g m g D e s i g n . c o m

This is amazing. Moscow’s many stray dogs are adapting to the harsh conditions of that city, some even learning to ride the subway and get off on the right stops! (Many humans are barely able to do that.)

From the article (emphasis added):

But beggar dogs have evolved the most specialized behavior. Relying on scraps of food from commuters, the beggar dogs can not only recognize which humans are most likely to give them something to eat, but have evolved to ride the subway. Using scents, and the ability to recognize the train conductor’s names for different stops, they incorporate many stations into their territories.

Additionally, Poyarkov says the pack structure of the beggars reflects a reliance on brain over brawn for survival. In the beggar packs, the smartest dog, not the most physically dominant, occupies the alpha male position.

It’s interesting that baseball players seem to be more than willing to take the steroid gamble (even though some deny it had anything to do with their successful careers). After all, at some point in the future, they might not be able to continue doing so with impunity—they may even get in legal trouble for their crimes, which is exactly what would happen to the average (non-famous) person who engages in such behavior. And of course, their Hall of Fame spots could be in jeopardy. So why risk taking artificial testosterone in a sport wherein greater strength is ostensibly of no advantage?

My suspicion—and note that I do not believe there is definitive proof of this (yet)—is that the baseball players who take testosterone supplements do so because it does make them better baseball players. High levels of testosterone don’t just alter muscle mass. Testosterone causes other changes in the brain in addition to the obvious signals to increase muscle mass. High levels of testosterone are correlated with spatial intelligence, a characteristic that is useful in baseball or any other ball-focused sport.

From the article (emphasis mine):

Significant improvements in cognition were observed for spatial memory (recall of a walking route), spatial ability (block construction), and verbal memory (recall of a short story) in older men treated with testosterone compared with baseline and the placebo group, although improvements were not evident for all measures.

The article doesn’t mention hitting a ball, but I find it highly probable that higher serum testosterone levels would also enhance the ability to target baseballs and hit them with a greater degree of accuracy. Hence, if my pre-suppositions are correct, then it’s very likely that use of testosterone-increasing substances (including testosterone itself) would enhance one’s ability to play baseball.

I’m guessing most baseball players won’t admit that, or likely, aren’t even aware of it. However, it seems naive to me to consider steroid use in baseball or any other sport to be of negligible benefit, given the correlation to spatial intelligence, not to mention any other potential gains that could conceivably be conferred by greater testosterone use.

Reading and listening to the coverage and commentary on healthcare, it’s hard not to become cynical. On the Right, you have repetitive talking heads with no interest in adding depth to the debate, instead arguing bellicosely against what they see as government-run healthcare (a credible threat, I concede), but providing no additional insight beyond that. On the Left, we’re met with the supposed “reality” that the “market has failed”—as though the market is free and unregulated to start with—and that the government must step in and save healthcare as we know it, providing liability coverage (insurance) to millions of Americans.

Yet the truth is in between, and the visions of both the Left and the Right are at best useless and at worst dangerous. There are real consequences to failing to understand economic problems and issuing false solutions to those problems. Using the fiat hand of government to distort markets has led to many severe consequences, and a few catastrophic consequences as well.

Something must be done about healthcare. That much is certain. Idealistic libertarians—and I’m including libertarian-leaning conservatives* in that group—are wrong to discount the need for action—for “change,” if you will—in healthcare. We do need change, and simply blocking that change isn’t enough for conservatives as a political force nor for the country.

Liberals*, for their part, are correct that we need “change,” but they fail to understand the necessary change, instead opting for change that “feels better” and is politically easier to explicate rather than sustainable and fiscally responsible change. They look at the deplorable number of non-insured without ever asking the obvious question:  why is medical treatment so very expensive that even routine procedures are unaffordable without insurance? The issue of cost control is met with an outmoded response: use the coercive power of government to control costs via legislation; furthermore, compete directly with the greedy, heartless private sector via a “public option.” Neither pseudo-solution will lower costs in the aggregate, instead shifting the cost burden and likely increasing aggregate costs.

