Wednesday, October 31, 2012


In 1996 my dad took me with him to the polls. He told me to punch out the chad for Bill Clinton, but I told him I wanted to vote for Bob Dole. Wasn't my dad supposed to vote for him because they had the same first name?

Thursday, October 25, 2012

The Total Package

I like how people ask "are you voting for Romney or Obama?"

There are three branches to the federal government: legislative, executive, and judicial. You get three votes to influence the legislative, two for senators and one for a congressperson. Your other vote, for president, represents your opinion on the entire two branches of government.

When you vote for president you're voting for who you think should be on the Supreme Court, which judges should set on other federal courts, who should be the Attorney General and which cases should he file, who should be the ambassador to the PRC, who should be the treasury secretary and the chairman of the federal reserve, which advisors should be on the Council of Economic Advisors, . . . oh and who should gave the state of the union address and sign legislation from congress.

I prefer to think about the election in partisan terms because most of what you need to know about all these nominees is which party they will come from. Imagine if Charlie Crist, the moderate former governor of FL, run for president as a Republican. Who would he nominate to the court? Who would run his state department? Who would be on his Council of Economic Advisors? Now imagine if he changed parties (he probably will) and ran as a Democrat. Would they change? I think so. So the man who runs probably isn't as important as his party and that is why I'm a party line voter for president.

Monday, October 22, 2012

Debate Thoughts

I watched some of the presidential debate tonight, mostly not by choice. Some thoughts:

1. My wife thinks the moderate "looks like a goldfish."
2. The moderate thinks "everyone likes teachers" but, of course, not everyone likes the American Federation of Teachers which is why we should hear about in a debate!
3. No one should have more gel in their hair than Mr. Schuster--that means you, Gov. Romney.
4. Get the fuck off my TV! I wanted to watch How I Met Your Mother on CBS tonight, but evidently new episodes of the Prime Time lineup were pushed back to next week so they could broadcast the debate. I don't want the president making speaks in the Magic Kingdom, blocking the main entrance during my vacation. Get the fuck out of my life.
5. Chuck Todd mentioned the "Acela corridor" on NBC. Did Amtrak pay him to say that?

Confidence Intervals

When you do a study on how something is causing something else you generally report two findings, whether your evidence is precise enough to detect if an effect exists and whether the effect is important (this part of subjective).

The second one is the important one but because it is subjective people prefer to put the emphasis on the "objective" test for statistical significance. Objective is a relative term here because, in true, personal biases can have an enormous impact on the result of the test and, more importantly, its interpretation.

Consider "The Effect of File Sharing on Record Sales An Empirical Analysis" a really terrible written paper by a professor at Harvard Business School and a professor at the University of North Carolina. The question they are interested in is whether (and how much) file sharing of music reduces CD sales for music.

Basic economic theory says that being able to get music "for free" should reduce sales of music that costs money. The baseline model would ignore transportation costs and whether consumers care think about the ethics of piracy and just focus on costs. In 2004 songs on CD costs on average $1.5 per song while storage for a 3 MB .mp3 file cost about $0.002 and the time to search for the MP3 (say 20 seconds) is worth about 5 cents . In other words downloaded songs cost about 1/20 as much as music purchased on CD.

If we estimate the elasticity of demand for music and the number of CDs the average person buys we can extrapolate how many songs the average downloader would download. Lets just use 1 for the elasticity and 2 for the number of CDs per year so that the average college student downloads 400 songs per year.

Since it is assumed downloaders do not per for any music the lost sales are about 20 songs and the lost sales per download is 20/400 = 0.05

In the paper the authors find have very imprecise estimates so they find sales increased by up to about .5 units per download or decreased by up to about .5 songs per download. Since one extreme would imply that sales jumped by a factor of over 100x and the other implies negative music sales, all else equal, it is safe to rule both out. Whether the impact is -0.05 as theory predict, -0.027 as they estimate, or 0 as they assume for no apparent reason, not much can be said. Nevertheless they told plenty of newspapers that the effect was 0.

