Archive for the ‘Introspection’ Category

The Power of SF

Monday, November 7th, 2011

This is from an interview with William Gibson (H/T Michael Jennings):

It gave me the idea that you could question anything, that it was possible to question anything at all. You could question religion, you could question your own culture’s most basic assumptions. That was just unheard of—where else could I have gotten it? You know, to be thirteen years old and get your brain plugged directly into Philip K. Dick’s brain!

That wasn’t the way science fiction advertised itself, of course. The self-advertisement was: Technology! The world of the future! Educational! Learn about science! It didn’t tell you that it would jack your kid into this weird malcontent urban literary universe and serve as the gateway drug to J. G. Ballard.

And nobody knew. The people at the high school didn’t know, your parents didn’t know. Nobody knew that I had discovered this window into all kinds of alien ways of thinking that wouldn’t have been at all acceptable to the people who ran that little world I lived in.

I love the idea that SF is so subversive. I experienced it too, around the same age, but I didn’t realise at the time what was happening, and I don’t think I realised it since until Gibson pointed it out to me. There does seem to be a correlation between SF fans and, say, libertarians, who are certainly in the habit of asking more questions about the world than most people. But I don’t think it occurred to me that SF was the *cause*. Perhaps, to an extent, it is.

GDP and Involuntary Transactions Redux

Monday, October 3rd, 2011

My last post hid my point in all the rambling.

GDP is all well and good as a measure of productivity if it adds up all the values of the voluntary transactions. This is because any voluntary transaction must increase the wealth of both participants, otherwise they would not have volunteered for it.

But GDP also includes involuntary transactions, and these do not increase wealth. If they did, people would volunteer for them.

So let’s sort out the semantics: Let vGDP stand for the value of all voluntary transactions. Let GIT stand for “gross involuntary transactions”. Let GDT stand for the value of all transactions. This is what is popularly called GDP. Then:

GDT = vGDP + GIT

Rearranging:

vGDP = GDT – GIT

If the government increases taxes, all other things being equal, productivity is reduced.

It might be useful to measure vGDP.

GDP and Involuntary Transactions

Wednesday, September 28th, 2011

GDP is supposedly a measure of economic performance. It measures the total value of transactions in the economy. If you consider that after a transaction both parties are better off, it makes sense.

Of course, when politicians fixate on something they can measure and try to improve it, they lose sight of what it is the measure means. So school targets result in a tendency for students being taught only to pass exams; crime targets result in police tending to investigate only the easiest to solve crimes.

And GDP targets result in money printing to boost GDP figures. But:

It will lift GDP statistics temporarily, never lastingly. It will not lead to a better use of resources, to better human cooperation in markets. It will not lead to innovation, creativity, or more entrepreneurship. It is a trick that the money producer plays on the economy for short-term effect, and it cannot increase the efficiency and productivity of the economy.

So says Detlev Schlicter in part two of his book Paper Money Collapse.

That’s because when new money is created its recipients spend it on goods and services, which increases the number of transactions and therefore GDP. But there aren’t really any more goods and services being produced. The economy hasn’t really grown. The recipients of the new money spend it, and the people they give it to spend it, and so on until prices start to rise, as they must because there is demand but no more supply, which causes the demand for money (as opposed to goods and services) to rise, so that the holders of the new money start to hold onto it, instead of spending it. Everyone whom the money has not yet reached is faced with rising prices but no new money.

The other way governments seek to increase GDP is by government spending, or to put it another way: involuntary transactions. These don’t create wealth in the way voluntary transactions do, because if someone takes your money by force, then buys you something they think you would like, it’s not likely to be something you really want. It *might* be, by pure chance, but it’s unlikely, so on average involuntary transactions don’t create wealth.

Paying one man to dig a hole, and another man to fill it in again increases GDP but doesn’t create wealth (and no-one would do this voluntarily, though it might make a nice government make-work scheme). Paying men to build a bridge might create some wealth by improving the transport infrastructure (which is seen), but if you’ve taken money by force to pay for it, then you’ve taken money that people would have preferred to have spent on something else (unseen). Something that would have created even more wealth than the bridge.

So if people say the government should not fixate on GDP, they are right, if probably for the wrong reasons. Growth as measured by GDP is only growth if it was caused by voluntary transactions. The only real growth is a growth in voluntary transactions. The best way a government can increase real growth is to increase the number of voluntary transactions which it can do by decreasing the number of involuntary ones, by cutting government spending.

Life or Death

Sunday, July 17th, 2011

“Why is it better to be alive than dead?” asked someone at a gathering I attended recently.

This was met with much derision at the time, but I thought I’d attempt a serious answer.

If A is better than B, that means someone prefers A to B. So someone has to do the preferring. In game theory is the concept of revealed preference. You can tell what people prefer by the way they behave.

So it is better to be alive than dead because people behave as if they would rather be alive than dead.

The context of the question was a discussion that started after someone suggested that it would be good if everyone in the world could become middle class. People don’t want to live in mud huts; subsistence farming. They want long and comfortable lives without threat of starvation.

