Saturday, May 21, 2011

Great article about facts and opinions

A friend pointed me to this great article in The Week that, in my opinion, explains so much about partisanship. Note that I'm not talking right-wing vs. left-wing, this is a human artifact. We simply don't like to be wrong.

The rapture is due to happen in 2hrs 10 minutes from now. I'm sure that tomorrow morning, when the rapture didn't happen, the folks who believe in it will have some perfectly "rational" reason for why.

Sunday, May 15, 2011

Why the TSA needs to be dramatically overhauled

I know that I've complained about the TSA before. I need to do so again. The TSA is structurally broken.

Allow me an analogy.

I think we can all agree that the acceptable number of murders in, say, Chicago, is zero, that even one murder is one too many.

In that vein, imagine if we proposed that in order to reduce the number of Chicago murders to zero, we are going to impose the following new policies:
  • No weapons of any kind, or things that could be weaponized (steak knives, for example) are allowed within city limits.
  • Because arson could lead to murder, we ban all flammable liquids within Chicago. For good measure, though, since we can't easily distinguish flammable from non-flammable, we disallow any other liquids over 3oz from being taken into the city.
  • Every person, without exception, is subject to a full search of everything in their possession in order to enter the city. They can refuse, but will be denied entry if they do.
  • For good measure, a bunch of people who we think might be associated with gangs, or otherwise just don't seem right to us, will simply be prohibited from entering Chicago. The list of these people will be secret, and there is no recourse if you find yourself denied entry into Chicago.
This might achieve the goal of reducing the number of murders to zero (then again, it might not). But I think we can all agree that these restrictions would be ridiculous overkill (pardon the pun) to the murder problem, and an unreasonable restriction on people's rights.

Yet substitute "airline system" for "Chicago", and "terrorism" for "murder" (not that there's any meaningful outcome difference on the latter substitution) and it's exactly what we have with the TSA. Why do we treat these two situations differently?

It should not be surprising that the TSA is a one-way ratchet to increasingly intrusive and unreasonable "security" procedures. After all, we've given the TSA a single goal: zero tolerance for any sort of security threat. If they think of anything that could be exploited and don't do something to address it, they will be blamed, yet there is little or no incentive to put limits on how intrusive these procedures are, nor any reason to evaluate their efficacy. (And of course, the TSA is famous for thinking up new threats only after somebody has tried it, not before). As a result, first we take our shoes off, then we can't take liquids on board, now we have a choice between giving up our right to travel or giving up our right to be free from unreasonable searches.

So now we have full-body scanners and/or intrusive pat downs. Is there any evidence that these actually enhance security? Have they found any bad guys with the new procedures and technology that they would have missed with the old metal detectors?

Perhaps, although I certainly haven't heard of it in the news. So at the moment, the hypothesis that "The TSA is effective at providing security" seems to me to be without data to support it. One might argue that we haven't had a terrorist attempt to do anything with an airplane originating in the US (the TSA's jurisdiction) since 9/11, and therefore the TSA is doing its job. But I'd counter that with the observation that we hadn't had a hijacking or similar incident with a US-originated flight in the 20+ years prior to 9/11 either (pre-TSA), which is more than double the current lifetime of the TSA, so I don't think a 10-year absence of airline terror in the presence of the TSA proves that they're doing their job.

In fact, I have an alternative hypothesis: it is not the TSA that has kept the skies safe. Rather, it is old-fashioned intelligence gathering and alert passengers. In fact, I can think of 3 attempts to commit an act of terrorism on an airplane in the past several years. One was the plot to blow up airplanes over the ocean using liquid explosives, while the other two were the shoe-bomber and the underwear-bomber. The first, of course, was thwarted by intelligence, long before the TSA would have gotten involved, while the latter two were missed by TSA-equivalents in other countries (the flights didn't originate in the US) and were thwarted by alert passengers.

I recognize that my examples here are anecdotal and don't actually prove anything, but they also don't support the idea that the TSA is actually effectively thwarting terrorism, and they certainly are suggestive that my alternative hypothesis could very well be the accurate one.

I'd love to hear any sort of counter argument supporting the argument that the TSA is providing any meaningful value.

Tuesday, May 10, 2011

Pakistan: get over it

Pakistan's president yesterday loudly condemned any notion of incompetence or "complicity" with Al Queda and expressed indignation at the violation of his country's sovereignty, particularly over the fact that Pakistan was not consulted prior to the raid.

