Friday, October 31, 2008

Ha, I'm not the only one who doesn't believe in voting

From the current issue of The Economist's Voice

As the election approaches, please
remember to be kind to any economist
you know. Economists feel
on election day a little like Jews
feel on Christmas. Participating
makes them feel like a traitor to their kind but
boycotting the extravaganza makes them feel
estranged from the rest of society.
Like everyone, economists have a choice on
election day, but to an economist neither option
seems good. We don’t mean the choice of voting
for a Republican or a Democrat. We mean
the choice of whether to vote.
An economist who votes commits an irrational
act, and to an economist irrationality is
a sin. Why bother spending half an hour or
more going to the polls and waiting in line
when the chance is infinitesimal that your vote
will affect the outcome?
Yet, what is the other choice? Not voting.
But, an economist who doesn’t vote must
squirm when others ask that day: “Have you
voted yet?” Any explanation about the irrationality
of voting will be scorned.
There is no winning for an economist on
election day (unless he or she is running for office,
and probably even then).

Thursday, October 30, 2008

More evidence that Gore = Bush

I have long noted here that people commit the fundamental attribution error when evaluating the Bush administration. Over attribute outcomes to disposition, and not accounting for situation. Most say that had Gore won, he would not have reacted the same way to 9/11 (though his VP, the wife of the president he served under, and that president's British doppleganger were all strong supporters of the war in Iraq).

In a recent economist book review, they find the following Al Gore quote:
IN 1993, Bill Clinton was pondering whether to authorise what is now called an “extraordinary rendition”, when American agents snatch a suspected terrorist abroad and deliver him to interrogators in a third country. The White House counsel warned that this would be illegal. President Clinton was in two minds until Al Gore walked in, laughed and said: “That’s a no-brainer. Of course it’s a violation of international law, that’s why it’s a covert action. The guy is a terrorist. Go grab his ass.”

Tuesday, October 28, 2008

Obama is one of "us" and indeed "we" are not "real" and "we" are not "pro-American"

A problem I’ve had with this election is that I actually identify with Obama quite a bit. But as I’ve elaborated on at length in this blog that doesn’t mean I’d vote for him (e.g. because I dislike many of his supporters, because I dislike the policy of the median Congressional Democrat).

The media has recently taken a lot of umbrage at the suggestion by the McCain campaign that Obama is not “pro-American” and that he is out of touch with “real” America (e.g. Time magazine). But I think those accusations are fair.

First of all, by “us” I am talking about well-off highly educated coastal elites. Although Obama often evokes the language of unity, when talking about tax policy Obama talks about people like “us“ meaning Obama and McCain and other well off elites, which implicitly creates the “other” of people not like “us."

Pundits are happily making the point that the real “Joe the Plumber” makes well less than $250,000 a year, but the point of the McCain campaign is that that doesn’t matter. Because in his world view Joe and McCain are part of the same “us.”

But Obama’s “us” is different. Saying that we are anti-American is too far, but that’s not what the McCain campaign’s been saying. The most extreme way to see this is the number of my friends who (jokingly, but still) threaten to move to Canada. Or, I bet if you poll my friends and ask them if they had to choose between wearing a Canadian flag or an American flag on their bag while traveling, I bet nearly all would choose Canadian. I bet most people in the pro-American states that Palin is talking about would never do that (admittedly, I’m not sure what I’d pick, but probably I’d still put an American flag). It’s not a bad thing to not be “pro American.” It represents a different cosmopolitan ecumenical humanist world view that I like. But it is different.

This is an old notion of course, the different ways of defining identity. Democrats try to create identity along economic divisions, whereas Republicans do so along social divisions.

