30 December 2008

Crime "wave"

Crime is up!, we're doomed! or not

It is funny what experts do with numbers. In this case, it seems pretty obvious that population increases in a criminally susceptible population (from lack of employment, education, etc) would cause a rise in violent crime. And of course it did. That there's some additional crime may or may not be statistically relevant (it doesn't appear to be).

The real issue is the hockey stick graph method. I hate how people present trends as coming out of nowhere or totally disproportionate to their actual natures. There was a very slight uptick in murders by/of black youths. But on the NYT, it looks like the return of our vaunted super criminals from the early 90s. Naturally it doesn't even come close to that. Which makes me wonder why Fox is calling for a major push of dollars for criminal enforcement or whatnot. (Maybe he got burned by Wall St and needs money?).

And naturally, thinking often as an economist as I often do now, it doesn't appear to be a good idea to keep pushing the war on drugs either. But given my recent (online) arguments in this arena, it appears to be an entrenched emotional problem. People who have known addicts or had them in their own families tend to be overly protective and do not want to allow a legal market. I realize there's some pain involved. That doesn't change the objective facts. It is quite clear that what we have been doing isn't the way to cure that pain for others.

Also. I need more egg nog. That stuff IS addictive.

25 December 2008

good signs

trade is good

In case anyone is wondering. The holiday season tends to drain out free time for my prolonged thought processes. I've had trouble even getting around to finishing several books. Not that I had much actual shopping to do, seeing as I know few people and mostly have cousins to buy for. I think it's mostly a palpable weight that it assumes on my thoughts. Either that or the cold does it and I'm spending my time like Lewis Black with thoughts that fade out into "It's cold", with perhaps more or less profane additions involved depending on the thermometer and my ability to devise a word for my displeasure of frigid air.

In the actual news, this was a good sign. Especially for Vietnam, but more generally, restrictive trade policies are part of the underlying causes of the Great Depression (or at least, they certainly didn't help it). I should hope that we follow this example, particularly since Japan already had a credit crunch and real estate/stock meltdown over a decade ago.

19 December 2008

discombobulated parts

Who had Tony Parker/Longoria and Brandon Roy as the first two 50 point games of the year?

I've been following at some distance the scandal with the hedge fund fellow. I'm not that surprised to see a system used to scam billionaires, I'm just surprised it took the total economic meltdown of the stock market for people to figure out they were being scammed. I may look into it further, but it sounds more or less like any confidence scam, just conducted on a very large scale and with a supposed official status as a "hedge fund".

These sorts of things come up more and more often with a society that continues to extend the limits of the mobility of the concept of 'identity'. It was one thing when there are dozens of "John Smiths". It's another when there are dozens of the same "John Smith". It's not like that cloning technology is coming around the bend just yet. The fungible nature of who we are and who we can trust is becoming a marketable commodity. In some ways it may be good to have a market on trust. But like many other brand competitions, it relies on having someone else independently valuable worth trusting also. And the whole thing then relies on a sort of chicken/egg scam. "You can trust us" Why? "Because they said so". Why should I trust them? "Because we said so".

In the particular case, it works basically like that. "You can trust me because I work on Wall St and nobody seems to think I'm capable of doing anything wrong (even the people whose job it is to see if I was doing anything wrong)". Yes...quite a load of crap. Bullshit is rampant in reality and it seems better not to bother trusting people with such things (asking questions is really an annoying hobby to have if you want people to get along with you, I'm willing to hazard it at least). I guess it's good to see it get caught once in a while. But it doesn't mean we should let the burden for our inability to ask questions be shouldered only by a federal regulatory body (which also dropped the ball).

15 December 2008

honestly who throws a shoe?

Good work..sort of

I'm not sure a shoe would be nearly sufficient to accomplish anything (which I guess is the point). At least it is funny.

13 December 2008

So terrorists are bad right?

Uh, why didn't they check a few years ago?

I'm not sure why this particular headline was picked. It makes it sound like we were doing in part what I have suggested has been lacking from our overall anti-terror strategy. Namely, what is so troubling about American or American-"ism" that it fosters the growth of international terrorist cells in other countries (or in the US itself). I have to wonder why this question has been fundamentally rejected as unimportant. It does not rule out the prospect of invading sovereign nations as our game of nations rulers are wont to do. It does not rule out the possibility of non-interventionism, as many Americans used to be wont to do. It just asks some formative questions about the particular enemy we are engaging before committing to a strategic game of maneuver. Or as we are apparently willing to do, fumble around with troops in hostile territory without a clear idea what will pacify the natives, and play read and react with the terrorist's mail by over-analyzing everything that shows up on Al-Jazeera.