My own libertarian instincts notwithstanding, I feel like the only practical and politically feasible solution is to mandate that every American have some minimal level of healthcare. Call it catastrophic health insurance, if you will. It would be like a high deductible health plan (HDHP), but primarily intended for ER visits and other major events. Of course, Americans could get beefier or additional insurance as well, though tax incentives toward “premium” (or Cadillac) plans would be removed, as would tax favoritism toward employer-sponsored health insurance. That coupling would be weakened over time. To truly distribute risk—which is the intent of insurance in the first place—non-discriminatory laws would be enacted such that insurance applicants are not rejected for existing medical conditions. More people would have health insurance even as insurance itself was taking a less active role in medical treatment.

In fact, the problem with healthcare is insurance itself. That is not to say that high healthcare costs are primarily due to insurance companies per se, though they do share part of the blame. Government shares a significant portion of the blame, and of course the public and media share the remaining. I’ll leave room for blame toward other sources as well, but that’s beyond the scope of this blog entry.

Healthcare is the only insured activity where typical, quotidian expenses are expected to be paid—at least in part—by insurance. Imagine going to Home Depot, purchasing some new lamps, and then whipping out your home insurance card at the cash register. Or imagine asking the mechanic who just rotated your tires if he will file your auto insurance claim or if you’re expected to do it. What would happen? In either case, the person at the cash register or in the body shop would probably look at you as though you were completely bonkers. And yet, a visit to the doctor necessitates the use of insurance and the negative ramifications that go along with it.

Referring to the examples above, what would happen if oil changes and tire rotations necessitated the use of insurance? Further, suppose due to custom or fiat legislation that auto insurance was required to cover such expenses; what then would happen? I suspect that oil changes and tire rotations would rise in price, perhaps over many years, until they were hundreds of dollars. In fact, you would likely blindly hand your insurance card to the attendant, never knowing before or after what the actual price of the tune-up (except your own co-pay). That is exactly what we do at the doctor’s office; and try polling hospitals in advance of surgery how much the operation will cost—you will likely be met with disbelief and non-committal estimates.

It doesn’t have to cost $2,000 to visit the ER. Routine or even advanced surgery doesn’t need to cost thousands or even hundreds of thousands of dollars. Staying one night in the hospital doesn’t need to cost as much as the accumulated mortgage payments for the entire year. While tort reform would lower some of these costs by lowering risk premiums, it would still not be sufficient to lower aggregate costs of medical care (though it would be a good start). More must be done, the objective being to increase price transparency and competitiveness. Ironically, that involves less insurance involvement, not more. The lofty goal of “insuring millions more Americans” is only a recipe for enslavement to insurance companies or to government itself for medical coverage, and even then it’s dangerously unsustainable.

There are solutions to our sick healthcare system, but time is running out. Solutions must be agreed upon by a majority in both parties, lest it be unwound later on. The solution isn’t a simplistic bullet point but instead a visionary, multi-faceted change; it must be phased in over time, not rammed through over a Christmas holiday. That’s the change I can believe in. Will the political class listen?

* Note that I’m using the modern definitions of conservative and liberal from the American vantage point.

This Iranian doctor who refused to be silenced by Iran’s version of Big Government is a hero, perhaps deserving of a Nobel Peace Prize (and definitely more deserving than a few of the recent winners). In a world of mindless followers and cowards, this man is a hero for others to aspire to, in and outside of Iran.

From the WSJ:

At the height of Iran’s bloody civil unrest this year, a young doctor named Ramin Pourandarjani defied his superiors. He refused to sign death certificates at a Tehran prison that he said were falsified to cover up murder.

He testified to a parliamentary committee that jailers were torturing and raping protesters, his family says. He told friends and family he feared for his life.

Al is asking for sustainable capitalism. Analysis…

It’s interesting that he seems to go to so much effort to brandish his “science credentials,” whatever those are. He evokes biological evolution as the reason for short-term thinking and also quotes Albert Einstein (note: he quotes non-scientists as well).

Al Gore isn’t completely wrong in his assessment that we need “sustainable capitalism.” My view, however, is that we already have sustainable capitalism (whatever that happens to be), and his true agenda is the usual suspects: a) relevance in a time of decline for him (his worthless Nobel notwithstanding); b) tying his environmental philosophy to economic prosperity (Thomas Friedman, a guy I like even if I don’t always agree with him, has fallen for the same logical fallacy).