I understand that of course he has to say that to pacify his domestic audience. It is, after all, them who he serves.

But that doesn't make it total nonsense.

I should start with a few bits of defense for Pakistan. First of all, I believe that the government is in fact our ally. Not a good ally or a reliable ally, and one with decidedly different priorities and interests from us. But Pakistan has also lost many of its citizens to Islamic extremists, and the rational ones in the government realize that the monster they helped to create is dangerous to them. (Hmmm...that wasn't much of a defense, was it?)

Secondly, nobody has yet produced any evidence that the Pakistani military or ISI knew about or protected Bin Laden. Again, I suppose that wasn't a strong defense, but it needs to be said.

But enough of defending Pakistan. The president of Pakistan deserves all of the suspicion and ridicule he is experiencing.

First of all, most of the criticism is that Pakistan should have known that Bin Laden was in their midst. It is perfectly reasonable to ask why the US, halfway around the world, was able to figure out Bin Laden's presence, when the elite of the Pakistani military trained only half a mile away in ignorance. It begs the question of whether the Pakistanis were merely incompetent or actually in cahoots. Not a comfortable question for sure, but I'm afraid it's a perfectly reasonable one to ask. It is, I suppose, possible, that Bin Laden was just that good and his network of support was just that secure (i.e., a third option in the loaded question above), but as we learn more, that possibility seems less and less likely.

Scondly, there is good reason that we didn't coordinate with Pakistan in the Bin Laden raid. Whether or not your military or intelligence organizations knew about Bin Laden's presence, somebody did. Al Queda and the Taliban have a strong presence in the country, and the lack of concrete evidence tying that support to the military or ISI is no reason to assume that there is in fact no such support. As such, any warning or coordination would have had a very real - and very reasonable - risk of tipping Bin Laden off. Pakistan can be indignant about not being told, but the cold fact is that they did not deserve that level of trust. Yes, I suppose we did violate their sovereignty. And if Bin Laden had been in, say, England, with whom we do share common interests and where there isn't a strong base of support for Bin Laden, and where corruption is not endemic, we wouldn't have done it without coordination or permission. But alas, Pakistan is no England, this is a war, and this was not a police action. If a country does not want its sovereignty violated, perhaps it is better to first ensure that the world's most wanted terrorist does not take up residence within its borders.

My message to Pakistan: you'd have done the same if the tables were turned. Your protests are hollow and unjustified. Get over it. If you really want to help defeat Al Queda, after screwing up Bin Laden so badly, you should double down and work with us on the follow up: interrogation of Bin Laden's widows and helping track other cells and other operatives.

Pakistan's government may actually be an ally. And The fact of the matter is that Pakistan

A spending problem? What is the right level of spending?

I saw a Facebook post the other day that mentioned that "the problem with our deficit is that congress has a spending problem." It's a sentiment that I've heard many times, and while it's not surprising that this generally comes from conservatives (it is, after all, not exactly a common liberal complaint), what I find fascinating about the statement is that it's ironic coming from folks who are very market-oriented.

Let me quickly say that I have no problem with the sentiment being expressed here. I am extremely worried about our deficits and debt, and spending is obviously one of the two ways you can address these huge problems (the other, obviously, is revenue). While I personally think we need to address both spending and revenue, my point in this post is not to make an argument about that particular issue, if only because I don't think I have anything particularly enlightening to add to that discussion.

Rather, I want to focus on two somewhat more esoteric points:
  1. The amount of spending is "correct".
  2. Politicians are not addicted to spending
Huh? Am I making some liberal argument that we aren't spending too much? No, no, don't worry - I do agree we are spending too much. But the amount of spending is nevertheless the "correct" level, in that it is the best level as determined by the relevant marketplace (in this situation, Congress).

Allow me an analogy. What is the correct price of a share of, say, Microsoft? That is fundamentally an unknowable question. There are lots of ways to compute it, but they don't all agree. We generally view markets as the best way to determine such prices, and when we say that a share of Microsoft is worth, say, $25.50, that doesn't mean that everybody agrees that it should be $25.50. Some people believe it should be higher (and they're generally buying), some believe it should be lower, but this is the price where such forces balance out. At a broader level, the level of the Nasdaq index is a similar process, just one level higher. after all, nobody really buys or sells "the Nasdaq index", instead they just do the aforementioned process with each of the constituent stocks of the index and the index rises or falls as a side effect of these thousands of individual price movements. So if you ask "what's the correct level for the Nasdaq," you're really asking a nonsensical question. The correct level for the Nasdaq is not a particular value, but rather a process, and as long as it is computed correctly from its member stock values, then it is at "the correct" level. It may be a bubble, it may be oversold, but it is nonetheless "correct" and it is meaningless really to suggest that the value should be higher or lower. (Predicting where it will go is another matter altogether, but that is not the same thing as saying it is "wrong".)

