Cumulative Model

I just want to say thanks for inflating long term interest rates and preventing me from refinancing and getting my interest expense low enough for me to consider investing or spending.

Note that gasoline prices rose preciptously starting in 2005.

INRIX has released its 2008 Annual Report on congestion. (Via Tom Vanderbilt)

The key finding is "a decrease in the Travel Time Index of 3.5% from 2007; more than
reversing the increase of 1.9% between 2007 and 2006".

This conflicts with my experience and analysis of fuel economy. For most of 2008, I've felt that my drive times were longer, except in recent months. This agrees with the decline in fuel economy. For gasoline, fuel economy declined in most of 2008 and only rebounded slightly at the end of the year. It finished down for the year.

However, a little further thinking reconciles my analysis with the INRIX Report. When diesel and gasoline fuel economy is looked at, fuel economy does begin improving earlier in the year and does end as a net improvement for the year, in agreement with the INRIX report.


Here's what I think is happening.

I think there are two traffic flows that exist at the same time.
Car traffic may have gotten worse while commercial traffic became more efficient.

My thinking is that car drivers responded to gas prices by erroneously accelerating and driving slower, this worsened fuel economy for car drivers. Commercial driving habits probably didn't change much for non-freeway driving. Trucking probably benefited from decreased congestion and also improved fuel efficiency by driving at lower top speeds on the freeway. Car traffic suffered from decreased throughput at intersections and decreased speeds for non-highway driving (below 55MPH, higher cruising speeds are more efficient).

UPDATE (4/27/09): I e-mailed INRIX at the time of this post about some shortcomings in their report, I received no reply other than acknowledgement of receipt. Their reporting is based on data from commercial vehicles. Commercial vehicles behave differently than passenger vehicles. They accelerate more slowly, have cargo that shifts, hit more red lights, etc. Generally, most traffic flows around them, interfering slightly as they merge in front after passing (i.e. diminished passanger vehicle traffic flow could result in slight improvement in commercial vehicle traffic flow). Also, INRIX data compares traffic relative to "free flow" rates. A decrease in free-flow rates will exaggerate improvement in traffic flow. Their reporting also will not recognize diminished flow during non-congested hours, which can be even more costly than gains during congested hours.

I'll do Ed Glaeser one better.

Replace the Interest Rate Deduction with a Principal Payment Deduction. Sure, it'll break some banks with a bad mix of Mortgage Backed Securities holding prepayment risk, but fuck 'em.

This will bring a soft landing as people with large amounts of cash are encouraged to buy houses, without lots of leverage. Demand will be buoyed and banks will be flooded with cash and will have to lend at lower interest rates to compete. It will also move properties to less risky owners. Fast.

Drive Sensibly

Aggressive driving (speeding, rapid acceleration and braking) wastes gas. It can lower your gas mileage by 33 percent at highway speeds and by 5 percent around town. Sensible driving is also safer for you and others, so you may save more than gas money.

While technically correct, this statement is likely to be misinterpreted and lead to worse fuel economy. Rapid acceleration combined with rapid braking results in wasted gas. However, quick but smooth acceleration is more efficient than slow acceleration. Slow acceleration spends more time at less efficient vehicle speeds and at engine speeds that are less efficient while the engine is under the heavy load of acceleration. (However, accelerating too hard at low engine speed uses large amounts of gas when it is inefficient. This is why "quick, but smooth" should be emphasized.)

What is most important is that drivers remain safe and alert. Being aware of what is ahead leads not only to safer driving, but more efficient driving. Avoiding needless braking is where the fuel savings are. Being alert and getting up to speed quickly reduces the burden of congestion, but being over eager will result in waste. A driver should always be going the same speed or slower than the vehicle ahead, unless of course it is safe to go around. Accelerating too much results in unnecessary braking, and acceleration that is wasted and must be done over.

Stops are by far the biggest fuel waster. It should probably also be emphasized that encouraging communities to properly time traffic signals to reduce the amount of stops and set appropriate speed limits to keep traffic flowing smoothly will increase fuel economy better than any individual effort. When traffic lights and speed limits are set properly, driving at the posted speed will result in better fuel economy and time savings. Removing unnecessary traffic lights and stop signs should also be looked at.

Bad information has lead to declining fuel economy over past several years, despite rising fuel prices, the purchase of better fuel economy vehicles, and flat and declining amounts of driving. Adaption of moderately poor fuel economy driving behaviors resulting from bad information and price pressures are further compounded by their effect on congestion.

fueleconomy.gov: fuelecnoomy@ornl.gov
Dept. of Energy: The.Secretary@hq.doe.gov
EPA, Energy Efficiency and Renewable Energy Information Center: Web Submission Form

Why is there no readily available list of cars' average optimal fuel efficient speed by make, model, and year? Shouldn't that be known for every car.

Back in 1998, the average was 55mph for the most fuel efficient speed. But modern cars have improved a lot. The average has likely increased for passenger vehicles and truck, and the range for all vehicles has certainly increased. I've read claims that some cars get their best fuel economy in the 75 to 80mph range.

Gas taxes (to include cap-and-trade) have become very popular with intelligent, but shortsighted economists. However, the benefits they expect are wishful thinking at best.

For starters, people confuse a gas tax with a Pigovian Tax. Pigovian taxes are largely accepted as economically stimulating in the long run. But a tax on a product or service that is associated with negative externalities is not necessarily Pigovian.

A Pigovian Tax is a tax that identifies negative externalities, prices their cost, and is spent directly on neutralizing the externalities (either by identifying the affected parties and compensating them, or spending on technology that prevents the externality). The national research council estimates the cost of externalities for gasoline consumption to be $0.26 per gallon for energy dependence and carbon emissions. That means that a Pigovian Tax would not be higher than $0.26 plus costs of infrastructure and pollution (Congestion cost cannot be included in a gas tax because congestion is a matter of when and where a vehicle drives. At most times and places, vehicles don't contribute to congestion.). The average tax on a gallon of gasoline is already $0.41 in the US.

Secondly, a gas tax is not a consumption tax. Gasoline is largely not an end use product, it is an input. Only for a small percentage of gasoline usage is gasoline an end use product (e.g., joy riding, snowmobiling, two-tracking, boating, recreational flying, luxury shopping and dining out, pyrophylic gratification). Usually it is an input for some other desired outcome.

Increasing input costs introduces risk to both individuals and businesses. When operating costs are higher, risk is higher and there is less certainty in the economy. It is harder to make good decisions.

Failing to notice that fuel efficiency has declined the past several years as gasoline prices have risen, the media will notice that fuel efficiency falls when gas prices fall this winter. They will totally ignore that fuel efficiency declines in winter due to the weather and that this year's winter has been and is expected to be especially harsh.

Fuel efficiency always declines in winter.

Tyler Cowen, "The real problem, of course, is the quality of our decisions on infrastructure."

Until people realize that Induced Demand is the whole point of infrastructure, not a symptom, it will just be pork.

I don't think cash will necessarily address the problem.

There seems to be two problems. The structure of cash flows don't match the expectations of banks when they bought these MBSec's, so many have a bad mix. Banks are afraid to lend to each other because they don't know who has a bad mix. The second problem is that aggregated, these MBSec’s have lost value for the same reason that banks ended up with a bad mix: Default Risk went up dramatically from expectations. Just like borrowers, banks are faced with lower asset values and lots of leverage (some banks should actually have higher asset value because they may own MBSec’s that are backed by cash flows that weren’t expected but are now coming in, like balloon interest rate payments).

Why did default risk go up? After 2005 oil prices went up ~100%, gas prices ~50%, other commodities went up… costs of consumables went up in price relative to everything else. Incomes for the majority were flat and negative. Expenses/Income increased significantly for the broader population. Viola, default risk jumps.

Here’s the problems with the solutions we’ve been given: Because costs have gone up so much relative to income, it can be expected that any inflation we will see will fall disproportionately on consumables. Combine that with the assumption that consumption and taxes are probably larger than income minus principal and interest payments for most people, it means default risk will rise with more inflation [until (Income – Tax – Interest – Principal Payment) is > Non-Interest Expenses].

UPDATE: Johnathan Gewirtz of chicagoboyz.net adds:

I don't know. It seems to me that the capital destruction caused by defaults and institutional failures (and expectations of more of same) is deflationary while recent Fed behavior has been inflationary. I don't think anyone knows how this is all going to shake out.

I'll add further: the velocity of money is down, so monetary expansion might not produce much inflation. The buying of T-bills to fund the policy would be contractionary too [but I have a feeling it will pull money from places we don't want to]. However, while the capital destruction should cause some deflation, the debts used to obtain the capital remain unchanged, so it drives up the real cost of principal and interest payments.

Little things that piled on: I think there was a bit of a gas price bubble as well. Poor reaction to high gas prices caused people to adopt inefficient driving habbits. This kept gas demand from going down much at all and reduced what we got out our gallon. Unfortunately, I don't think falling gas prices will make that go away. Fortunately, I don't think falling gas prices will reduce the push for more fuel efficient technology. The possibility of higher prices is enough to keep that going.

Another Update: Arnold Kling has an excellent summary up. I think this makes for an excellent set of lessons learned.

Mortgage Losses On Owner-Occupied Homes Lower Than Assumed from PhysOrg (via commeter at Lubos Motl's)

Part of the problem is that when default risk went up, buying slowed and so values on homes went down. This means that for many people, if they sell they are still stuck with a sizeable debt and no asset to lose if they default on it. And banks end up with an oversupply of properties it can only sell at firesale prices, which push home prices down further.

Here's a way to mitigate some of the problem.

Upon sale or foreclosure, the bank gives the borrower foreclosed properties on its books for the value, or partial-value, of the remaining debt.

The taxpayer pays. The taxpayer always pays. No. Matter. What.

Everyone pays taxes and everyone is the taxpayer. When a blowup happens, it's the taxpayer who will pay. When there is economic destruction, the taxpayer pays. (And, conversely, when we pay taxes there is economic destruction… generally.)

Now that we've dealt that, who should they pay?

Should they pay borrowers, who didn't realize that living expenses might go up but their wages wouldn't, so they might want to default?

Or lenders who didn't expect the borrowers’ wages to stay low and prices to go up, leaving them less to make payments with?

Should we pay the flipper, who bought houses, hopefully with the intention of improving them and quickly selling? He didn’t know costs would go up and home values would go down, decreasing the return on his now costly improvements.

Or should we pay the lenders, who loaned to flippers at low rates, but put a ballooning interest rate on the loan so that the flipper would sell to someone else if he didn’t improve the property fast enough? He didn’t know that improvement costs would go up and tightening budgets would cause home prices to go down.

Or should we pay the banks, who bet that they would not see default risk go up, bet that they would receive sub-prime principal in lump sums, bet that they would not see sub-prime principal payments in installments after 2 years, bet that they would not see interest payments at ballooned rates, then borrowed on those bets and bet bigger?