As far as Wall Street “fat cats” (not his quote, I just like the term) using short-term thinking, we could go a long way to solving that by real problem by removing absurd restrictions on executive compensation. Those restrictions haven’t reduced CEO pay (CEOs still get huge salaries that they don’t necessarily deserve), but have instead made it more difficult for boards to align incentives such that executives focus on long-term growth and sustainability. Of course, in Gore’s tangential discussion on evolution, he failed to mention something economists are already aware of: incentives matter, and altering those incentives to fit some political agenda has real consequences.

Implications:

This scandal has real implications. Mr. Inhofe notes that international and U.S. efforts to regulate carbon were already on the ropes. The growing fear of Democrats and environmentalists is that the CRU uproar will prove a tipping point, and mark a permanent end to those ambitions.

The scientific, or possibly pseudo-scientific, basis for the quasi-religious zealotry of the climate change movement has been called into question. Hence, the political will to propose dumb ideas like a cap and trade regime will probably not happen. I’m looking forward to the free market, not bureaucrats, deciding on innovative engine designs and cool new alternative fuels. Having said that, I’m not certain that that will be one of the implications.

Per the NY Times:

Two years ago, Congress ordered the nation’s gasoline refiners to do something that is turning out to be mathematically impossible.

To please the farm lobby and to help wean the nation off oil, Congress mandated that refiners blend a rising volume of ethanol and other biofuels into gasoline. They are supposed to use at least 15 billion gallons of biofuels by 2012, up from less than seven billion gallons in 2007.

But nobody at the time counted on fuel demand falling in the United States, which is what has happened during the recession. And that decline could well continue, as cars become more efficient under other recent government mandates.

At the maximum allowable blend, in which gasoline at the pump contains 10 percent ethanol, updated projections suggest that the country is unlikely to be able to use all the ethanol that Congress has ordered up. So something has to give.

The state of Florida has a “public option” for home insurance, per the MR blog site (an economic blog). Like the proposed federal “public option” for health care (i.e., medical insurance), the Floridian home insurance option competes directly with private insurance and drove out a major national insurer from the state (for home insurance; that insurer still insures autos).

Bottom line:

In Florida, the public option has meant a substantial socialization of insurance, subsidization of the public option by those who take a private option, and the creation of a fiscally-unsound public insurance company despite the subsidy.

Security expert Bruce Schneier has a great editorial on zero-tolerance rules. So what are zero-tolerance policies?

These so-called zero-tolerance policies are actually zero-discretion policies. They’re policies that must be followed, no situational discretion allowed. We encounter them whenever we go through airport security: no liquids, gels or aerosols.

Why are they annoying?

These policies enrage us because they are blind to circumstance. Editorial after editorial denounced the suspensions of elementary school children for offenses that anyone with any common sense would agree were accidental and harmless. The Internet is filled with essays demonstrating how the TSA’s rules are nonsensical and sometimes don’t even improve security. I’ve written some of them. What we want is for those involved in the situations to have discretion.

And finally, Schneier’s recommended solution to them! (emphasis added at the end)

The solution is to combine the two, rules and discretion, with procedures to make sure they’re not abused. Provide rules, but don’t make them so rigid that there’s no room for interpretation. Give the people in the situation — the teachers, the airport security agents, the policemen, the judges — discretion to apply the rules to the situation. But — and this is the important part — allow people to appeal the results if they feel they were treated unfairly. And regularly audit the results to ensure there is no discrimination or favoritism. It’s the combination of the four that work: rules plus discretion plus appeal plus audit.

An “economist” at NADA, the National Automobile Dealers Association, suggests that the wealth re-distribution to auto dealers (“cash for clunkers”) was a success, while the Freakonomics blog site scrutinizes the claim.

Per the blog, the “cash for clunkers” scheme cost taxpayers around $24,000 per vehicle sold.

According to some well-known economists, the higher income disparity in this country is not a bad thing. They talk about how in certain emerging markets—China and India—economic growth and the income disparity that has resulted has not been bad for inhabitants of those countries, even for those toward the bottom of the socio-economic ladder.

In this country, they explain the bulk of the wage gap as follows:

The main action came in the earnings of college graduates and those with postgraduate education. They both increased at a rapid pace, with the earnings of persons with MBA’s, law degrees, and other advanced education growing the most rapidly. All these trends produced a widening of earnings inequality by education level, particularly between those with college education and persons with lesser education. I should also note that while an upward trend in the earnings gap by education is found for both men and women, and for African Americans and whites, the earnings of college educated women and African Americans increased more rapidly than did those of white males. As a result, inequality by sex and race, particularly among college educated persons, narrowed by a lot.

