Thursday, June 7, 2018

The Avengers need a new team member: Professor Econom!


Ok, I admit it.  I love to watch movies, in particular the popcorn and superhero variety.  Yes, I did watch “Avengers Infinity War”.  [ Spoiler Alerts! ]  Smash-bam-pow!!  What’s not to like?  Well, the end apparently left a bunch of (young) fans weeping: “Mom, the big bad Thanos guy won, how come?!  Why are so many of my favorite superheroes dead now?”.  Well, why indeed?!  We do not know what the sequel has in store, but judging by the post-credit scene (wait, you didn’t see it?  Keep seated to the very end!), it looks like Captain Marvel will come in to somehow save the day, reverse history, bring back beloved Spider-Man  and beat up Thanos, before he can do all those things he did.  Perhaps.  Perhaps not.

But here is truly the biggest challenge in crafting that sequel and resolution.  Thanos is pretty satisfied with himself at the end of the “Avengers Infinity War”, isn’t he?  And he as well should be!  After all, he set out to  solve the biggest problem of the Universe (according to Thanos): overpopulation.  His logic is to randomly kill half of all beings (I presume, only the sentinent ones), so that the rest can have a better life.  If you buy into that Thanos argument, you have to hand it to him.  He did make half of the population of the Universe better off!  And the other half died a very quick and painless death!  Well done, Thanos!  You should cheer for him, right?  What’s a little Spidey death, by comparison?  So, if Captain Marvel somehow waltzes into that sequel, reverts time and stops Thanos from doing all that, isn’t she then really imposing back all that pain and suffering?  How can that conflict possibly be resolved?  Is duking it out with Thanos really the right answer to the core of the question that Thanos has raised? Obviously not.

Let me offer a suggestion, then.  The Avengers are a pretty cool team and all.  They even have some brainy types among them.  But they made a big and glaring mistake.  They never engaged with the fallacy in Thanos’ argument.  Not once did it occur to them in the “Avengers Infinity War” movie to go to him and say, “Hi there, big fella!  I understand you want to help the universe population to a better life. What a noble cause!  But there is a better way to do that than to kill off half of them. Let me guide you how!”.
Finding a better way is a matter of economics. Let’s examine the facts.  For example: the world population has grown massively over the last 200 years or so.  Are we worse off for it?  Not so!  Average world income and average life expectancy has risen.  We are seeing progress even in the poorest of nations (not everywhere, but still).  Markets have provided answers to the incentives of providing the goods that people need and love.  Supply rises to meet demand.  Technological progress has been directed to enable that supply, in order to earn the profits that can be earned that way.  We know how to contain environmental externalities with proper economic incentives. Humans are now by and large far away from rummaging through the forests and living off the berries they can find (which seems to be a version of the Thanos view).  Yes, the details are important.  They deserve attention!  And they are receiving attention. There are large groups of development economists, growth economists, macroeconomists, environmental economists and of other fields, figuring out, how to make the growing world a better place.  They are good at it.  I doubt that any of my colleagues would recommend killing off half the population to solve the Thanos problem.  I bet nearly all of them have better suggestions.  So there.
Now, you might argue that Thanos witnessed immiseration on his home planet Titan.  He has one data point, showing that not killing off half of the population led to decline and starvation!  He also has another data point of a field experiment, where killing half of the population did make things better for the rest on the home planet of Gamora.  Well, any econometrician worth her salt would gently pat Thanos on his back and say, “Well there.  Two data points isn’t a lot of evidence.  Standard errors are huge.  You shouldn’t yet conclude that it is time to kill off half of the population of the universe.  Let’s collect some more data first, shall we?”.  Indeed, in the Thanos mode, how about running some more field experiments on some of the many planets out there, to see what works and what doesn’t?  And for that, don’t use the gruesome course of action chosen by thick-skulled non-economist Thanos, but rather base it on the best research and far more gentle and promising approaches that those other aforementioned specialty economists would be suggesting.   Further, mechanism design theorists could investigate exactly what went wrong on Titan in the first place, and how to improve on it based on first principles.  That already would be much better, wouldn’t it?
So, why did the Avengers not pursue that route?  Simple.  They didn’t have an economist on the team!  If Captain Marvel somehow gets around to do something about that “Avengers Infinity War” ending in the sequel, that should be her first act of heroism: find a new avenger!  Captain Marvel: you don’t need a Doctor Strange!  You need Professor Econom! Forget Spidey, Iron Man, Thor.   Professor Econom is the one with the true superpower to solve the biggest problems of the universe!  Send Professor Econom back in time to have a nice, long chat with Thanos, and convince him that he was wrong all along, and to show him a better way.  Really: it wouldn’t be all that hard. 

