Friday, June 29, 2007

Takes One to Know One


A canary in the coal mine tells minors they are at risk. Canary in Alabama shows our Democracy is at risk.

Leurid details below.

United States District Court Judge Mark Fuller has sentenced former Alabama Governor Don Siegelman to a term of over seven years in prison and a fine of $50,000.

Recall

Siegelman was found guilty of pushing HealthSouth CEO Richard Scrushy to contribute $500,000 to a state lottery fund in exchange for reappointment to a hospital board. The first puzzle he lists is: Why was the wife of a well-known Republican operative who had worked on Siegelman's opponent's campaign allowed to initiate the investigation:

Why did Leura Canary get anywhere near my case knowing her husbands’ ties to my campaign opponents? Why did she have to be “outed” before her undocumented “recusal” after driving the case for 8 months?



Notice not cash to Siegelman and note reappointment (Scrushy had been appointed already by other governors).

OK so a contribution followed by an appointment is suspicious, so why hasn't Leura Canary investigated herself ? She was appointed US attorney by George Bush and she gave money to an organization a good bit closer to bush than the lottery board is to Siegelman

Results:

3 records found in 0.2656 seconds.


Total for this search: $3,000


Search Criteria:
Donor name: canary, leura
Cycle(s) selected: All

[snip]

CANARY, LEURA G MRS
MONTGOMERY,AL 36106
U.S. GOVERNMENT/U.S. ATTORNEY
11/5/2003
$2,000
Bush, George W

CANARY, LEURA J G
MONTGOMERY,AL 36106
HOMEMAKER
6/7/1999
$500
Bush, George W

CANARY, LEURA J G MRS
MONTGOMERY,AL 36106
HOMEMAKER
10/26/1999
$500
Bush, George W

OpenSecrets' Donor Lookup comprises contribution data available electronically from the Federal Election Commission on Monday, June 04, 2007. Because campaigns and other political committees typically disclose their contributions on a quarterly or monthly schedule, it can take several months for a contribution to be recorded in this database.


After donating just $1,000 she went straight from "homemaker" to "U.S. ATTORNEY".
Wow.
I haven't had much good to say about House Republicans in the past 46 years but I must say that Representative Ralf Regula has an Excellent idea

"Rep. Ralph Regula (R-OH): 'Of course you’re going to abolish the residence, and I assume you’re going to get a Katrina trailer to provide for the vice president.'"

Brilliant. Perfect. Do it. Now

Thursday, June 28, 2007

I disagree with Kevin Drum and Mark Kleiman about an economic issue.

How odd. Drum wrote

Andrew Sullivan returns to the Big Pharma debate today, stepping back a bit from yesterday's claim that European pharma companies have been "decimated" by Europe's widespread adoption of universal healthcare. And a good thing too. After all, the market for pharmaceuticals is global. Every pharmaceutical company, no matter where it's based or where it conducts R&D, sells into the exact same market. If European national healthcare had really decimated European pharma companies, it would have decimated American companies too.

But it hasn't. So today Andrew moves on to a different, and more common, conservative claim. With some coaching from Mark Kleiman, he argues that the real issue is drug innovation, which he thinks is driven largely by profits from U.S. sales. If we introduce national healthcare in American and start bargaining down the price of drugs, Big Pharma will no longer have an incentive to invest lots of money in R&D. Result: no new drugs.

On its face this sounds reasonable. Pharma companies are like anyone else: they invest in R&D to the extent that they can earn a return from the drugs they develop. If drug company profits are driven mostly by high-priced U.S. sales, then the rest of the world is getting a free R&D ride on our backs.

But I don't think that's quite what's happening. There's a free ride happening, but it's not a free ride on innovation. It's a free ride on pricing.

As Mark points out, pharma companies have to raise capital in the same markets as everyone else, and that means their overall pricing has to be high enough to provide them with the risk-adjusted returns on equity that the market demands. So what happens if prices in America are gradually pushed down? Answer: prices everywhere else will be gradually pushed up. Americans will pay a bit less and Europeans will pay a bit more — which suits me just fine — and both profit levels and risk-adjusted returns will remain constant, just as basic economics demands. The only difference is that Europeans will be forced to pay their fair share of pharma R&D budgets. No more free ride on pricing.


This reassoning seems to me to be very very odd. A standard simple model of pharmaceutical company managers would have them sell for the highest price they can get. This would suggest that they are squeazing all of the money out of Europe that they can already. It is not clear how a decline in profits earned in the US would change the game played by the pharmaceutical companies and European states. Now I don't believe in standard simple models of firms (or anything) especially since I mean models which have been proven false decades ago. However, I don't see how a more sophisticated model would imply that prices in Europe go up as prices in the USA go down.

Before going on, I have to distinguish two kinds of risk adjusted returns. One would be risk adjusted returns to investments in the shares of pharmaceutical companies. It is very easy for these to remain the same (after a period of adjustment) even if the USA begins bargaining seriously about drug prices. A surprising discovery of a federal spine (plus a federal pair and other anatomical metaphors) would cause a drop in share prices. That would imply higher returns for a given path of dividends or, in a simple model, equal returns given lower dividends due to lower drug prices and profits. No problem there. In particular appropriate risk adjusted returns on shares can be achieved via changes in share prices no matter what firms' R&D (or any other) policy is.

On the other hand, it might be that MK and KD think shareholders will demand a given risk adjusted return on investments included investments in R&D.

Now if the required return on an investment stays the same, the pharmaceutical companies can manage that by investing only in projects which currently pay higher than the required return. That is by investing in fewer projects. In other words via a reduction in R&D as argued by Sullivan.

But how do investors demand such returns ? The return on investment in the pharmaceutical industry is very high compared to other sectors (also adjusting for risk that is their Q even including R&D investment in the denominator is very high). How and why do investors manage to make managers earn such high returns. In the simple model (which I don't believe) managers act in shareholders' interests. Ha. Back to seriousness. Investors can demand a high return on investments by only buying new shares issued by firms if the firms have high enough returns. Pharmaceutical companies are not issuing new shares, so this is not a factor.

Basically the way that investors can force managers to act in their interests is via the threat of takeovers, that is, if the current management doesn't maximize shareholder value, someone can make a lot of money buy quietly buying 5% minus one of the shares then taking over the firm. In other words managers are forced to make the highest return possible. There is nothing that implies that this return must be constant.

My guess is that if the US got tough on drug prices, the price of pharmaceutical companies shares would fall as would the value of those companies to predators. Managers' incentives would not change. I would guess R&D would remain about the same.

The reason pharmaceutical companies must earn huge returns on capital is that they can and if current management won't someone else will. If the environment changes so that they can't make such returns, they won't be forced to make such returns.

Wednesday, June 27, 2007

Constituent Service and Standing

If I understand correctly, I can't sue the NSA for intercepting e-mails or recording international phone calls, because I can't show that I have been harmed, and, therefore, I don't have standing to sue. However, I can write to my senior senator (that would be Kennedy) and ask him to demand that the NSA say whether any of my e-mail was intercepted. I don't need standing to ask my Senator for a favor. If I ask, they can't claim they are protecting my privacy by refusing to answer (failing the laugh test aside). Thus, it seems, if a majority of the Senate judiciary committee wants to give some people standing to sue, they can. Sounds simple to me. What am I missing ?
Great Moments in the history of the English Language

The CIA's publication of the "family jewels" (that is documents written before 1973, which they kept secret for no good reason for decades after confessing to the Church and Pike commissions) make me think of great literature. In particular of Orwell's admiration for "Ulysses". Orwell had been attempting to write a long poem about a day in London, when he read the very long novel about a day in Dublin. He wrote in his diary that he was "sick with envy." This was not an unusual entry for Orwell. It was unique.

Now I wonder if he might, again, recognise that he has been surpassed. I am thinking of 1984 of course. A very good book (and he finished it unlike the poem) with brilliant writing. However, the prose of "Politics and the English Language" might be even better. Both however are surpassed by the brilliant Al Haney (organizer of the coup in Guatamala) who wrote

"Eliminate all the absolute monarchies, dictatorships and juntas from the free world and count those that are left and it should be readily apparent that the U.S. would be well on its way to isolation.”


I have great respect for Orwell, but I don't think he dared imagine a character who would claim that "the free world" consists *mostly* of "absolute monarchies, dictatorships and juntas." Sometimes truth is stranger than fiction.
New Frontiers in Social Science

In a study of total self absorption, social scientists study the reactions of members of the research team.

"a study that showed that many doctors waste patients’ time and lose their focus in office visits by interjecting irrelevant information about themselves."

One might imagine (as the research team did) that it is good for doctors to say a little bit about themselves as it builds rapport by putting them on a more equal footing with patients. They were surprised and dismayed to find no benefits to patients of time spent talking about the doctor

The researchers studied the conversations looking for any hint that patients were helped when the doctors talked about themselves.

“We looked for any statement of comfort, any statement of appreciation, any deepening of the conversation,” Dr. Beckman said.


