Localism: local regulation and the FCC

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I’m amused that the organizers of the Maker Faire in NYC have discovered that they need to replicate on a local level the function of the Federal Communications Commission on the national level: “Due to the nature of the event, we need to know if you plan to use radio frequencies and if so, what frequency and/or frequencies and the amount of power you are using so we can coordinate placement and usage. There was a detailed list of potential radio frequency issues requested on the maker entry form.”

Generational Forgetting

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I see a mention over here of something called “generational forgetting.”  I like this term, and I sometimes talk about the syndrome (I assume) it labels.  The pattern it labels is scale free and once you have recognized it you’ll see it everywhere.  It goes like so:

  1. Problem arises that creates pain.
  2. Solution demands collective action, creation of a complex institution or widespread change in social norms.
  3. Such a solution emerges; via solidarity and institution building (driven by the pain of the problem).
  4. The pain is  dissipated.
  5. The institution and norms switch into a  maintenance  mode (driven by fear of the pain, and  collective  memory).
  6. Time passes, new generation arrives, memory of the pain becomes based in stories rather than  experience.
  7. Norms and institutions decay as they are critiqued and defunded.

This pattern, and it will often be cyclic, is particularly intense around problems requiring collective action.  During step two all the usual conservative talking points will be deployed, and particular variants of them honed.  When we get to step seven, like bitter zombies, they will all rise from the dead hoping to reclaim the day.

There millions of examples of this.  For example if you work in some organization you will probably have little trouble thinking of some social norm inside the organization that appears to require a lot of ongoing persuasion (moral-suasion) to maintain.  The actors who are engaged int hat persuading are doing the work of #5; and if you dig you can usually retrieve horror stories from phase 1.

I’m sad to see that the term “generational forgetting” isn’t actually widely used.  It appears less than ten thousand times in Google search.  It appears to be a term of art used in the back rooms of the social science ivory tower, where the pack in the graduate students.

Trust and Crime

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The following framework for thinking about crime, or the breakdown of trust, is excellent:

“Trust is what stands between individual actors and defection (as in the Prisoners’ Dilemma game); between civilisation and anarchy. Trust relates to the risks we must take and the relationships we must establish and maintain to promote sufficiently high rates of cooperation and low rates of defection or cheating for the society to hold together, whether a cycling club or the Roman Empire. Trust can be intimate – as within families – or impersonal, as where I trust the new contractor servicing my gas heating because I trust the certification and monitoring system that causes him to respect safety standards.

The issues to which trust, cooperation and defection pertain are defined as societal dilemmas, pitting actors in conflicting, competing or collaborating relationships. These are often ‘wicked’ issues, and many universal (like the Tragedy of the Commons). Well thought-out examples pepper the book, from price-setting/fixing among sandwich makers or industrial cartels, to bank misbehaviour, overfishing, military desertion, littering, adultery and volume crimes like burglary. These are neatly and consistently presented as tables which (adapted from p131):

  • Identify the dilemma (e.g. Doping in professional sports)
  • Identify the society (All the athletes in the sport)
  • Identify the group interest (A safe and fair sport) and group norm (Don’t take performance-enhancing drugs)
  • Identify the competing interest (Winning and making money) and corresponding defection (Take performance-enhancing drugs)

The analysis continues by describing the trust mechanisms available to the society in question to encourage people and corporations to act in the wider group interest. These come under four categories comprising the fundamental and universal ways whereby societies hold themselves together. The example continues:

  • Moral (e.g. guilt at not winning fair-and-square; shame at failing as role model)
  • Reputational (e.g. keep fans and commercial advertising opportunities by maintaining reputation of a fair player)
  • Institutional (e.g. civil or criminal bans on performance-enhancing drugs)
  • Security (e.g. testing for specific drugs)

The Institutional approach lies at the heart of defining certain behaviours in response to certain societal dilemmas, as  criminal  rather than merely defecting.”

That’s from a book review  of amusingly titled: “Liars and Outliers.”    I guess I’ll need to read the book now; because that applies to a lot of situations.