Since the actual article basically says what everyone should have known: that the American strategy is unchanged and still inflexible. It's pretty boring. One weirdo factor out of our Iranian experience was that assassinations are no good for creating foreign policy regime changes. Apparently that leaves on the table: embargoes (which don't work one iota on tyrannical societies and require multilateral support to have any effect at all) or full-out invasions (which seems mostly to induce advanced societies to produce enriched uranium while the little guys can get flattened if we care enough to bomb them). That should not be our only two options and having them as the only "out" cards in the deck seems to suggest we've made some fundamental errors in reaching them.

12 December 2008

politics are weird

It's amusing media types try to get around phrases like 'ass backwards'. Verbal contortions are quite silly. Bass ackwards?

10 December 2008

education for education

What are the criteria when there are no criteria?
There were a couple nuggets in here that sounded interesting (if not surprising).

"estimates that the students of a very bad teacher will learn, on average, half a year’s worth of material in one school year. The students in the class of a very good teacher will learn a year and a half’s worth of material." This is a crucial understanding to make. It very probably explains why so many teachers have to begin a year with a segment of review. Because their predecessors are by general measures terrible by comparison and didn't get to several important steps. There is also a reverse effect that needs better accounting: students who would get through an extra year's work in a subject. Both are possibly good calls for more flexible understandings of grade levels.

"Teacher effects are also much stronger than class-size effects. You’d have to cut the average class almost in half to get the same boost that you’d get if you switched from an average teacher to a teacher in the eighty-fifth percentile." -- Of course, we don't know really what a teacher in the 85th percentile is just by looking, or even through testing standards. But Gladwell naturally went on to state that the cost of an average teacher is the same as that of a good one. I would propose that it shouldn't be. Under a market system, we would probably see the same sort of guesswork and investigative research that goes into evaluating future quarterbacks or starting pitchers in sports, but we would also see better teachers commanding better pay over time, and less of a demand for smaller classrooms.

"have investigated whether it helps to have a teacher who has earned a teaching certification or a master’s degree. Both are expensive, time-consuming credentials that almost every district expects teachers to acquire; neither makes a difference in the classroom." -- This doesn't surprise me at all. Education majoring isn't as useful as majoring in the subject material and then understanding how to communicate that subject to a given body (small children, teens, whatever).

The prospect is offered later in the article that raising the standards on who gets to teach is ridiculous. What instead is needed is a sort of training camp for teachers after they are admitted, to shake out the good ones from the bad. That makes sense, is probably cheaper than our alternatives (requiring degrees and so forth, which raises the pay scale). Of course, the reasons for the rising hiring standards are generally the license systems being controlled by the unions rather than the educational boards. But that's a side issue. Further included as options: getting rid of or curtailing tenured positions. The flexible pay that I proposed. The general trend of economic thinking and evaluation isn't necessarily a progress to society, but I offer that it will allow some advantages...and this is most definitely one of them if we can revamp our educational system into something that works.

"What does it say about a society that it devotes more care and patience to the selection of those who handle its money than of those who handle its children?" -- I think it says that one industry is allowed to operate under a market economy and the other is not. But then that's only my opinion. The financial industry has has decades to develop a system of sorts in evaluating the people who enter and succeed at it. Football or baseball drafts are similarly confused, in part because of the draft system. But mainly they are still new evaluational processes, conducted under duress. At least baseball has a minor league system which allows the development (potentially) of prospects. Football players would probably demand much, much higher salaries for professional players than they already do if they had a similar apprenticeship system. Teachers on the other hand can teach for decades, just like a good financial planner. The impact they have is (possibly) measurable, and ideally greater than that of a good planner. Yet we have a virtually impenetrable wall in front of this means of growing and harnessing the great teachers and culling them out from terrible ones. I'd say it says the society has a fundamental problem with how it has organized itself along these crucial lines.

07 December 2008

more activity

This one is the Frankenstein type idea. The last one was my own.

It is likely that with a voucher type system (I'd prefer a tax credit system rather than a voucher, the tax credit is more individually flexible and evades the goofy problems of private schools often being parochial, for now), that competitive schools would emerge to challenge the public school monopoly. Right now with tax dollars forced to go to one location, there are no feasible economic reasons to create additional/different schools to meet a prospective demand for such. Only those parents capable of meeting through their own independent means fund their demand for a higher standard of education, hence only two private schools (the back and forth responses indicated there are only two private schools in the other fella's home state). If indeed we are speaking of collections of people so small that a demand would not be economically viable, then there is a problem. There are few such communities left. The answer is not to get better teachers only in public schools, but to have better teachers available period and have parents/students able to select them through a market process rather than through a (union controlled) license system.