Here's my Best Case:

Nothing is done. Banks, afraid to lend to eachother and faced with watching their assets depreciate, loan to good borrowers with higher down payments or collateral and lower interest rates. Portions of loans with 6% or higher interest rates are refinanced at a lower rate, probably around 4%, on the existing value of the house or other collateral, the owner must pay the portion of the principal not covered by the current value of the house at existing terms, but the current rate is locked in. Owners deemed too risky at the new low rates default. Some banks holding mortgage backed securities that are dependant on the cash flows on the portion of the loan refinanced and on defaulted loans go bust. The assets of failed banks are sold off and the debts are nationalized. Inflation is kept in check, so costs of living do not increase relative to income, so default risk goes down. Commodity production increases to take advantage of recent rises in prices, continuously rolled over long positions on commodities are seen as untenable long term investments. Money is moved away from commodities, and prices of consumables fall. Default risk further decreases and some risky assets become valuable again.

And now the Worst Case:

Bailout happens. Inflation increases, but home values continue to decline and wages remain flat. Home owners, with budgets already crunched beyond expectations, are burdened with even higher costs of living and default risk increases greatly. Defaults increase and home prices fall more. The bailout causes the interest rate the government borrows at to go up, moving money away from businesses and causes banks to expect higher interest rates from home buyers, putting further downward pressure on home prices. Scared money also goes from home and business loan to continuously rolled over long positions on commodities, which people expect production not to increase for but demand to remain. Prices go up relative to income, and default risk goes up....

Credit markets freeze up within the next week and many businesses cannot meet their payrolls. Margin calls cannot be met and the NYSE shuts down for a week. Hardly anyone can get a mortgage so most home prices end up undefined rather than low. There is an emergency de facto nationalization of banks to keep the payments system moving... There is no one to buy up the busted hedge funds, so government and the taxpayer end up holding the bag. The quasi-nationalized banks are asked to serve political ends and it proves hard to recapitalize them in private hands. In the very worst case scenario, the Chinese bubble bursts too.

Here are Tyler Cowen's Best and Worst Good and Bad Case Scenarios.

And Commentary at Megan McArdle's

Update: via commenter Nelson at Megan's Industrial Companies Can Thank Banks for Lower Rates.

Money-market funds that gorged on the debt of financial companies are now pouring cash into Treasury bills and corporations which avoided the troubled mortgage bonds that contributed to the failures of New York-based Lehman Brothers Holdings Inc. and Washington Mutual Inc. of Seattle. Yields on 30-day non-financial commercial paper dropped to 1.86 percent on Sept. 24, the lowest since November 2004.

Lower short-term rates are proving irresistible to companies that haven't relied on borrowing, or leverage, to pump up profits.

General Electric Co., the world's biggest provider of aircraft leasing, jet engines, power-plant turbines, medical imaging machines and locomotives, is having no problems accessing the short-term debt market even though about half of its business comes from lending, Chief Financial Officer Keith Sherin said on a conference call with investors Sept. 25.

But, then there's also this (via Instapundit):

Places off limits areas within fifty miles of the coast line, where 80 percent of the oil and gas deposits are. This bill, if it becomes law, will place these energy rich areas off limits permanently.

* Places off limits such energy rich areas as the Destin Dome off Florida and the super-rich areas off the coast of California on a permanent basis.

* In a gesture of what she probably thought was courage, Speaker Pelosi allows drilling on seven percent of the acreage offshore in the most difficult, deep water areas, one hundred or more miles offshore.

* If state legislatures sign on, drilling would be allowed in a further 12 percent of the untapped areas between 50 and 100 miles offshore -- again, difficult areas to explore and difficult areas in which to drill.

Call me when you want to lend to me at 4%!

UPDATE: This includes "Distillate Fuel Oil", which includes diesel, as well as gasoline. The data is very noisy because the Distillate Fuel Oil data includes Distillate Fuel Oil used for power generation, locomotives, and construction and industrial equipement. A large portion of the consumption does not correlate with miles driven, so it masks the trend.

The trend is much clearer when miles driven are compared with gasoline consumption only. This ignores that diesel use for commercial transportation could be up, diesel use could have improved in efficiency (congestion on interstate roads is down), and maybe only car travel is down. However, from a 2005 BTS study, commercial diesel vehicles only makes up ~7.5% of vehicle miles travel, diesel commercial vehicles only get 6-7MPG, and efficiency gains are not likely to be large.

1976 to Present

CPI from here.

ADDED:


UPDATE: Recalculated with Diesel added in.

13 Month Moving Average

Vehicle Miles Driven is from DOT.

Gasoline Consumption is from EIA.

My guess is that DOT over estimates VMT and/or EIA under estimates product supplied, leading to the high MPG calculated.

What's important here is the trend.

UPDATE:Finished Motor Gasoline doesn't include diesel. New numbers with diesel here.

Fuel Efficiency is higher now than back in 1998. Efficiency Declined from 1998 unitl the end of 1999 and then improved quickly. It remained relatively flat until 2004 and then began improving until the middle of 2006. Since 2006 fuel efficiency has been in steep decline.

(Data is from EIA and DOT. The graph is of % change from one year prior in vehicle miles driven minus gasoline consumption % change summed for each month since Jan 1998)

Bryan Caplan links to a snippet from Richard Posner on people's resonses to high gas prices.

I wonder, too, whether the recent decline in U.S. gasoline consumption doesn't represent to some degree an irrational panic reaction. To take a huge loss on the sale of your SUV in a market that is depressed because so many other people are doing the same thing at the same time is unlikely to be justified by the gains from the improved gas mileage of the car you buy with the modest proceeds of the sale. Likewise, driving a substantial distance to save a few cents a gallon on the gas you buy is unlikely to be worthwhile. A recent article suggests that people fixate on the price of gasoline because unlike most regularly purchased items, such as food, gasoline is purchased separately from other items so that its price is not buried in a bill for multiple items.

Pile on top of that, entirely rational reasons fuel efficiency may decline with higher gas prices.

And, it gets worse. From CNN, communities are cutting back on public transit, police, and road maitenance.

Food prices are greatly affected by oil. It accounts for most of the production cost.

Fuel consumption is declining much less than driving is.

Not to worry, people are discovering ways to reclaim their lost efficiency.

The last time there was a significant reduction in gasoline consumption was 17 years ago.

17 and a half years ago, there was an upward spike in oil prices in August 1990. It was followed by a recession from Sept 1990 to Sept 1991.

As a percentage of the same month, one year earlier.

Getting rid of traffic lights has been proposed for certain metro areas.

Getting rid of stop signs has also been proposed. I think this is a good idea. The vast majority of stop signs could replaces with yields, the rest eliminated, to the benefit of safety and traffic.

But the remaining traffic lights? I don't think we need them most of them. We don't need the red anyway. We should only have two traffic signals: Yield and Don't Yield.

With just green and yellow lights, we could help keep traffic moving and help it clear more easily when it does form.

Green means Don't Yield. Yellow means Yield. If you have a yellow, other traffic has the right of way. If there are cars in the interesection, you must yield to them. Changes to Yield would overlap other traffic. Like current yellow lights, if you are unable to stop, you may continue.

We are currently enduring a natural experiment on the effects of higher gas prices. While it has spurred movement toward more efficient technology, it has brought about some severe consequences that will need to be dealt with.

Last month it was reported that driving in the US was down 4.3% in March compared to last year. What everyone missed was that gasoline consumption wasn't. It was down less than 2%.

For the year, gasoline consumption is down little more than 1/2% [correction, DOE now shows close to 1% less fuel consumed for the year].

We aren't using less fuel, we're getting less done with the fuel we are using.

If the most efficient driving was being eliminated, it still couldn't explain the large difference in fuel efficiency. The driving being cut would need to be several times more efficient than normal to have such a negligible impact on fuel consumption. This is not plausible.

Among the reasons: Less efficient fuel mixtures may be being used; People are acting on bad advice. We've known for awhile now that accelerating faster is more fuel efficient (this is even before considering the beneficial effects on traffic), yet people believe the opposite; People may be driving more at high traffic times to generate needed income and be too tired and poor to drive at other times; And, during the economic slow down, communities may be neglecting good traffic management (e.g. not timing traffic lights properly).

We also need to consider whether higher prices will strengthen the movement toward more efficient technology or have little additional effect. (i.e. Has the move already happened and will further price pressure be of no value? After the crunch of the 70's, efficiency contitued to improve greatly despite falling prices.)

Additionally, we need to realize that in the mid-term, our current vehicle fleet and the infrastructure to produce more aren’t suddenly going to disappear. New tech won’t wash out these adverse effects.

[The gasoline consumption data can be found here: http://tonto.eia.doe.gov/dnav/pet/xls/pet_cons_wpsup_k_w.xls

It's in excel format. See U.S. Weekly Finished Motor Gasoline Product Supplied (Thousand Barrels per Day).

The Energy Information Administration defines Production Supplied as their calculation of consumption:

Products Supplied Approximately represents consumption of petroleum products because it measures the disappearance of these products from primary sources, i.e., refineries, natural gas processing plants, blending plants, pipelines, and bulk terminals. In general, product supplied of each product in any given period is computed as follows: field production, plus refinery production, plus imports, plus unaccounted for crude oil, (plus net receipts when calculated on a PAD District basis), minus stock change, minus crude oil losses, minus refinery inputs, minus exports.

More petrol data can be found here: http://www.eia.doe.gov/oil_gas/petroleum/info_glance/petroleum.html]

previous post

UPDATE: A mistake was made or the DOE revised their numbers. For the year, consumption is down close to 1%, not close to 1/2%.

UPDATE II: Large trucks do get less than 1/3 of the gas mileage of passanger cars (6.7MPG vs 22.9MPG 2005, DOT). However, they make up only 7.5% of total miles driven.(ANNUAL VEHICLE DISTANCE TRAVELED IN MILES AND RELATED DATA - 2005 BY HIGHWAY CATEGORY AND VEHICLE TYPE) If all driving cut was in passanger vehicles, it should still reduce fuel consumption by only slighly less.

Here are the weekly comparisons of 2008 over 2007, 4 week moving average 2008/2007, and the total consumption, year to end of week, 2008 over 2007:

Weekly | 4 Week Moving | Average Total
Week 1 1.12% 0.42% 1.12%
Week 2 0.62% 1.13% 0.87%
Week 3 -0.49% 0.42% 0.42%
Week 4 -1.65% -0.10% -0.10%
Week 5 -2.41% -0.99% -0.56%
Week 6 -0.45% -1.25% -0.54%
Week 7 -0.79% -1.33% -0.58%
Week 8 -0.83% -1.12% -0.61%
Week 9 -1.31% -0.85% -0.69%
Week 10 -0.29% -0.81% -0.65%
Week 11 -1.83% -1.07% -0.76%
Week 12 -1.45% -1.22% -0.82%
Week 13 -1.70% -1.32% -0.89%
Week 14 -1.96% -1.74% -0.97%
Week 15 0.98% -1.04% -0.83%
Week 16 0.57% -0.55% -0.75%
Week 17 -0.77% -0.31% -0.75%
Week 18 -0.35% 0.11% -0.73%
Week 19 -0.65% -0.30% -0.72%
Week 20 -0.78% -0.64% -0.73%
Week 21 -1.18% -0.74% -0.75%
Week 22 -3.85% -1.62% -0.89%
Week 23 -0.80% -1.66% -0.89%
Week 24 -3.54% -2.35% -1.00%

I've contended for a while now that high gas prices will lead to decreased efficiency.
It seems I've been right. I've been looking more closely at the data at the Energy Information Administration. I've found the appropriate data set (see Product Supplied, Finished Motor Gasoline).