Sunday, October 26, 2008

I might support Obama but will never be an “Obama supporter”

There are various reasons to describe how people vote given in the political economy literature. A few are:
  1. You vote for who you think will be best for you.
  2. You vote for who you think will be best for the country.
  3. You vote for symbolic or expressive purposes.
  4. You vote for who you think is going to win.
  5. You vote for the candidate you identify with.
  6. You vote to be affiliated with others who vote for that person.
I’ve already said in this blog that I am largely indifferent between Obama and McCain on the first two points. Points 3 and 4 and 5 are pushing me toward Obama. It would be cool to vote for the first black president (as a fellow political economic thinking friend of mine who is similarly indifferent to voting pointed out), and I have long identified with Obama’s post-partisan rhetoric (though he basically abandons bipartisanship whenever it is expedient, which is basically always).

My problem, is point 6, which is actually the point I focus on in my current research. And on this point, I really really don’t want be associated with Obama supporters. And that is making me not want to vote for Obama. A recent New York Times column is a case in point which has the audacity to blame Republicans alone for being condescending and derisive. They probably are, but I’m rarely exposed to Republicans, or Republican media, so that doesn’t bother me as much. But I’m constantly exposed to the condescension and derision of “Obama supporters” and liberal newspapers (as measured by Groseclose and Milyo) who think that McCain supporters “cling to their guns and religion” or that Palin supporters are “frightening” and “delusional” and don’t give voters in Alaska any credit for overwhelmingly voting her into office, and assume that mistakes she gives during interviews are signs of incompetence, whereas the numerous mistakes and fabrications that Joe Biden makes are merely signs of eccentricity.

I agree that Palin is really bad at handling herself on the national stage. Unlike Obama, she hasn’t had 4 years doing nothing else but campaigning for president. But that doesn’t make her incompetent, and doesn’t make her unfit. Bloomberg gave probably the worst speech I ever heard for his inaugural but has proven to be a very well respected mayor. It’s fine to disagree with Palin’s policies, and it’s fine to disagree with her view on the world, but please, as Obama would advocate, do so with respect.

Another reason to ignore the Issues when picking president

Pretty much exactly 4 years ago, days before the election, I argued in my Stanford Daily column that Americans (myself included) are too stupid/ignorant to pick the President. That really understanding the correct policies a president should take, requires years of study, that people don't really take the time for, but shouldn't, given that in an economy where people specialize, it doesn't make sense for everybody to be a policy wonk.

That is why I advocated basing decisions on character rather than the "issues" journalists and pundits are always blathering on about.

Another reason issues don't matter, is that whatever issues Presidents promise is rarely what they deliver (usually because circumstances change). Bush ran on a campaign for a humble foreign policy and against nation-building, though 9/11 forced him to change all that.

Kinsley, in Time magazine this week made the point "Even more miraculous (though troublesome for democracy), both Lincoln and F.D.R. were elected by promising more or less the opposite of what they did in office. Lincoln said he'd preserve the institution of slavery. F.D.R. said he'd balance the federal budget."

Thus when the fact checkers all bristled and got all indignant at McCain's accusation that Obama would raise taxes, even though Obama's "plan" said he wouldn't. I think pish posh. Since when do campaign promises have any bite. McCain's point that Congress will likely push for higher taxes, and Obama will be more likely to accede is perfectly valid.

Thursday, October 23, 2008

A Kristof column I agree with?!

I had this discussion with myself some time last year, even before Obama won the primaries. Obama would have a huge effect on world perception of the US. As a semi old-school Marx style materialist/realist, I am not convinced that perception matters, but it is still nice when it shifts to what I think is a more accurate image of America.

A friend of mine said recently, it'd be nice to tell your grand kids, that you voted for the first Black US President. But otherwise, he like me is still mostly unmotivated to vote.

I also decided, when I had this thought some time last year, the same sentiment Kristof ends with: "Look, Mr. Obama’s skin color is a bad reason to vote for him or against him."

That logic takes away the main reason I have for voting for Obama. So I am still largely indifferent.

(Amusingly, in Kristof's list of countries led by minority presidents, he left out Peru's Fujimori, perhaps because Fujimori fled in ignominy.)