So the important discovery seems to concern the reactions of the patients. Very interesting except they weren't real patients

Their paper, published yesterday in The Archives of Internal Medicine, involved 100 primary-care doctors in the Rochester area. As part of a study on patient care and outcomes, the doctors agreed to allow two people trained to act as patients come to their offices sometime over the course of a year. The test patients would surreptitiously make an audio recording of the encounter. The investigators analyzed recordings of 113 of those office visits, excluding situations when the doctors figured out that the patient was fake.


They got a publication by studying the behavior of actors who were part of the research team ? Researchers are supposed to study the experimental subject not the experimenters. Thi icing on the cake is that the research team then went on to accuse the doctors of being self absorbed.
The CIA and Laugh In.

Ah nostalgia. After the horrors of the Bush/Cheney copresidency, it is comforting to read about the good old days when the CIA worked with the mafia to kill Castro.

Over at the post, they are sifting through the CIA declassified "crown jewels". It looks like there isn't much there (the jewels were shared with Sen Church and Rep Pike over 30 years ago). However, the sweet nostalgia became intense when they mentioned an old friend

The project was nearly exposed when Maheu was arrested for arranging the wiretapping of the room of comedian Dan Rowan, who Giancana suspected was having an affair with the mobster's girlfriend. When the wiretap technician was captured, he implicated Maheu, requiring the CIA to ask then-Attorney General Robert F. Kennedy to drop the prosecution.


The girlfriend would be Judith Exner who got around. She claimed she had an affair with John Kennedy.

Dan Rowan was cohost with Dick Martin of "Laugh in" a TV show, which I found quite funny at the time and which introduced Lilly Tomlin, one of the great comic geniuses of our time, and Goldie Hawn, who is beatiful.

Dan Rowan's second most famous line was "say goodnight Dick" so the article has some current relevance -- you can bet your bippy on that.

Update: Wrong girlfriend. AP explains "At one point, Giancana asked Maheu to bug the Las Vegas hotel room of entertainer Dan Rowan to see if Giancana's girlfriend, singer Phyllis McGuire, was sexually intimate with Rowan." Seems like Sam got around too.

Tuesday, June 26, 2007

Washington Lobbyists ain't got no culture

Harper's' Washington editor Ken Silverstein went undercover to see how eager lobbyists were to represent Turkmenistan (slogan our current President hasn't named a month after himself yet). They were eager. They are also out of touch with high culture.

For answers, Silverstein went undercover as “Kenneth Case,” a consultant for “The Maldon Group,” a mysterious (and fictitious) London-based firm that claimed to have a financial stake in improving the public image of neo-Stalinist Turkmenistan.


Ahhh someone looking for extremely shameless PR who says he works for the Maldon Group which is not, I think, a reference to the battle on the field of Maldon, but rather to the South Maldon Icelandic Saga Society as seen on Monte Python's Flying Circus which discovered that Gnarls Saga focused on the advantages of locating one's business in South Maldon.

Don't tell me it's a coincidence.

p.s. the punctuation if Harper's' is not a typo, Harper's is the Magazine so Siverstein is Harper's' Washington editor.

The title is a reference to "An average desultory philippic or I've been McNamara McNamarad" by Simon and Garfunkle which contains the immortal lines
"When you say Dylan, he thinks you mean Dylan Thomas
Man he ain't got no culture"
The Binary Executive

Now I understand why the Bush administration monarchists like the phrase "unitary executive." They were hiding their actual aim to create a binary executive, in which the Vice President is not subordinate to the President. The fiercest proponent of Presidential power was David Addington first counsel now chief of staff of Cheney. The absurd claims, which convince no sensible person but might flatter a total idiot, were part of their plan to seize power exploiting the total idiocy of Bush.

Monday, June 25, 2007

That's a Lott

The New York Times reports on Ruthless Rupert Murdoch

It seems that he was very generous to Trent Lott when Congress was debating how many TV stations he could own.

Congress was on the verge of limiting any company from owning local television stations that reached more than 35 percent of American homes. Mr. Murdoch’s Fox stations reached nearly 39 percent, meaning he would have to sell some.

A strike force of Mr. Murdoch’s lobbyists joined other media companies in working on the issue. The White House backed the industry, and in a late-night meeting just before Thanksgiving, Congressional leaders agreed to raise the limit — to 39 percent.

One leader of the Congressional movement to limit ownership was Senator Trent Lott, Republican of Mississippi. But in the end, he, too, agreed to the compromise. It turns out he had a business connection to Mr. Murdoch. Months before, HarperCollins, Mr. Murdoch’s publishing house, had signed a $250,000 book deal to publish Mr. Lott’s memoir, “Herding Cats,” records and interviews show.

[really huge multipage skip]

Mr. Lott’s book sold 12,000 copies, according to Nielsen Bookscan, which tracks about 70 percent of all domestic retail and Internet sales.


OK so that would imply an estimate of 12,000/0.7 copies so 250,000*0.7/12,000 = $14.5833... per book (fourteen dollars and figty eight and one third cents).

That sounds huge to me. Odd that I had to skip pages to compare the total royalties to sales. I have no idea how much authors get, but googling tells me that 10% is a normal royalty and I doubt the book cost over $ 140. Also an author claims he gets $ 1.25 a book. Google answers has a reference to a sliding scale

Royalties
are typically broken out on a scale according to the number of copies
sold, such as:

10% on the first 5000 copies
12.5% on the next 5000 copies
15% over 10,000 copies


Which would give Sen Lott an average royalty of 13.86% given the guess of 12,000/0.7 = 17,143 copies so the price per book would be $ 105.23 (usually the scale is applied to the wholesale price!).

Now could have gotten the list and wholesale prices from Harper Collins and saved the heavy arithmetic. Also why the gap between the $250,000 and the 12,000 copies ? And why did I have to google normal royalties ?

Anyway it sure seems to me that Lott got 3 to 7 times normal royalties just about the time he was helping his colleagues decide how many TV stations Rupert Murdoch could own.

Didn't Jim Wright get nailed for less ?
The second article of the very excellent Gellman and Becker series on Cheney includes a minor but extreme example of generous granting of anonymity -- ex poste anonymity for public statements.

The Justice Department delivered a classified opinion on Aug. 1, 2002, stating that the U.S. law against torture "prohibits only the worst forms of cruel, inhuman or degrading treatment" and therefore permits many others. [Read the opinion] Distributed under the signature of Assistant Attorney General Jay S. Bybee, the opinion also narrowed the definition of "torture" to mean only suffering "equivalent in intensity" to the pain of "organ failure ..... or even death."

When news accounts unearthed that opinion nearly two years later, the White House repudiated its contents. Some officials described it as hypothetical, without disclosing that the opinion was written in response to specific questions from the CIA.



Hmm who might they have been (and might one of them have been under oath at the time ?)

Let's go to the Washington Post to find a someone to whom The Washington Post granted ex poste anonymity.
Text: Ashcroft Comments on Anti-Terror Policy

FDCH E-Media
Tuesday, June 8, 2004; 2:15 PM

SPEAKERS:

U.S. SENATOR ORRIN G. HATCH (R-UT) CHAIRMAN

[snip]

WITNESSES:

JOHN ASHCROFT,

U.S. ATTORNEY GENERAL

OK that's clear. Any lie from Ashcroft is a crime.

Kennedy is trying to ask him about the Bybee memo

ASHCROFT: Senator Kennedy, I'm not going to try and issue hypothetical...

KENNEDY: I'm not asking hypothetical. This is a memoranda that, again, was referred to today in the Post. "August 2002, Justice Department advised the White House that torturing Al Qaida terrorists in captivity abroad may be justified and that international laws against torture may be unconstitutional if applied to interrogations." Do you agree with that?

[long back and forth mostly about Ashcroft refusing to hand over memoranda and time runs out]

HATCH: Senator, your time is up.

But if you'd care to answer.

ASHCROFT: Well, I do care to answer because the senator raises very serious issues. And I think they deserve an answer.

[big snip]

I'm not doing anything other than to say that there is a long- established policy reason grounded in national security that indicates that the development and the debate of hypotheses and practice of what can and can't be done by a president in time of war is not good government.


My snips make my reading questionable (check the transcript) but, it seems to me, hat Ashcroft is definitely saying the memoranda were hypothetical and, thus, is lying and a felon.

Gellman and Becker have done a great job, but shouldn't they have named he people who lied in public ?

Saturday, June 23, 2007

Russ Douthat explains why Conservatives are unfit to govern.

Well not directly. Here he writes "there’s something slightly perverse about pursuing humanitarian ends through policies that lower the incomes of your poorest citizens and raise the incomes of your richest citizens. If I proposed a new AIDS-in-Africa initiative and advocated funding it through a regressive tax that included a tax credit for families making over $75,000, I doubt that many liberals would line up behind the proposal."

Hey let's try out Ross Douthat's analogy. How about universal health care funded by an extremely regressive tax ? Why low and behold, (most) liberals are wildly enthusiastic about employer mandates which are just that. It seems liberals want the post tax US income distribution to be more equal but liberals are not monomaniacs. Hmmm how about the reverse Douthat -- would conservatives support a tax increase for the rich to fund, say, a war in Iraq (or more defence spending or incentives to pregnant women to not abort or well anything ?). The question is answered. Conservatives do not accept trade offs. They want everything now. I would not have imagined that an intelligent conservative like Douthat would have chosen to draw attention to this fact.