Damn it: the tax system is not progressive

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I wish the right would stop complaining  about how unfair the tax system is to the rich.  That’s a lie.  The tax system is regressive.  The well off pay a smaller percentage of their income than do the poor and the middle class.  It’s a lie and they shouldn’t be allowed to get away with this lie.

The recently released video of Romney’s at fund event at the home of the infamous sex party hosting hedge fund manager holds few surprises about what the far right actually believes.  E.g. that Democrats are  indistinguishable  from welfare queens. That the nation is drifting toward a democratic take over.  That the underclasses spend their day in  leisure,  sucking the life force from the helpless upper classes.

That polarizing view has been a core value of the far right forever.  And recently it has become a core believe of the Republican party.  They went off the deep end a long time ago.    Low (even medium) information voters are still unlikely to realize this. Still.

Some of press have called this a “gaff.”  You know … falling off message is one thing and revealing your honest beliefs is another.  This was  the latter.

The tax system is not progressive.  It is not Robinhood.  It does not tax the rich more than the poor.  In fact it taxes them less.

I have found the press coverage frustrating.  The counter point to his remarks has been weak.  The meme he was repeating was that 47% don’t pay takes and just take from those that “make.”  He obviously believes this.  The counter point has been in order:  Try to go all technical an point out that he is confusing the listener by a narrow definition of taxes and then highlight other taxes.  Then there is the appeal to emotion response – were we mention the elderly, children, students, and  military.  Finally there is more sophisticated technical point that this situation was engineered by Republicans, as part of the reegineering they did to the poverty programs over the last decades.  For example they introduced Earned Income Credits so that firms could offer low paying jobs and with the help of the credits people could barely survive doing those jobs – assuming they can figure out how to do the paper work.

What frustrates me is that these reports don’t bother to mention the core lie.  It is a lie that the tax system is punishing the rich and transfering money to the poor.  It is not.  The tax system is not Robinhood.  If you think so then you are misinformed.  The rich pay a smaller portion of their income and wealth into the system than do the poor.  If we embrace the victum/parasite framing Romney is using – well then – it’s actually the other way around.  They are the parasites and the lower and middle class are the victums of their free riding.

I rarely do this, but here is a very old posting that explains the details.

I suspect a lot of people believe that their state has a progressive tax structure.    That belief is wrong.    The well-off do not pay a larger percentage of their income and wealth than do the poor.  There are a very few exceptions, Delaware for example – at least in 2002.  Here’s what it really looks like.

Here for example is my state.

That shows how the mix of taxes effect things.  In Massachusetts it’s the sales tax that really does the damage.  The mix of taxes that implement this lovely situation for the parasitic well-off varys from state to state.  New Hampshire manages to be extremely regressive; using a different mix.

If you want to screw the poor then here some hints:

  • Avoid an income tax
  • If you have to have an income tax be sure it’s flat. (that’s what we do in Massachusetts)
  • Adopt a sales tax and some excise taxes
  • Use property taxes
  • Exclude capital gains from income
  • Use tax credits to counteract progressive taxes; say on federal taxes or certain property taxes
  • Be sure your sales/excise tax includes groceries, smokes, beer, and gas
  • Don’t index to inflation if forced into tax brackets, exemptions, or earned income payments
  • Empower local governments to raise funds using regressive means

No doubt there are much more creative schemes for assuring your tax system screws the poor.  I certainly can think of quite a few without much effort.  This posting is based entirely on the original edition of what is currently  this report, from  www.itepnet.org; you can quickly  find your own state here.

This is Washington state, which makes me wonder how those Microsoft and other high tech winners feel about this.

The success of self deluded lying men

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Boffins are spreading the news that throwing like a girl might just be optimal if at the time you happen to be carrying a child on your hip.  I think a lot of sports would be improved if we required the players to carry a child! (see article in the Washington Post, or if you want the story with a healthy dose of Evolutionary psychology snark the Jezzabel version).