Wednesday, October 22, 2008

Even a Stopped Clock is Nouriel Roubini

I’m a little bugged by all the attention and credit Nouriel Roubini has been getting for predicting the crash. I normally like contrarians, but I’m also generally an optimist, and pessimistic Bears bug me. I was always annoyed by the credit the Morgan Stanley economist, Stephen Roach, got for predicting the end of the dot-com boom in 2001.

The problem is that the fact of business cycles means that every expansion will end in recession. And people like Roach and Roubini started predicting the crash many years before the crash actually happened.

If I start predicting that there will be another crash, I will be right eventually. It doesn’t mean it’s useful.

There’s an expression, even a stopped clock is right twice a day. Just because a clock that happened to have stopped at 7:56 is accurate when it is 7:56 doesn’t mean it is useful.

I have the same problem with people who complain that there was someone at the FBI who predicted 9/11 before it happened. In an organization with 30,000 people, you probably have 30,000 predictions being made every single day. Anything that could possibly happen is probably predicted by one of them. It doesn’t mean there was anything useful about that prediction, any more than a stopped clock.

Monday, October 20, 2008

Reviewlet: Man of the Year

Sometimes movies surprise you.
Movies that you hate as insipid drivel somehow pull it together in the closing scenes of the last act.

I can't think of a complete list off the top of my head.

Skeleton key was definitely one. (pap. airplane fodder. drivel.) But the last 10 minutes made it all worthwhile. the first 90 were all there to lower expectations.

Deterrence is another. Which is also all the pap and drivel except for the end of the last act, which not only excuses the rest of the movie but at least partially justifies the earlier crappiness. (domino and contender and matchstick men and euro trip have this quality to a lesser extent)

Man of the year is certainly another.

I spent the first hour not just thinking it was bad (despite its impressive cast), but actively hating it, at how it glorifies the mockery of the political system, taking cheap and dumb shots. The premise--amusing given Al Franken's true story--is that a comedian in the style of Bill Mahr or Jon Steawrt, but played by Robin Williams, decides to run for president. And while commercials had led me to expect something that glorified the everyman as president (like Bullworth or Dave) and while i'm fine with that concept, this movie made the premise of Robin Williams as president both disgraceful and disgusting.

And so i was actively hating it, handling e-mails, playing with my phone, until I realized, that the disgust was intentional. That everything I hated about it was intentional. That explained how they managed to attract such a stellar cast (laura linney, christopher walken, and tons of cameos from news anchors and comedians from chris mathews to tina fey).

So at the end, still not a great movie, but I respect it.

Final Grade:

Monday, October 13, 2008

Krugman and Asimov and Me

So Paul Krugman received a well deserved Nobel Prize today. Despite my political differences with his Ny Times column that I have commented on many times here, I still respect his models of international trade (I went to grad school wanting to expand on his models to understand development) and his popular books before the New York Times.

Watching him on News-Hour today, interesting that he said it was Asimov's sci-fi Foundation novels and psycho history that made him want to be an economist. I, somewhat embarrassingly, said exactly the same thing in my grad school essays. The idea that you could use mathematics to not only understand but also to shape society. In some ways, its amazing how far we've come toward achieving Asimov's vision, on the other hand, it's also notable how very far away we are as well.

The intro to my essay:
Issac Asimov, the science fiction writer, once envisioned a world where a mathematician invented a science called psychohistory that allowed him to foretell and therefore improve the course of human events. When I was younger, this fascinated me. However, it was not until I took freshman economics in college that I realized this was not all fantasy. By studying economics, I could apply my training in abstract math and theoretical computer science to something beyond the world of academia. The field of economics provides a window where my interests and abilities could be applied to research that has direct impact on the lives of so many people.
Heh, also gratuitously mentioned "such as those from Paul Krugman’s graduate International Economics class which I audited." Interesting to read these old essays, made readily available by Vista search.