So if you want to know why it is better to be middle class than to live in a mud hut, the answer is that it enables you to act on all your other preferences, including the one about not dying of starvation. To deny that this is better is to deny that people have preferences.

Teething

Tuesday, June 21st, 2011

Teething. A kind, forgiving, loving god who just happens to torture babies for mysterious reasons?

Or a series of mutations that led to a skull optimised for brain size but with some serious but non-fatal flaws?

Coffee Price Oscillation

Wednesday, April 6th, 2011

Following on from my analysis of Steve Leighton’s ideas about fair trade, I noticed something else interesting he wrote:

The coffee market has also long been a reactive market; when prices are high, every piece of available land has a coffee plant on it, but when prices are low farms disappear along with the coffee, this in turn raises prices as beans become scarce, resulting in re-planting (you get the picture). For a coffee plant to be suitable for harvesting requires around 4 years from seedling to mature plant. So it’s easy to see why the market fluctuates so much, as there is a four year gap before changes are fully appreciated. The coffee-growing countries have tried and failed to work together, holding back crops to raise prices, but when harvests eventually hit the market a downturn in price always occurs. This leads to the whole boom and bust cycle that has been such a feature of the coffee market for many years.

I’m an engineer, and this kind of oscillation seems all too plausible to me. There is a negative feedback and a delay. It seems inevitable.

But I have questions: in a truly free market, is this inevitable? Can’t speculation such as futures markets damp this effect? If so, why do we still see the oscillation?

More importantly: is there any kind of outsider meddling that can solve the problem of oscillation without introducing even worse problems? (I have a tiny suspicion that the price oscillation may turn out to be a feature, not a bug, but it’s not immediately obvious how.)

Monbiot on Nuclear Power

Wednesday, April 6th, 2011

I started to like George Monbiot a bit when I read his latest Guardian column on nuclear power. He has apparently changed his beliefs based on lots of work, digging into the evidence and checking sources. You certainly can’t accuse him of being the type of lazy journalist who doesn’t check his facts. And here he is saying: I thought nuclear power was bad, but now I don’t think it is bad any more, because I have done some research.

But something bothered me about why he thought nuclear power was okay. It’s as if he is right for the wrong reasons. In his correspondence with the anti-nuclear campaigner:

I’m struck by the fact that none of the attachments you’ve sent me is a peer-reviewed article. [...] I’m looking for peer-reviewed papers or high-level reports

In the analysis of her evidence:

As my article explains, the Yablukov book has little scientific standing and has not been peer-reviewed

From the article itself:

Its publication seems to have arisen from a confusion about whether the Annals was a book publisher or a scientific journal. The academy has given me this statement: “In no sense did Annals of the New York Academy of Sciences or the New York Academy of Sciences commission this work; nor by its publication do we intend to independently validate the claims made in the translation or in the original publications cited in the work. The translated volume has not been peer-reviewed by the New York Academy of Sciences, or by anyone else.”

I can see why a journalist wants to be able to point to proper papers in proper scientific journals, but it’s all argument from authority. There’s very little engagement with the details of the argument. What are the scientists saying? What are the environmentalists saying? Why is the group that is right, right? Why is the group that is wrong, wrong?

And then this, at which I went from thinking, “maybe Monbiot is not so bad after all” to “oh, yes he is”:

Failing to provide sources, refuting data with anecdote, cherry-picking studies, scorning the scientific consensus, invoking a cover-up to explain it: all this is horribly familiar. These are the habits of climate change deniers, against which the green movement has struggled valiantly, calling science to its aid. It is distressing to discover that when the facts don’t suit them, members of this movement resort to the follies they have denounced.

Those who refute the catastrophic anthropogenic global warming hypothesis, (deniers, if you like), are not correct because they have more peer reviewed papers published in respected scientific journals. They are correct because they have analysed the data and methods of climate scientists and found flaws in the work. You can tell they are correct by understanding the arguments. For example, you can learn what principal component analysis is and how it works and see why its incorrect use in producing the hockey stick graph gave the results that it did. And it’s quite possible to explain this to a general audience.

This is exactly what Monbiot’s “climate change deniers” have done. They have not failed to provide sources (in fact they are more open than the climate scientists, and in many cases their original work is their source, whether it is peer-reviewed or not), they do not rely on anecdote, they do scorn the scientific consensus (consensus is meaningless) and they don’t invoke “cover-ups”.

Peer-review is not the be-all-and-end-all. It’s perfectly possible for groupthink to set in. Scientists often get attached to their theories and defend them too much. The consensus is often overturned. Without understanding the details, the UN’s report into Chernobyl might be just as flawed as its report into climate change.

If Monbiot dropped all the argument from authority and wrote about, for example, why the UN report on Chernobyl is more correct than the Annals of the New York Academy of Sciences book, then he would have a better case.

He actually does this occasionally:

A devastating review in the journal Radiation Protection Dosimetry points out that the book achieves its figure by the remarkable method of assuming that all increased deaths from a wide range of diseases – including many which have no known association with radiation – were caused by the accident(15). There is no basis for this assumption, not least because screening in many countries improved dramatically after the disaster and, since 1986, there have been massive changes in the former eastern bloc. The study makes no attempt to correlate exposure to radiation with the incidence of disease(16).