Congressional spending is really the same way. The total spend is not something anybody formally agrees on really. Rather, it is a whole bunch of individual spending decisions: defense, social security, etc. Like the stock market, each of these individual spending items has people who think spending should be higher and those who think it should be lower, and the ultimate value in the budget is not correctly viewed as a "consensus" level so much as a "market clearing" level. And to continue the analogy, the total budget is analogous to the Nasdaq index: it's just the result of thousands of smaller market-clearing decisions.

The analogy carries one step further as well, actually. The stock market, for all of its efficiencies, is still a rather imperfect pricing mechanism, which is why prices swing, bubbles form and deflate, and so forth. But we use it because it's better than any alternative yet devised. I do not need to point out the flaws in our government's budget process (often compared to sausage making), but democracy, like the market, is also the worst possible way to do this, with the exception of all the others that have ever been tried. (Apologies to Churchill, who I believe is the source of that).

But the larger point here is that if you don't like the level of spending on an individual item (whether you think it's too low or too high), it is generally the result of something akin to a market process. If you don't like the result of it, you really have two options: (a) get involved and start buying or selling in that "marketplace", or (b) get the process changed. Note: the former is generally easier than the latter.

Which brings me to the second point. We don't have a spending problem per se. Politicians do indeed spend money, but they're not spending it on themselves (other than corruption, which thankfully is a minor problem in the US), so it's hard to see them doing it to serve some personal need that they have. I think a far better explanation is that politicians are addicted to their jobs (or to power), and spending is a powerful tool for satisfying that need.

More to the point: politicians don't spend money just to spend it. They do it for constituents. They build roads in their districts, steer contracts to their districts, spend money on things that their voters believe to be important such as national defense or social security and so forth. Which means that in the end, it's the voters who receive the benefits of the spending.

There's an important corollary to this: we all complain about the overall level of the budget and say that spending is too high (and we're right), but the problem is that pretty much all of that spending is going to things that somebody wants. Everybody has ideas about where spending should be cut, but there's very little consensus among those ideas for this reason. So it all gets worked out in the aforementioned budget "marketplace", as a huge aggregation of individual spending decisions.

We have met the enemy and it is us, not the politicians. If we really want to reduce overall spending (and I reiterate that I am in that camp), the only effective and non-reckless way to do it is to slog it out item by item in the budgeting marketplace. Focus on the individual spending decisions and the "budget index" will fall.

Friday, May 06, 2011

Environmentalists hate progress, right?

I keep seeing posts by folks (usually, but not always, on the far right) portraying all environmentalists as extremists who want us to effectively go back to living in caves in the name of reducing carbon footprint, and who are otherwise opposed to freedom and economic growth. In fact, some of the rhetoric here comes right out and says that it's about "control," such as Penn & Teller's episode of "Bullshit" where they "debunk" recycling, in which they declare - without any evidence - that control is in fact the real motive behind getting people to recycle. I'll leave my problems with this particular P&T episode for another day, but I think I need to stand up for environmentalists.

I recall a number of years ago hearing a conservative friend of mine talk about how when environmentalists see a suburb he sees wealth, better lives for people, freedom, etc., but environmentalists just see negatives: sprawl, degraded habitat, etc.

Who is right? Well, of course the answer is "both." Nothing is free; upsides like greater wealth and economic growth come with costs. You can focus on whichever you like, you can decide the where you believe the balance between the two lies, but it is naive to pretend that either upside or downside doesn't exist.

Environmentalists indeed tend to focus on the downsides of growth, and focusing on the downsides of course never makes anybody popular.

But let's use an economic analogy. At most businesses, there are two ways to increase profits: increase sales or lower the cost for each sale (thus increasing the margin for each sale). These are, of course, not mutually exclusive - in fact, they are often self-reinforcing. WalMart, for example, has a laser focus on lowering costs, which allows them to offer lower prices, which helps them to increase sales. And at a successful company like WalMart, I should point out, nobody who points out a way to lower costs gets accused of being opposed to increased sales.