Neel Kashkari: the $700 billion man, and bailout czar

Interesting. This is the guy i used to wrestle with at the white house over the details of the white house energy policy of 2007. I think we were probably the only ones who really saw all the details. and we often clashed on them. He's a smart competent smooth talking guy, though there were times he played things a bit fast and loose.

The stock photo all the news articles are using is kinda funny.

nytimes article

usa today article

Friday, October 10, 2008

Digging Vista

The New York Times has an article on living with vista. Having used vista as a clean install on two new machines, I've had no problems. Yeah, upgrading an old machine sonds problematic, but I've been happy. For the most part, no substantive differences except one: integrated search.

Now, the file explorer has fast integrated search (something you could do with google desktop, but integrated), and that's nice. Let's me adopt the google philosophy "search don't sort." After decades of experience in carefully organizing my files into directories, I don't have to so much anymore. And that is a good thing.

Wednesday, October 08, 2008

what happened to tackling the root causes of terrorism?

Watching the debate last night, to Obama especially, it sounds like people believe that the way to handle terrorism is to find this Osama Bin Laden guy and the Taliban, and then the problem will be solved.

That was the attitude that was roundly derided by the media once upon a time. Terrorism is like a cancer of different cells, and killing any one is hopeless. Focusing on Afghanistan is pointless, most of the 9/11 terrorists came from Saudi Arabia. Many are now coming from Europe.

There was a time when liberals advocated somehow reforming the root causes, by spurring economic development. Though now the middle east is awash in petrodollars, you don't hear that any more.

Plus, decades of foreign aid spending and quiet diplomacy hasn't worked.

What isn't easy to say, is that the war in Iraq was an attempt to get at the root causes of terrorism. There was a time in 2005 when it looked like the crazy experiment might work. Democratic movements spreading across the middle east and arabic world, in Libya, Egypt, Jordan, Syria, Lebanon, Iran, Iraq, Afghanistan. I used to have the cover of the Economist magazine from this time. It didn't work, but that doesn't mean it wasn't worth a try.

Monday, October 06, 2008

Capping CEO Pay - why Golden Parachutes save firms money.

There's been a lot of talk about capping CEO pay--which is included in the last bailout bill--and pretty much all of it has been ideological; no one has asked an economist what it all means.

So yes, from an "optics" view as they say in Washington, paying CEO's huge bonuses when they are forced to leave a failing company looks awful.

But from an economic point of view, the point of Golden Parachutes is to transfer risk from the risk averse potential CEO to the risk neutral firm. It is not something you give to reward a CEO for leaving, it is something to promise at the beginning to get him to join. What basic contract theory says is that by reducing the risk to the CEO for taking the job, you actually have to pay him/her less overall. Thus a ban on Golden Parachutes should lead to increased overall CEO compensation.

Of course a more likely and better outcome is that if a ban is in place, companies will come up with contracts to replicate golden parachutes, but don't look like golden parachutes. Perhaps a loan that is paid out of future wages. (Which I guess is already done and still looks bad, but less bad.)

Thursday, October 02, 2008

Doctors as Titans

R- often describes the founders of modern medicine as Titans, superhuman, looming over mere mortals with their larger than life presence. In some ways cultivating the exalted status the medical profession enjoys (doctor was the highest status job in some New York Times article some years ago, college professor was down around the 75th percentile).

Flipping through an issue of Hopkins medicine, there was one article about the passing of someone they literally described as a “towering international figure.” It was also interesting. The cover story was about work-life balance. It is funny, that most civilians think the 80 hour restrictions with the 30+ hour shifts every 4 days is insanely too high, and leads to tired doctors and needless mistakes. Instead, in this article, nearly every quote is of a Hopkins doctor talking about how working ONLY 80 hours, and ending a shift at ONLY 30 hours demonstrates a disgraceful lack of commitment to their patients, and anyone who wouldn’t happily put in those hours is a disgrace to the profession.


It seems like the profession is changing. And the younger doctors interviewed didn't feel that way. But Wow.