The EIA defines product supplied as the appropriate measure for consumptions:

Products Supplied--Approximately represents consumption of petroleum products because it measures the disappearance of these products from primary sources, i.e., refineries, natural gas processing plants, blending plants, pipelines, and bulk terminals. In general, product supplied of each product in any given period is computed as follows: field production, plus refinery production, plus imports, plus unaccounted for crude oil, (plus net receipts when calculated on a PAD District basis), minus stock change, minus crude oil losses, minus refinery inputs, minus exports.

Gasoline consumption is down less than 1% (approximately 2/3 of one percent) compared to last year, while driving has been estimated to be down 4.3%.

This is a major decline in fuel efficiency. It cannot be explained by decreases in the most efficient types of driving alone. The driving cut would need to be several times more efficient than normal driving.

I’ve identified three reasons for the decline in efficiency I believe most likely(other than population growth combined with a lack of infrastructure growth):

3. Less efficient fuel mixtures (reformulated gasoline is making up a greater percentage of fuel).

2. Possible Giffen Behavior.

People are pressured to forgo luxury driving during off-peak hours, but must drive more during peak hours to produce a needed increase in income. And people are only willing to do so much driving in a day or week. People must drive more during congested times and are too tired to take the family out or take that country drive to visit grandma. Maybe mom and dad don't even want to be in a car any more.

1. Drivers acting on bad information (e.g. Accelerating slower rather than faster)

"It's not commonly understood by people who drive," Dr. Dougherty said. "They think that the way to get best fuel economy is to accelerate very gently, but that proves not to be the case. The best thing is to accelerate briskly and shift.

"Don't give it everything the car has, but push down when you're going to shift, using maybe two-thirds of the available power, and change through the gears relatively quickly."

Megan McArdle answers the unanswerable question.

Somehow, she decides it's zero.

Never mind that if you can't count it, you can't control it, and you certainly can't raise its price.

It'd be like trying to tax or set the price of cocaine, keeping it illegal and still prosecuting.

POP QUIZ!

Ok, we have two alternate worlds with two identical villages, the exception being that Village A has only an income tax and produces greenhouse gasses. Village B has a combination of income tax and greenhouse gas emissions taxes. Village B's tax system implemented in a way that completely eliminates greenhouse gas emission, but has no effects on its ability to meet the material need of its population; i.e., the villages have the same GDP, population growth rates, etc.

Both populations start with 2000 people.
The population growth rate is 1.3% for both villages.
The GDP growth rate is 4% for both villages.
30% of both populations have IQs sufficient to perform higher level work requiring a college degree, and do so.


Lets say Village B has a .01 chance of a 100 year storm hitting which will kill .05 of the population and destroy .05 of the economy every year. Due to its greenhouse gas emission, Village A has a .011 change of being hit by a 100 year storm. Various engineering projects are available that will reduce deaths and destruction .005. These projects require 100 civil, environmental, or marine engineers to start.

Assuming a hundred year storm absolutely will not happen until at least 100 years from now, which village is at greatest risk from a hundred year storm? Please explain why and show any calculations.

One more plausible rational reason why fuel efficiency continues to decline.

Perhaps there is Giffen Behavior in driving. If the cost of driving goes up, we may get more demand for driving.

People are pressured to forgo luxery driving during off-peak hours, but must drive more during peak hours to produce a needed increase in income.

Added: And people are only willing to do so much driving in a day or week. People must drive more during congested times and are too tired to take the family out or take that country drive to visit grandma. Maybe mom and dad don't even want to be in a car any more.

Kevin Drum observes that people respond to higher gas prices by driving less.

He fails to notice that along with the decline in fuel production is a decline in GDP growth.

He also fails to notice that miles driven have decreased much more than fuel production. That's right, fuel efficiency is declining with higher fuel prices.

According to Kevin, fuel production has declined by .7%. Average Daily Miles Driven have declined by 5%.

Some of this decrease in efficiency is due to increasing population and limited growth in infrastructure. Some may be due to people forgoing long trips to recreational destinations. But none of this comes close to explaining a 5% decline in driving. It's hard to believe that long recreational drives are a big part of American culture, let alone the greater than 5% of driving necessary to drive down efficiency.

I have my own theory. Markets only perform well when there is good flow of information. Because of people's misconceptions of what is efficient and how they affect traffic, they are modifying their behaviour in counter productive ways.

Popular belief is that people will notice their decreased fuel efficiency and correct their mistakes. However, among other complications, I believe gas prices are nowhere near high enough to get people to seriously consider the consequences of their actions.

[UPDATE: Giffen Behavior may contibute to decreasing efficiency]

31556926 Seconds/Year (Google search)
303824646 Population of US (2007 est, cia world factbook)
$13860000000000 Annual GDP of US (2007 est, cia world factbook)

(13860000000000 $/year) / (303824646 people*31556926 seconds/year) = .0014456 $/person-second [That's $4.97 an hour]

30 miles/gallon at 55mph (source, est from graphic)
23 miles/gallon at 75mph (source, est from graphic)
25 miles/gallon at 70mph (source, est from graphic)
28 miles/gallon at 65mph (source, est from graphic)
3.62 $/gallon May 4th US average (source)
1.63 person/vehicle (source)
3600 second/hour

(3.62 $/gallon * 55 mi/hour) / (30 miles/gallon * 3600 second/hour * 1.63 people) = .001131 $/person-second

(3.62 $/gallon * 75 mi/hour) / (23 miles/gallon * 3600 second/hour * 1.63 people) = .002012 $/person-second

(3.62 $/gallon * 70 mi/hour) / (25 miles/gallon * 3600 second/hour * 1.63 people) = .001727 $/person-second

(3.62 $/gallon * 65 mi/hour) / (28 miles/gallon * 3600 second/hour * 1.63 people) = .001432 $/person-second

Of course, this assumes that your daughter and grandmother are as likely to be the 1.63 occupants as you and your wife.

(Also, I don't like that consumption curve. That 55mph tripe is based on old vehicles, and may also include big trucks. I know my 2002 Mazda protégé is at 3400RPM at 75mph, still in the flat part of the torque curve.)

Like AGW itself, the cost of moderate regulation is probably greatly exaggerated. It won't cause the end of civilization.

But what if we're wrong? What would be more costly, if Alarmists are wrong, or if Skeptics are wrong? Which is more dangerous?

Cass Sunstein's book Worst Case Scenarios is a good start at contemplating what we don't know.

Recommendation

Dr. Sunstein considers many modes of thought and the book should get you thinking.

Throughout the book Dr. Sunstein uses two main narratives to examine how people react to uncertainty, Terrorism and Global Warming. He provides a very PC perspective, probably to better reach a broad audience and get them thinking about how we deal with what we don't know. The book is an exercise to get the lay person thinking about uncertainty rather than an objective analysis of how to deal uncertainties. It should get the reader to consider how we over and under react and how costly that is.

Sunstein makes the very good point that people have over-reacted to the historic risk level of terrorism (with much unnecessary cost in life and resources) and explores several reasons why. He also makes the point that probabilities alone are not enough to make decisions. Context is also important. That said, he possibly over emphasizes the fact that people over-react to more highly salient risks and he fails to thoroughly consider why people react strongly to risks involving justice and intent (especially that there is also a signaling component).

While most of us make the mistake of over-reacting to highly salient risks, Sunstein does the opposite. He makes the mistake of greatly exaggerating the risks of Global Warming. For the sake of argument, he makes up numbers. But the numbers are absurdly high, even when considering them as the likelihood that a risk will increase rather than the likelihood of an actual event happening or not.

When dealing with the uncertainty created by human actions, Sunstein also neglects uncertainty that already exists. The human component of global warming is small (and the greenhouse gas component of that is less than half). A large amount of uncertainty exists whether we reduce CO2 emissions or not. Building a particle accelerator creates a small, immeasurable risk of catastrophe. But Earth is surrounded by many particle accelerators which bombard the Earth and even produce collisions. Building one doesn't significantly affect the level of risk we face (and may provide us with knowledge that will help us avoid other risks).

The biggest qualm is that Sunstein advocates a policy of generational neutrality. He makes a good rhetorical argument, but logic is not on his side. He notes the consensus among economists that future lives should be discounted is unraveling. And unraveling is an apt term. The principle was long considered obvious to economists for the reason that it is obvious. When Sunstein asks whether the life of a 10 year old today is worth more than the life of a 10 year in 2040, he quickly answers, as many would like to, "No." But he fails to consider the obvious; that a 10 year old now will have 10 year olds of his own in 2040.

As to which is more dangerous, I think it's clear that regulation is far more dangerous than diversified growth. It's just that the imagery of catastrophic events associated with AGW (which is very unlikely to be mitigated by proposed regulation) is much more salient than the alternative of a much bigger, healthier, and wealthier future population.

Catastrophic events are discrete, but economic growth is compounding. So small changes in the growth rate make a big difference in well being over time. That's why a life now is worth more than a life in the future, because it affects the well being of the future. A catastrophic event that happens in the future will affect a smaller portion of wealthier society.

And it's unknown whether we are making catastrophes more or less likely.

This is out of Oxford!

It's nice that people are starting to think more about what we don't know, but it'd be nicer if they'd think a little harder.

Cass Sunstien does a better job, and he's a lawyer.

Bush is suprized that some analysts say we'll see $4 gas this summer.

Sure, it may happen. It's even plausible that it'll stay there.

But the implication that $4 gas will be the norm this summer is ridiculous. No suprize that Bush thought the idea was ridiculous. If he was keeping up on trivia like that, then I'd be really worried. That'd mean we really might see $4 gas in our futures.

This article (via ClimateDebateDaily.com) and these posts by Arnold Kling got a chuckle out of me.

CDD introduces the New Yorker article thusly:

“The carbon footprint of apples imported to New York from New Zealand can be less than for apples from fifty miles away. How can people make the right decisions? The answer is ...”

The answer is way simpler than anything proposed in article.

To begin, of course things will be missed and there will be unrecognized distortions and mistakes made in any method used to calculate carbon emissions or Green House Gas equivalents. Counting airplane stickers and carbon units are likely to mislead you, but getting an accurate measure isn’t necessary to reduce your energy consumption (and therefore GHG emissions). There is a better and easier way that has been in practice for thousands of years.

Cost. Reduce your costs: Reduce your consumption: Reduce your emissions.