Conservatives, according to Douthat, are consistent, in that they refuse to compromise on any of their aims even, it seems, if compromise is necessary for budgetary, political or logical reasons. I think he is on to something. A refusal to admit that trade offs must be made is infantile thinking and handing government over to spoiled brats would tend to lead to massive disaster. The evidence supports Douthat's theory of Conservative unfitness.


Also, by the way, I would support an AIDS in Africa program funded by a regressive tax with a tax credit for the rich (unless I hoped to get a big anti-aids program financed by a progressive tax). This is exactly the logic of my support for immigration and free trade. I would like to help low wage US workers but, if forced the choose (and I am not forced to choose in the real world) I care even more about lower wage non US workers. It's called egalitarianism.


Via Ezra Klein who points out the obvious -- if we want immigration and high wages for low skilled native workers we can just allow immigration and finance an increase in the EITC by increasing taxes on rich people.
Andrew Northrup more or less declares Richard Cohen the Wanker of all time and before and after.

Warning the post has an illustration which is not work safe in Iran or Saudi Arabia and which should not be viewed immediately after taking a drink.

I have boring comments partly in response to comments.

Failure to prosecute is not proof that no crime was committed. In the trial, the accused must be presumed innocent. In discussing a sentence, it is not necessary to assume that anyone who might have been accused if Libby had told the truth is innocent. Also it is very important that Fitzgerald's decision not to ask the grand jury for indictments may well have been based on the risk of a mistrial due to greymail not absence of proof of guilt.

The IIPA is very hard to break. It would be necessary to prove that the accused "knowingly" blew Plame's cover. Also it is necessary that the accused learned of Plame's true occupation using his security clearance (this is the reason for the "a journalist told me" lie). This can only be shown if it is demonsrated that the accused read some secret document or had some secret discussion with someone else with security clearance. The defense team would definitely not concede this point, but demand that the secret communications be shared with the jury so they could argue ... well it doesn't matter what, the communications are definitely relevant.

They can only be shared with the jury with the permission of the Bush administration. Obviously this permission would not be granted. As a result, Walton would have had to declare a mistrial and let Libby walk. The strategy of demanding access to secret information is called greymail.

To get off on a technicality is bad enough. To ge off because the prosecutor chose to prosecute only the crimes which were not vulnerable to greymail is beyond absurd.

Also a law, the espionage act, was clearly violated. Fitzgerald chose to interpret it as referring to, you know, espionage for exactly all of the reasons regularly given by Cohen.

On other issues.

I don't think the sex lies and audiotape scandal is responsible for 9/11 via the almost election of Bush. Gore would have done what could be done instead of nothing, but it probably wouldn't have worked.


tigrismus : Clinton's alleged perjury did not occur during the Whitewater investigation. He was accused of lying to Paula Jones' lawyers in a deposition concerning Jones Vs Clinton. Starr was only brought in after the alleged perjury by Linda Tripp who he wired up even though the alleged perjury had nothing to do with the issues he was originally authorized to investigate. Clinton definitely lied on TV. Whether or not he lied under oath really does depend on what the definition of "is" is. He said something along the lines of "There is no sexual relationship between me and Monica Lewinsky" which was true at the time as they had broken up already. Deliberately misleading when under oath is not (always) perjury. Also, if he lied, his lie was immaterial as his affair with Lewinsky had nothing to do with sexual harassment. Also there was no reason to find the facts about Jones and Clinton, because, if the events occurred exactly as described by Jones, Clinton would owe her 0 damages as being a jerk is not a tort. My two last claims are findings by the trial judge which are authoritative as they were never challenged. Also, come on, it was just a blow job.

Does being a total bore make me a wanker too ?

Friday, June 22, 2007

Aunts, Fish, Ants,

ATBozzo links to me here after writing

He invokes Francis S. Collins to name a scientist who would argue that physical processes cannot account for the universal presence of moral impulses like altruism, “the truly selfless giving of oneself to others” with no expectation of a reward. How can there be a naturalistic [i.e., evolutionary] explanation of that?

Fish, let alone Collins, shouldn't need an economist to answer, "easy."


Thanks for link. Fish is, well fish. The possible evolutionary explanation of altruism is quite different from the selection of sickle trait. The generally favored view is called kin selection". The argument is that if we help a random person (more generally organism in our species which we meet) we do something very different from helping a random organism in our species, since we are more likely to meet our kin than our non relations.

If there is an altruism allele, it can be selected. Acts of pure altruism reduce he chance of reproducing (or else it wouldn't be pure altruism) but increase the chance of reproducing of the beneficiary. If the beneficiary is the brother of the altruist, he has a 50% chance of carrying the allele which is therefore 50% selected via the act of altruism, a nephew, niece aunt or uncle 25% a cousin 12.5% etc.

The "result" of very early theoretical population biology that true altruism is not selected was based on the assumption, made for simplicity, of random matching so an altruist was as likely to help someone who was unrelated as she was to help a first cousin.

Now, an allele which causes us to recognize the exact degree of relation to another organism and callibrate our altruism would drive out simple altruism in evolution. It is impossible to imagine how exactly such an allele could do this (especially if you go back a few million years and consider our ancestors who couldn't talk or count or anything).

An implication of the evolutionary theory of altruism is that extreme altruism will occur among animals who are more closely related to their sisters than to their daughters. The most extreme altruism possible from an evolutionary point of view is to refrain from even attempting to reproduce -- like a worker ant or worker bee. They are (as you guessed) more closely related to their sisters (the queens) than to their possible offspring sharing 3/4ths of genes not just 1/2 because males of the species are haploid (only 1 copy of each gene like our sperm or women's ova).

For someone who has seen a worker ant to claim that altruism proves that evolutionary biology can't explain everything is for someone to make a total fool of himself.

A few minutes of research on the topic would have made it clear to Fish that he was defending a statement which is ignorant or dishonest (Collins may know the human genome but is less familiar with the population biology literature than with the incentives for scientists to be overly humble about the power of science). I dare say it probably did, since defending dishonest ignoramuses is what Fish likes best.

Now Fish's claim is that materialistic reductionistic science has failed (so far) because the molecular basis of altruism is not known. This is a much more reasonable claim than the claim that altruism could not be selected (Bozzo responds very effectively back at marginal utility). I will just add some Nit Picklering noting that Fish neglects to mention the observed effects of oxytocin (the hormone which triggers labor) in voles.

Dave Barry is a more reliable source for information on the subject (search for vole or muskrat and, sad to say, The Economist is not run by altruists).

update: Dave Barry might be a bit too unserious so let's go to the Wikipedia

Oxytocin (C43H66N12O12S2) AKA CYIQNCPLG means trust, falling in love, maternal love and (female) monogamy. to make males monogamous you have to use vasopressin (a slightly heavier molecule for a harder problem).

Wednesday, June 20, 2007

Huaylas and Horizontal Relationships

This is actually a fascinating article about not so current events (1530). The topic is Pizzaro's conquest of the Inca empire. This is one of the more amazing events in history. IIRC Pizzaro lead 70 soldiers to the conquest of an empire of roughly 12,000,000 people. The version of history I learned is that this demonstrated the psychological power of muskets (70 mussel loaded muskets would be of little use against a disciplined army of thousands armed with sharpened sticks let alone the Inca army) and the extreme vulnerability of empires which have long been locally hegemonic due to their mental rigidity (in this case excessive devotion to the emperor which gave Pizzaro great power between the capture and killing of Atahualpa).

The new discovery is of 72 hastily buried corpses in an Inca burial ground. Carbon dating suggests that the deceased were killed in a battle in 1530 (after Pizzaro had killed Atahualpa). Many skulls were crushed by clubs. Let me hand the mike over to Cock.

Cock, who is trained as a historian as well as an archaeologist, said about 30 of the 72 bodies had been killed by native weapons -- lending support to his theory that Pizarro succeeded only because he enlisted the help of other tribes who were enemies of the Incas. Pizarro's closest allies are believed to have been the Huaylas, who lived about 100 miles north of Lima, Cock said. Pizarro is known to have taken a prominent Huayla woman to be his mistress, and Huayla forces are believed to have had a decisive impact during the Lima siege.


The excellent article concludes with an unfortunately phrased quote

"They joined Pizarro in the hope of being rewarded with more independence and freedom," Cock said. "I believe they wanted a more equal, more horizontal relationship with the Spaniards. Clearly, that did not happen."


All I can say is that if my name were Cock, I would be careful about using the word "horizontal" to discuss an alliance sealed in bed.

update: I forgot to link to the article.
Thanks anonymous commenter.

Tuesday, June 19, 2007

Doesn't the poor man already have enough problems.