Meanwhile boffins have long known that, generally speaking, people have an inflated view of their past achievements, and further that men’s delusions are about twice the size of women’s.  So, if your in the mood, you can forgive the lying bastards since they know not what they do.  Speaking of mood the  optimistic, manic, cheerful folks are more delusional; while the  melancholic  are less so.

In another study Boffins looked into the possible benefits of making inflated claims about your past performance – i.e. bragging, lying, or shall we say marketing our personal brand.  Turns out it’s quite beneficial, if you want to be in charge. Groups are more likely to promote the braggarts, and particularly if cash rewards are involved. (see pdf, or this article is briefer).

He’s not lying, it’s just honest overconfidence.  I prescribe a child on the hip.

Forbidding Standardization

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The FCC tests radio equipement to assure they conform to the regulations.  This is to keep your neighbor’s wifi, CB radio, baby monitor, etc. from conflicting with yours.  They worry.  They worry that the consumer will modify the equipment.  In my neighborhood I’ve got neighbors like that.  So the FCC has instructed manufactures to make it hard to modify the equipment, for example it is should be hard to modify the antenna on your wifi hub.  They say that the devices should be  “designed to ensure that no antenna other than that furnished by the responsible party shall be used with the device.”

I’m inordinately  fascinated  by connectors and their standardization.  For example I love the story of how, to avoid construction workers stealing lightbulbs, they bought non-standard lightbulbs that screwed in backwards during the construction of the old World Trade Center in NY, for more examples see  this posting.

While it is common to see that kind of behavior from vendors, for example Apple’s pentolobular  screws  and the complementary asymetrical screw hoax, I’m delighted to see an example from a regulatory agency.

Just and FYI – I do not consider standardization to be an unalloyed good.  The lack of standardization is one way to keep economy’s of scale under control; which in turn helps to avoid concentration of power and wealth.

Search: Egg and Sperm

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I’m thinking about sex, dialectics, and search due to a book I’m reading about evolution. The germ cells (egg and sperm) of most species have evolved to be extremely different. The human egg is the largest, most spherical cell in the body; while the sperm is the smallest straightest (thread like). The cells are few; and the sperm are numerous (40 million sperm in an ejacualtion is considered a problem).

This is quite a dialectic. Puts the 1%/99% to shame.

The sperm are R-selected and the eggs are K-selected. Millions of enthusiastic optimistic naïve sperm rush out seeking success; and honestly they all fail. Meanwhile the eggs wisely hide out, they know this is serious.

What’s up with this design pattern? Clearly some powerful selective forces are a work here. The hypothesis outlined in the book is that this is a solution to a search problem. Apparently it’s true, if you have lost your friend at the mall it’s best if one of you stays in the same place while the other searches for you. And, it’s easier to be found if your big and visible. In fact eggs are bigger than they look, since they emit a cloud of pheromones.

Like elite organizations of many kinds the eggs try to make the applicants solve complex puzzles to prove they are worthy prior to letting them in. They want to be found, but only by the best.

Findablity is a common problem. Buyer and sellers want to find each other. Publishers and readers, employeers and employees, boys and girls, etc. etc. In the social sciences (business for example) the usual solution to this problem is to add in intermediary; the point of rondevous: the dating bar, the classified adds, the day labor broker, the search engine. And nature does this too. Insects intermediate between plants to provide reproductive introduction services.

The egg and sperm design pattern is exactly what’s going on when firms establish developer networks. The firm, in the K selected role, would like to attract the innovations (babies). So they create an attractive platform and labor to attract developers to innovate upon it. Most of the developers fail (die) trying.

I suspect you could go a long way in a lot of directions with this analogy.

This and that

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This emerging story of how the major banks have been misreported the interest rate they were paying to borrow/lend money to each other is beyond outrageous.  The LIBOR (London InterBank Offer Rate) is has many uses and this fraud corrupted all those uses.

