October 03, 2009

A green thing which stands in the way

"The tree which moves some to tears of joy is in the eyes of others only a green thing which stands in the way. Some see Nature all ridicule and deformity, and some scarce see Nature at all. But to the eyes of the man of imagination, Nature is Imagination itself. As a man is, so he sees." --William Blake

October 02, 2009

Here we go again

It looks like we're going to be in for another coal-fired hissy fit as the EPA takes a more active role in regulating mountaintop removal mining. Here's WV Public Radio on the topic. As I've said more than once here before, it wouldn't surprise me if things get really ugly around here.

This past summer, El Cabrero made the following predictions about coal controversies:

First, the powers that be here will resist any climate change legislation or regulations of mining with the same intensity that those in the south resisted desegregation.

Second, state political leaders will try to outdo each other in positioning themselves as defenders of the status quo--even some of the ones who know better.

Third, it wouldn't surprise me if somebody gets killed. If that happens, it will probably be at the hands of people inflamed by over-heated rhetoric.

Fourth, when it's all over, people will wish they'd done things differently.

MISSION ACCOMPLISHED? The stock market may be back from the brink, but unemployment is likely to remain high and do a lot of damage without more action to stimulate the economy, according to Paul Krugman's latest.

LOUDNESS AND LOBBYISTS dominate efforts to block real health care reform, according to this op-ed from the Gazette.

RACISM AND THE RIGHT are discussed here.

A BLAST FROM THE PAST. I guess we can start revising the family tree after the discovery of a hominid who walked upright more than 4 million years ago.


October 01, 2009

Pre-Copernican economics

The astronomer Ptolemy, circa 90-168 AD.

Lately Goat Rope has been looking at some of the flaws of some schools of economic of economic theory, especially those of the market fundamentalist variety with their warped view of humans as organic calculators.

Just as I was about to head once more into the breech, a friend passed on a link to this op-ed from the Washington Post by Harold Meyerson that speaks my mind. Here are the first three paragraphs:

"The worldly philosophers" was economist Robert Heilbroner's term for such great economic thinkers as Adam Smith, Karl Marx, John Maynard Keynes and Joseph Schumpeter. Today's free-market economists, by contrast, aren't merely not philosophers. They're not even worldly.

Has any group of professionals ever been so spectacularly wrong? Pre-Copernican astronomers and cosmologists, I suppose, and for the same reason, really: They had an entire, internally consistent, theoretically rich system that described the universe. They were wrong -- the sun and other celestial bodies save the moon didn't actually revolve around the Earth, as they insisted -- but no matter. It was a thing of beauty, their cosmic order. A vast faith was sustained in part by their pseudo-science, a faith from which such free thinkers as Galileo deviated at their own risk.

As it was with the pre- (or anti-) Copernicans, so it is with today's mainstream economists. Theirs is an elegant system, a thing of beauty in itself, as the New York Times' Paul Krugman has argued. It just fails to jell with reality. And unlike the pre-Copernicans, whose dogma posed a threat to those who challenged it but not, at least directly, to anyone else, their latter-day equivalents in the economic profession pose a clear and present danger to the well-being of damned near everyone.

The rest is here and methinks it's well worth reading.

IT'S NOT OVER YET. Support for a public option in health care reform is high despite Tuesday's vote in the Senate finance committee.


THE OFFICE-CAR is a dangerous place.


September 30, 2009

The ultimatum game--don't monkey around with it

Don't offer this guy a bum deal.

A classic experiment in behavior economics challenges the image of people as rational agents who always act in their own material self interest. It's called the ultimatum game and it works like this:

there are two players, one with say $10 and the other with nothing. Player A decides how to split the money and makes a take it or leave it offer to Player B. Player B can either accept what is offered or veto the whole deal.

While it would technically be in Player B's rational interest to accept whatever is offered, even if it's only $1, most people in that position insist on a fairer division, even if it means walking away from a bad deal with nothing at all.

In most games, the average amount offered was $4.71. When people in Player B's position were asked what the lowest amount they would take would be, the average answer was $2.59. As Michael Marmot put in in The Status Syndrome,

"Players were prepared to tolerate a degree of inequality if the absolute reward to them was great enough. But if the inequality increased sufficiently, or the absolute rewarded went down enough, the game wasn't worth it, and they opted for both getting nothing."

That's also the way some monkeys play it. James Surowiecki in an old New Yorker column relates the following:

...the primatologists Sarah F. Brosnan and Frans B. M. de Waal released a study showing that female brown capuchin monkeys seem to have a sense of fairness, too. Pairs of capuchins had been trained to give Brosnan pebbles in exchange for slices of cucumber. This idyllic monkey market economy was disrupted, though, when the scientists changed the pay scale, rewarding one monkey with a delicious grape and the other with the same measly old cucumber. Exposed to this injustice, the capuchins who were given cucumbers often refused to eat; forty per cent of the time, they stopped trading entirely. Things got worse when one monkey in each pair was given a grape for doing nothing at all. The other monkeys often responded by tossing away their pebbles; eighty per cent of the time, they stopped trading. The capuchins were willing to forfeit cheap food simply to express their displeasure at their partners’ unearned riches.

