfoot follows.

Regardless of all this, bigfoot isn’t a big deal. If somebody were to discover a bigfoot next year, it’d be a big story, then life would go on as normal. If bigfoot were to exist, it wouldn’t really affect our lives or our concept of our world at all. There are other such “cryptids” which are similar, the yeti, the skunk fox, ogopogo, etc. I doubt any of them exist, but they wouldn’t be a big deal.

Ghosts are another matter. If we ever determine that ghosts actually exist, many people will have to re-examine their entire worldview. Suddenly, physics will either have to deal with the fact that we have souls or that there is something really weird going on with ghosts.

If you were to ask anyone why they don’t believe in ghosts, the answer would probably be something like why hasn’t anyone seen them. But thousands, perhaps millions of people have seen ghosts. Well, why aren’t there any photographs of ghosts? But there are hundreds of photographs of ghosts. Don’t believe me, do a quick google search for ghost photograph, and see them.

But are they real? Is it possible that every single person who attributes something to ghosts is wrong about it? Yes, it is possible. Is it possible that every single photograph and video which has a ghost is some form of a hoax, optical illusion, or other mistake? Again, it is possible, people make mistakes about things all the time. We see faces all the time where they shouldn’t be.

So should we believe in ghosts? Quite frankly, I have idea. The amount of ghostly evidence seems to about fit the pattern of people frequently mis-attributing things to ghosts and sometimes making things up. But I have no idea what the evidence level of “ghosts are real” would look like.

Lets put ghosts in perspective by talking about bigfoot. If bigfoot was real, there’d probably need to be at least 2,000 of them to form a stable breeding population. If the population was spread out over the state of Washington, (area of about 70,000 square miles), and we were to monitor 5,000 sites throughout Washington (either through game photographs or people with cellphone cameras or the like), each of which covers a half acre. Finally, each bigfoot stays in a viewing site for 6 hours, then is randomly transported to another viewing site. This is an admittedly weird scenario, but it gives us something to go by; some assumptions are simplifications to be sure (bigfoot probably aren’t teleporting), but they go in both directions (a half acre may be too big, but six hours may be way too long.  Also, there are areas of Washington we shouldn’t expect Bigfoot to live, such as Seattle).  Anyway, lets see what happens when we run the numbers:

This boils down pretty quickly to a randomly drawn ball problem. If there are 91 million balls in an urn and 2,000 of them are red, the chances of drawing a red ball are only .00219%. Which means that there is a 99.99781% chance that, at any given time, you will draw a non red ball. The chances that you draw a red ball in either of two draws is the probability that you don’t draw a red ball in the first times the probability you don’t draw one in the second. To simplify, we can reduce the probability of drawing a red ball on any number of draws by using the formula x = 1- P^N, where x is the probability of not drawing a red ball in N draws, and P is the probability if not drawing a red ball in one draw.

We can use our example and ask a new question, how many draws would we need to make before we had a 50% chance of drawing a red ball? We can use a simple formula, .5 = .9999781^N. Or, to make it simpler,N = Log(base .9999781) of .5, which means N is 31,656.85. So to get better than even odds of drawing a red ball, we would on average draw 31 thousand balls.

Lets apply this to bigfoot. If there are 2,000 bigfeet in Washington, and we have a viewing sites of a half acre each, that means we would have to make 31 thousand observations before we expect to see one. Which, with 5,000 viewing sites, each observation taking 6 hours, would take us all of 36 hours. A day and a half to find bigfoot, given our parameters. Which means we should be seeing many many many more bigfoot sightings than we do right now; about 120 per year, not 593 all time. Now you can argue about my numbers, but that’s not the point. The point is we can have some sort of baseline, we can make assumptions to create some sort of a test, if bigfoot is real, how often should we see him. We can then get an estimate and compare it what we actually see, and see if it matches our theory.

I don’t think we can do that with ghosts. If ghosts are real, how common are they? I have no idea. If they exist, what are the chances that we see them in any given time period? Again, I have no idea, it matters a lot if they are supposed to come out once per day or once per year. Are they permanent or do they eventually dissipate (or cross over or whatever). I have no idea what the answer to any of these questions would be.

I’m not trying to argue that ghosts somehow exist – I am saying that i don’t even know how to determine if they are.

Perhaps the wisest thing I’ve ever heard in terms of epistemology is this: that true things become more obvious the more they are studied. I think that’s the only thing I can really say about ghosts, that they’ve been studied a lot, but we aren’t more sure of them now than we were 20 years ago. Perhaps that’s something, but its hollow to me, a non answer. Sure, I can say that I don’t believe that ghosts definitely do exist, but I have a very hard time understanding why I should have a strong belief that ghosts don’t exist.