Ok, after that’s done in the first 15 minutes of the sequel, what do we do with the rest of the movie?  Oh, I don’t know.  More Smash-bam-pow, perhaps!!  Pass the popcorn, please.

Thursday, March 8, 2018

Kim Jong Un will successfully test atomic ICBM before 2019

Kim Jong Un is now closing in on the finish line of its long march towards becoming an atomic superpower: successfully testing an atomic ICBM, which is capable of threatening the U.S.A..  By “threatening”, I have in mind an atomic ICBM capable of destroying Los Angeles, San Francisco or Chicago.  Or an EMP weapon, wrecking havoc with the electronic infrastructure of the U.S., with potentially devastating consequences.  A successful test is to let such a weapon detonate somewhere in neutral waters, with sufficient warning time ahead of times for ship routes and airplanes, but leaving no doubt about North Korean capabilities.  Kim Jong Un knows that this is a dicey step.  So far, the U.S.A. leaders could tell themselves, that North Korea is not and will not be capable of producing such a weapon, or that sufficient sanctions or sufficient rewards could deter it from trying.

But this final step is in a new league entirely.  The U.S.A. now realizes that it may need to contemplate first strike scenarios to destroy these weapons.  So, Kim Jong Un will have to both be fast and smart to cross that line.  Fast will go like this: the successful test will probably conclude before the end of 2018, before the U.S.A. has gotten its act together fully in terms of figuring out a successful, preventive strategy, before their rocket scientists realize that North Korea can make this happen faster than they have allowed for.  Smart will go like this: make sure the U.S.A. would look really, really bad in a first strike, preventing them from carrying it out in the first place.  How do you do that?  Three steps.  First, play nice at the South Korean Winter Olympics: check.  Second, reach out to South Korea, offer peace negotiations: check.  Third, reach out to the U.S.A, and offer to negotiate to stop nuclear armament for security promises etc.: check.  Heck, invite Donald Trump for a visit!  So smart.  Even Donald Trump will (probably) not dare to launch a first strike, putting millions of lives at risk, under such circumstances. And so obvious. We have seen this many times with North Korea before.  It always instead took a step forward to that finish line, anyhow.  Anyone who thinks that North Korea will not now finish the program they started many years ago, is delusional.  If they really do, if Donald Trump can be convincing enough in his visit, then Donald Trump and Kim Jong Un deserve the Nobel Peace Prize.  Unlikely, I say.

We better get used to the new reality, one year from now. North Korea will then be a full-fledged atomic superpower, capable of striking the U.S.A..  The commitment of the U.S.A. to South Korea will then be just skin deep, except perhaps for the most dire of circumstances.  And with that, the real negotiations of North Korea with South Korea will commence (more about that, some other time).  This was the North Korean master plan, all along.  

Tuesday, September 26, 2017

Would you defend football players waving the confederate flag and dressing in Ku Klux Klan garb during the playing of the national anthem?


Would you defend football players waving the confederate flag and dressing in Ku Klux Klan garb during the playing of the national anthem? 

And if you are one of those journalists writing passionate columns about the freedom of speech now, when so many are taken a knee, would you write the same passionate columns then?  Would you eloquently explain that these players then truly, really shouldn’t be fired by their club owners?  Such columns surely would be even more necessary then, because I would bet that it would garner a lot more criticism than the current knee-taking to protest remarks by President Trump. 

Think about it.  I almost want to see a few football players try.  Aren’t there some that are reasonably suspect of sympathizing with Trump and the alt-right?  There got to be, I imagine.  Let them bring a large confederate flag and spread it among them to show it off, on national television.  Bring some Ku Klux Klan gear, and quickly put it on, while that anthem plays, while the cameras are zooming in.  There would be wide-spread storms of protests and indignation, right?  And if you are one of those journalists now writing all these impassioned columns about the freedom of speech, you will probably deeply despise the message of these players.   But if you are such a journalist, and if you then stand up for their freedom to speak and give a passionate plea that this is all ok, and that they should not be fired, despite the despicable message (yes, I would despise it too!!) and despite the widespread indignation, then you have truly mastered how to defend the freedom of speech and you have my respect.