Bush, Olmert Praise Palestinian Leader

By ANNE GEARAN
The Associated Press
Tuesday, June 19, 2007; 11:56 AM

WASHINGTON -- President Bush and Israeli Prime Minister Ehud Olmert on Tuesday sought to bolster Palestinian President Mahmoud Abbas in his battle with Hamas for primacy, calling him a moderate voice and the only true leader of the Palestinian people.
I'm with Matthew Yglesias and Karen Tumulty on this.

Tumulty wrote

campaigns should not be allowed to distribute things on a NOT FOR ATTRIBUTION basis. Both NOT FOR ATTRIBUTION and OFF THE RECORD (and their cousins, BACKGROUND and DEEP BACKGROUND) are understandings that are agreed to mutually by a source and a reporter. What I've noticed about this cycle is that campaigns (and not just Obama's) are falling into a bad and sloppy habit of sending out mass hit pieces by e-mail and demanding anonymity. As far as I am concerned, unless I have agreed in advance to accept a specific piece of material from a source on a limited or not for attribution basis, these unilateral declarations of anonymity mean nothing.



So be warned.

I'm sure that, in the future, I will never ever receive a "not for attribution" hit piece from a campaign, but I am willing to courageously make that sacrifice and not just because no campaign has ever heard of me. Really (I think).

Also I will not ever wiretap your phone without a warrent and I'm not reading your e-mail. Plus I'm not clubbing baby seals or wasting gas speeding in a Ferrari.

God I'm so virtuous that the only thing keeping me from kissing myself on the lips is a severe shortage of lips (don't draw any inference about a lack of leaks, taps and passwords which might help me keep my promises).

p.s. I mean I have two more or less normal lips. don't get grossed out.
The Washington Post gets Reyes' Syndrome

U.S., British Troops Battle Shiite Militiamen in East
Forces Push Into Insurgent Areas Around Baghdad


By John Ward Anderson and Joshua Partlow
Washington Post Foreign Service
Tuesday, June 19, 2007; 6:14 AM

BAGHDAD, June 19 -- U.S. troops backed by helicopters and Bradley Fighting Vehicles launched a major offensive Tuesday to clear the Sunni extremist group al-Qaeda in Iraq from its new stronghold in Diyala Province north of the capital, the U.S. military said in a statement.


There is also an impressive contribution to the blame al Qaeda for everything effort with a claim that al Qaeda is bombing Sunni sites supported by evidence such as ...
normal background noises crickets chirping, car bombs exploding.

Although it has killed numerous al-Qaeda in Iraq leaders and members, the U.S. has had limited success in previous efforts to crush the group. The group is thought to have perhaps several thousand members, most of them extremist Sunni Arabs from foreign countries. It has kept violence in Iraq boiling with indiscriminate attacks against Shiite and Sunni targets, seeking to foment sectarian bloodshed and push Iraq towards civil war. U.S. officials believe al-Qaeda in Iraq is the main sponsor of suicide bombings in the country


and simultaneously a new step in the blame Iran campaign with the discovery of Iraqis who are sort of Iranian

"'American intelligence reports indicate that "Iranian surrogates, or Iraqis that are liaisons for Iranian intelligence operatives into Iraq,'"

so now there is no need to arrest Iranian diplomats to prove that Iran is to blame. Iraqi's making IEDs in Iraq are proof enough.

Please, someone tell me that my computer is infected with a virus which redirects me to The Onion when I type www.washingtonpost.com. I can't take it any more.

update: Headline corrected to "U.S. Forces Target Insurgent Stronghold" by 7:28 AM EST

Monday, June 18, 2007

Virtual Capitalist Nightmare in the People's Republic of China

12 hour shifts 7 days a week playing the online game "World of Warfare" to collect "gold coins" sold at an appalling markup on the web. Marx and Smith had this concept called "productive labor". Working to collect virtual money which the game site can make instantly has to be about as unproductive as labor gets.

Also regular players kill their avatars and the game sites ban them (and seize their coins).

It isn’t that WoW players don’t frequently kill other players for fun and kill points. They do. But there is usually more to it when the kill in question is a gold farmer. In part because gold farmers’ hunting patterns are so repetitive, they are easy to spot, making them ready targets for pent-up anti-R.M.T. hostility, expressed in everything from private sarcastic messages to gratuitous ambushes that can stop a farmer’s harvesting in its tracks. In homemade World of Warcraft video clips that circulate on YouTube or GameTrailers, with titles like “Chinese Gold Farmers Must Die” and “Chinese Farmer Extermination,” players document their farmer-killing expeditions through that same Timbermaw-ridden patch of WoW in which Min does his farming — a place so popular with farmers that Western players sometimes call it China Town. Nick Yee, an M.M.O. scholar based at Stanford, has noted the unsettling parallels (the recurrence of words like “vermin,” “rats” and “extermination”) between contemporary anti-gold-farmer rhetoric and 19th-century U.S. literature on immigrant Chinese laundry workers.

Min’s English is not good enough to grasp in all its richness the hatred aimed his way. But he gets the idea. He feels a little embarrassed around regular players and sometimes says he thinks about how he might explain himself to those who believe he has no place among them, if only he could speak their language. “I have this idea in mind that regular players should understand that people do different things in the game,” he said. “They are playing. And we are making a living.”

It is a distinction that game companies understand all too well. Like the majority of M.M.O. companies, Blizzard has chosen to align itself with the customers who abhor R.M.T. rather than the ones who use it. A year ago, Blizzard announced it had identified and banned more than 50,000 World of Warcraft accounts belonging to farmers.


The virtual horror the virtual horror.

Mao Zedong must be rolling over in his grave. The unkindest cut of all

It may seem strange that a wage-working loot farmer would still care about the freedom to play. But it is not half as strange as the scene that unfolded one evening at 9 o’clock in the Internet cafe on the ground floor of the building where Donghua has its offices. Scattered around the stifling, dim wang ba, 10 power levelers just off the day shift were merrily gaming away. Not all of them were playing World of Warcraft. A big, silent lug named Mao sat mesmerized by a very pink-and-purple Japanese schoolgirls’ game, in which doe-eyed characters square off in dancing contests with other online players.

Sunday, June 17, 2007

Friday, June 15, 2007

I just passed the speed of light as this blog is now among the 186,000 blogs ranked highest by technorati ! I'm particularly thrilled to get a link in cyrilic although I would be happier if I were sure the text isn't "hey look at this bozo".

update: On the principle of a link for a link, I note that Holler Back, memeorandum, the lantern, and the reincarnation of George Orwell have linked to my blog.

I stress I am not joking about this Greenwald is like Orwell business, although Paul Krugman edges him out in the "Orwell of our times" contest I set up at my daily Kos diary (I included Hitchens as a joke and I assume those 5 silly kossacks voted for him as a joke).
Seeing Forrest for the Trees or
What is Atheism part N

Here I go again trying to define "atheist" and "secular". What a bore.


Tristero quotes Barbara Forrest at length

ID proponents and their Religious Right allies promote a distorted understanding of secularism, presenting it as synonymous with atheism and antireligious animosity. However, contrary to this misconception, “secular,” properly understood, merely means “not religious” rather than “anti-religious.” In the same vein, criticism of ID as a religious belief rather than a scientific theory is not criticism of religion per se.
[snip]
the vast majority of Americans, .. understand that the strongest protection for people of faith lies precisely in maintaining government neutrality with respect to matters of religion.


I agree with the substance but, as an intolerant atheist theologian, object to the wording. I would say that that "secular" means "not involving religion at the moment". If I understand correctly, the Catholic church introduced the word to describe legitimate authorities who were not clergy people. It is possible to be both religious and secular, that is, personally religious and in favor of keeping religion out of some part of our society (and in particular government policy). So a secular state is not a state run by non religious people, it is a state run by people who do not use their official powers to advance their religious beliefs. The founders were Christian (with the likely exception of Thomas Jefferson whose heterodoxy was a bit extreme).

The reason I object is that Forrest does not note the difference between atheism and anti-religious animosity, although she doesn't say that one implies the other either.
I think this vagueness is unfortunate.

First in a quibbles quibble I note that, if I had to coin a word for anti-religious animosity, I would invent antitheist. the prefix "a" means "non" or "not."

On a more serious point, if "secular" were used to mean "not religious but not anti-religious" then there would be no word for "religious but in favor of separation of church and state."

I think a bunch of atheists decided to take control of the word "secular" distorting the language. IIRC the unfortunate phrase "secular humanism" was introduced in a document called "The Secular Humanist Declaration" signed by, among others Isaac Asimov and B.F. Skinner. I'm sure they were secular and Asimov at least was a humanist, but one of the principles of the declaration was "6. Religious Skepticism"
so signers were at least agnostic if not atheist.

I just checked the Wikipedia and I see that there were much more eminent signers. Also the date, 1980, seems very late for the introduction of the phrase so probably I didn't recall correctly.

The problem with letting the religious right define "atheist" as hostile to religion is not just that leads to horning in on the turf of "secular". It also leads to abuse of the word "agnostic" which properly does not refer to someone who has no doubt that no God exists (or who has no hope that a God exists). In common usage atheists who are not anti religious tend to claim they are agnostic. Not as bad as claiming to be simply secular, but not accurate either.