[…]

The widening earnings gap is mainly due to a growth in the demand for educated and other skilled persons.

Bottom line is that artificial means at shrinking the wage gap could have unintended consequences (politicians are renowned for their ability to not foresee the consequences of their legislation). Legislation that coercively shrinks the wage gap (stronger unions, higher min wage, punishing “progressive” taxes) could eventually result in market-distorting, state-sponsored ramifications that a) discourage investment in economically productive areas of the market and b) discourage individuals from pursuing higher education. The long-term ramifications of such legislation by our political luminaries would not be immediately obvious, but over time would decrease our competitiveness and productivity and, therefore, our standard of living.

If we all have lower standard of living, do we really benefit from a narrower wage gap?

The irony is that government could declare a sharply lower standard of living as a “market failure” and become more involved in the economy… oh wait, that’s already happened, has it not?

EDIT:

Their concluding para is worth reading:

So instead of lamenting the increased earnings gap by education, attention should focus on how to raise the fraction of American youth who complete high school, and then go on for a college education. These pose tough challenges since the solutions are not cheap or easy. But it would be a disaster if the focus were on the earnings inequality itself. For that would lead to attempts to raise taxes and other penalties on higher earnings due to greater skills, which could greatly reduce the productivity of the world’s leading economy by discouraging investments in human capital.

Generally speaking, people don’t like generalizations. People are very predictable that way. Of course, people generally make generalizations all the time. Some are benign, others not so much. It’s the subset of generalizations that are generally considered “non-benign” that are so bothersome, of course. And hence, in our world of (often coerced) political correctness, people generally shun generalizations, often calling them “sweeping generalizations,” “stereotypes,” or some other negative term.

They never talk about political corruption on the news!

It’s really nice outside!

Dogs are so obedient.

Those are all generalizations. I’m sure they do talk about political corruption in the news; it’s not nice outside to everyone, everywhere; not all dogs are obedient.

Of course, there is no national uproar over generalizations such as these. People only object when generalizations are offensive to them, due to their own personal biases. Generalizations against their “enemies”—often political, or of particular people or organizations they find distasteful—are entirely acceptable, of course. Again, no national uproar over this sort of hypocrisy.

Some generalizations truly are offensive (to the general population). For example, I find the idea that I “can’t dance” (due to my complexion) or that I am “aesthetically ignorant” (due to my gender) entirely offensive (though both observations happen to be true). But, like it or not, the absence of any kind of generalization at all would make communication extremely cumbersome. Imagine a piece of legalese where every single provision is spelled out ever-so-carefully; communication of that sort in the general sense would be incredibly unmanageable.

So why are people generally so opposed to generalizations? What’s wrong with a rhetorical short-cut or two? And why are people only outraged when the generalization contradicts their own personal or political preferences?

In a move to prove how economically inept they are, the Times has editorialized their favoritism toward the much-discussed “public option.”

The last para espouses that, eventually, the “public option” be available for everybody.

I’ve written before about why I think the public option is a bad idea (and no, not because some conservative loud-mouth on “talk radio” told me what my opinion should be). The underlying reason is that our medical system as a whole isn’t very good, and additional activism by government will make it worse – in fact, cementing the current system in place for many more years to come.

We need reform, but the “reform” currently being proposed will further lead us astray if it includes the public option. I have a vested interest in cost control (that doesn’t decrease quality). Hence, my bias in this debate is in favor of real and substantial reform (again, something I’ve written about in the past).

The bottom line is this. Although government can make promises, such as liability acceptance for millions of people (via the provision of insurance), that does not mean that the government can guarantee outcomes. The government can promise that people will get insurance (and, by extension, medical care), but that doesn’t make it so. Government can’t guarantee that its own market interventions won’t augment the already-high level of market inefficiencies, leading to higher aggregate costs associated with medical care and treatment. Even if government covered everyone in this country, that does not mean that a) medical coverage would truly be affordable – imagine if income tax rates went up to 60% for most Americans, or that b) quality would be higher or as high as what we have now (imagine waiting months for time-sensitive surgery, or years for “optional” surgery).