Now?  Don’t get me wrong.  Of course, these football players have the right to express their views about the treatment of blacks by the police, they have the right to protest President Trump and they have the right to kneel during the national anthem.  Club owners have the right to fire them because of it, by the way: so Trump actually did not attack the constitutional rights of football players, but what an annoying and pesky detail, right?

In any case, it is pretty clear, that the current kneeling and the current defense-of-freedom-of-speech is not about some courageous act of standing up for democratic values.  I would so love that to be true, really.  Instead, it is all just Anti-Trump-ism. I get it.  It feels good to show you are against his remarks, and to show you are on the other side.  His ratings are down, so beat him up some more, right?  Way to go!  Let’s all join hands now, and stand up for freedom of speech, while we all agree with one another and all agree with the anti-Trump message that gets sent that way!  How wonderful and delighted we now all feel, right?  But folks, seriously.  This isn’t an act of bravery, this isn’t an act of standing up of a minority,  whose views you despise, but whose rights to peacefully state their views you staunchly defend.  This is all about defending the right to speak for those that you agree with in the first place, dressed up as a proud defense of the constitution.  This is an act of a majority ganging up on one who is down. What a phony act of cowardice and pretense.

Why not instead simply say, that you don't like Trump, and that you are therefore happy with people protesting him, like those football players?  It is your right to do so, and it is the honest thing to say.  Just don't pretend this is about you defending the freedom of speech.

Tuesday, September 5, 2017

When the Rich Said no to Getting Richer --- and the Michigan car industry went south.


Today, David Leonhardt has an op-ed in the New York Times: “When the Rich Said No to Getting Richer.” You can read it online here https://www.nytimes.com/2017/09/05/opinion/rich-getting-richer-taxes.html .   The gist of it is the recommendation to massively increase the top tax rates in order to fight inequality.  As exhibit number one, the op-ed is constructed around George Romney, father of former Massachusetts governor Mitt Romney.  The article said that George Romney was an automobile executive and half a century ago volunteered to not earn more than $225,000 a year, close to $2 million today.  It also states that the top tax rate at the time was 91 percent.  Leonhardt keenly observes that “the high tax rates … didn’t affect only the post-tax incomes of the wealthy, … [it] also affected pre-tax incomes,”.  Leonhardt quotes the economist Gabriel Zucman as saying that “It’s not worth it to try to earn $50 million in income when 90 cents of an extra dollar goes to the I.R.S.”

The article attributes that voluntary Romney-income-bound to his Mormon beliefs.  Perhaps that was it.  Perhaps it was also that he figured there are better things to do in life than slaving away for your company, and passing on all the fruits of your labor to the tax man.  Just don’t work so hard!  Here, I completely agree with Gabriel Zucman, but for obviously different reasons than David Leonhardt.

Ah, which car company did George Romney work for, by the way?  I did a quick Google search and found that he was president of the American Motors Corporation from 1954 to 1962, headquartered in Southfield, Michigan back then.  Romney is credited with turning that company around, “focusing all efforts on the compact Rambler car” (and don’t we know how much Americans love their compact cars!) and that he was media-savvy.  I am not sure how much of a long-lasting impact that “turn-around” on AMC had.  Wikipedia mentions that it was ultimately acquired by Chrysler.  Wikipedia writes that “at its 1987 demise, The New York Times said AMC was ‘never a company with the power or the cost structure to compete confidently at home or abroad.' ”  I have to trust the New York Times, right?  That does not sound like George Romney left a fantastically successful car company behind, securing the jobs of his workers.

The Michigan car industry generally isn’t doing all that hot, is it?  So, Michigan car workers, how did that 91% top tax rate work out for you?  Happy that George Romney didn’t feel like putting in that extra effort that could have saved your jobs?  How do you like the lack on inequality (in dollar terms) in Michigan, when nobody has anything anymore?

I hope the New York Times keeps publishing more op-eds like these.  They are really fun to read.  Paul Krugman next, may be?