Atheists are numerous (I am one of them) and by no means all of us are anti-religious (obviously I don't think any religious belief is true, but one of the teachings of Christ which does not convince me is "the truth will set you free" and, all in all, I think believing the truth is often over rated).

I do like Forrest's use of the phrase "civic friendship"

Civic friendship means, at the very least, being reasonable enough and respectful enough of one’s fellow citizens to trust that they can be good people—good neighbors—without adopting one’s own religious views, or perhaps without any religious views at all.


Although, perhaps, she could have done without the "perhaps".

Thursday, June 14, 2007

Glenn Greenwald AKA the Orwell of our time discusses
"that sight unprecedented in all history, a jingo with a bullet hole in him."

From "Homage to Catalonia"

The people who write that kind of stuff never fight; possibly they believe that to write it is a substitute for fighting. It is the same in all wars; the soldiers do the fighting, the journalists do the shouting, and no true patriot ever gets near a front-line trench, except on the briefest of propaganda-tours. Sometimes it is a comfort to me to think that the aeroplane is altering the conditions of war. Perhaps when the next great war comes we may see that sight unprecedented in all history, a jingo with a bullet-hole in him.


I wonder whether Orwell is more able to comment on our times than the MSM in spite of the disadvantage of having been dead for 57 years.

Update: Glenn Greenwald linked to this post !!! Welcome Greenwaldinans. I should clarify that when I called Greenwald "the Orwell of our time" I was not being sarcastic or ironic. I really believe that.
Sometimes the Good Guys Win.
Orwell in Russia
The Lord of the Fleas

The original neoconservatives, neoliberals and liberal hawks criticized liberals, leftists and defeatists for parasitic negativism -- for sneering at the USA, capitalism and the military while living off of it, like fleas irritating their host while sucking away. The claim was that privileged radical chic critics had no positive proposals but only criticisms of the necessary imperfections of the people who actually got things done.

Fleas have lesser fleas upon their backs to bite them, and the neo * critique is a parody of itself when the critics' critics become focused on the the critique of criticism and neglect to make positive proposals.

Ezra Klein presents "a challenge to these hawks to say what they think, not merely what they think about what others think."

I have long considered neoconservatives to be parasites' parasites, but I didn't have a blog (this is first in a series of how I suffered in the decades I lived without blogger boo hoo).

So I have a question. Who is the lord of the fleas ?

Norman Podhoretz
Irving Kristol
Martin Peretz
Michael Kinsley (I love him but when was the last time he got around to actually stating an opinion after mocking the hypocrisy and idiocy of others)
Christopher Hitchens
Kenneth Baer

No need ask if anyone has noticed that the lesser fleas have still lesser fleas

And so ad infinitum in comments ?

update: Come on. go over to my daily kos diary to break the tie between Podhoretz and Lieberman

Update: Glenn Greenwald votes for both.
Photon has a blog

Wednesday, June 13, 2007

ATBozzo has interesting things to say and links to me.

The topic is the appalling ignorance and/or rejection of scientific theories with overwhelming empirical support found in the GSS (a bare majority of US residents agree that the Earth orbits the Sun once a year).

Kim noted that

The ignorance of or rejection of the consensus of people who know the facts is particularly marked for fundamentalist Protestants and very weak for Jew and the non religious.

An anonymous commenter objects.

I bloviate at great length.


Thanks for the link. As you note, I think (and think I can prove) that anonymous is wrong when he or she claims that there are, at the moment, economics "facts".

"
This commenter also notes that liberals and atheists may harbor beliefs based on bad science, citing genetically modified foods "fear mongering" and selective rejection of economics or social science "facts.""

I agree with your note that scientific theories are not facts, but, beyond that, I don't think that the results of economic research have the status of scientific theories yet (much doesn't even manage to be a falsifiable hypothesis).

I don't think there is anything the economics profession agrees on in the way that biologists agree on evolution by natural selection (just as well as I am 50% confident that we would be right if we agreed on a yes or no question).

The implications of economic science are, first of all, generally implications of theoretical analysis not empirical results and, second of all, always inevitably implications of assumptions made for simplicity (or to get the result) not assumptions that anyone actually believes.

I personally claim that, for any policy you propose, I can write a model such that it is optimal. If I am right, there really isn't anything for liberals to disagree with. I haven't been stumped yet (OK no one has tried but come on it would be fun no ?).

As to GMO, I am a liberal and a fanatical enthusiast for genetically modified foods, the only cause to which I ever really devoted myself (until I found that I was just getting in the way). Anonymous should at least show a positive correlation between liberalism and GMO phobia before shooting his or her keyboard off. Good luck on a correlation between atheism and GMO phobia, I'm willing to bet a modest amount that atheists are less GMO phobic.

Also, of course, we don't know all about GMO dangers and not all GMOs are created equal, so it is not a well defined scientific result that GMOs are safe (certainly one could make a dangerous GMO I, for one, aint eating nothing with HIV genomes incorporated into its chromosomes).

update: On the principle of a link for a link, I note that Holler Back, memeorandum, the lantern, and some Russian guy have linked to my blog.
Interpersonal Comparisons of Utility
or
I was the least miserable person at Jean Francois Mertens' seminar

Over at Brad's blog, point 4 below has lead to a discussion of interpersonal comparisons of utility.



What is it with this obsession with pareto efficiency in welfare economics? Almost no relevant policy initiatives will ever be pareto effecient, but will, arguably, be very a great net welfare improvement.

Why this fear of interpersonal utility comparisance? Is it cause needs (as opposed to wants) might sneak in an muddy the waters or is it an atavistic leftover from a time when the liberalistic market was sacrosankt in economics?

Posted by: Tomas | June 12, 2007 at 01:05 PM


Tomas, the reason people hate interpersonal utility comparisons is because they don't work. For example, if you multiply anyone's utility function by a constant, and their observable behavior won't change at all. This means that people don't have uniquely determined utility functions, which means you can't compare them.

That is, if you try to compare two people's utilities directly, then you get to make up any result you want, because you can multiply one guy's utility by whatever constant makes the right person's utility bigger.

Posted by: Neel Krishnaswami | June 12, 2007 at 05:01 PM


Excellent point Tomas. 'Nother excellent point Neel Krishnaswami. I think the (valid) argument that interpersonal comparisons of utility are impossible has had immense influence on economists.

There are two ways to make interpersonal comparisons. One is explained by Jean Francois Mertens (this is a joke as "explained by Jean Francois Mertens" is an oxymoron). As far as I can tell after listening to him for 90 minutes, his proposal is as follows. First consider people whose happiness is definitely bounded above and below so there is an epsilon so small no outcome so wonderful that they would trade 90% of their lifetime wealth for epsilon chance of that outcome and vice versa there is none so horrible so that they would trade 90% of their lifetime wealth to avoid an epsilon risk of that outcome. This is reasonable, otherwise one can get to a St Petersburb paradox (warning pdf)


if so, for each agent say the upper bound of his utility is 1 and the lower bound is zero. The rest can be filled in observing his choices over lotteries. Now we have interpersonally comparable utility.

This can also work even if happiness is, in principle, unbounded, so long as, for each person there is an upper and lower bound of technologically feasible happiness (misery).

Finally, it can work even if there are no psychological or technological limits, there can be limits based on some non utilitarian principle of fairness (say starving to death is infinitely horrible but we believe as a moral principle that before we begin adding up utils we have to save everyone from starvation if we can(or maybe torture is infinitely awful but also before we think about utils we must respect peoples right to not be tortured as a prior and absolute moral principle)). The 0 is the lower bound of misery which we can morally allow someone to suffer (even if technology makes a much more horrible outcome possible).

This is really a simple method to arrive at comparable numbers which are linear in happiness such that your argument does not apply.

I wonder why this idea is not more influential (again a joke, Mertens may be the worlds worst lecturer).



The other is an "assume we have a can opener" approach based on absolutely absurd assumptions about mega rationality. Imagine being someone else (a super mega rational being can do this). Now imagine your soul being removed from you and planted in a random person (a super duper mega ratoinal being can do this). Now, if you can make rational choices under risk, you can decide how to maximize the sum of human happiness e voilĂ  (this approach is advocated by a friend of mine, Peter Hammond, so I am being polite).

Of to be really picky now that no one is reading, Tomas
technically you are arguing that Pareto improvements are impossible in the real world Pareto efficiency just occurs when no Pareto improvement is possible so there are many many Pareto efficient outcomes (slavery was Pareto efficient or else slaveowners would have freed their slaves). Pareto improvements are always impossible in the real world which is complicated (in simple models there can be simple Pareto improvements). Thus Pareto efficiency is just about nothing. It gets attention because of the result that, under very strong assumptions, the market outcome is Pareto efficient. Arrow proved this and has been trying to explain (to no avail) that the proof amounts to just about nothing ever since.

Tuesday, June 12, 2007

Provocative Displays of Utter Ignorance.