It won’t always be perfect (there are always distorting effects), but in general dollars represent energy, whether it be from calories or solar panels, that ultimately comes from the fossil fuels needed to develop and produce them (energy produced from solar panels will reduce costs once/if-ever the output exceeds the manufacturing and development requirements). Common to all goods and services, and included in the price, is the effort/energy to produce, transport, and develop products, perform services, and to sustain the producers, creative minds, politicians, and managers.

Cost should almost perfectly translate into energy consumption. Whether it’s the cost of transportation fuel, electricity for production, or producing the calories to feed employees and bureaucrats who regulate, in some way costs ultimately translate into energy resources. Somewhere in price is all the energy used directly in production and indirectly by financing the consumption of employees, owners, or funding of government welfare programs. Even for scarce, highly demanded materials (like diamonds) the price includes energy efforts to locate, extract, transport, and regulate. Beyond that, the high price funds the carbon intensive lifestyles of profiteers.

Things do get a little fuzzy. Just because someone profits highly doesn’t mean that they will consume more. The best way to be carbon efficient is to be prodigious in work and investment and frugal in spending. By investing, people can increase the production and decrease the costs (energy needed) of the goods and services that satiate the demands and desires of others. By minimizing cost and maximizing profits, we automatically meet more people’s demands, more fully, with fewer resources. The two things that people are most meticulous in measuring are their efforts and their finances. And, as shown here, when activities pose an externality on others, people are excellent at making them accountable.

Things do get even fuzzier. As mentioned in the New Yorker article, GHG like methane don’t correspond to price quite as well. However, growth in such emissions is much lower than CO2 (and emissions may possibly even be declining). And looking out more broadly, such gas levels are likely to be ultimately determined by interplay of the broader biosphere and atmosphere as CO2 concentrations increase. Regardless, if warming is your concern, you should be more focused on changes to lands and water. Changes to albedo and increases in humidity driven by changes in land use may cause more warming than the GHGs. And energy/carbon efficient practices aren’t necessarily less polluting. Shipping is more efficient than trucking and produces less GHGs, but produces far more pollution.

UPDATE: Wow! Solar panels may take more than I thought.

Conservation effort.

We need a National Horn Day!

One day a year. At every traffic light. When the light turns green. Everyone presses into their horn until they get to the speed limit.

People need to learn that efficiency means efficiency, both in time and fuel.



Save Gas: Avoid Brakes!

Accelerate Faster

Trends in Congestion

Why Peak Torque

High Gas Prices Are Destroying My Fuel Economy

The Big Deal About Gas Prices

Is Gasoline a Giffen Good

Giffen Behavior in Driving

Econlog had a post on The Selfish Reasons to Have More Kids last week and the Economist had a post on Children as a Public Good. One positive social and selfish good that was overlooked is using population growth strategically in war as a signal to stave off aggression. The Make Love and War argument.

Population has always been a major component of war. The ideas of chivalry and sending men off to war and not women probably comes from the fact that the number of women in a society ultimately determines the upper bounds of potential population growth and ability to recover following a war.

Low population growth is viewed as a weakness by al Qaeda types and is a very big part of why they attack us.

Make the world safer by having more babies! In the interest of national security, we could create a tax holiday for households who have a baby in the 9-12 months following any significant terrorist attack.

This has three important impacts: 1) Increase in population growth, 2) A shift in timing of population growth that could send a powerful signal, and 3) Most strongly incentivizing childbirth for higher income (and, therefor, IQ and productivity) households.

It makes clear both the futility and absurdity of al Qaeda, and highlights the strength of the higher value given to women in the west and the higher proportion of women in our population.

Simply adopting a like policy could impact birthrates and fight terrorism by making it clear that even the mere thought of violence by a potential terrorist will cause ten more western women to get pregnant.

Safety in numbers you know.



One negative, which I hope is quite small, is that, primarily in the lower middle class, it would lead to bad long-term decisions to achieve a short-term gain.

It also presents as a type of social engineering policy, typically frowned on, in a more acceptable framework (tax cuts and national security).

Knowing that I'd eventually breakdown and buy Tyler Cowen's new book, I pre-ordered and participated in his personal-podcast experiment.

I asked Tyler what he thought about my contention that gas taxes, like cap and trade, could lead to traffic problems and increased gas consumption. He graciously responded here.

In an effort to stave off Global Warming, the Vatican has become "Carbon Neutral" by growing trees in Hungry.

Whooops!

Oh the irony.

[and they don't even address the problem that most trees don't pull much CO2 out of the air, they put most of it back, and ultimately they release all the carbon back into the atmosphere, much of it as methane and other more powerful GHGs. I wonder if they're deciduous trees, which basically convert a good chunk of CO2 into methane every year.

Oh, for those who don't want to do the reading, the paper says due to albedo and water transport/feedback effects, unless they covering very dark soil AND in the tropics, trees cause warming.]

The Economist asks.

I think I know the answer.

Update: What I describe isn't Giffen behavior, Giffen behavior is substituting a superior good with more of an inferior because the increase in price makes the superior good impractical to buy in sufficient quantity. It's a rational behavior, where what I describe is irrational. The Economist has a good clarification.

There no real superior good similar to gasoline, higher gas might cause people to use more to do more work to have gas for their leizure and personal business, but this is highly unlikely and wouldn't have much impact. It's not the same.

[related: What's the Big Deal About Gas Prices]

Prompted by previous posts here and here and here.

A simplified description:

The load on the engine is about same regardless of which gear you are in, the RPMs being lower than peak torque doesn't mean much for fuel consumption. A lot more fuel is injected into the cylinders to provide the power needed to keep the car going at the lower engine speed, and power transmission (for acceleration) is less efficient at the lower engine speed.

Think of your car's mechanics as a set of springs that transfer all the forces acting on the car to the crankshaft. In order to provide the same power in less cycles per minute, more power must be provided by each piston in each cycle (more fuel, bigger explosion). But at slower engine speeds, not all of the blast energy is transferred to the crankshaft. The piston doesn't move as much during the blast (the blast occurs in a smaller space) so more of the energy becomes heat (some of the blast also becomes strain on the piston rod and cylinder). At about 3500 rpm, the pistons are moving at a speed that allows the explosive force to best transfer to the piston (the explosion is pushing as much as possible on the piston during the entire stroke). After 3500 RPM, the piston is moving so fast that not all of the explosive force acts on the piston.

It's also a lot like riding a bicycle. At high gears and low speed, you might not even be able to push hard enough to get going. You mostly just put a lot of strain on the chain. Instead, you use a lower gear and pedal less hard at a more comfortable, medium pace. Once you get going faster, you'll notice that you're spinning the pedals faster, but there is almost no resistance at all and you're wasting a lot of energy moving your feet so fast. So you upshift, resistance increases slightly, your pedaling slows slightly, and you're a lot more comfortable.

Wow! Just wow!

People think they're saving gas by taking it easy on the throttle, THEY ARE NOT!!

I'm hitting more traffic lights and having to sit through multiple light cycles. I'm getting way less MPG.

More time on the road and more stops = more gas burned.

And engines are most efficient between 3000 and 4000 RPM. The extra fuel spent getting up to speed faster is negligible (you may even use less fuel).

(see also, Save Gas: Avoid Brakes!

and, Accelerate Faster

and, Why Peak Torque

and, The Big Deal About Gas Prices

and, Is Gasoline a Giffen Good

and, Horn Day)

UPDATE: An analogy to clarify:

It's also a lot like riding a bicycle. At high gears and low speed, you might not even be able to push hard enough to get going. You mostly just put a lot of strain on the chain. Instead, you use a lower gear and and pedal less hard at a more comfortable, medium pace. Once you get going faster, you'll notice that you're spinning the pedals faster but there is almost no resistance at all and you're wasting a lot of energy moving your feet so fast. So you upshift; resistance increases slightly, your pedalling slows slightly, and you're a lot more comfortable.

Does a Barrymore shit in the woods?

(see also Love in the Time of Cholera)

I'm not a violent person. But right now I'd like to curbie a few people at Apple.

I have chronic pain problems. Lot's of issues with repetitive stress.

I spent a lot of time ripping my music onto my hard-drive and suffered a lot of pain due to the process. Now, most of it is gone. iTunes won't play it. Don't know why. Can't locate it.

Someone needs to die.

Just askin'?

I'm tempted to give this a try.

I certainly don't hold "Megan's view" on AGW policy against her. She basically assumed the Economists position when she started working for them. I believe she implied as much shortly before or after the blog started. Not provable, but it looks like she's insincerely pulling the band wagon for the economist. Note that just before she made a provocative post, she provided a forum that would bring together much of the arguments against "her position". Megan seems to be shilling for the Non-catastrophic AGW movement.

Sure it's a bit sloppy, but there's also a lot of very good information compiled in the thread.

And don't everyone forget to look at Nir Shaviv's sciencebits.com blog, in particular the CO2orSolar post and comments. Also the Cosmic Ray Flux Link and his primer on climate sensitivity. His paper on climate sensitivity. And where he politely takes climate fundamentalists to task on their own territory (and they state that even though he's probably right, he shouldn't get any attention because he jumped the gun in making claims previously).

Naughty, subversive elf.

Really?! Who's trying to move the football?

And, who's not falling for it?

Not me for one.

The Economist has developed a very strange concept of "insurance". It advocates anti-global-warming policies as "insurance". Funny that the insurance industry insures by saving and investing so that resources are available to be moved where they are needed when the unexpected happens instead of spending recklessly and frantically on unproven, highly speculative, risk mitigation efforts.

Doug Feith's office made the entire case for war, that Saddam controlled al Qaeda, and they did it 6 months after the invasion.

To summarize: Kevin Drum quotes an article written by Stephen Hayes about a memo, drafted in Oct. 2003, as if it were Doug Feith's words. He insinuates that he lied and railroaded us into the Iraq war with a memo written 6 months after the invasion and based much on intelligence gathered as a result of the invasion.

Words matter, so do false attributions and dates.

UPDATE: Apparently, providing both actual and likely instances of Saddam/al Qaeda relations is the same as using the politically charged phrase "Operational Relationship".

IPCC Report

Some amuzing observations:

The Sum of Calculated Individual Contributions to Increased Sea Levels is less than the contribution of just the Antartic Ice Sheets. Where did the extra water go, did it evaporate?