Monday, September 4, 2017

Think like Kim Jong Un: backwards!


I am shocked and appalled by the dismal level of analysis in the New York Times and other news outlets regarding the North Korean threat.  So, let me give it a try.  I am not an expert, by any stretch.  But it seems to me that there are some patently obvious things, how one can do better than what one gets to read and hear these days, by all these news outlets.  Here is my take, thus.  Add some expert analysis to it, and one might get somewhere.

A disclaimer up front: this analysis is not for the faint of heart.  Is the analysis cold, is it cruel, is it disregarding human lives?  It turns out, the subject matter is simply too serious for that.  Don’t shoot me, the messenger! 

Ok, here is the first item on my agenda.  The typical commentary and analysis out there usually goes like this: “oh no, North Korea has tested a nuclear weapon!  What should be done, if they test the next one?”.  This is the entirely false approach. 

The right approach is what every student of economics learns in a basic course on game theory: don’t solve it forward, solve it backwards!  Start from the end point and then think back along each decision of what each player would do, given what is then going to happen in the future.  There is a bunch of technical terms in game theory and economics for this, like subgame perfection and dynamic programming.  If you enjoy, look it up and learn about it.  In particular, if you are one of these journalists writing about the North Korean threat, please do your job and spend fifteen minutes on it, will ‘ya?  You will even be able to write a bunch of columns that are way better than anything that the competition gets to offer, as a result, just imagine!  Now, if you are not a journalist or analyst (or, actually, an economist, who know this stuff by heart already anyhow), and just want to understand the very basics, watch any two-year old child.  They have that thinking down pat.  It goes like this: “mama will hug and cuddle me, if I cry, no matter what I have done before.  Thus, I can do whatever I want.”.   They know.  They think about what comes at the end, first.  For some strange reason, parents often don’t know, and it befuddles them, why children can allow themselves to be so mischievous. 

How does apply to foreign policy?  Let me warm you up with a simple example: that “red line”, which Obama drew in 2012, when Assad used chemical weapons. Remember that?  Assad just ignored and crossed it.  Nothing happened.  Poof.   It was a cringe-worthy blunder of the first kind by the Obama administration.  Here is the parallel.  That two-year old child of yours has an egg in his hand.  You warn it that you will toss its favorite toy into the garbage can, if it smashes that egg.  Child smashes that egg, you turn to that toy, child starts crying.  Go to the end game, described above.  Child wins.  Assad wins.  Truly easy, truly simple.  Perhaps dictators aren’t genius, but we should allow that dictators are at least as smart as your two-year old.  Ah, and by the way: some say, just keep secret what you will really do!  No, sorry.  No one told the two-year old.  And no one told Assad.  They know you and they’ll figure it out.  

On to Kim Jong Un and the situation in North Korea, thus.  Whatever you might say about him: it strikes me that he is remarkably capable of solving backwards, and does very well in avoiding to solve forwards.  Is that what makes him dangerous?  C’mon.  Just think like him!

So, what in the end, does he want?  What do his upper ten thousand want (which, remarkably, always get forgotten … a dictatorship is never one person alone!)?   They want what we all want.  A nice life.  Not being bullied around.  More power.  Perhaps It is something else: I am just making this up, but it seems reasonable enough.

Ok, if you are Kim Jong Un, how can you get there?  More precisely, roll all this forward a few years, to the end.  Imagine you have some nifty nuclear weapons and the rockets and intercontinental missiles to go with it, other conventional toys and a powerful military.  Suppose you are so mighty and can wreck so much havoc on South Korea, Japan and the US, that the US will not dare entering a war with you anymore: the risk of North Korea dropping their nuclear bombs on Los Angeles and San Francisco and Chicago has shut that option down.  But North Korea is rather poor, right?  I imagine the upper 10000 do ok there, but I suppose, they yearn to do better.  And you spend all this money on all those weapons and military?  What do you do?

Well, if you see a bunch of criminals near a bank unloading lots of weapons from their truck, what do you think they might do?  Sell them?  Polish them?  I rather suppose, they might go rob that bank, right? After all, that’s where the money is.