Government can’t guarantee outcomes even though government can accept liability with the stroke of a pen. The role of government at various levels has rendered the medical insurance (“healthcare”) market less efficient, with aggregate costs much higher (and far less transparent) than they otherwise would be.

Greater inefficiency and higher aggregate costs (with likely lower quality of service) is a future worth avoiding.

Wow, great editorial. Excerpt (emphasis added), plus some comments…

Yet, one thing we do know: Many Americans now believe many things about their government that are false, and they expect much from the government that the rulers cannot provide. The public at large embraces myths about what the government can do, what it actually does, and how it goes about doing it. Only people enamored of such myths can support, for example, a gigantically expensive health-care “reform” at a time when the present value of the government’s promised future Social Security and Medicare benefits alone amounts to several times the current GDP. (I am disregarding here the interested parties who expect to reap short-run pillage from an intrinsically doomed system.) Until more people come to a more realistic, fact-based understanding of the government and the economy, little hope exists of tearing them away from their quasi-religious attachment to a government they view with misplaced reverence and unrealistic hopes. Lacking a true religious faith yet craving one, many Americans have turned to the state as a substitute god, endowed with the divine omnipotence required to shower the public with something for nothing in every department – free health care, free retirement security, free protection from hazardous consumer products and workplace accidents, free protection from the Islamic maniacs the U.S. government stirs up with its misadventures in the Muslim world, and so forth.

Points made by blog entry (my paraphrasal):

1. therapy and diagnosis are different – if you want a support group for your ideology, consult the relevant right- or left-wing news source (depending on your bias); if you want a diagnosis, don’t be upset when one is given
2. the general public disagrees on “the problem”
3. the general public disagrees on “the solution”
4. the (US) public is increasingly replacing belief in formal religion with the (informal) quasi-religious belief in government as the provider (rather than God)
5. there is no immediate, “magic bullet” solution
6. we should be incredulous of “magic bullet” solutions (flat tax, “public option” in healthcare, etc)

This corresponds with an observation of mine that the US is heading toward Fabian socialism (philosophically): in practice, social democracy. Western Europe is ahead of us in this regard (“ahead of us” is bad, in this case). Think of social democracy as a mix between democracy and socialist ideals. It’s the idea that “communism didn’t work out, but the underlying ideas were valid.”

Of course, that’s false. The irony in all this is that when countries are “converted” into socialist-style democratic systems, the people don’t get to compare such systems with what things would have been like absent those systems. Some people might think of the good ol’ days, but others will naturally prefer the system that “takes care of them” (absent God, someone’s gotta do it!), and while the non-socialist alternative might be substantially better in practice, there’s no way of 1) proving it cogently to the public, or even 2) returning to such a system, since governmental systems win constituencies that prevent such systems from improving over time (Social Security can’t be reformed for this reason).

So we’re left with a deeply flawed system that’s trending worse toward a maddeningly avoidable fate. Well, at least we get eloquent speeches out of all this.

No offense to Barak Obama, but he does not deserve the Nobel Peace prize, nor will that make his job any easier. The Nobel committee, at least for Peace, seems to have a proclivity toward making very good choices some years and awful choices other years (i.e., 2007’s choice of co-winner Al Gore or, of course, this year’s choice of Obama). Which year takes the cake for the worst decision by the luminaries on the Peace committee: 1994, for co-awarding Yasser Arafat with the Peace prize. I mean, how stupid are the Peace prize judges? By comparison, I should point out that Obama and Gore are much more peaceful than Arafat, but the lack of judgment is still very obvious, years later.

Obama might deserve the Peace prize at some point in the future, but that time hasn’t arrived, not by a long shot. Further, winning the prestigious award will almost certainly make his job much harder, as every action he takes is critically evaluated for its “Peace-ness.” Perhaps the Peace prize judges are trying to strategically effectuate an outcome that they find appealing; however: 1) that is not the point of the prize, making the prize seem disingenuous, and 2) that approach is likely to backfire.

The willingness to take bold, direct action (against vile dictators, terrorist-supporters, or Somali pirates) will likely drop, as Obama already has his Peaceful legacy to consider. Bush Jr may have been too flippant about going to war, but Obama will be the opposite: too contemplative, weak, and unthreatening.