The summation is also shown to have a greater amount of certainty than the individual components:

Rate of sea level rise (m per century)
Source of sea level rise 1961 – 2003, 1993 – 2003
Thermal expansion 0.042 ± 0.012, 0.16 ± 0.05
Glaciers and ice caps 0.050 ± 0.018, 0.077 ± 0.022
Greenland ice sheets 0.05 ± 0.12, 0.21 ± 0.07
Antarctic ice sheets 0.14 ± 0.41, 0.21 ± 0.35
Sum of individual climate
contributions to sea level rise 0.11 ± 0.05, 0.28 ± 0.07
Observed total sea level rise 0.18 ± 0.05a, 0.31 ± 0.07a
Difference
(Observed minus sum of estimated
climate contributions)
0.07 ± 0.07, 0.03 ± 0.10

And. The projections don't fit the observations:

Likelihood that trend
occurred in late 20th
century (typically post
1960) * Likelihood of a human
contribution to observed
trend --> Likelihood of future
trends based on
projections for 21st
century using SRES
scenarios

Warmer and fewer cold days
and nights over most land
areas:
Very likely * Likely --> Virtually certain

Warmer and more frequent
hot days and nights over
most land areas:
Very likely * Likely (nights) --> Virtually certain

Warm spells / heat waves.
Frequency increases over
most land areas:
Likely * More likely than not --> Very likely

Heavy precipitation events.
Frequency (or proportion of
total rainfall from heavy falls)
increases over most areas:
Likely * More likely than not --> Very likely

Area affected by droughts
increases:
Likely in many regions
since 1970s * More likely than not --> Likely

Intense tropical cyclone
activity increases:
Likely in some regions
since 1970 * More likely than not --> Likely

Increased incidence of
extreme high sea level
(excludes tsunamis):
Likely * More likely than not --> Likely

Just Sayin'.

We should be more concerned with the refugee threat from North Korea than any WMD threat.

(from Instapundit.)

Great organicaly grown Lebanese food flown in fresh.

Many people blame Bush policy for our troubles in Iraq. I think these people are incredibly narrow-minded. Our greatest weakness in Iraq is policy.

But then I started having second thoughts.

I don’t think this will be as harmful as people think. Don’t forget that crisis means opportunity.

Not allowing carry-on baggage should really simplify boarding, unboarding, and passing through security. I’m doubtful that the number of carry-on only travelers is large enough increase waits dramatically. And increasing curb-side and self check-in can speed things up even more.

By making the requirements for boarding clear and simple, we can really up efficiency.

Also screeners shouldn’t need to clear each person before the next, they can be directed to idiot lines or “to the back of the line”. And pre-screeners can walk the lines to address potential issues.

Say all you want about islamo-fascists, at least they can make the planes run on time.

I have no idea how these ended up in the middle of the desert. There was a whole pallet of these.[Used for running in sand. Thanks Ken S]

120 Degrees with 22MPH winds. Feels like when you sit too close to the fire on a windy night.

Why do leftwing blogs remind me so much of New Path lately?

accelerating slowly is to a stress position in an Asian or South American prison.

al Kout mall in Kuwait City. I bought a pair of ecco Reaction shoes, had a lamb brain salad and carrot juice, and smoked the sheesha.

I was able to get into Kuwait City yesterday on a tour of the Mosque and al Kout Mall.

Cheeziness be damned.

Comfortable, breathes, doesn't hold water. Don't need to do laundry--just hand wash in the shower, rinse with hotwater, wring, and air-or-wear dry.

Oh, and you can use it to clean your glasses.

I'm packing up all my cotton.

Times' Secret Program

The other day IT was in here to hook the nextdoor trailer up to our network. They needed to move my desk to get at the box, and when they did it collapsed. It just couldn't be put together again (it was warped).

Good. I hated my desk.

For one, I hate the height of desks. They are always too high.

I made my own desk out of stuff we had around and parts of the old desk. It was much better, the right height and the side of the old desk was just the right size for the top. However, because it wasn't fixed, my supervisor made me get ride of it (safety hazard). So now I'm using a printer stand from the office nextdoor and the drawer unit from my old desk (nice that I didn't have to move my things around).

Unfortunately it is the same height as a desk. Having experienced the comfort of an appropriately tall desk, I went to the carpentry shop yard and took a small platform to elevate my chair. Problem solved.

The only existing problem is that the printerstand is a couple inches smaller than the desk-side, which was perfect--just the right amount of workspace and small enough to keep the area open. It's a bit inconvient for shuffling papers. Oh well, can't win 'em all. But still, I like the smaller top better than the full size desktop, which for some reason, was no better for shuffling papers.

I got rid of my chair a while ago. Again (why does office funiture suck so much?), poor height, took up too much space, and I hate arm rests. I saw an article on people using exercise balls for desk chair so I gave it a try. It's much more comfortable and there are no restrictive, mispositioned armrests! And only $15 a pop (ha). The only inconvenience is having to reposition it everytime I sit down.[update : I bought a carpet remnant, so no more rolling away.]

Here's a pic (yeah, I just discovered I can upload pics today):

This is in the shade.

Here's one in the sun:

I bought a new toy. I ordered an apple 15" PowerBook Pro. It also came with 30GB iPod for an additional $90. Also, for another $90.00, I upgraded to the faster hard drive. I can't wait to get it, unfortunately it might be several weeks.

Buying it online was a pain in the ass. They may have a good product, but company runs like big government. After I picked everything I wanted out and went to purchase it, I found out that they do not deliver to APO addresses. The website said to go through AAFES. I went to a AAFES, they didn't have anything in store. The catalog said to use the AAFES website. The website was incredibly slow and of course there were no apple computers. Finally I ordered the computer to my cousins house and will have him forward it to me. This really sucks because now I have to pay Michigan tax and probably over $100.00 for shipping.

Me, outside of al Boom for a business function.

Al Boom is a replica of a 17th century wooden ship at the Radisson SAS, the interior has been turned into a resaurant.

The interior:

I bought this Lapiz Chess Set a couple of months ago. It was about $85.

I bought this wool carpet for my parents for the Mother's Day/Birthday/Father's Day Season. It's from Hariz, Iran.

Story by Alan Zarembo of the LA Times.

Joining the Mile High Club?

Some people are taking a closer look at WMD in Iraq.

I think that's a good idea, but hyping the idea that there were WMD in Iraq is really dumb. I have a feeling that the way some are spinning the reports of WMD in Iraq are setting us all up to look bad (not intentionally, of course).

Playing-up the old chem weapons scattered around as vast supplies of WMD is really dumb, and will take away from the more important themes that we should draw-on.

It would make much more sense to use the reports to provide proper perspective; reminding people that when they say "No WDM were found in Iraq", they mean it figuratively, not literally. They just didn't have large, fresh stocks and weren't actively producing WMD. They were doing research and could set-up production and testing in weeks (not days, as the brits believed).


aaron

...or: Environtoligist vs Scientologist.

...or: Spy vs Lie. (ok, that one is reaching).

I'm mostly impressed that this post generated so many comments.

Bitter got me screwing around on blogthings. Errr!

5 Factor personality test was suprisingly accurate considering I barely selected any responses:

Extroversion:
You have low extroversion.
You are quiet and reserved in most social situations.
A low key, laid back lifestyle is important to you.
You tend to bond slowly, over time, with one or two people.

Conscientiousness:
You have medium conscientiousness.
You're generally good at balancing work and play.
When you need to buckle down, you can usually get tasks done.
But you've been known to goof off when you know you can get away with it.

Agreeableness:
You have medium agreeableness.
You're generally a friendly and trusting person.
But you also have a healthy dose of cynicism.
You get along well with others, as long as they play fair.

Neuroticism:
You have medium neuroticism.
You're generally cool and collected, but sometimes you do panic.
Little worries or problems can consume you, draining your energy.
Your life is pretty smooth, but there's a few emotional bumps you'd like to get rid of.

Openness to experience:
Your openness to new experiences is high.
In life, you tend to be an early adopter of all new things and ideas.
You'll try almost anything interesting, and you're constantly pushing your own limits.
A great connoisseir of art and beauty, you can find the positive side of almost anything.
The Five Factor Personality Test

What DVDs I've recently watched (minus some of the especially bad one's, Evicted was horrible): Sin City; Strawberry Fields; Dirty Pretty Things (recommended); Aeon Flux; The Lion, the Witch, and the Wardrobe; Jarhead; V for Vendetta; Closer; the Swimming Pool; Dangerous Lives of Alterboys; Neon Genesis (collection here is spotty, so I ordered the series); Cursed; Dark Water; Waiting; Vanity Fair; Pride and Predjudice; Stay; Hustle and Flow; Crash; Time Code.

Memory is failing me, I'll update and provide links after I visit the rental again.

Too much chick music, that can't be healthy.

Tegan and Sara, So Jealous; Old Crow Medicine Show; tATu, Dangerous and Moving, 200km/h in the Wrong Lane; Porcupine Tree, Deadwing, In Absentia; Thelonious Monk Quartet w/ John Coltrane @ Carnegie Hall; White Stripes, Get Behind Me Satan; KT Tunstall, Eye to the Telescope; Paul Simon, Suprise; Yeah, Yeah, Yeahs, Show Your Bones; Kings of Leon, Aha Shake Heartbreak; Nickel Creek, Why Should the Fire Die; The Tea Party, Splendor Solice; Postal Service, Give Up; Cake, Motorcade of Genorousity; The Who; Supertramp, Breakfast in America; Les Paul; Louis XIV, The Best Little Secrets Are Kept; Ken Layne and the Corvids, Fought Down; Rascal Flatts, Feels Like Today; Kanye West, Late Registration; Digible Planets, Reachin'(A New Refutation of Time and Space); Bela Fleck, Little Worlds; Rush, Spirit of the Radio; Smashing Pumpkins, Siamese Dream; Bebel Gilberto, Tanto Tempo; Stan Getz and Joao Gilberto, Getz/Gilberto; Rolling Stones, Beggar's Banquet; The Roots, Tipping Point; Pantera, Vulgar Display of Power; OMD, Sugar Tax; Janis Joplin, Super Hits; Harry Belefante, All Time Greatest Hits; Crystal Method, Vegas, Tweekend; Metallica; Coldplay, Parachutes, A Rush of Blood to the Head; Cannonball Adderly, Somethin' Else; Blues Traveler, Four; Beck, Guero; Artic Monkeys, When the Sun Goes Down (lost my album, think it made it's way back to the states w/ a co-worker); Arcade Fire, Funeral; Allison Krauss & Union Station, Live; Radiohead, OK Computer; Ramones, Mania; BT, Ima; Butthole Surfers, Independent Worm Saloon; Beach Boys, Made in USA; Franz Ferdinand; Foo Fighers, In Your Honor; Michael Buble; The Pharcyde, Labcabincalifornia; Mozart: Eleven Overtures Essential Beethoven; Chopin Piano Favorites; Nirvana, Nevermind; Hometeam, Via Satellite from Saturn; G. Love and Special Sauce; Portishead; Nine Inch Nails, Fixed ; Tool, Undertow; Sublime, Greatest Hits; Korn; Phish, A Live One, Junta; Sting, Fields of Gold, Brand New Day.

Recently ordered: Meatloaf, Bat out of Hell; Nickel Creek, Nickel Creek, This Side; Zero 7, Simple Things; Yeah Yeah Yeahs, Fever to Tell; Nelly Furtado, Loose; bt, Movement in Still-life.