Where is the money near North Korea?  Tough question?  Really?!  C’mon.  It is in South Korea, of course.  South Korea is rich.  If North Korea can conquer it, Kim Jong Un and his buddies will be rich.  Done.  How?  Doesn’t South Korea have an army, ready to defend itself?  Well, think like Kim Jong Un!  You got those nifty atomic weapons and rockets, right?  Just ask South Korea to surrender and the US to give up its military bases there, or to otherwise be bombed.  If they hesitate too much, perhaps, just to make sure they know you mean business, drop an atomic bomb on, hmmh, say Daegu, killing nearly 3 million people and wiping out the U.S. military base there, in one go.  Would that make South Korea mad?  Of course.  Would it make it surrender?  I bet it would.  Would the US intervene?  We solved that one already, remember?  No atomic bombs on San Francisco and Chicago, please!  So, done.  North Korea gets to unify with South Korea, on their terms.  The upper 10000 share the spoils and become rich and live happily ever after.

Ok, one branch back in the tree!  We are making progress here!  If you follow along, you should have noticed something.  If South Korea is good at solving backwards, they will surrender without that atomic bomb being dropped on Daegu.  They should be able to figure out, what’s coming.  Ok, perhaps some smaller, conventional bombs need to be thrown by both sides, for good measure and posturing, but that war should be over before it even started.  Next step, then.

How does Kim Jong Un get to be strong enough to avoid fearing retaliation from the U.S.?  Well, he has to have those intercontinental atomic missiles in place.  Experts say, it takes North Korea a few years to develop them, and their tests haven’t been all that successful, right?  That still gives the US some time, correct?

That’s forward thinking.  How do you solve it, if you are Kim Jong Un?  You make sure to take away that time.  The less time the US gets to plan and think through what to do,  the less time they have to find out where everything is hidden and can be attacked, the faster you can get to your goal and the greater the chances of success.  So, go into high gear now, while the US is still thinking!  If the North Koreans are worth their salt, they will have their atomic intercontinental missiles up and running much faster than the experts predict.  This isn’t foremost a matter of engineering.  This is foremost a matter of game theory. 

Ok, but we get to a decision node of the US now.  Couldn’t the U.S. do something about, like strike first or something nasty of that sort?  Well, sure.  Kim Jong Un is already thinking through that U.S. decision, I bet.  To bomb or not to bomb?  Kim Jong Un wants the “not bomb” decision, obviously.  So, he has to make the “bomb” decision unpalatable to our forward-thinking “experts” in Washington.  The generals have already told Trump that they cannot guarantee to wipe out the entire weapon arsenal of North Korea!  The South Koreans already beg for Trump not to do anything!  The U.S. cannot possibly throw an atomic bomb first!  A pre-emptive strike will be really, really messy, millions will die!  Military options must be off the table!  The U.S. must seek peaceful solutions! 

Ok, nobody wants to see millions die, right?  Well, then do not pre-emptively strike North Korea.  That branch of the decision tree has now been cut off.  Think about it: that’s a pretty cool achievement for Kim Jong Un, right there!  Kim Jong Un did it, congratulations to him!  And before there is enough intelligence on the weapon whereabouts in North Korea, Kim Jong Un will have his intercontinental atomic missiles in a short amount of time, in order to strike San Francisco and Los Angeles and Chicago, if need be, but he will not have to use them be (just to summarize where we were before). 

Now, Trump is a rather, let’s say, impulsive president. Might he do a pre-emptive strike?  He might.  Millions would die.  It would be a mess.  Is that a better outcome?  Before you judge, keep reading.

There are a few more forward-thinking ideas.  More sanctions on North Korea!  Yeah, right.  Like they ever worked much.  C’mon, Kim Jong Un wants all of South Korea!  What’s a sanction of a year or two to get there? Nothing.   The border to China is porous, anyhow.  Another idea: have China reign in North  Korea!  Ah, China.  The true masters of backward analysis, the ultimate kings of the chess board.  Would they like a Korean peninsula under North Korean control, or would they prefer a South Korea with a bunch of American military bases?  That’s not a serious question is it?  As long as North Korea can make sure that Seoul isn’t damaged too much by it all, as long as all those beautiful shopping avenues there for those rich Chinese tourists will remain open, what’s there to be unhappy about? Ok, North Korea will have atomic weapons, which they could throw on China. They could do that already, I suppose.  It doesn’t look like China feels particularly threatened by that.  Some mutually assured destruction strategy, perhaps, or something else.  Let’s just say: China is on board with that North Korean strategy. And why shouldn’t they! Less American influence in that region means more Chinese influence!  They gain without having to do much.  So smart.