That’s the kind of analysis which can get to the truth. If Monbiot could do this consistently, and apply the same kind of thinking to the global warming debate, he might come up with the right answer there, as well.

Taxonomy of Media Consumers

Thursday, March 3rd, 2011

Commenter Geronimo on a guest post on Bishop Hill about a debate about whether the media has failed science:

The readers fall into three general categories the gullible, the knowledgeable, and the sceptical/synical.

The gullible themselves fall into two sub-classes, those who are predisposed to believe the reports because they support some life view of their own. And those who don’t have any life view and believe that politicians/civil servants/’academics etc. are beyond reproach.

The knowledgeable are those who have experience/pre-knowledge of the contents of the press reports, they are in most cases astounded at how little truth there are in these reports. This is on almost any topic, journalists aren’t scientists, engineers, doctors or of any other profession, they don’t have, or want, a deeper understanding of the issues other than one that can side with the political/social position of their newspapers. The knowledgeable are the most like to splutter toast crumbs across the breakfast table.

The sceptics themselves fall into two categories. Those who have thought the problem through and investigated the issues with which they find fault, on all topics they are generally amazed at press bias. The second group is my favourite, it’s the great unwashed, who despite being fed media propoganda on all topics read the articles and say,”Pull the other one”, and move on. Theirs is a voice seldom heard because they keep their opinions to themselves, but they are the people we trust on juries, an institution that has stood the test of time, and which while not infallible, continues to treat the evidence they’re presented with and make reasonable judgements on it.

These latter are the natural enemies of the metro-elite. They are almost beneath contempt for the Guardian reading lifestyle clique because they eschew pseudo education for their own knowledge and experience of the world. They thumb their noses at their betters in the metro elite, and are now defecting in droves into the sceptic side of the climate debate. Where they go Murdoch will follow, as will the politicians. They may save us from these awful eco-jihadists yet.

This last group is very interesting. Most of my older relatives fall into it: they’re not intellectual, but they’re not stupid either. This group probably also forms quite a large voting block. The UK Libertarian Party might do well to engage with them. All this highfalutin philosophy stuff is necessary, but can it win votes?

In this regard, the Taxpayers Alliance seem to be on the right track. Taxing ordinary families to pay for daft quangos is a narrative that should be easy to sell. But can the rest of libertarianism be re-worded as so-obvious-it-must-be-true common sense? I think so. Has anyone tried? We need a libertarian version of the Sun, or something. Hayek on the front page; tits on the next page; Micklethwait and Jennings doing sport on the back page…

Quote of the Day, Purpose of the Universe Edition

Saturday, November 27th, 2010

David Pearce posted a video on Facebook to start a discussion asking: does the universe have a purpose?

To win the thread, George Lee Stowell replied:

It’s where I keep my stuff…So yes

Think Like an Austrian #1

Thursday, August 12th, 2010

I struggle to hold my own in verbal debates with people who think radically differently to me. It’s easy to be distracted from my point by constantly having to correct misconceptions.

I keep meaning to write dialogues — imaginary debates in which I rehearse my arguments. This is a start, .

The thing about economics is most people think it’s about money supply and inflation and defecits and that there are formulae that relate these things and that the whole thing works like that computer with the pipes. This stuff is impossible to debate. The nice thing about Austrian economics is you can talk about it.

So where to start? Let me try this:

A: The government is cutting jobs in the public sector. This will ruin the economy and cause a double-dip recession.

B: You can’t spend the same money twice.

A: Yes you can, money just goes round and around.

B: What I mean is, *you* can’t spend the same money twice. Let’s say I run a cake shop. I am forced at gunpoint to give you £100. You spend that £100 on buying my cakes. How has this helped the economy?

A: There are more cakes in existence than there otherwise would be. The world is richer.

B: The number of cakes I can make is fixed. I would have sold them to someone else and I would be £100 better off. Or, I would learn that nobody wants my cakes and I would find something to make that people *do* want.

A: But if I don’t get your £100, I will be unemployed and not doing any useful work.

B: The work you do can not be very useful if you can’t get people to pay for it voluntarily.

A: The work I do in the public sector will improve the quality of the transport infrastructure, thereby enabling you to get ingredients for your cakes more cheaply.

B: Yes, but if you were unemployed, I would still have my £100. I might use it to buy a better cake-making machine that will help me make cakes more cheaply. Or I might invest it in a transport infrastructure company.

A: How is that different?

B: Well, apart from the irrelevant (for the purposes of this discussion) fact that there is less violence involved, perhaps I might be better placed to decide how to spend my £100 than you. I might be better able to cut the cost of cake-making because I understand the business of making cakes.

[At this point the discussion veers off into the question of why distributed decision making is better than centralised control. Also, the parenthesis above is why I don't think of myself as a *consequentialist* libertarian. I would be opposed to the violence even if centralised control was more efficient.]