Friday, October 19, 2012

Kristof and the Rule of Two

Nick Kristof presents a case study for the Rule of Two.
Let me offer two counterarguments. 
First, a civilized society compensates for the human propensity to screw up. That’s why we have single-payer firefighters and police officers. . . . Compassion isn’t a sign of weakness, but of civilization. 
My second argument is that if you object to Obamacare because you don’t want to pay Scott’s medical bills, you’re a sucker. You’re already paying those bills. Because Scott wasn’t insured and didn’t get basic preventive care, he accumulated $550,000 in bills [he didn't pay] . .  . We’re all paying for that.
By the rule of two, one of these arguments has to be bullshit. Obviously here it is the second one. Taxpayers and the insured currently pay for a substantial amount of free riding. Kristof would have you believe that under Obamacare, despite substantial expansions of Medicaid and large subsidies for others, we would pay less for other people's healthcare because so much expensive treatment would be avoided when diseases are detected and treated early on. That is mostly bullshit, or at least wishful thinking. There is a substantial costs to screening everyone to detect disease early. In most cases it costs as much or more as waiting and treating the few cases that develop. The CBO estimates for the cost of the Medicare expansion and subsidies is positive to the tune of hundreds of billions over 10 years. If the savings from preventative care were so substantial they should be negative.

Kristof knows this, but at least he is transparent enough to include the real reason he favors increasing health care subsidies and even to put it first.

The Rule of Two

I have this rule that when I hear someone make an argument and they give me two or more reasons they are right, I always assume they are wrong. Some examples:

We went to Iraq to prevent WMD terror . . . and to spread Democracy.

Cash for clunkers will stimulate the economy . . . and lower carbon emissions.

Affirmative action is helps level the playing field . . . and diversity is good for every college student's education.

We should make Medicare a voucher system to increase competition . . . and to reduct the deficit.

Whenever you hear more than one reason to support a policy, odds are someone is just trying to find something that sticks. Why would people do that, why not just offer the one compelling reason that convinced them? Probably because they know you disagree with them on that point, so they hope they can sway you with other reasons -- reasons that they don't even find convincing.

And that is the generous interpretation. Sometimes people give you a lot of (bad) reasons because they want to hide the real reason they favor a policy. M.D.s will tell you that "brain drain" of medical professionals causes shortages overseas, hurting the poorest, and lowers quality standards in the U.S. . . . but not that it increase supply putting downward pressure on wages. The foreign aid lobby will tell you that the U.S. spends lots of money screening immigrants for TB each year and that dangerous strains of TB from overseas will eventually kill Americans . . . but only when they can't sell spending on overseas TB treatment for humanitarian reasons.

So whenever I hear two reasons to support a policy I assume that one of them is bullshit and that the other is so weak not even the person saying it believes it.

Thought Police

There is this stereotype that some liberals are so liberal that they will attack you for even asking certain questions. Do blacks have lower SAT scores, in part, because they study less and not just because of bias in the test? Don't ask, racist.

But in most cases there is a reasonable response: no one is attacking someone for asking the question, just for intentionally get the answer wrong, probably due to prejudice. At least some of the time that is plausible.

But today Time just published this headline from Toure:

Will Blacks Vote for Obama “Because He’s Black”?The question itself is offensive and racist. Here's why

A lot of the time journalists don't write their own headlines. I don't know if he wrote the subtitle, but he does say it in almost the same words in his article "the idea that blacks support Obama just because he’s black is itself racist."

The strange thing is that Toure brings up these statistics "Obama leading Romney among blacks 94% to 0%" while "Al Gore won 90% of the black vote in 2000 and John Kerry won 88% in 2004" and then concedes "[yes], Obama’s blackness is part of why many blacks support him."

The strange thing is that Toure goes on to write about why blacks should vote, in part, based on race because race is "a deep shaper of your life, a significant part of your soul, such that [Obama's victory] is critical to your life and worthy of support."

I wonder what people will think of this argument in 50 years. When my mom was a kid every Irish person she knew in New York was a Democrat. They all liked the Kennedys, in part I guess becasue John's "victory helped Irish-Catholics feel fully American." But my generation, or maybe it's just me, look back on the era of machine politics with shame, not pride.

Friday, October 12, 2012


Evidently no one has ever heard of mularkey. I guess that is why they can't identify the horseshit leaking out of the politicians' mouths for what it is.

If I were an idiot I'd be voting for Paul Ryan. The guy promises that you can have your cake and eat it too on entitlements. Medicare will be cut because there is a low-cost low-benefit option but if you can't want the low-beneift option you can keep the old one and . . . somehow that still saves money?

I'll be back after I eat 10 McRyans. You see they introduced a low-calorie soup for dieters, but if you don't want to eat if you can have the McRyan burger and still lose weight.

Friday, October 5, 2012

TV is "America's Biggest Classroom?"

When did cutting subsidies for children's TV become an attack on education?

The old liberal line used to be that we needed universal pre-K and subsidized daycare so that parents would not "use the TV as a babysitter." Somehow that become "TV is out best educational device" so we need to encourage kids to watch more?

This is almost as bad as eating fried chicken to "protect First Amendment rights."