Alright then, done!  Here we are, we reached present times.  So, what can be done about North Korea, then?

For that, go back to the end point.  What is it, that Kim Jong Un and his upper 10000 want?  A nice life.  Not being bullied around.  More power.  That’s where the analysis started (at the end, remember?!).  And that’s what they will get, once all is said and done, one way or the other.

The art of the deal then is to give them much of that, without having to go through all these motions.  Let me list some options.  Well, let me just list one (more for another time,  perhaps).  Option 1 is for South Korea to surrender to North Korea, for the US to withdraw its military bases and to make the unified Korea a preferred trading partner, in exchange for stopping their development of intercontinental missiles, and to arrange this all quickly: 2017 would be good.  If the upper 10000 in North Korea can subsequently have a peaceful life in luxury and with power, and if the US and the unified Korea both benefit from the trade agreement, there will then be little reason for Unifiied Korea and its rulers to fear the U.S. and vice versa, guaranteeing the not-being-bullied part.  Lots of tricky details there, but it could work. 

Let me argue that this outcome is better than a pre-emptive strike by the U.S..  Most South Koreans wouldn’t see much changes in their daily lives: after all, North Korea would want a rich South Korea, not destroy it.  They can no longer vote for their leader for the next 30 years or so: oh well.  It wouldn’t be so bad.

But this is now the time to judge that and to think.   I know what you say: wait, South Korea should surrender now?  That’s not a palatable option at all!  What are the other options?

Alright, your turn then.  Just make sure to solve backwards, when you do.






Tuesday, August 22, 2017

How to Predict a Solar Eclipse: a Guide for Ancient Egyptians --- and what it has to do with good economic analysis.


I had the fortune of watching the solar eclipse on August 21st 2017, slightly north of Bloomfield, Johnson County, Illinois.  No cloud disruptions, just two-plus minutes of total-eclipse gazing and an awe-inspiring event.  Magnificent!

Returning back to Chicago, I had to wonder whether ancient cultures, like the ancient Egyptians, the ancient Babylonians or the ancient Chinese, could predict solar eclipses, and how.  I searched the Internet, and I found http://www.haaretz.com/archaeology/1.808116 , which says, that they did, but not, how.   And I found https://image.gsfc.nasa.gov/poetry/ask/a11846.html by the NASA, no less, which suggests that those folks tried to find a discernible pattern in the recurrence.  The readings, in any case, made me feel that predicting a solar eclipse was rather impossible for these ancient people, or a somehow really amazing and hard-to-explain feat.  And they also make you feel, that those astro-observers back then had better try hard: if they missed one, their heads would be chopped off!  That’s a huge penalty for a type-1 error of rejecting a truthfully occurring eclipse.  I imagine that type-2 errors (“hmmh, there could be one”, and then there isn’t one) probably were ok for those guys, by comparison.  What an interesting problem in decision theory!

Having some leisure time in my car trip going back (which I should have spent thinking about more serious matters, probably), it then occurred to me that it really can’t have been all that hard to predict the few critical-solar-eclipse-times, within limits.  And I have to believe that these ancient observers indeed did.  Here is how.

Clearly, trying to extract some pattern from their occurrence will go nowhere. That method seems doomed from the get-go, right?  We get the next total solar eclipse in the US in 2024, then in 2045: where is the pattern in that?  I mean, fine, some surely tried.  And given enough data, one could learn some pattern in some mechanical fashion, it is bound to succeed.  The problem is: this takes lots of data, many tens of thousands of years: not wise. 

Instead those ancient astro-observers could have figured out and probably did figure out, that some structural modelling will go a long way.  First, it does not take a genius to figure out that the solar eclipse involves the moon and the sun.  Back then, the smartest scientist probably spend a large portion of their time observing the celestial bodies.  They knew about the cycle of the moon and the sun.  They knew about the new moon: there are days when you can see it faintly up in the sky.  They surely kept track roughly how high the moon would rise and how high the sun was.  The latter is known to practically all young kids today: the sun is high in the summer and low in the winter.  It is how you keep track of the year.  With the moon, I believe it always rises to the same height, but I might be wrong: in any case, surely, the ancients knew.  And surely, the ancients tried to measure these with some precision (How?  Not that hard either, but that could be a topic for another day). 