This was unsurprisingly met with the resistance that is deserved for supporting vouchers even partially. "When vouchers have been implemented, it has been shown it works as a tax cut for the people already going to private school. The problem is they can accept any one they want. They can not let in poor people or minorities or any kids that achieve at a low level. This would cause the public schools to be the schools of last resort and only house the lowest achieving children, and no teachers would want to go there. This downward spiral, i fear, would create a illiterate class in our society, something much worse than the status quo." So I had to defend my actual position: tax credits used to create a totally private market for education. My position is unfortunately too radical to be popular (much like privatizing OASI), but I have no problems with that.

There are several fundamental problems with this, but since many of them are caused by my previous vague preferences, I must be more clear: I very much prefer a tax credit system to a voucher program. A voucher leaves in place the current problems and places at their side an option which doesn't really offer much. A tax credit does more what I want; kill off the public school system monopoly and create a marketplace for education.

For my purposes the essential problems are that there are 'government/public schools' and 'private schools'. My interest is that there should be 'a school' or 'a better school', or 'an affordable school'. There should be no "public school system" at all. This is not to say that there would not be (extensive) public subsidy involved, but my preference would be that the subsidy of education is actually executed by the free choice of individuals given tax credit by government(s) for spending money to foster educational growth in others. No preference should be exercised for a state monopoly on education as this severely limits the ability of individuals to supply education for their progeny.

1) The current status quo you are defending is precisely the spiraling scenario you are afraid of. Some public school districts are ALREADY a school of last resort whose students are generally poorly educated (if they are still attending) and whose districts are generally composed of the poor or minorities. In strict terms, families are stuck there because they cannot execute the choices available to them to improve the education of their children. They cannot afford a private school, even with a voucher system, and they cannot afford to move to a more affluent neighborhood with a genuinely useful public school system because the property values are much too high. Their children must suffer with what they have, and in many cases, suffer they do. Under a non-monopoly system, there would be options available to them to spend whatever funds they can desire to do so for education and a basic requirement that those funds afford for their children at least a minimally competent education (most essentially issues like basic math and literacy along with a smattering of civic awareness, but certainly there are many other issues which might be considered of value to the public utility of education). There is no accountability in the present system owing to the government monopoly over school systems in many locations and we should expect no responsiveness, adaptivity, or improvements so long as a monopoly remains firmly in education.

2) As previously discussed, a person without cannot make these choices. But to put it quite plainly, a person with means can already perfectly execute the system you are describing as happening only under a voucher or tax credit system. They can, if they choose, send their children to 'a better school' by moving to an affluent district or paying for private schooling. If it is their wish, and unfortunately this is still true of many, they can send their children to a school with very little in the way of minority attendance (and that very often more or less only Asians, depending on local demographics). A monopoly is naturally more discriminatory than a free market as it imposes fewer internal costs on discrimination (of any prejudicial format), where as the market imposes the costs of discrimination directly. A system which allows favorable preferences to be expressed for higher values placed on education ONLY by people of means is necessarily unfair for everyone else, as is a system which naturally excludes minorities. Such systems impose a social cost of vigilance against that minority or illiterate underclass and deprivation of the diverse contributions and scholarship potentially provided by such. Education in its pure ability can become a meritocracy where people can achieve through their innate ability or interest, regardless of means or race. Right now it does not achieve this end. I propose that it would most nearly do so under a responsive market circumstance and propose to abolish the state monopoly, not merely place alongside it an attractive option for people already able to manipulate it to their advantage.

3) I am not sure that I understand the significance of objection to accepting or rejecting 'low achievement'. The issue of education should be one of supply and demand. The demand of parents is for their children to get an education, generally speaking, and a supply will be made to meet it. Even low achievement students will therefore have options, such as schools or teachers which specialize in such 'problem students' or special needs (a name which should really apply both to students of minimal or exceptional ability). As undesirable as these options are in the present circumstances, they can be accounted for. Teachers might expect (and receive) better pay and have better administrative support in exchange for tackling these problems. I would also presume that the necessary involvement of parents could improve where they are more responsible for the decisions of where their children will attend and where they are aware of the immediate costs of that attendance (even if they are re-compensated). This factor can be overvalued but is of some consequence. Right now it is of no significance.