I haven't seen anything live in quite a while, but I list some anyway. Most recently Charlie Daniels (Arifjan), before that Crystal Method (State Theatre, Nectorine), Darude (Space), Incubus (Cobo). Going back several years 311 (Pine Knob, St. Theatre--or was St. Andrew's?), Bare Naked Ladies (Pine Knob), Dave Matthews (Pine Knob), Metallica (Palace), Cypress Hill (Pine Knob), Fugees (Pine Knob), Primus (State Theatre), Maralyn Manson (St. Andrews), some Lalapaloozas (Pine Knob), NIN (Pine Knob), Oasis (St. Andrews), ICP (all over, Kid Rock with them sometimes), Ramones (Pheonix in Pontiac), Pearljam (Breslan), Ani Defranco (some hall in Florence), Rage against the Machine (Cobo/JLA), Kid Rock (state fair video shoot. American Badass, I think),... I'll list others as they come to me. I'm pretty sure I've seen some shows at Hill and also more at St. Andrew's and the State Theatre and Harpos.

Right now I'm reading: A Scanner Darkly, The World's Banker, Fooled by Randomness, When Genius Failed (unfortunately I lost my copy, so 'til I find another....), Crisis of Abundance, The Prince.

Here's what I've recently read or listened to: Blink, Undercover Economist, System of the World, The Fountainhead, Snow Crash, Freakonomics, The Diamond Age, The Game, Army of Davids, Shop Girl.

Efficient Driving in Wikipedia.

Further support for my previous post.

When I have the time sometime, I will look at fuel consumption curves and try to create some traffic models. I should be able to figureout what level of buy-in is needed to get my fuel saving driving to work and how much fuel and time would be saved.

[Update:Climate Change Connection cites a researcher who says it's best to use 2/3 of available power!. I actually was aware of this link long, long ago but neglected to post it.]

One advantage of getting to work at 5am every day is getting most of my work done before I wake up.

I enjoy reading the Huffington post a couple of times a week, but I'm thinking about giving it up. It's double click ads are annoying because they interfere with page navigation. I must "double click" to back up, sometimes I get dumped back onto the same page, and sometimes I back up too far.

UPDATE: It'll be tough to give up this kind of stuff though.

Sebastian Mallaby praises the administration's performance regarding AIDS treatment and prevention in the Washington Post. His quibbles are minor, the biggest being an unknown portion of abstinence and faithfulness education money is wasted on abstinence only programs.

UDATE: And there's this.

If the decimal of Pi continues infinitely without repeating, then wouldn't every conceivable number, including those with repeating patterns, exist within it?

Maybe Al Gore's film will have the benefit of people looking more closely at climate change data and possibilities. This article from Washington Post gives some hope. Here's a little snippet:

"Terrible toos," (Chris) Horner says. I'm confused. He explains that it's shorthand for environmental doom and gloom.

"Terrible toos. Too many people, using too many resources."

Smith has a different equation: "Less people, less affluence, less technology: We call that death, poverty and ignorance."

I like that. I think it could be turned into a good slogan or bumper sticker:
"Death, poverty, and ignorance won't stop Global Warming."

Ann Althouse has a good post on happiness.

Those whose children they want to have, and those they want to raise them.

(Link from Brian Gongol.)

I believe that the reason we don’t often hear a lot of complaining about inflation is because inflation is usually focused on the rich and middle-class. While there has been mild inflation, people in the lower income brackets have been affected less than the upper. In fact, while income was flat (slightly increasing) over 2000-2003 for the lower income brackets, expenses were also flat and actually decreased some. This is because they purchase from a different basket of goods, and because many of the products they buy may be easily substituted. Gas, however, is a larger portion of expenditures for the lower income earners than the upper income earners. It is also one of the expenditures that is not easily substituted, so gas price increases cut into disposable income.

Gas prices cut into the disposable income of the lower 60% of earners, who have less disposable income to begin with. So you are affecting a lot more people, and people who are affected more.

Everyone has a right to their own opinion. People can have all kind of opinions about facts and hypotheticals. But what the heck is this? An opinion about a situation that doesn't exist [at least not to a significant degree].

We have a NY Times opinion piece with no support for their opinion and no evidence that the situation that is the subject of their opinion even exists. Hacks.

In response to my recent post, Jonathan at Chicagoboyz raised concerns that a large number of voters, who influence spending decisions, would not be taxed. This could lead to reckless spending [very true].

Personally, I don't think that eliminating taxes is going to encourage people to vote more. They system will not increase the power of the voting block (a very idealogically diverse block) affected. Also, I don't see taxes as a major factor in people's decisions to advocate spending with the current system, and I don't see voters as having much influence on politicians' spending decisions under the current system. In anycase, failsafes can be designed into the system to prevent that from happening and to scrap the system if it does.

If a progressive tax policy encourages reckless spending, being that spending is a primary concern among voters and pundits, shouldn't we be advocating a tax hike that is focused on the masses. This should make voters more involved with how politicians are spending our money.

(No more payroll tax. Everything will be paid for out of general tax revenue.)

1. One Flat Tax Rate for income.
2. Another (lower) Flat Tax Rate for investment income.
3. One, and only one, deduction: A standard deduction, of the per capita GDP, for every individual.

No taxes until you make over $42,000.

Married, no taxes until $84,000.

Incentive to have a child for every additional $42,000 of income.

The only way for businesses to take advantage of the deduction is to hire more employees. Companies have incentive to hire more workers, especially for jobs with salaries $42,000 and below. There is also incentive to pay employees with families more.

What do you think?

Is Bush's approval down because of the war, or are people susceptible to negative perceptions of the war because of Bush disapproval?

Bush's approval is down because he is unwilling to do his job: Stand-up to Congress and Lead.

Knowing that people are richer than you.

The widening income gap is a frustrating problem to attend to fairly. But atleast we know being poor ain't so bad.

I took a look at the Department of Labor's Bureau of Labor Statistics reports for the past few years. Key points:

In general, income may have remained flat, but so have expenditures for all but the top earners. For the lower income earners, income has increased and expenses have decreased.

Transportation expenditures have declined for all but the top 40% earners (they spend more money on new cars as status symbols).

Health care expenditures have gone up significantly, but again only for the top 40% (Have health care cost gone up for basic services, or are we mostly spending more on the latest and greatest?)

All groups saw increases in entertainment expenditures.

All groups had a decline in spending on reading (just thought that was interesting).

Increases in tobacco and smoking spending in the lower end and decreases in the high end earners.

Decline in alcohol spending for lower 60%, big increase for the top 40%.

Food expenses have remained flat for all groups (slight decline).

1) Move toward private accounts for Social Security. This will ensure that benefits paid match resources available. Private accounts will allow investment in diversified index funds and fixed rate funds. During each year a Social Security benefit will be paid to every person's private account.

2) Social Security, healthcare, and health insurance taxes only collected for benefits paid out in the same year.

3) Move toward HSAs, reduce regulation, and simplify healthcare. Allow individuals to make more of their own healthcare decisions. Allow pharmacists to write most prescriptions. Money in HSAs should be invested in indexed healthcare funds, this ensures that benefits will grow along with the healthcare industry.

4) Provide nationalized insurance and basic health care to all Americans. This will include only the most basic, necessary, and cost effective care (and that benefit from very large economies of scale). No patented procedures or medications will be covered. Long-term care will only be provided for life-threatening and debilitating degenerative conditions and only proven effective treatments will be covered.

5) Streamline education and training of doctors and healthcare workers. Create more focused and specialized programs.

6) Simplify taxes and focus taxes on consumption.

7) Allow deficit spending only when interest rates are below historical inflation. Deficits will be funded with long-term debt only.

8) Restrict non-deficit spending to a fixed percentage of GDP. Exceptions will be made for extra-ordinary disasters and war. Extra-ordinary and war spending will be funded by additional tax or deficit spending (if available).

UPDATE: Inflation may be too conservative. Nominal GDP growth would be a better number to compare with interest rates. It would be really nice if we could figure out what the marginal contribution a dollar of government spending contributes to GDP.

This was removed from my letter to the MetroTime:

A draft would 1) Take opportunities away from lower income people and force them on people who don't need or want them 2) Put more unmotivated people in the way of those driven to achieve 3) Further keep salaries depressed. A draft mostly keeps salaries artificially low.

It would also further decrease efficiency and productivity [if that's possible].

I don't really like the idea of neuroscience in the court room. The only place I see it being useful is in establishing motive. I believe that if neuroscience is involved with law, it should remain on the investigative side.

Here's the link: http://neuroeconomics.typepad.com/neuroeconomics/2006/04/there_is_a_nice.html

As of late, a major talking point has been Bush’s low approval rating. Most people attribute this to the negative approval of the speed and cost of the war in Iraq. However, I don’t believe that the polls showing disapproval for the handling of the war reflect on how people feel about it. They are mostly the result of not being able to observe assured, lasting achievement. I think they can be easily changed if success is seen to finally take root (and is perhaps defined more realistically, instead of expecting Iraq to become some Super Pro-American Super Progressive Democracy).


I think that where Bush is weakest is that he is seen as a political tool. He is completely subservient to congress. Bush’s approval rating is so low not because of Iraq, but because he lets congress, which has long had lower approval ratings, have free reign. Bush hasn’t lived up to his obligation to be a check on the hundreds of politicians who are disapproved of more than him. He has been oblivious to mismanagement of funds in Iraq and Defense Spending. He has poured money into Katrina Relief without concern for results. He has funded deficits with short-term debt, leaving us at the mercy of rising interest rates.

His fear of micro-managing has given the crooks free reign.

Time to take a stand, pussy.

I wish I had my camera, I almost grabbed it on my way out the door too.

On my way back from the gym during lunch just now, I was following a bus on a dirt road. The air was filled with a light dust cloud about as far as the eye could see. The sun was bright, and about an hour past directly overhead (it's 2:00 here). Because the sunlight was uniformly illuminating the dust cloud, rather than the sunrays showing in the dust, the shadow of the bus showed. It was like the rays of a dark light shining from the top edge of the bus, a pyramidal shadow was clearly visible in the air. The side of the shadow along the bus was significantly lighter than looking through the back of the shadow and the shadow cast on the ground looked almost black. This created a clear three dimensional shadow.

Blocking the port deal would be bad for business and bad for national security.
UAE seems to be a true ally and would be instrumental in dealing with Iran. Cozying up with them seems like a good idea to me.

Opponents of the deal are looking awefully bad to me. Nationalist, Racist, and reactionary.

If many of the opponents are also opponents of Social Security and Healthcare reform, this could help the Administration stack the deck in favor of its policies after '06.

The strawman that private accounts would somehow prevent the US from ever implementing a national healthcare system should be easy to knock down. Getting rid of reactionary hacks might make the agenda more tenable.

Sorry to anyone who is disgusted by these images.

If you have gone beyond disgust to anger, you should be ashamed. You have failed the radical acid test, do you like who you are becoming?

The inept FEMA response seems to be the focus of news right now. I would like to invite people to consider what the cost of the poor response truly was.

How many of the victims were killed or seriously injured after the storm due to inadequate response? How many simply could not have been prevented by faster disaster relief? How much faster could we have actually been? How much more property could have been saved?

I believe the biggest cost of poor performance of FEMA will end-up being that it opened the door to poorly managed reconstruction efforts.