Armed with these two pieces of information, one now gets two intersecting patterns.  One is the up and down of the sun, due to the annual cycle.  The other is the lunar phase, changing from full moon to new moon and back.  If the new moon is too much below or too much above the sun, no solar eclipse.  It has to be close.  The “misconceptions” piece on https://en.wikipedia.org/wiki/Lunar_phase lays it out quite nicely, actually.  One probably needs a bit more: where the new moon rises that day and where the sun, and think about where their paths might cross.  Give an ancient astro-observer a few extra days of thinking about it, and they could probably figure that in as well.

Some rough measurement should then have been enough to predict when these close encounters might happen.  Would they be close enough for a solar eclipse?  If the measurement is too rough, then most of the times, an upcoming close encounter will not result in an eclipse.  So, the rougher the measurement, the more type-2 errors.  If those astro-observers warned of a potential eclipse, and it then didn’t happen, they can always tell the king that the gods were looking upon him kindly.  Who knows, perhaps they even got a raise that way!  But at least, they could avoid the type-1 error of not knowing of their possible occurrence. 

It really does not seem all that hard, right?  It would be nice to hear from a physicist, how precise the measurement needs to be to predict a solar eclipse correctly this way in, say, one of ten cases and have a warning in vain in the other nine.  Pretty precise, probably, and that may have been the main technical challenge then.  “When you cannot measure, your knowledge is meager and unsatisfactory” (Lord Kelvin, see https://bfi.uchicago.edu/news/mfm-feature/challenges-identifying-and-measuring-systemic-risk ).  So, precise measurement surely would have been important.  But the conceptual challenge, at least, seems reasonably simple, and certainly within the grasp of astro-observers back then, allowing them to make some reasonable predictions, even without the precise measurement equipment available today.

What does this have to do with good economic analysis?  Economists, too, need to predict events and need to discern effects from causes.  These days, machine-learning is all the rage for doing so.  Just takes lots of data, shove it into a computer, and it will detect any and all patterns, see e.g. https://scholar.harvard.edu/sendhil/publications/machine-learning-applied-econometric-approach and the work by Mullainathan at Harvard for econometric approaches, but also by many others.  One has to concede: remarkable achievements have been and are still being made, using that approach.

But the world is amazingly complicated.  Patterns are probably ultimately very tough to discern, unless they are guided by some theorizing.  So, structural modeling can go a long way.  The danger?  The theory and the structure might be wrong.  That can be a problem, sure.  But for those ancient astro-observers, that surely must have been well worth the risk, compared to the machine-learning approach of pattern detection and head-off-chopping.  And regardless of how little theory we pretend to us: we all use it anyway and all the time.  Perhaps that is a good thing, for the astro-observers back then and for economic analysts today just the same.  But it surely would be good to be explicit about it, when we do. 

IThat's it!  If you enjoyed this, I might tell you some other time how to calculate the diameter of the Earth, standing on the beach.  All that you need is your thumb, some waves, some plausible guesses and high school geometry.  Intrigued?

Friday, August 18, 2017

Is the New York Times advertising to join a violent group, condoning its methods?

There is a an organized group of activists that formed “a human chain …, blocking” people to participate in a scheduled rally.  They “have shown no qualms about using their fists, stick or canisters of pepper spray to meet” them, “armed with sticks and masked in bandannas”.  “In February, black-clad protesters [of that group] …  smashed windows, threw gasoline bombs and broke into a campus building, causing $100.000 in damage.”  At “Mr. Trump’s inauguration … a masked member of the movement punched the prominent R.B. Spencer”.  “Now, more than ever, ‘physcial confrontation’ would be needed,” according to one member of the group. 

Repugnant?  Dangerous?  Should police lock them up?  Should politicians publicly condemn them? 
Make your choice now.  And meet the new darling of the vast majority of the press and the large majority of the public these days: the Antifa movement.  Antifa, as in anti-fascist (and who isn’t against fascism, right?).  More, pro-North-Korea, perhaps: after all, communist regimes are typically not called fascist.  More importantly, this was the group that violently clashed with the rally participants in Charlottesville, among them the White Supremacists.  Trump has criticized the violence on both sides.  For that, Trump was criticized from pretty much all sides (well, excluding the White Supremacist groups).  Hardly anyone, except for Trump, has dared criticize the Antifa movement in the ensuing days. 