Or alternatively/alongside we could have more practical educational options combined with a re-accessible education system all along its length, at least beyond primary education, which should probably be mandated to about 7th grade. Either high school or the first two years of college are a joke, and many people shouldn't be doing both. Nor am I at all ready to be convinced that a high school diploma is somehow essential. In any event, academic achievement is often, by itself, useless except to other academics. The assumption that all students should be at least adequate academics is a value judgment which isn't realistic. Not everyone likes reading Shakespeare or studying WWII while commenting on politics, as I do. If we assume that they should be competent in such things in order to be considered literate or educated, then I have to suggest a functional disagreement with what the aims of education should be. Namely that it should provide a desire and ability to learn, provide some basic tools to do so, then to help feed whatever hunger for knowledge and wisdom that creates. Naturally some subjects will be disagreeable to the individual or their ability and they may be of low achievement in these arenas. I'm not how sure that's the state's problem to resolve to the exclusion of other agencies and, more importantly, without the option of choice by the individual and their parents on how to resolve it.

activity responses

Since I've been busy lately arguing over some various political questions I'll re-post some ideas I sketched out. One of them is actually mine, one is basically my adaptation of several old ideas.

"Should the government become the spender of last resort and have a massive stimulus to boost the economy?" -- Further clarification of this relies on the idea that the government could just buy up cars or TVs, or whatever in order to inject spending in the system. A direct stimulus check to the public it is argued would go into savings or debt, or mortgages and wouldn't cycle as much as spending does. There's a lot of problem with the idea that we should be spending (even though not spending is what causes recessions in part..and it means I've been spending because everything is so damn cheap). I was also very worried that this sort of idea was basically a soft price floor which price controls are generally a horrid economic idea.

I'd propose something a little different if his (Blankley's) idea is to have government buy stuff. Take people who are currently filing for unemployment and ask them if they'd like to have something to do for a little extra cash. Tell them it doesn't involve bombs or guns (which may dismay some). Give them a mission to go out and purchase a car or TV, or whatever it is the government wants them to buy on their behalf with a pre-paid credit card. If they spend less than the amount necessary to get the item(s), then they get a commission on the difference and still collect unemployment as usual. If they spend the amount or more, they get unemployment (and I guess the difference), but nothing else. They should have plenty of time to bargain hunt. If they spend the credit card on strippers or whatever, it's gone (they don't have to repay it), but they get nothing. They forfeit unemployment benefits and obviously no commissions. It should be spent on the requested item(s) only. That gets around the price floor from negotiated government spending, gives unemployed people something to do in the 'make work' tradition of FDR (and I'd have no problem extending unemployment out for a reasonable time of service in this task), and it still injects some money into the economy by force feeding spending. I'm not fully in favor of this idea either, but I find it much preferred to a price control system created by massive non-defense government purchases in consumer arenas.

I'm not seeing a reason to use a price floor as consumers won't buy below their market price which merely encourages more people not to produce (or adds to the inventory surpluses of manufacturers/retailers, which would create a massive price war between MSRP and retail except for the Supreme court's decision last year). Consumer spending makes up something like 70% of GDP, not the government's budget. If they don't buy, there is no way the government can make up the difference. That's many trillions of dollars we're talking about.

05 December 2008

college costs alot, news at eleven

Somehow I don't think this was a breaking news story. College has generally always been the expensive province of the wealthy, with some exceptions made for the gifted few. Even today with our expanded demand for college educated persons to do everything, despite the fact that few professions have better than a tenuous link to what a college education provided historically, the actual percentage of people attending what are perceived as prestigious universities (those which would therefore actually have some supposed impact on future earnings, again a tenuous link) is still roughly the same as it always has been. Roughly 10% used to get a college degree, it's roughly 10% who get either an advanced degree or attend a 'top school', even though the percentage of graduates increased to almost 30%. Virtually millions of people are effectively scammed into believing they need a college degree for...something.

To me, the fact that tuition has increased dramatically isn't surprising at all, it's predicted by basic economics. In an issue of supply and demand, where the supply is roughly fixed by the amount of people able and interested in teaching at a university level (consider for example that to do so, one should be actually versed in the subject, rather than what we often do for public schools), and the demand keeps going up and up, the price would naturally go up and up. We have made this worse by demanding through public policy that we expand the amounts of people going to college and by thus throwing money into it. A college which knows people will pay any price to go, even if it means leveraging their future earnings for a long, long time, will be able to charge any price. The results are somewhat disappointing. Of course, there are some professions which are less than concerning when this creates a strange over supply of people training in them. But what it does to say, the medicinal arts, is park a large portion of people in less than their favorable choice of specialty (or even a specialty period) in order to pay off their financial aid.