Of course, businesses focus on those costs for which there is an economic signal to which they can respond - i.e., it is usually something that can be represented on the balance sheet or income statement.

Environmentalists are the cost-watchers for the stuff that doesn't have those direct impact on the financial statements. This doesn't mean they aren't costs, just that reducing the impact of these costs doesn't improve the bottom line, so the economic signal to reduce those costs is not nearly as strong, and thus it often requires other forms of pressure, such as that provided by environmental organizations.

I don't mean to imply that companies like WalMart don't respond to environmental costs - in fact, large companies such as WalMart, Coca-Cola, etc., have been leaders over the past decade in recognizing the need to make their practices sustainable, to lessen the impact of their operations on the planet. And they should be commended for this.

And I also don't mean to imply that there aren't extremist or naively idealistic environmentalists who truly want to reduce freedoms and/or economic growth in the name of saving the planet (or "control", if you are prone to conspiracy theories). Earth Liberation Front comes to mind here. Thankfully, these represent a tiny fraction of environmentalists and are viewed by the greater environmental movement the way the majority of Caucasians view the white supremacy movement - i.e., with great disdain.

But it is irresponsible to paint all environmentalists with a broad "extremist" brush when they fill an important role as the cost-watchers for our ecosystem.

Monday, May 02, 2011

Climate vs. Weather

OK, folks, I feel compelled to weigh in on this. I'm tired of people looking at individual weather phenomenon (Katrina, the recent tornadoes in the south, cold winters, heat waves) and declaring a connection to (or a refutation of) global warming.

It's apples and oranges. Weather and climate are different things.

Allow me the analogy to a roulette wheel in a casino. Imagine that when the wheel is spun, you knew the exact velocity and position of the wheel. You then use that to predict which number will be pointed to at any given moment, using the basic laws of physics. You predict what number will be at the top in 2 seconds, 4 seconds, 6 seconds, and so forth. Your prediction for 2 seconds will likely be pretty good. But due to imprecision in your measurements, your prediction for 4 seconds will not be OK but not as good as the 2-second prediction, for 6 seconds will be not as good as the 4-second prediction, you will not be terribly accurate at all at predicting the final resting number of the wheel. (If you want the details for why the predictive ability falls off, it is due to chaos theory.)

This is analogous to predicting the weather. A roulette wheel is of course far simpler than the weather (and doesn't have nearly the chaos-inducing non-linear variables), so in practice you'd do a lot better than a weather forecaster, but the principle is the same (and this is, after all, an analogy). In particular, you can see that predicting the roulette wheel (weather) gets significantly more difficult as time passes.

If the casino made its money "predicting" the roulette wheel, they'd lose money like crazy and go out of business quickly. But of course, we know empirically that as a rule casinos have a bit of a habit of making, not losing, money.

Why? Simple: they're not predicting the weather, they're looking at the climate. If predicting the weather is analogous to predicting the outcome of given roulette wheel spin, looking at the climate is analogous to predicting the AVERAGE outcome of MANY roulette wheel spins. In other words, it's looking at the statistics of the system rather than any individual outcome.

In the case of the roulette wheel, we know that over the long time, a fair roulette wheel will end on red a little less than half of the time, on black a little less than half of the time, and occasionally on 0 or 00. And that "little less than half" is where they make all of their money at the roulette table.

In the same way, climate is not about individual weather events, it's what the statistical averages and trends are in temperature, precipitation, etc. Having a "warming" climate doesn't mean that winter snowfall stops, or that we have nothing but heat waves and no cold snaps. But it does mean that over a long-ish period of time, when these things are averaged out, there are measurable trends in the statistics.

One heat wave, one hurricane, one deep freeze - it is impossible and thus meaningless to say that any of these would or would not have happened without climate change, or that any such event proves or disproves climate change theories.

This is like saying that 4 spins of the roulette wheel which, in a row, yield 4 reds somehow "proves" that the odds of the roulette wheel favor red. Assuming the wheel is not rigged or flawed, this proves nothing of the sort. People who make similar claims relating weather to climate are doing everyone a disservice by saying so. Climate science has its flaws, but its model and accuracy will be refined and improved in the aggregate, not by the individual weather event.