So, the perfect time for a bit of advertisement, then?  The quotes above are all taken from a New York Times article today, Friday, August 18th, starting on the front page. You can  find the online version  here, https://www.nytimes.com/2017/08/17/us/antifa-left-wing-faction-far-right.html . Superficially, there is nothing particularly wrong about that article.  It reports on the movement, and lists views on all sides.  All good then, right?

Until one examines the pictures to go along with the article.  Look at them.  Look at them again.  Given the description above, what would one have expected to see, I wonder?  Perhaps an image of the “black-clad protesters [who] … smashed windows”?  Or pictures of them showing no “qualms about using their fists, stick or canisters of pepper spray”?  At least some nice pictures, where they are “armed with sticks and masked in bandanas”?

Those weren’t the pictures shown.  On page 1 of the printed New York Times, there is instead a picture of “members of the antifa movement”, showing a rather sympathetic-looking group.  Ok, the one on the left, barely in the picture, wears a bandana.  In the center then is a young woman, looking fierce, but not covering her reasonably beautiful face at all.  There is a black man too, and without a covered face: wonderful, a truly diverse group!  The group does not seem to be threating at all: there is a guy on the right of that picture, calmly stretching out his arm as if to guide them where to go.  A harmless, diverse group of young people in parkas, thus.  Oh, and no sticks.  On the web version, those antifa members seemed to protest peacefully behind some border in the background, while a “White Nationalist” in the foreground looks ready to throw something at them: hardly an illustration either.

But then, turn to page A15 in the printed version, where the article continues, or scroll down the online version.  Another picture of a group member!  This time, it is of Emily Rose Nauert, a 20-year old, who “became a symbol of the movement … when a white nationalist leader punched her in the face”.  A google-search brought me https://www.blackandblondemedia.com/wp-content/uploads/2017/04/Berkeley-riot-punch.jpg , which I guess was that actual punch.  But that is not what the New York Times showed.  They show her sitting on some stairs in a garden, barefooted, in a flirty dress, the backlit light perfectly reflecting of her long, tussled hair.  This looks like a professional photograph. I was trying to think what the picture was meant to convey.  Do we see traces of that punch?  Do we see someone fierce, ready to battle and impose violence, as the article would seem to suggest?  Do we some tough woman, that is going to stand up to everyone everywhere?

Look at it.  Look at it again.   To me (and, really, is it just me?), it looks more like a young, fragile and, yes, beautiful woman.  If one only saw that picture out of context, one might have thought that this is a picture of Giselle B√ľndchen on the cover of Vogue, somewhere and a few years ago, perhaps making advertisement for some Laura Ashley dress.  So, the Antifa movement now has its own Giselle Emily Rose Nauert B√ľndchen!  Congratulations!  She got street-cred by getting punched in the face, ok.  But none of that is seen here.

But how did that picture get into the New York Times?  Theory 1 is that they are no different from any of the other tabloids, that like to print pictures of beautiful women to increase sales.  Let me dismiss that theory: those pictures are typically remarkably hard to find in the NYT.  Theory 2 is that they just happened to have that picture at hand and it seemed to be the best picture to illustrate their story.  Really?  C’mon.

Theory 3 remains.  Show a picture of beautiful woman, who is a member of that movement, to convey how beautiful and humane and loving that movement is.  To all the young men out there, considering joining it, it says: “join us and you get to meet cute, lovely women like her!”.  It is the oldest trick and strategy for getting young men to join anything and to do anything.   Some things just always work.

So, if this was the main web page of the antifa movement, advertising for membership, I’d understand perfectly.  But this is the New York Times, right?  Are they making subtle advertisement?  Are they subtly encouraging young men to join the Antifa?  Hey, have some fun, smash windows, throw gasoline bombs, use canisters of pepper spray on people whose views you find despicable, and meet the girl of your dreams, right? 

Shame on you, New York Times. 

Or perhaps the picture really just got in there by accident, and those capable journalists of the New York Times never reflected on this one bit.  Possible too, of course.