Alberto Gonzales was just saved by a filibuster from a vote of no confidence by the Senate and Mike Huckabee decided to emulate the "he who knows and knows not if he knows" claiming not to know if he owns a thong (he seems pretty sure that he doesn't have a miniskirt in his closet).

Via Mark Ambinder Via Matthew Yglesias

Q: I read that you're against miniskirts.

A: If a person dresses provocatively, they're calling attention -- maybe not the most desirable kind -- to private parts of their body.

Q: What about a burka?

A: No, that hides everything. I think a person's hair, arms, shoulders, legs are an appropriate display of who they are. I want people to be attracted to me because they find me interesting, not because I'm wearing something ... well, I doubt I own anything provocative.

Q: How about a minskirt?

A: A thong.


Let's edit some "I doubt I own ... a thong"
Robert Frank is interested in dumb blondes

Update: To be frank, there might be another explanation. Look
Here, here
Diane Sawyer seems to think only 3000 US servicemen have died in Iraq

I'm not sexist at all.

Oddly, I think that Frank is too interested in standard economic theory here, that is too inclined to assume that people are rational with simple desires (money and blondes roughly).

Basically he assumes "blonde" stands for beautiful and that beautiful women (and studly men aka dumb jocks) don't bother learning much because they don't have too and are thus rationally ignorant but not dumb.

His post is brilliant, of course, and it is very odd to complain about the conventionality of an economist whose raw data is a google search for dumb blonde jokes, but I expect even more unconventionality from Frank, and, besides, I have an alternative theory.

I ask "why are point guards and tailbacks short ?" I think the first point is that they aren't except compared to centers and linebackers. Only in the context of the NFL and the NBA are speed and agility strongly negatively correlated with height. In the NBA there are the quick and the tall (and once upon a time Magic). The reason that relatively large players are relatively slow is that, even though speed and height are positively correlated, no one is in the top 0.00002 % of both distributions (I think that 0.00002 % of US residents play in the NBA).

Similarly, I think impressions of blondes, athletes and smart people are disproportionally based on the extreme elite of the beautiful, athletic and brilliant (the last mostly via wealth and power). Within the ultra elite, brains and beauty are negatively correlated, because one makes it into the ultra elite by being extraordinary in some way, and few people are extraordinary in two ways.

Consider Maralyn Monroe, She was the second smartest person in the Monroe-Miller marriage (and Joe DiMaggio was, at best, her second smartest husband) because there had to be some reason why a nerdy looking guy like Arthur Miller made it into the trio of Miller, Monroe and DiMaggio.
A three-judge panel of the U.S. Court of Appeals for the Fourth Circuit just struck a glorious blow for liberty in the honorable tradition of the barons at Runymeade (although the panel was not quite so radically progressive as the barons).

I was absolutely delighted to read

"The President cannot eliminate constitutional protections with the stroke of a pen by proclaiming a civilian, even a criminal civilian, an enemy combatant subject to indefinite military detention," the panel found. "Put simply, the Constitution does not allow the President to order the military to seize civilians residing within the United States and detain them indefinitely without criminal process, and this is so even if he calls them 'enemy combatants.' "


I am absolutely horrified by my delight. How can we have sunk so low so fast that this even needed to be said ?

What will those radical judicial activists declare next -- that the sun rises in the East even if the President declares that it rises in the West ?

Monday, June 11, 2007

Possible efficiency gains due to taxes and transfers

Economists generally agree that redistribution reduces money metric welfare, that is the welfare effects of tax and transfer policies are equivalent to the welfare effects of a set of lump sum taxes and transfers which add up to less than zero. Thus desirable redistribution comes at a price and the standard question is how large is this price worth paying (Brad DeLong explained this to me in 1979). I certainly think that it is and would support massively increased redistribution from the rich to the poor even if I assumed that reality were well described by standard models. Indeed the general view of public economists who developed those models is very egalitarian (see Diamond Mirrlees , and Vickrey ).

In this post, I discuss the possibility that redistribution from the rich to the poor might increase money metric welfare. My point, if any, is pessimistic, negative and destructive, as, I think, the discussion suggests that economic theory is not able to answer practical policy questions convincingly, since, even an generally agreed claim depends on assumptions made for convenience. In each case, I will present an argument in which agents are rational utility maximizers and the world is in Nash equilibrium. I will not argue that it is plausible that the magnitudes of the benefits I describe are great enough to imply that redistribution increases money metric welfare.

1) First, I have to mention this paper to be fair to Alessandra Pelloni. In it we show that the standard result, taxing capital income would be a terrible idea if a Romer '86 endogenous growth model describes reality, depends on the assumption made purely for convenience that labor supply is exogenous. I think the paper shows that once one allows spillovers (or imperfect competition or incomplete markets) anything can happen. it has been published .

2) Another argument (and one which I personally find convincing) is the Robin Hood and the Welfare State argument due to Hershel Grossman . A standard assumption in general equilibrium models is that agents are free to keep their endowments and only trade if they want to. This assumes that there is no theft. If desperately poor people rob the rich using violence or the threat of violence, the rich can be better off taxing each other to make them less desperately poor.

3) Dissipative signaling. Theorists love the model of job market signaling . In this model agents perform a costly effort which produces nothing useful. The only point is that it is less costly to the able. Thus an equilibrium exists in which the able signal their ability by performing the costly effort (the example is obtaining a BA). Employers require the lowest level of signaling such that it is not optimal for the less able to produce the signal of high ability. The able can save on pointless effort by paying the less able to be honest. This is a collective action problem. They can implement this strategy by taxing each other to pay a subsidy to those who admit they have low ability and, therefore have low incomes. Obviously the policy helps the less able (they get something for nothing). Therefore, in a model of job market signalling a progressive tax and transfer program can be Pareto improving

4) A little bit of altruism changes everything. If people care about their own physical well being (pleasure minus pain) plus that of those they love plus 0.00001 times the well being of strangers redistribution can be Pareto improving. Non poor agent A doesn't need taxes and transfers to give his money to the poor. However, after he has chosen my level of private giving, he doesn't want to give any more via taxes. However he wants to give rich agent B's money to the poor. He cares a tiny bit about the small cost (in pleasure minus pain) to B and the same tiny bit about the large benefit to the poor. Increasing taxes and transfers from zero will make everyone happier if the population is large enough so that taxing one me is more than balanced by taxing lots of you (Brad DeLong explained this to me in 1988 progress albeit slow progress). I find this argument totally convincing. I note that, in this case, the transfer itself causes an externality. A much more demanding standard for efficiency increasing taxes (met by examples 1 and 2) is that the incentive effects of the tax and transfer program are good so it would be good if people believed that there will be a tax and transfer program, yet that program isn't actually implemented. This an occur if

5) people are at least slightly altruistic. This not only implies that transfers to the needy create positive welfare externalities but also implies that responses to the incentive effects of taxes can create positive welfare externalities. Imagine a medical doctor who is deciding whether to care for the rich and/or insured or the medically underserved population (say the homeless). I would much rather this MD take care of the homeless who might otherwise go without basic care.
It increases total pleasure minus pain for the doctor to take care of the homeless as they get little care and there are decreasing returns to medical care (implied by the phrase basic care). Only if people who aren't directly involved care because of altruism, does this increase in welfare imply an increase in money metric welfare.

The doctor cares about the homeless too, but isn't willing to accept the much lower income. In this case, the market is sending the wrong signal to the MD, since it doesn't internalise the externality of third people who wish someone took care of the homeless. A high marginal tax rate weakens the MD's incentive to take care of the rich (or insured) and can, in theory, allow the MD's altruistic impulse to overcome the desire for high income. This increases money metric welfare as many people who are neither doctors or patients feel better because they know people are getting basic care. This example is actually quite general as many people and firms face choices about whether to make products for the rich or non rich. A key example is the model T. Henry Ford wanted to make a car for regular guys even though profit margins were higher in the luxury car market. In fact, the perception that people face a choice between doing something socially useful and making money is quite common (search for "selling out"). Economists tend to argue against this perception, but all that is needed to make it possibly valid is that "socially useful" refers to utils and economic incentives imply counting the utils of the rich as much more important than the utils of the poor.

6) Selling out can be worse than taking care of rich people. Consider, for example, the lobbyist who lobbies for subsidies or protection for a particular industry. Economists will generally tend to suspect that the social value of this person's work effort is negative, however it may benefit his clients. The libertarian straw man will reply that the solution is to rule out once and for all any such evil interventions in the market. I will reply that I am talking about the real world. In my example, the sources of the problem are the legislators who don't love the market enough (or the constitution which allows them to sell out). I believe there are many other cases in which rent seeking is well rewarded. A desire to do something useful which is too weak to overcome the desire to earn a huge income as a lobbyist might be strong enough if the tax man took away a lot of that huge income.

7) also envy. Another externality is envy. To the extent that consumption is desired as a means of showing high relative wealth and obtaining status, an income tax has no effect on the welfare of the rich. If the rich are motivated by a desire to win the money game, an income tax does not tilt the playing field, so they don't suffer from paying taxes so long as their competitors pay them too.