There are other issues with this that make less sense. For example, most people generally attend school/college once. They pay it back, if they must do so (some of us get scholarships or pay while working), over a long period of time during which time they have (hopefully) improved their earnings potential by going to school. The amount of money for an advanced degree may be roughly comparable to that of a home mortgage. And yet the amount of money it may potentially gain may be many thousands more than this (though this is a fishy calculation used to advertise going to college in the first place). More over, most people don't just buy one home in their lifetime, or especially, one car, which is roughly comparable to an undergraduate degree at a subsidized state college. It is assumed somehow that the price tag for college should be somehow 'cheaper'? Why? If it is both valuable enough to make a priority for people to do it, then why should it be 'affordable' in the view of the public. It should represent a cost or at best, a costly investment in human capital.

Most of the 'alternatives' that exist are perfectly reasonable. For example, going to a two year school to blow through all the gen ed requirements is both cheaper and possibly more useful. Testing out of them entirely is probably the most efficient bang for the buck, but not everyone can do that. Most people can attend a subsidized two year college, blast through a series of what would otherwise be boring classes that would cost ten times as much at another school, then transfer off to that 'another school' and finish out their degree. There is nothing wrong with this decision. Virtually all gen ed classes are the same whether they are at Harvard or Cape Cod Community College. The difference is in price and perception. It might be assumed that at Harvard, more is expected of a student (ie, the 'professor' doesn't do much actual teaching). But otherwise the distinctions are meaningless for an undergraduate.

The final problem is that is a burden on poverty. I agree with the conclusion that making college ever more expensive provides a cyclical situation, especially as we make our claims that somehow everything requires a college education to get a job in it. There are simple economic solutions to this. Freidman basically proposed a garnishment system on future earnings, sort of like a direct investment in human capital and its associated returns. I'm not totally certain we should be subsidizing the cost of higher education, but if we must do so, the premise should actually be consistent with the effect. The effect of providing loans and subsidies to universities has been to raise the effective cost of entry. As with health care, a subsidized system may be necessary or desirable to gain positive externalities for the rest of us. But the effects of such a system have proven to gain very unintended negative problems without a simple transparent system working to help control costs.

While a university education may be seen as an intrinsic good, it is effectively difficult to place an actual price tag on how we value it (sort of like a mastercard commercial: priceless). Hence we seem to be willing to find some way to bear any burden, this despite any reasonable measures on what that burden actually gains. It is difficult to quantify what an undergraduate degree gains for the person who attains it. A college graduate is apt to be a person of some natural intellect, and some natural ambitions already. Such a person might very well be capable of making, through their own exertions, plenty of money. Or it is entirely possible that only through whatever specialized training they sought and became certified in were they going to make money. Personally I suspect that the actual economic effectiveness in college education is through the networking that develops. Placing ourselves in contact with other people of similar means and goals allows us a framework to find support in as we take on the new tasks of finding gainful employment later. These casual links with professors and other students are very useful for this purpose. I highly doubt that the actual learning could not occur outside of an academic setting, particularly in some courses and that such activities are really a cover for the actual purpose of a college: academic research or scholarship. As a result, I'm not sold that such things are necessary good for the entire American adult population or that such benefits are not generally to be taken as intrinsic to the individual partaking of them, rather than as some general social good to be sought after and attained. Education in and of itself is a valuable commodity, worthy of subsidy and public supports. Higher education seems to me to be a valuable commodity to the person and individual, rather than always a socially migratory good of others.

02 December 2008

Maybe now somebody will listen

Economists take over

I still remain cautious in my judgments of the incoming administration and its potential plans to aid our ailing economy. But indeed things like this make for considerable appeal. Someone willing to call out a stupid political gimmick as a meaningless economic gesture (the gas tax holiday) may be able to avoid doing most of the other political gimmicks that presided over previous economic problems (namely populist mandates such as price controls, further contractions of money supply, endless indictments and recriminations of CEOs, etc).

There are indeed some interesting problems emerging, in that it will be possible to use the economic injections to pass several Obama reforms in relatively unrelated areas, such as infrastructure or environmental infrastructure, neither of which will 'create new jobs' as is suspected. But there are tempting conclusions being proffered by these incoming economists and the elected Obama camp that suggest some of his campaign rhetoric was just that. Considering the general ignorance of the public on economics, it may even be possible to basically say we as a country are doing one thing (and harness whatever placebo effectiveness that has on the country's economic psyche), but do something different. This to me represents the scene in Idiocracy where Joe claims he can talk to plants in order to convince the dolts that water was needed.

It confuses me greatly where a large contingent of either major party is chronically anti-intellectual and thus virtually ignorant of issues that relate to empirical data (in this case, economics, but certainly the other major sciences can offer dozens of similar examples) and yet they seem still to want intellectuals to solve their problems. That strikes me also as a serious problem.