For example it signals what the market thinks about the stability of the banks, so by reporting the wrong values the banks were hiding their instability.  There is no doubt that if they had reported it accurately then at least some people would have reacted.  For individual investors those reactions could have saved them from huge loses.  For regulators it might have reduced the magnitude of what happen in the world economy.

But that is not why the banks were engaged in this fraud.

It’s not often you get to talk about quadrillions of dollars; but this is a good time.  The US economy in total produces around 15 trillion dollars a year.  But there are financial instruments around which 500+ trillion dollars worth of trades happen a year.  The LIBOR forms the foundation for  some of these instruments.  The banks undermined these markets by manipulating the LIBOR.  It looks to me like quadrillions of dollars of transactions are now in doubt.

…

I’m reading “Red Plenty”.  It is, sort of, a series of short stories about the Soviet Union’s experiment with central planning.  Each story is a beautifully written; with sympathetic and complex characters.  I was delighted to encounter in the midst of it a story about  a middleman.  Literature where the middleman is the hero are exceptionally rare, but apparently not entirely so.

One of many threads that runs thru the book is how the central planners are caught between a rock and hard place.  For example at one point the eggheads point out that nobody can create a supply meat at the regulated price and convince the planners that if only they would raise the price of meat sufficiently then there would be meat.    So, they raise the price, the workers complain, some of them step into the streets, some of them gather in the town squares.  Some local officials say unfortunate things.  Soon men appear on roof tops and bullets tear into the crowd.

A problem of central planning is that you lose the plausible deniability that markets provide.  When the market raises the price of meat the public doesn’t march out of the office building and into the town square; and even if does the elite merely shrugs and mutters:  “Tell it to the invisible hand.”

But in sense that’s not true.  Political scientists assure me that the single most potent predictor in electoral upsets is the public’s sense of how much better or worse off they are v.s. 12-18 months ago.  So the embrace of a market economy v.s. a centrally planned one doesn’t entirely shield the political elite from the being asked to take responsibility for hard choices.  One group of the elite capture the benefits for disruption while others are take the blame for the resulting displacement.

…

This chart from Mike Konczal  illustrates a fascinating statistic that I didn’t realize the government collects – how many people quit their job.  Mike posts this statistic because of a conversation that’s broken out in one corner of the blog-o-sphere about – a worth conversation about how if we are to go all gushy about “freedom” we really ought to spend some calories discussing “freedom” inside of commercial contexts.  In particular how much or little freedom most employee’s have.  Unsurprisingly there are people on the Internet who whole some pretty outrageous opinions.  For example that there’s not problem with the boss insisting that you sleep with him, or wear diapers rather than use the bathroom; since your always free to quit.

Quiting is, is of course, one of the ways firms get clear feed back about their employment regime.  If lots of your workers quite, presumably you might adjust your terms of employment.  Hershman wrote a nice book about this “Exit, Voice, and Loyality;” where in he makes short work of the fanciful presumption that exit – the best loved feedback signal of simple economic models.  Early in the book he allows as the claim that exit works as a feedback signal has no experimental data to back it up.

What this chart shows is that when the economy tanked people stopped quitting in droves.  Apparently 38 Million corrective signals have gone missing.  What can this mean?  Three thoughts come to mind.  Employees have become significantly more loyal or vocal.  Employers have become much nicer.

Where are the statistics on the volume of employee voice?

Blah Blah Blah

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From here. This chart is the usual VoteView scatter plot with one more bit of data added.  For those who haven’t been following along each point is a member of congress, and the X axis shows how economically conservative the member is (e.g. how much they prefer legislation that servers large economic entities v.s. small ones); and the vertical economic axis is their preferences on civil rights issues, higher is (roughly) more socially liberal.  The red points are the Republicans and the Democrats are blue.  As you can see there are few, if any centrists, and the two parties are totally polarized.

The added datum is the “grade level.”  It’s based on a somewhat silly measurement tool that used on text to estimate the grade in school the reader would need to have achieved to read that text.  In this case the text is the member’s statements in the congressional record.

Honestly I don’t know that I’d draw any conclusions from this, but don’t let me stop you from that pleasure.