I'd say that's a pretty long list.


update: Over at Brad's blog, this point 4 has lead to a discussion of interpersonal comparisons of utility.



What is it with this obsession with pareto efficiency in welfare economics? Almost no relevant policy initiatives will ever be pareto effecient, but will, arguably, be very a great net welfare improvement.

Why this fear of interpersonal utility comparisance? Is it cause needs (as opposed to wants) might sneak in an muddy the waters or is it an atavistic leftover from a time when the liberalistic market was sacrosankt in economics?

Posted by: Tomas | June 12, 2007 at 01:05 PM


Tomas, the reason people hate interpersonal utility comparisons is because they don't work. For example, if you multiply anyone's utility function by a constant, and their observable behavior won't change at all. This means that people don't have uniquely determined utility functions, which means you can't compare them.

That is, if you try to compare two people's utilities directly, then you get to make up any result you want, because you can multiply one guy's utility by whatever constant makes the right person's utility bigger.

Posted by: Neel Krishnaswami | June 12, 2007 at 05:01 PM


Excellent point Tomas. 'Nother excellent point Neel Krishnaswami. I think the (valid) argument that interpersonal comparisons of utility are impossible has had immense influence on economists.

There are two ways to make interpersonal comparisons. One is explained by Jean Francois Mertens (this is a joke as "explained by Jean Francois Mertens" is an oxymoron). As far as I can tell after listening to him for 90 minutes, his proposal is as follows. First consider people whose happiness is definitely bounded above and below so there is an epsilon so small no outcome so wonderful that they would trade 90% of their lifetime wealth for epsilon chance of that outcome and vice versa there is none so horrible so that they would trade 90% of their lifetime wealth to avoid an epsilon risk of that outcome. This is reasonable, otherwise one can get to a St Petersburb paradox (warning pdf)
http://www.springerlink.com/content/d0k7604j263788ht/

if so, for each agent say the upper bound of his utility is 1 and the lower bound is zero. The rest can be filled in observing his choices over lotteries. Now we have interpersonally comparable utility.

This can also work even if happiness is, in principle, unbounded, so long as, for each person there is an upper and lower bound of technologically feasible happiness (misery).

Finally, it can work even if there are no psychological or technological limits, there can be limits based on some non utilitarian principle of fairness (say starving to death is infinitely horrible but we believe as a moral principle that before we begin adding up utils we have to save everyone from starvation if we can(or maybe torture is infinitely awful but also before we think about utils we must respect peoples right to not be tortured as a prior and absolute moral principle)). The 0 is the lower bound of misery which we can morally allow someone to suffer (even if technology makes a much more horrible outcome possible).

This is really a simple method to arrive at comparable numbers which are linear in happiness such that your argument does not apply.

I wonder why this idea is not more influential (again a joke, Mertens may be the worlds worst lecturer).



The other is an "assume we have a can opener" approach based on absolutely absurd assumptions about mega rationality. Imagine being someone else (a super mega rational being can do this). Now imagine your soul being removed from you and planted in a random person (a super duper mega ratoinal being can do this). Now, if you can make rational choices under risk, you can decide how to maximize the sum of human happiness e voilĂ  (this approach is advocated by a friend of mine, Peter Hammond, so I am being polite).

Of to be really picky now that no one is reading, Tomas
technically you are arguing that Pareto improvements are impossible in the real world Pareto efficiency just occurs when no Pareto improvement is possible so there are many many Pareto efficient outcomes (slavery was Pareto efficient or else slaveowners would have freed their slaves). Pareto improvements are always impossible in the real world which is complicated (in simple models there can be simple Pareto improvements). Thus Pareto efficiency is just about nothing. It gets attention because of the result that, under very strong assumptions, the market outcome is Pareto efficient. Arrow proved this and has been trying to explain (to no avail) that the proof amounts to just about nothing ever since.

update: functional NMR supports point 4

Saturday, June 09, 2007

Scott Horton suspects that the appeal from the new to the old conservative will be rejected.

I therefore could never reconcile myself to the bill ..., which is expressly provided to remove all inconveniences from the establishment of a mode of trial which has ever appeared to me most unjust and most unconstitutional. Far from removing the difficulties which impede the execution of so mischievous a project, I would heap new difficulties upon it, if it were in my power. All the ancient, honest, juridical principles and institutions of England are so many clogs to check and retard the headlong course of violence and oppression. They were invented for this one good purpose, that what was not just should not be convenient. Convinced of this, I would leave things as I found them. The old, cool-headed, general law is as good as any deviation dictated by present heat.


h.t. Northrup (not to be confused with either Oliver or Lord North).

Once upon a time, one of his fellow founders of the Ancient and Hermetic Order of the Shrill, suggested that someone might make a blog (now defunct) consisting entirely of George Orwell's commentary on current events, the disadvantage of having been dead for over half a century (even then) easily overcome by genius.

Edmund Burke too. I deleted 3 words "I send you" which are not relevant to the present case. Aside from that, I wouldn't add or remove a comma. Knowledge of 230 years of events is no match for genius.
Lt. Col. Dale Kuehl's ... battalion ... the Sunni enclave of Amiriyah. [snip]

"We're going after al-Qaeda," a leading local imam said, Kuehl recalled. "What we want you to do is stay out of the way."


After a bit, Kuehl got the point and the rest is on the front page of the Washington Post. When will his commander in chief understand ? To destroy al Qaeda in Iraq we have to stay out of the way.

Actually the real plan is to arm Sunni insurgents who are now fighting al-Qaeda in Iraq. Arming both sides of a civil war does not sound like an ideal strategy, but it sure beats fighting against both sides in a civil war.

At the end of the article, there is a pessimistic view

The tank driver, Spec. Estevan Altamirano, 25, expressed skepticism about his new partners.

"'Pretty soon they run out of al-Qaeda, and then they're going to turn on us,' he said."

That was the best quote Joshua Partlow could get to prove he is a reporter not a cheer leader. The down side is that after a bit of US forces getting out of the way, the Sunni insurgents will run out of al Qaeda. Hmmm maybe when they run out of al-Qaeda we can leave. Oh no, silly me, that would mean al-Qaeda wins (except for the little problem of all being dead).

Thursday, June 07, 2007

Stem Cell Scientific Breakthrough garnished with total hokum about human applications and more Journamalism at the Washington Post.

Rick Weiss reports


Three teams of scientists said yesterday they had coaxed ordinary mouse skin cells to become what are effectively embryonic stem cells without creating or destroying embryos in the process -- an advance that, if it works with human cells, could revolutionize stem cell research and quench one of the hottest bioethical controversies of the decade.


[snip]


Last year, Shinya Yamanaka of Kyoto University identified four genes in mouse cells that have the innate capacity to turn countless other genes on and off in the proper configuration to make a skin cell revert to an embryonic state.

Now Yamanaka and two American teams -- one led by Wernig and Jaenisch and the other by Konrad Hochedlinger of Massachusetts General Hospital and the Harvard Stem Cell Institute -- have gained good control over the process. They infected mouse skin cells with viruses genetically engineered to activate the four key genes.


The explanation is a bit garbled. In fact, the viruses contain the 4 genes and do not activate the copies in the mouse's chromosomes.

The discovery is of amazing interest as pure biology. I find the fact almost incredible. The ability to identify genes which control (or in this case reverse) differentiation of mammalian cells stuns me. I've been out of the biz for a while, but I didn't expect biologists to find this holy grail so quickly.

Weiss, however, is interested in human applications and political implications. He does mention one possible problem

The approach would have to be changed somewhat for use with human cells, Plath and others noted. The viruses used to turn on the four genes in mice are of a type that can cause cancer, so researchers are now studying alternatives -- using other engineered viruses, for example, or feeding the cells small molecules that can activate the key genes.


over at The New York Times, the risk that the approach causes cancer is not described as if it were hypothetical.


An immediate issue is whether the technique can be reinvented for human cells. One problem is that the mice have to be interbred, which cannot be done with people. Another is that the cells must be infected with the gene-carrying virus, which is not ideal for cells to be used in therapy. A third issue is that two of the genes in the recipe can cause cancer. Indeed 20 percent of Dr. Yamanaka’s mice died of the disease. Nonetheless, several biologists expressed confidence that all these difficulties would be sidestepped somehow.

That does seem to be an important drawback no ? 20% is not "could" it is "has". Also, since 2 vital genes can cause cancer a different viral vector would not eliminate the problem.

Now I would have a suggestion. Add a 5th gene , herpes Tk, to the viruses. This would mean that cells which carry the viruses can be killed with gangcyclovir (sp?). Thus any cancers caused by the treatment would be treatable. I have never understood why this is not routine in gene therapy (neither does my dad). Also the genes could be linked to promoters which are only activated when exposed to some reagent (I think metalothionine promoter activated by heavy metals but, like I said, I am out of the business. Then when the organ is grown, the genes, which are no longer needed, could be turned off.

Still, it is a really really big problem. The problem that 20% of subjects died of cancer should not be summarized with the word "could".