Wolf Blitzer relayed the best bit of moral equivalence yet last night when he was interviewing the cleric who created the cartoon controversy. To paraphrase:

"Why do you think we didn't see rioting and protests like this when people were being kidnapped and heads cut off?"

Many countries and papers have chosen not to publish the incitive cartoons. Some call this censorship, but there is nothing wrong with not publishing the cartoons. The most important aspect of the cartoon controversy has been overlooked.

The Cartoons Suck!

They are not clever or amusing. I am offended that they received any attention at all.If they were funny or interesting, I would be all for them being published globally. I want to see who is so fucking off their rocker that a cartoon sets him off. Maybe even a few of the radical idiots will kill each other. I'm all for it. It's just like Iraq. If our presence there radicalizes people, GREAT! I'd rather they be open about it. I want them to go underground and blow themselves up instead of passively propagating their fragile ideology. Pussies.

But the cartoons suck.

"four years of failure - enough is enough - why hasn't Osama Bin Laden been captured or killed, and how will he be destroyed before he next appears on tape to spread his disgusting message?

"That discussion -- rather than criticizing American citizens who exercise their right to free speech and express dissenting opinions - is the discussion that America needs.

I like how he criticizes criticism of criticism in the context of criticizing not having killed a man before he could spread more criticism.

The primary reason I voted for Bush over Gore was that Bush's budget made much more sense to me. Bush advocated paying down the national debt, as did Gore, but Bush's plan payed down more and started out more slowly. It just seemed more considered.

Gore's paydown, on the other hand, was front loaded. It didn't make sense to me to pay down the national debt at a time when interest rates were low, the job market had evaporated, and we were clearly about to enter a recession.

The thing I've come to realize is that deficits matter when interest rates are high. It's the cost of capital that matters. It almost doesn't make sense to run a surplus or balance the budget when rates are so low. What we should really be concerned with is what the money is spent on. Is it being used for education and infastructure, or is it being wasted on inflationary, non-value added projects?

Only recently have interest payments on the debt began to increase as a percentage of GDP (there was a large drop after interest rates dropped). Question is, as interest rates rise, can the budget deficits be cut before interest payments excede 1990s levels.

Common sense tells us that opertional security was likely significantly compromised by the NSA leak publication. This seems different than the rendition revelation in that most of the damage there appears to be cosmetic and the revelation may actually have led to improvement of operations.

I am, however, willing to reserve judgement of the Times for publication of the NSA wiretapping program. I would consider the possibility that the administration and the military were complicit in the publication; perhaps the program had outlived its usefulness and al Queda reaction is of more value. Perhaps the appearance of weakness and the superficial blackeye on the Administration are useful.

All I have to say about the 55mph speed limit is "dumb". It's not worth the effort and may waste energy in the long-run. For one, people's time, and the time of the truck drivers that supply us with, well, everything, is worth a lot more than the fuel we'd save.

If you want to save fuel, at least 20% and maybe much more, avoid using your brakes. Every deceleration is matched by a corresponding acceleration. That wastes fuel. And if you come to a stop, you waste a lot more fuel. According to Pakistan Energy and Environment Management Center, a car coming to a complete stop can use 6 times the fuel of a rolling stop.

Below are three behaviors that I believe would cut down on fuel consumption if enough drivers buy in.

1. Accelerate Faster!
2. Obey the speed limit on surface streets.
3. Use your horn! Communicate.

The variation in speed and driving style causes traffic. Reducing variation will cut down on traffic and reduce both drive times and the frequency of fuel wasting stop/starts. Accelerating faster prevents backups from forming and lowers the number of cars that will have to stop as they join the flow of traffic. It also moves more cars through the queue faster once traffic has formed [that means less stops]. To accelerate faster, Dr. Mark S. Dougherty, a professor at Dalarna University in Borlange, Sweden who is involved in fuel-saving research, found that the best way is to use about two-thirds of available power and change through the gears relatively quickly [Next time you’re at the front at a traffic stop, try this. The space between you and the following car is how many more cars can be passing through every traffic signal. That’s a lot of fuel. Now multiply that by the number of cars that accelerate too slowly.]

Obeying speed limits allows for better planning of traffic light timing and better use of speed limit planning. The road system determines the average speed of your journey far more than your top speed while driving. It’s the intersections and turns that affect you average speed and drive time the most. Allow yourself to slow down to avoid stops. Accelerate Faster and Drive Slower. Result: shorter driving times, and less stops.

On one occasion, I drove north on Rochester Road here in SE Michigan. When the light turned green and the car in front of me didn’t quickly accelerate, I gave my horn a friendly tap. Often the cars would accelerate slowly, exceed the speed limit, and the slam on the brakes at the next light. When I could get around such drivers, I would accelerate quickly to the speed limit, or slightly below, and cruise. The cars would eventually speed passed me. Because they would queue up at the light and take their time accelerating, I would have to stop despite the light being green for several seconds. I, again, would tap my horn and accelerate quickly to the speed limit. The drivers started catching on, and we all began smoothly cruising through several traffic lights at a time.

While this instance was special because of the small/moderate number of cars in our traffic pocket, it is much more difficult to communicate/model smooth driving behavior if there is a large queue, slowly dispersing at a green light when you arrive. There is too much in view [too much to be aware] for drivers to analyze your driving or care about one car honking its horn. However, if several cars used their horns and modeled smooth driving behavior, I think it would drive the message home.

I am confident that an effort to coordinate speed limits and traffic light timing along roads in any community, and switching as many Stop signs to Yield signs as possible, follow by a large campaign to promoted smooth driving, focusing on the three simple behaviors I listed above, will have surprisingly beneficial effect on fuel consumption and reduce drive times.

This would have the added benefit of making drunk drivers easier to spot.

I think cabs that double as a delivery service in metro areas would also be a good idea.

Update: Welcome Chicagoboyz.

Update II: I've also noticed electronic speed limit signs in some communities. I see potential for networking these signs and traffic lights so that the postings vary. Speed posting could tell drivers what speed to drive to avoid hitting the upcoming traffic lights! Same could be done with GPS systems.

From Nature.com:

Can you bottle trust? The answer, it seems, is yes.

...

Oxytocin, a chemical that is produced naturally in the brain. Its production is triggered by a range of stimuli, including sex...

Arnold Kling opens a discussion on the implications of the aromatic drug:

Oxytocin is "easy and cheap to produce and it is easy to get it in drug stores, at least in Switzerland," Fehr says. So does that mean it could be pumped into the air in department stores by unscrupulous salespeople, turning us all into soft targets?

The hormone doesn't simply decrease inhibitions:

Investors were more willing to part with their cash when they inhaled the potion, Fehr's team reports in Nature. Of 29 subjects given oxytocin, 13 handed over all of their cash. Only 6 of the 29 subjects given a placebo to sniff invested all 12 of their credits.

When the human trustee was replaced with a random number generator the effect disappeared. This shows, the researchers say, that oxytocin specifically boosts social interactions, rather than simply making people more willing to take risks.

The article suggests that marketing already takes advantage of the drug:

Perhaps, but it seems a trifle extravagant, says Antonio Damasio, a neurologist at the University of Iowa in Iowa City. Modern advertising already uses tricks to get us to trust a brand that probably make us boost our own oxytocin levels. "It lures you in with images of wonderful landscapes or sex, and it probably works in exactly the same way," says Damasio.

This is a report from the Time's business section, mine in italics:

Economic Scene

Putting a White House Annual Report to a Test

By HAL R. VARIAN

Published: June 2, 2005

EACH February, the Council of Economic Advisers issues "The Economic Report of the President." The report, which can be found at http://www.gpoaccess.gov/eop/, contains useful economic statistics as well as essays by the members of the council.

Nice beginning; a statement of fact followed by a very reasonable and unimposing opinion.

This year's report, as usual, reflects the priorities and interests of the administration and is worth reading for that alone.

Again, a reasonable and valid assertion. I don't know if the reports usually reflect the priorities of the administration, but I'm willing to accept that they do. If this report didn't reflect the administrations priorities, I'd think the admin was up to something.

The ostensible audience is Congress but the essays are generally accessible and are often assigned reading for college economics classes.

Sounds good to me.

This year's report is particularly noteworthy because it was written by N. Gregory Mankiw, a Harvard professor and the council's chairman at the time. Mr. Mankiw is the author of a best-selling introductory economics textbook who is known for his clear writing. In addition to the standard "state of the economy" discussions, there are essays on tax reform, immigration, property rights, the information economy, H.I.V./AIDS and international trade.

Very good background support. The author has already asserted that the report represents the admin's priorities, now we can also expect them to be clear. Look at all the interesting stuff too.

The report is supposed to provide an "accurate assessment of the consensus professional views of economists." Why not use the full quote and source instead of a partial quote that looks to me like "scare quotes"? Recently The Journal of Economic Literature asked five economists to review the report, posing the question, "Does the discussion in the E.R.P. in fact accurately summarize what we as economists know?" Oh, maybe this administration, despite being more clear than others, is pulling a fast one.

Space precludes a detailed discussion of all the reviews, so I will focus on the examination of the chapter on property rights by Jonathan Gruber, an economist at the Massachusetts Institute of Technology.

Maybe you could have fit more in by getting to the point. Oh well, I'm sure Mr. Gruber's chapter is representative of the report.

Although Mr. Gruber generally finds the discussion in the chapter to be fair, he disagrees with some of the conclusions. Economists have a saying, "De gustibus non est disputandum," which I like to (mis)translate as "It's disgusting not to dispute."

"Gruber agrees with the report, but it would be wrong not to question it no matter how absurd, especially since it is supposed to be so straight forward."

The chapter points out that property rights help to solve three problems: the tragedy of the commons, which involves overuse of unowned resources; the lack of incentives to invest in unowned resources; and the difficulty of transferring nonowned resources, making trade problematic.

Way to state the obvious. I think pretty much everyone can accept these.

The first example the report gives to illustrate the benefits of property rights is homeownership, citing studies that find that areas with high rates of homeownership have lower crime rates, more educated residents and other positive social indicators.

Yup.

But, as Mr. Gruber points out, the question of cause is unclear. How's that? Does homeownership cause lower crime rates, or do people prefer to buy houses where crime rates are lower? Both, dumbass. Does homeownership result in higher income, or is it just that those who have higher income can afford houses? Umm. Owning a home provides incentives for maintenance and improvement which generate income.

People with higher incomes can rent if they want to, but they seem to choose to own more, now why would someone suggest that it's not a good idea for people with less income to do the same. When people have a stake in their environment, they tend to want to manage it.

The report fares better with its next example: tradable permits for sulfur dioxide emissions. "Fairs better?" Awfully quick to pass judgment based on silly ponderings. When this program was introduced by the first Bush administration in 1990, it was widely criticized by environmentalists.

But the program is now considered a success, credited with reducing the costs of meeting 1990 sulfur dioxide targets by at least half.

Hmm, an analogous program to the policy you find so questionable "fairs better" because it's already successful.