The point was not—as some of the news coverage suggested—that capuchins are innate sharers. (The capuchin who got the grape showed no inclination to give it up.) The monkeys want to distribute things fairly, not equally. They seem to believe that there should be a clear connection between work and pay. One variation of the ultimatum game shows that humans feel this way, too: instead of randomly assigning the proposer role, the researchers had the participants take a trivia quiz beforehand, and the ones who did best became proposers. Not one of their offers was rejected; apparently, people believed that a proposer who might be worthy of his status deserved to keep more of the money.

Our sense of fairness, in other words, demands that there be at least some relationship (however tenuous) between accomplishment and reward...

It looks like a sense of justice is a primate thing.

SPEAKING OF WHICH, justice lost a round yesterday in the US Senate finance committee. WV Senator Jay Rockefeller's public option amendment to the Baucus health care reform bill was voted down. It's not over yet as there is still a chance to amend the bill on the floor or when the House and Senate meet to reconcile their bills.
Here's a big Goat Rope "Thank You!" to Rockefeller for fighting the good fight.

THE GREAT DEPRESSION of the 1930s might have had a silver lining, according to this scientific study. Thanks to a certain hermit for passing this along.

IN THE HOLE. Economist Dean Baker takes on the deficit here.



September 29, 2009

It's relative

Would you rather be a big cat or a small dog?

Developments in behavioral economics have challenged the old idea of humans as belonging to the species "homo economicus," a fabled creature that purportedly rationally acts in accord with its material self interest. Real humans often have other priorities, including things like a need for social status and a sense of fairness (which admittedly aren't always compatible).

One experiment cited by Michael Marmot in The Status Syndrome: How Social Standing Affects our Health and Longevity is a case in point:

...people are asked to imagine two situations. First, you live in a society where the average income is $100,000 and your income is $125,000. Now consider a new situation. Average incomes are now $200,00 and your income is $175,000. In the two societies, a dollar has the same purchasing power. Which situation would you prefer?

If people were really out to go for the bottom line, they would pick scenario #2. In reality, most people pick #1. As Marmot puts it, "They would rather sacrifice material gains for better social standing."

There are several ways to interpret these results. One would be that people are obsessed not just with keeping up with the Joneses but with burying them in the dust. A more charitable interpretation--and one that makes sense in light of other research--is that a key factor in peoples' sense of well being, and even of health and mortality, is the ability to fully participate in society.

Being at a material disadvantage in comparison with others in the same society can limit our sense of being able to fully participate. For that matter, a lot of research on things from health to violence indicates that relative poverty, i.e. one's position in comparison with others, is a major factor in causing lots of problems--and not just for those who are relatively poor.

More on this to come.

PAYING MORE TO DIE SOONER. Here's another critique of the American health care system.

ONE THING NOT TO FEAR, Dean Baker argues, is the public option in health care reform.

By the way, I heard last week that the vote on the public option may take place today in the Senate. I don't know whether this has changed. Still, it wouldn't be a bad idea to make yet another call.

STATING THE OBVIOUS. The AFLCIO blog points out that millions of Americans already rely on government-provided health care. And they're not trying to get rid of it.

INCONSISTENCIES. This Gazette op-ed by a friend of mine looks at some of these on the right.


September 28, 2009

Humans and Econs

One of the cherished ideas (I don't want to degrade the word "myths") of neo-classical economics is that of humans as profit-seeking organic calculators hardwired to act rationally to maximize material self-interest. We can call homo economicus for short.

One problem with this idea is that not a whole lot of such creatures live on this planet. Richard Thaler and Cass Sunstein, authors of Nudge: Improving Decisions About Health, Wealth, and Happiness, distinguish between Humans (most of us) and Econs (the mostly imaginary creatures found in economic textbooks). As they put it,

...Whether or not they have ever studied economics, many people seem at least implicitly committed to the idea of homo economicus, or economic man--the notion that each of us thinks and chooses unfailingly well, and thus fits within the textbook picture of human beings offered by economists.

If you look at economics textbooks, you will learn that homo economicus can think like Albert Einstein, store as much memory as IBM's Big Blue, and exercise the willpower of Mahatma Gandhi. Really. But the folks that we know are not like that. Real people have trouble with long division if they don't have a calculator, sometimes forget their spouse's birthday, and have a hangover on New Year's Day. They are not homo economicus; they are homo sapiens. To keep our Latin usage to a minimum we will hereafter refer to these imaginary and real species as Econs and Humans.

The growing field of behavioral economics has shed light on the vast difference between imaginary Econs and real Humans. More on that to come.

PARANOIA REVISITED. This op-ed on political paranoia by yours truly, known informally on this blog as Whackadoodle-ism, appeared in yesterday's Sunday Gazette-Mail and on Common Dreams.

MOVING ON TO FEAR of health care reform, here's another item from the Gazette.

CLIMATE CASSANDRAS. Here's Paul Krugman's latest.