Monday, June 04, 2007

The Bad Pun At The Heart Of Creationism

by tristero

If [belief in evolution] means assenting to an exclusively materialistic, deterministic vision of the world that holds no place for a guiding intelligence, then I reject it.


One word interests me here: "materialistic." Brownback, or rather, Brownback's ghost, is punning on the meaning of "materialism." Doing so is a small but important piece of standard "intelligent design" creationism rhetoric. And it highlights exactly how cheap a fraud it is.


Oh come on Tristero, even they can't be that crude and cynical can they ?

Oh yes they can

As for spirituality, Rove said, “As baby boomers age and as they’re succeeded by the post-baby-boom generation, within both of those generations there’s something going on spiritually—people saying it’s not all about materialism, it’s not all about the pursuit of material things. If you look at the traditional mainstream denominations, they’re flat, but what’s growing inside those denominations, and what’s growing outside those denominations, is churches that are filling this spiritual need, that are replacing sterility with something vibrant, something that speaks to the heart of the individual, that gives a sense of purpose.”


Actually, maybe "cynical" is too kind to Rove. He is trying to convince Jeffrey Goldberg, who is unlikely to fall for the equivocation. I think it is really possible that Karl Rove doesn't think there people can care about anything other than the quest for material things and religion (and he has said that he is not religious). Explains a lot no ?

The Rove quote via Matthew Yglesias who is brilliant as usual. Rove is also still on the internet high

The power of the computer has made it possible for people to gain greater control over their lives. It’s given people a greater chance to run their own business, become a sole proprietor or an entrepreneur. As a result, it has made us more market-oriented, and that equals making you more center-right in your politics.”



I'd say the fact that it's now more feasible for people to "run their own business, become a sole proprietor or an entrepreneur" means people are more interested in seeing the development of a policy agenda -- federal guarantees of health insurance, elder care, and basic child services -- that facilitate that sort of lifestyle.


So Yglesias argues that the Petit Bourgeousie are naturally leftist !?! This reminds me of the time he argued that the left is naturally non-ideological (OK he said liberals but he contrasted us with rightists). Rove is combining Friedman and Marx (the facial hair popular front). Yglesias notes that Generous Motors et al made it possible for US workers with steady jobs, health insurance and generous pensions to reject the welfare state, but that small (tiny) businessmen need the state.

So why is it that small businessmen have traditionally voted on the right ? Well when the left was organized labor this is understandable (I don't have to read history books or even remember to no, I live in Italy and the conflict between the interests of employees represented by trade unions and of small businessmen is a constant part of the policy debate). US trade unions are too weak to drive e-entrepreneurs to the Republicans.

Another issue is tax evasion. Tax evaders usually choose to convince themselves that taxes are theft. Everyone thinks everyone else is evading more than they are and feels cheated. Evasion limits revenues and programs. I am sure that tax evasion, anger over tax evasion, and sense of guilt over tax evasion is a major problem for the left in, say, Italy. It divides employees and small businessmen and prevents a broad social democratic coalition typical of Northern European countries with very few small businessmen.

I don't think the internet is going to aid Rove by making his natural opponents quarrel over tax evasion. It makes it possible to manage a tiny business. It makes it very very hard to hide transactions. It means less and less use of cash. It is not going to help Rove.

I think Yglesias is right and Marx and Rove are wrong. The changes in the US economy increase economic risk and reduce the role for employer based social insurance. Thus they help the Democrats.

Update: A link to this post.

Sunday, June 03, 2007

Below I take up a challenge from Matthew Yglesias to describe an economic model in which increased numbers of scientists and engineers in China and India (from now on chindia) imply that the US should increase public spending on science and engineering education. He notes that , in the simplest model, scientists and engineers in Chindia are substitutes for scientists and engineers in the USA so the optimal response would be to lower US spending the more scientists and engineers there are elsewhere.

I had two semi joke models. Now I think of a model which is almost not totally ridiculous (still ridiculous). One can argue that the services supplied by scientists and engineers in Chindia complement the services supplied by scientists and engineers in the USA even if they all have the same knowledge and skills.

The argument is that the most profitable use of engineers in poor countries is to assist the adoption (imitation if you want to be rude) of rich country technology -- that they are needed to design factories and to explain to untrained workers what to do with such factories. In rich countries, these needs are met and, besides, it takes fewer engineers to expand a factory than to design a new one (one can copy the old part) and many fewer to train new workers if the firm employs experienced workers who have learned on the job and can show the new workers what to do. Also chindian engineers might profitably spend their time adapting the technology appropriate to capital rich labor poor countries to their own labor rich capital poor countries. No sane manager would pay an engineer to do any such thing in rich countries.

Thus engineers in the USA are likely to work on developing new technology -- new products and processes. The increased supply of old products from Chindia increases the relative price of new inventions increasing the marginal product of engineers in rich countries.

Thus, even if the engineers are identical except for their location (and language skills) they may provide their employers with services which are different and, indeed, complementary.

Can such a model be written ? Sure. Do I believe it is relevant to the real world. Certainly not.

Saturday, June 02, 2007

Alessandra Braiotta Explained to me how to get access to Lexis-Nexis !!!

Now I am an insider who can use Lexis-Nexis not just a member of the googling masses.

I searched for "Robert Waldmann" and got this

The Capital (Annapolis, MD.)

November 05, 1997, Wednesday

Man gets 9 months for tussle with cops

BYLINE: By MARY ALLEN Staff Writer

SECTION: Inside; Pg. a7

LENGTH: 252 words

A man who started a violent, bloody struggle with county police officers will serve nine months in the county jail, a Circuit Court judge ruled this week.

... charges of second-degree assault, resisting arrest and fourthdegree burglary in an agreement with prosecutors.
In exchange, other charges of resisting arrest and reckless endangerment were not prosecuted, said Andrew Jezic, the assistant state's attorney who handled the case.

Judge Clayton Greene Jr. ... 11 years in a state prison for the three counts, but suspended all the time in favor of nine months in the county detention center with work-release privileges. He also ordered ... anger management counseling and five years of supervised probation.

The case stemmed from a July disturbance at the Friendly's restaurant at 412 Crain Highway in Glen Burnie. Police at the time accused ... of tossing a metal napkin dispenser through the drivethrough window and crawling into the business, cutting his arms in the process.

Officers said he was chasing his former girlfriend around the establishment when they arrived. He resisted being handcuffed and banged his head against a table, police said.

... Robert Waldmann asked Judge Greene ... house arrest.

"I guess what is most telling is your complete out-of-control (nature)," Judge Greene said.


Maybe I'll go back to google.

Update: The Robert Waldmann in question is Assistant Public Defender Robert Waldmann, not the defendant (my motto never libel a lawyer even if it is obvious to all normal people that you are joking). Pretty good job Robert, to get 11 years (11 years !!!) down to probabion plus 9 months with work release (as if the defendant is ever going to get a job after this story was published). Please don't sue me. I was only joking. You understand humor don't you ? For example you understand that a case "Robert Waldmann vs Robert Waldmann" will make both Robert Waldmanns laughing stocks right ? Right ?
Matthew Yglesias Comes up with a really tough Challenge.

"I'd love for somebody to write up a model for me in which the optimal level of US investment in math and science education is increased by an increase in the number of Asian scientists and engineers." -- Matthew Yglesias

"Isn't there some existence theorem that there is a second best argument for all policies ?" -- Robert Barro

I can think of two ways to make it work.

One is Marshallian spillovers imply increasing returns to engineers world wide. Basically we might benefit twice from our engineers if they invent stuff and China and India have enough engineers to adapt that stuff to labor abundant economies and we get more cool stuff from them (I mean what would be the point of inventing the internal combustion engine without Toyota to make decent cheap cars).

I don't think this is what Newtie had in mind.

The other is subsidizing education of engineers is a way to subsidize tehcnology intensive industries which might make sense as strategic trade policy. This is clearly what he has in mind (why is it that Republicans can be counted on to be against free markets ?). This would mean that we have to keep ahead so as to keep all of the high wage high profit margin production in the USA (except bit late for that eh). It can be made to work if we are at a sweet spot of the grabbing rents with subsidies curve and should stay there. As the amount of subsidies needed to keep that share of the good jobs industries in the USA increases in the number of Chinese and Indian engineers the desired result obtains.

Actually to get closer to a semi serious model, the claim must be that the elasticity of market share with respect to subsidies decreases in current market share. Thus the better other countries are at making the goods associated with rents (high profits or high wages given worker characteristics) the higher is the optimal subsidy.

In this neo-mercantalist model it doesn't matter whether the subsidy is of the form of paying to train engineers or cash later provided that engineer intensive industries generate high rents.

It is possible to write models in which mercantalists are right (see "Industry Rents: Evidence and Implications" by Larry Katz and Larry Summers Brookings Papers on Economic Activity:Microeconomics 1989 209-75 which I think is the same as "Can inter-Industry Wage Differentials Justify Strategic Trade Policy" in a book except Summers was advising Dukakis and said the phrase "Strategic Trade Policy" was a no no). You will noticed that Summers was not convinced by Katz and Summers.

Much theory due to Krugman (who was not convinced by Krugman).