But Mr. Gruber argues that "it is when the chapter tries to extend these lessons from goods markets to service markets that it runs into trouble."

For example, he argues that the report paints too rosy a picture of voucher programs for school choice. Although there is some recent work indicating that students who use vouchers to move to small private schools improve their performance, there is still debate about what happens to those left behind.

Ok.

The report cites one study that finds that both those who move and those who do not benefit from vouchers. But this is only one study; other studies find a negative impact over all on student performance. Thus, according to Mr. Gruber, the "jury is still out."

This is plausible, if students/parents choose their own schools there might be grade inflation at schools that don't have well established reputations.

Mr. Gruber also criticizes the president's proposed privatization of Social Security, arguing that "the fundamental reason that the Social Security program exists is to prevent myopes from undersaving for their retirement; how can those same myopes be trusted with the much more difficult decision of portfolio optimization?"

Umm. There's a whole industry dedicated to doing that for them.

The chapter tends to extol the virtues of privatization, ignoring privatization programs that have not worked out. For example, Mr. Gruber points to the guaranteed student loan program, arguing that it has been a failure.

I think he's confusing private ownership w/ decentralization. Guaranteed loans aren't really privatizing, it's more like outsourcing.

Rather than making loans directly to students, the government offers a subsidy to banks in the form of guaranteed repayment. Remarkably, banks are not required to bid for the right to issue these loans, and a result has been both an inefficient mechanism for student aid and a windfall for banks.

Mr. Gruber concludes that the chapter offers an "excellent exposition of the case for property rights" but that policies that work well for goods may work less well for certain kinds of services.

Reasonable conclusion. Now, what was the point suggesting the priorities of the administration were questionable and then simply questioning whether the policies would achieve the desired results?

The report is certainly correct that property rights should be one of the first places to look for solutions to the problems that bedevil public programs. But they should not be the last place, or the only place, to look.

Is that the only place they looked? I didn't read the other essays.

Hal R. Varian is a professor of business, economics and information management at the University of California, Berkeley.

Saw Star Wars Episode III today.

Low expectations, I had.
Disappointed, I was.

Dan Drezner's guest bloggers have numerous posts on John Bolton and anti-Americanism. Here's one. I find the comments much more interesting and convincing than the post.

It seems to me that anti-administration politics have turned this guy into a symbol of all that invites anti-Americanism, and then made his being a symbol of all that engenders anti-Americanism a reason not to appoint him. In my opinion, the partisan contention has provided more rhetorical fuel and validation to anti-Americanism than his appointment ever could.

Fully privatizing social security would basically index benefits to economic growth during one’s life (working life plus retirement years) rather than speculating on the productivity of future generations. This would eliminate the problem of declining productivity growth and demographic changes causing shortfalls.

The system also would provide a bonus to those who have loved ones whom do not use their full benefit. As the majority gains wealth, the question is: In the future will there be Wealth Affirmative Action? Will there be a tougher job market for Trust Fund Babies?

After seeing several posts on huffinton's celebrity group blog, most recently this one, I decided to check it out.

At a glance, it reminds me of The Onion.

That might be a compliment. I like The Onion. However, I almost never visit it.

Compare and Contrast.

I went to breakfast with my parents this morning. We dropped into the fruitmarket nextdoor and I bought a rabbit for dinner tonight. Yum.

Sometimes we focus to much on finding a perfect theoretical solution to our problems and ignore practicallity. Some questions simply can't be answered to everyone's satisfaction and it may be better to accept a good solution rather than pursue definitive answer. Some very good points were made on Kudlow and Co. about Terri Schiavo.

I think we need to defer to the courts in establishing whether Terri wishes to die over living in her condition. However, if it can't be established what her wishes are, I think that so long as the burden of keeping her alive doesn't fall on unwilling parties, I don't see any problem with any party that wishes to keep her alive doing so. I suppose now that the problem is whether parties are obscuring the situation to keep her alive against her will.

Personally, I don't know what I would want and don't really care. I'm perfectly fine with leaving that decision to others should I end up incapacitated. I feel that I can't know what I would want and I am fine leaving things up to chance should the unthinkable happen.

UPDATE: dogfaceboy has a good post on Schiavo.

Austin Bay contemplates the difficulties of providing insurgents with a viable exit strategy. Even when it is apparent that a group is fighting a losing battle, if their backs are to the wall they will fight to the death, prolonging the war increasing overall costs. If the prospects that your enemy will regroup and attack again are low enough (that they will accept defeat and reassimilate into society), it is economical to provide an exit.

I think this must read post by Frank is pretty inspiring, especially considering this and this.

Don't forget...Iraq is Bush's Vietnam. [via Frank Martin.]

I dropped by Frank Martin's today. He has lots of good stuff.

A couple of inches of snow, and people forget how to drive. It took me 20 min to drive 1 1/2 mi home.

Douglas Feith, Defense Under Secretary for Policy, was in a press conference on C-Span today discussing strategy. One reporter asked of specifics regarding Iran; I think this demonstrates a lack of expertise, and even a general understanding, of strategy and war.

Strategy should not be mistaken for tactics, which are more explicit. Strategy is more of guide, containing both explicit and implicit aspects, which are used to determine tactics with the effect of achieving desired outcomes. A strategy may contain some specific tactics that are necessary to enable the use of other tactics which work with a broader strategy aspect, such as preparedness, but generally incorporating specific tactics into a strategy is limiting and likely bad strategy. An inflexible and overly explicit strategy is cumbersome and yet easily evaluated and manipulated by opponents and competitors.

Science can be used tactically in war, and many people would like to view war scientifically; however, in the art of war, being unpredictable is a generally a strength and flexibility allows skilled tacticians to turn potential weaknesses into strengths and an enemy’s strengths into weaknesses. We have seen this in Iraq, where choosing flexibility and being image conscious has cost lives on many occasions. But, being flexible allowed us to turn those losses into moderate wins, such as in Fallujah where insurgency led to more unified opposition to insurgents. And when we chose to disband the Bathist army, we may have helped fuel the insurgency, but detaining them would have been costly, limited the flexibility of the military, put more troops in harm’s way, been questionably beneficial and tied-up logistical resources and capabilities, fostered the dependency that is left behind by a totalitarian regime, and diminished the drive for independence that has been crucial in spreading freedom.

Strategy is an art and not a science and major aspects of strategy must remain implicit. Perfection is not an option; even if it were practical, the information broadcast to enemies would make it a devastating strategic weakness. While it is likely that much of the Iraq results were a stroke of good luck, it has been observed in humanitarian circles that countries tend to achieve most when they struggle against adversity. The most growth producing regions/countries of today were once considered the most hopeless, as noted by Sebastian Mallaby.

During the conference Feith said:

If you look at the war on terrorism, for example, it is clear to us that there is enormous importance to the capture-and-kill operations we do in the war on terrorism, but they will not allow us to win the war. The only way we are going to win the war on terrorism is, as a country, by dealing with the ideological support that the terrorists get.

Now this is not a Defense Department mission, but the U.S. government recognizes that to have a winning strategy in the war on terrorism, we're going to have to address what it is that allows the terrorists to recruit and indoctrinate new terrorists. And the kind of work that we need to do in the world as a government -- and the Defense Department only has a -- you know, a slice of this large responsibility -- but the work that we need to do as a government to win the war on terrorism does require activity, as opposed to just reaction.

And the president's strategy of freedom and democracy promotion is an example of changing the situation in the world in a way that contributes to strategic victory for us in the war on terrorism. It also serves other U.S. national security purposes.

Over the past several years, I’ve observed that the public in general can be pretty reactionary. This is especially true of a large portion of people in mid-eastern culture. The reaction that the US evoked in the mid-east before 9/11 and Iraqi Freedom certainly wasn’t a positive one. It seems clear to me that if democratization and promoting independence and unity in Iraq had been made central components of the explicit strategy and reasoning leading up to the war, the effectiveness would have been neutralized and they likely would have been used against us.

Because of the implicit nature of strategy, many components can be difficult to articulate. I think that often people are even incapable of articulating aspects of strategic thinking. In any case, the implicit nature of strategy will always leave some people in the dark and require those with a general understanding to champion the strategy. Some may follow these champions because of implicit understanding that they themselves are unable to articulate.

Even after the fact, strategy cannot be made fully explicit because it would provide valuable insight to our enemies.

Another point of interest from Feith’s conference is this:

Q: Mr. Feith, Mr. Feith, having said that you don't know where you're going to have to operate, have you identified any areas for priority attention, such as the Middle East, Taiwan Straits, Korea, maybe East Africa?

MR. FEITH: I don't think that the world gives us the luxury of picking areas. We have interests all over the world. I dare say that if anybody before September 11th, 2001, was listing places that we would want to focus on as a matter of priority, Afghanistan would have been rather low on the list.

I think we need to be very modest about our ability to predict the future, and I think a proper intellectual modesty is built into this concept of strategic uncertainty, and we tried to infuse that idea through these documents.

And what that means is we have interests all over the world; we have to be ready to work with countries all over the world, move and act in various types of operations, as I said, you know, spanning the whole range from humanitarian activities, diplomatic activities, combat activities anywhere in the world that they're required.

I think this implies the direction our military will be taking. We now realize that we can’t predict the conditions and even the rules we will be required to operate under in the future. September 11th and the Tsunami disaster have highlighted the importance of maintaining an active, adaptable, cutting-edge, ready and capable military. I think that incorporating humanitarian operations as training ops may prove to be a very effective tactic in the future of the military. Humanitarian missions would provide a variety of constraints and conditions that would keep our military active and adaptable. It would also help to justify the investment in a large military, which must exist as an insurance policy, though it might never be used in major combat operations.

Back in my undergrad, I learned from my Classic Civ class that the traditional definition of Martyr is someone who subjects themself to an unjust law to draw attention and compassion and effect change in that unjust law, similar to Ghandi's passive resistance techniques. So, are suicide-mass murderer-bombers protesting Allah's law that bombs will rip you apart and send the bomber onto eternal damnation?

Jenny: Do you think we lack class?

John: I think I'm classy.

Frank: I think you can't use the word "class" and have class.

John: Are you saying you don't have any class?

Frank: I implied it.

Why do I have a blog? I had to register to post comments at Kudlow's Money Politics. Also, I figured it would help my communication skills, which are kinda weak.

Didn't make it to the bar at lunch. Guess I'll go later in the afternoon.

Now that I've created a blog and made my first post, I think it's time to head over to the local brewery and have a beer. Maybe I'll bring my laptop.

People store and assimilate information. Whenever we pass a bad driver on the road, we turn and look at the car and the driver. We may not memorize the details, but we absorbe the information and add it to our model. In this case, our model of bad drivers, a set of stereo types, which is part of our model of the world. It helps us to be more aware of possible dangers while we are driving and signals to help us navigate and drive efficiently. Over time we recognize the most important aspects of our environment on a subconscious level, improving our driving ability and increasing our available range of perception. Whether we are aware or not, we assimilate all the information we percieve on some level, and it changes the lens we see the world through.